Federal Register Vol. 82, No.129,

Federal Register Volume 82, Issue 129 (July 7, 2017)

Page Range31429-31713
FR Document

82_FR_129
Current View
Page and SubjectPDF
82 FR 31514 - 2018-2020 Enterprise Housing GoalsPDF
82 FR 31552 - Sunshine Act Meeting NoticePDF
82 FR 31429 - Reviving the National Space CouncilPDF
82 FR 31476 - Competitive Passenger Rail Service Pilot ProgramPDF
82 FR 31548 - Availability of a Final Environmental Assessment and Finding of No Significant Impact for the Field Release of Genetically Engineered Diamondback MothsPDF
82 FR 31593 - Proposed CERCLA Sections 104, 106, 107, and 122 Bona Fide Prospective Purchaser Settlement for Removal Action for the Alfred Heller Heat Treating Superfund Site, City of Clifton, Passaic County, New JerseyPDF
82 FR 31627 - Public Meeting for the Northwest Oregon Resource Advisory CouncilPDF
82 FR 31468 - Flonicamid; Pesticide TolerancesPDF
82 FR 31594 - Notification of a Closed Meeting of the Science Advisory Board's 2017 Scientific and Technological Achievement Awards Committee and Closed Meeting of the Science Advisory BoardPDF
82 FR 31598 - Certain New Chemicals; Receipt and Status Information for April 2017PDF
82 FR 31596 - Access to Confidential Business Information by Syracuse Research Corporation and Its Identified SubcontractorsPDF
82 FR 31592 - Scopes of the Risk Evaluations To Be Conducted for the First Ten Chemical Substances Under the Toxic Substances Control Act; Notice of AvailabilityPDF
82 FR 31596 - Receipt of Information Under the Toxic Substances Control ActPDF
82 FR 31471 - Prosulfuron; Pesticide TolerancesPDF
82 FR 31640 - Vertical Capital Income Fund and Oakline Advisors, LLCPDF
82 FR 31494 - Magnuson-Stevens Act Provisions; Fisheries Off West Coast States; Pacific Coast Groundfish Fishery; 2017-2018 Biennial Specifications and Management Measures; Inseason AdjustmentsPDF
82 FR 31442 - Revisions to the Export Administration Regulations Based on the 2016 Missile Technology Control Regime Plenary AgreementsPDF
82 FR 31608 - The Presidential Commission on Election Integrity (PCEI); Upcoming Public Advisory MeetingPDF
82 FR 31615 - Notice of Issuance of Final Determination Concerning a Digital Radiography SystemPDF
82 FR 31551 - United States Standards for BeansPDF
82 FR 31550 - United States Standards for LentilsPDF
82 FR 31454 - Safety Zone; Annual Event in the Captain of the Port Buffalo Zone-Brewerton FireworksPDF
82 FR 31611 - Agency Information Collection Activities: Proposed Collection: Public Comment Request; Information Collection Request Title: Poison Help General Population Survey, OMB Number 0915-0343, Reinstatement.PDF
82 FR 31612 - Agency Information Collection Activities: Submission to OMB for Review and Approval; Public Comment Request; Information Collection Request Title: Delta States Rural Development Network Grant Program, OMB No. 0915-0386-RevisionPDF
82 FR 31450 - Safety Zone; Lake Michigan, Whiting, IndianaPDF
82 FR 31455 - Safety Zone; Port Huron Blue Water Fest Fireworks, St. Clair River, Port Huron, MIPDF
82 FR 31637 - Notice of Proposed Information Collection Requests: 2017 Sustaining Indigenous Culture Survey: The Structure, Activities, and Needs of Tribal Archives, Libraries, and Museums Needs Assessment SurveyPDF
82 FR 31636 - Agency Information Collection Activities; Comment Request; Information Collections: Davis-Bacon Certified PayrollPDF
82 FR 31618 - 60-Day Notice of Proposed Information Collection: Comment Request; Housing Discrimination Information Form; HUD-903.1, HUD-903.1A, HUD-903.1B, HUD-903.1C, HUD-903.1F, HUD-903.1CAM, HUD-903.1KOR, HUD-903.1RUS, HUD-903-1_SomaliPDF
82 FR 31622 - 30-Day Notice of Proposed Information Collection: Implementation of the Housing for Older Persons Act of 1995 (HOPA)PDF
82 FR 31624 - 30-Day Notice of Proposed Information Collection: Delta Community Capital InitiativePDF
82 FR 31613 - National Institute on Minority Health and Health Disparities; Notice of Closed MeetingPDF
82 FR 31614 - National Institute on Deafness and Other Communication Disorders; Notice of Closed MeetingPDF
82 FR 31613 - National Institute on Aging; Notice of Closed MeetingPDF
82 FR 31614 - Center for Scientific Review; Notice of Closed MeetingsPDF
82 FR 31489 - Fisheries of the Caribbean, Gulf of Mexico, and South Atlantic; 2017 Accountability Measure-Based Closures for Commercial and Recreational Species in the U.S. Caribbean off Puerto RicoPDF
82 FR 31433 - List of Approved Spent Fuel Storage Casks: EnergySolutionsTMPDF
82 FR 31619 - 30-Day Notice of Proposed Information Collection: Appalachia Economic Development InitiativePDF
82 FR 31512 - List of Approved Spent Fuel Storage Casks: EnergySolutionsTMPDF
82 FR 31620 - 30-Day Notice of Proposed Information Collection: Affirmative Fair Housing Marketing PlanPDF
82 FR 31548 - Notice of July 19, 2017 Advisory Committee on Voluntary Foreign Aid MeetingPDF
82 FR 31549 - Availability of FSIS Guidance for Importing Meat, Poultry, and Egg Products Into the United StatesPDF
82 FR 31597 - Environmental Impact Statements; Notice of AvailabilityPDF
82 FR 31555 - Certain Crystalline Silicon Photovoltaic Products From Taiwan: Final Results of Antidumping Duty Administrative Review; 2014-2016PDF
82 FR 31491 - Fisheries of the Northeastern United States; Recreational Management Measures for the Summer Flounder and Scup Fisheries; Fishing Year 2017PDF
82 FR 31554 - Foreign-Trade Zone (FTZ) 106-Oklahoma City, Oklahoma, Notification of Proposed Production Activity, Eastman Kodak Company, (Printing Flexographic Plates), Weatherford, OklahomaPDF
82 FR 31559 - Certain Hot-Rolled Flat-Rolled Carbon-Quality Steel Products From the Russian Federation: Final Results of Antidumping Duty Administrative Review; 2014-2015PDF
82 FR 31557 - Honey From the People's Republic of China: Preliminary Rescission of the New Shipper Review and Preliminary Results of the Administrative Review; 2015-2016PDF
82 FR 31604 - Change in Bank Control Notices; Acquisitions of Shares of a Bank or Bank Holding CompanyPDF
82 FR 31603 - Formations of, Acquisitions by, and Mergers of Bank Holding CompaniesPDF
82 FR 31610 - Notice of Single Source Award to the Genesee County Health Department for Addressing and Preventing Lead Exposure Through Healthy Start in Genesee County, MichiganPDF
82 FR 31680 - Hours of Service of Drivers: Application for Exemption; Rail Delivery Services (RDS)PDF
82 FR 31682 - Agency Information Collection Activities; Extension of a Currently-Approved Information Collection: Accident Recordkeeping RequirementsPDF
82 FR 31671 - Administrative Declaration of a Disaster for the State of ColoradoPDF
82 FR 31672 - Administrative Declaration of a Disaster for the State of TexasPDF
82 FR 31449 - [Regattas and Marine Parades; Great Lakes Annual Marine EventsPDF
82 FR 31579 - Mid-Atlantic Fishery Management Council (MAFMC); MeetingPDF
82 FR 31561 - Mid-Atlantic Fishery Management Council (MAFMC); MeetingPDF
82 FR 31575 - Fisheries of the Gulf of Mexico; Southeast Data, Assessment, and Review (SEDAR); Post Data-Workshop Webinar Gulf of Mexico Gray Snapper; Public MeetingPDF
82 FR 31575 - Fisheries of the South Atlantic; South Atlantic Fishery Management Council; Public MeetingsPDF
82 FR 31560 - Fisheries of the South Atlantic; Southeast Data, Assessment, and Review (SEDAR); Public MeetingPDF
82 FR 31683 - Hours of Service (HOS) of Drivers; American Pyrotechnics Assn. (APA) Application for Exemption From the 14-Hour Rule; Request To Add New Member to Current APA ExemptionPDF
82 FR 31579 - Takes of Marine Mammals Incidental to Specified Activities; Taking Marine Mammals Incidental to Seattle Multimodal Construction Project in Washington StatePDF
82 FR 31562 - Takes of Marine Mammals Incidental to Specified Activities; Taking Marine Mammals Incidental to Site Characterization Surveys off the Coast of New JerseyPDF
82 FR 31603 - Agency Information Collection Activities: Announcement of Board Approval Under Delegated Authority and Submission to OMBPDF
82 FR 31452 - Safety Zone; Oswego Harborfest 2017 Breakwall and Barge Fireworks Display; Oswego Harbor, Oswego, NYPDF
82 FR 31686 - Agency Information Collection Activities; Comment Request; Renewal Without Change of Bank Secrecy Act Recordkeeping RequirementsPDF
82 FR 31545 - Evaluation of Existing Coast Guard Regulations, Guidance Documents, Interpretative Documents, and Collections of InformationPDF
82 FR 31635 - Steel Concrete Reinforcing Bar From Japan and Turkey; DeterminationsPDF
82 FR 31634 - Notice of Receipt of Complaint; Solicitation of Comments Relating to the Public InterestPDF
82 FR 31650 - Self-Regulatory Organizations; Bats BZX Exchange, Inc.; Order Approving a Proposed Rule Change, To Amend BZX Rule 14.11 To Provide for the Inclusion of Cash in an Index Underlying a Series of Index Fund SharesPDF
82 FR 31638 - Self-Regulatory Organizations; NASDAQ PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Regarding Delivery of Options Disclosure Documents and Special Statement for Uncovered Options WritersPDF
82 FR 31648 - Self-Regulatory Organizations; ICE Clear Europe Limited; Order Approving Proposed Rule Change Relating to Amendments to the ICE Clear Europe Limited Articles of AssociationPDF
82 FR 31656 - Self-Regulatory Organizations; Bats BYX Exchange, Inc; Bats BZX Exchange, Inc.; Bats EDGA Exchange, Inc.; Bats EDGX Exchange, Inc.; BOX Options Exchange LLC; C2 Options Exchange, Incorporated; Chicago Board Options Exchange, Incorporated; Chicago Stock Exchange, Inc.; Financial Industry Regulatory Authority, Inc.; Investors' Exchange LLC; Miami International Securities Exchange, LLC; MIAX PEARL LLC; NASDAQ BX, Inc.; Nasdaq GEMX, LLC; Nasdaq ISE, LLC; Nasdaq MRX, LLC; NASDAQ PHLX LLC; The NASDAQ Stock Market LLC; New York Stock Exchange LLC; NYSE Arca, Inc. and NYSE MKT LLC; Suspension of and Order Instituting Proceedings To Determine Whether To Approve or Disapprove Proposed Rule Changes To Establish Fees for Industry Members To Fund the Consolidated Audit TrailPDF
82 FR 31644 - Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Withdrawal of a Proposed Rule Change Related to Unusual Market Conditions and the Duty To Systemize Non-Electronic Orders Prior to RepresentationPDF
82 FR 31668 - Self-Regulatory Organizations; Miami International Securities Exchange, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend its Fee Schedule Concerning the Options Regulatory FeePDF
82 FR 31651 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Proposed Rule Change to Facilitate the Listing and Trading of Certain Series of Investment Company Units Listed Pursuant to NYSE Arca Equities Rule 5.2(j)(3)PDF
82 FR 31642 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Specify in Exchange Rules the Exchange's Primary and Secondary Sources of Data Feeds From NYSE MKT LLCPDF
82 FR 31644 - Self-Regulatory Organizations; Municipal Securities Rulemaking Board; Notice of Filing of a Proposed Rule Change To Amend MSRB Rule G-21(e), on Municipal Fund Security Product AdvertisementsPDF
82 FR 31629 - Agency Information Collection Activities: OMB Control Number 1014-0018; Oil and Gas Drilling OperationsPDF
82 FR 31625 - Notice of Availability of a Draft Candidate Conservation Agreement, Draft Candidate Conservation Agreements With Assurances, and Draft Environmental Assessment for Activities Within Eddy County, New Mexico, and Culberson County, TexasPDF
82 FR 31680 - Notice of Final Federal Agency Actions on Proposed Gravina Access Project in AlaskaPDF
82 FR 31673 - Surface Transportation Project Delivery Program; Ohio Department of Transportation Audit ReportPDF
82 FR 31535 - Airworthiness Directives; Bell Helicopter Textron Canada Limited (Bell) HelicoptersPDF
82 FR 31609 - Agency Information Collection Activities: Submission for OMB Review; Comment RequestPDF
82 FR 31615 - National Institute of Allergy and Infectious Diseases; Notice of Closed MeetingPDF
82 FR 31614 - National Eye Institute; Notice of Closed MeetingPDF
82 FR 31613 - Center for Scientific Review; Notice of Closed MeetingsPDF
82 FR 31440 - 2017 Revisions to the Civil Penalty Inflation Adjustment Tables; CorrectionPDF
82 FR 31672 - Petition for Exemption; Summary of Petition Received; Scott E. AshtonPDF
82 FR 31612 - Senior Executive Service Performance Review BoardPDF
82 FR 31440 - Amendment of Class E Airspace; Arcata, CA; Fortuna, CA; and Establishment of Class E Airspace; Arcata, CA, and Eureka, CAPDF
82 FR 31602 - Procedures for Commission Review of State Opt-Out Request From the FirstNet Radio Access NetworkPDF
82 FR 31546 - Air Plan Approval; Wisconsin; Site-Specific Sulfur Dioxide Requirements for USG Interiors, LLCPDF
82 FR 31458 - Air Plan Approval; Wisconsin; Site-Specific Sulfur Dioxide Requirements for USG Interiors, LLCPDF
82 FR 31595 - Cross-Media Electronic Reporting: Authorized Program Revision Approval, State of West VirginiaPDF
82 FR 31547 - Approval and Promulgation of Air Quality Implementation Plans; Pennsylvania; Volatile Organic Compound Reasonably Available Control Technology for 1997 Ozone StandardPDF
82 FR 31464 - Approval and Promulgation of Air Quality Implementation Plans; Pennsylvania; Volatile Organic Compound Reasonably Available Control Technology for 1997 Ozone StandardPDF
82 FR 31457 - Approval of California Air Plan Revisions, Antelope Valley Air Quality Management DistrictPDF
82 FR 31462 - Air Plan Approval; TN: Non-Interference Demonstration for Federal Low-Reid Vapor Pressure Requirement in Shelby CountyPDF
82 FR 31576 - Streamlining Regulatory Processes and Reducing Regulatory BurdenPDF
82 FR 31628 - Notice of Availability of the Draft Environmental Impact Statement for the Normally Pressured Lance Natural Gas Development ProjectPDF
82 FR 31553 - Submission for OMB Review; Comment Request; CorrectionPDF
82 FR 31604 - Agency Information Collection Activities; Proposed Collection; Comment RequestPDF
82 FR 31537 - Proposal of Special Measure Against Bank of Dandong as a Financial Institution of Primary Money Laundering ConcernPDF
82 FR 31690 - Elementary and Secondary Education Act of 1965, as Amended by the Every Student Succeeds Act-Accountability and State PlansPDF

Issue

82 129 Friday, July 7, 2017 Contents Agency Agency for International Development NOTICES Meetings: Advisory Committee on Voluntary Foreign Aid, 31548 2017-14288 Agriculture Agriculture Department See

Animal and Plant Health Inspection Service

See

Food Safety and Inspection Service

See

Grain Inspection, Packers and Stockyards Administration

Animal Animal and Plant Health Inspection Service NOTICES Environmental Assessments; Availability, etc.: Finding of No Significant Impact for the Field Release of Genetically Engineered Diamondback Moths, 31548 2017-14345 Safety Enviromental Enforcement Bureau of Safety and Environmental Enforcement NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Oil and Gas Drilling Operations, 31629-31634 2017-14236 Census Bureau Census Bureau NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals; Correction, 31553-31554 2017-14110 Centers Medicare Centers for Medicare & Medicaid Services NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 31609-31610 2017-14230 Civil Rights Civil Rights Commission NOTICES Meetings; Sunshine Act, 31552-31553 2017-14386 Coast Guard Coast Guard RULES Regattas and Marine Parades: Great Lakes Annual Marine Events, 31449-31450 2017-14269 Safety Zones: Annual Event in the Captain of the Port Buffalo Zone—Brewerton Fireworks, 31454-31455 2017-14307 Lake Michigan, Whiting, IN, 31450-31452 2017-14304 Oswego Harborfest 2017 Breakwall and Barge Fireworks Display; Oswego Harbor, Oswego, NY, 31452-31454 2017-14258 Port Huron Blue Water Fest Fireworks, St. Clair River, Port Huron, MI, 31455-31457 2017-14303 PROPOSED RULES Evaluation of Existing Coast Guard Regulations, Guidance Documents, Interpretative Documents, and Collections of Information; Extension of Comment Period, 31545-31546 2017-14254 Commerce Commerce Department See

Census Bureau

See

Foreign-Trade Zones Board

See

Industry and Security Bureau

See

International Trade Administration

See

National Oceanic and Atmospheric Administration

Education Department Education Department RULES Elementary and Secondary Education Act, as Amended by the Every Student Succeeds Act—Accountability and State Plans, 31690-31713 2017-12126 Environmental Protection Environmental Protection Agency RULES Air Quality State Implementation Plans; Approvals and Promulgations: California; Antelope Valley Air Quality Management District, 31457-31458 2017-14203 Pennsylvania; Volatile Organic Compound Reasonably Available Control Technology for 1997 Ozone Standard, 31464-31468 2017-14204 Tennessee; Non-interference Demonstration for Federal Low-Reid Vapor Pressure Requirement in Shelby County, 31462-31464 2017-14202 Wisconsin; Site-specific Sulfur Dioxide Requirements for USG Interiors, LLC, 31458-31462 2017-14212 Pesticide Tolerances: Flonicamid, 31468-31471 2017-14339 Prosulfuron, 31471-31476 2017-14315 PROPOSED RULES Air Quality State Implementation Plans; Approvals and Promulgations: Pennsylvania; Volatile Organic Compound Reasonably Available Control Technology for 1997 Ozone Standard, 31547 2017-14205 Wisconsin; Site-specific Sulfur Dioxide Requirements for USG Interiors, LLC, 31546-31547 2017-14213 NOTICES Access to Confidential Business Information: Syracuse Research Corp. and its Identified Subcontractors, 31596-31597 2017-14324 Bona Fide Prospective Purchaser Settlements: Alfred Heller Heat Treating Superfund Site, City of Clifton, Passaic County, NJ, 31593-31594 2017-14344 Certain New Chemicals: Receipt and Status Information for April 2017, 31598-31602 2017-14326 Cross-Media Electronic Reporting: Authorized Program Revision Approval, State of West Virginia, 31595-31596 2017-14208 Environmental Impact Statements; Availability, etc.: Weekly Receipts, 31597 2017-14284 Meetings: Science Advisory Board's 2017 Scientific and Technological Achievement Awards Committee, 31594-31595 2017-14338 Receipt of Information Under Toxic Substances Control Act, 31596 2017-14320 Scopes of the Risk Evaluations To Be Conducted for the First Ten Chemical Substances Under the Toxic Substances Control Act, 31592-31593 2017-14321 Federal Aviation Federal Aviation Administration RULES 2017 Revisions to the Civil Penalty Inflation Adjustment Tables; Correction, 31440 2017-14223 Class E Airspace; Amendments: Arcata, CA; Fortuna, CA; and Establishment of Class E Airspace; Arcata, CA, and Eureka, CA, 31440-31442 2017-14219 PROPOSED RULES Airworthiness Directives: Bell Helicopter Textron Canada Limited (Bell) Helicopters, 31535-31537 2017-14231 NOTICES Petitions for Exemption; Summaries: Scott E. Ashton, 31672-31673 2017-14222 Federal Communications Federal Communications Commission NOTICES Procedures for Commission Review of State Opt-Out Request From the FirstNet Radio Access Network, 31602-31603 2017-14216 Federal Highway Federal Highway Administration NOTICES Federal Agency Actions: Alaska; Proposed Gravina Access Project, 31680 2017-14234 Surface Transportation Project Delivery Program: Ohio Department of Transportation Audit Report, 31673-31680 2017-14233 Federal Housing Finance Agency Federal Housing Finance Agency PROPOSED RULES 2018-2020 Enterprise Housing Goals, 31514-31535 2017-14286 C1--2017--14039 Federal Motor Federal Motor Carrier Safety Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Accident Recordkeeping Requirements, 31682-31683 2017-14272 Hours of Service of Drivers; Exemption Applications: American Pyrotechnics Assn., 31683-31686 2017-14262 Rail Delivery Services, 31680-31682 2017-14273 Federal Railroad Federal Railroad Administration RULES Competitive Passenger Rail Service Pilot Program, 31476-31489 2017-14355 Federal Reserve Federal Reserve System NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 31603-31604 2017-14259 Changes in Bank Control Notices: Acquisitions of Shares of a Bank or Bank Holding Compan, 31604 2017-14276 Formations of, Acquisitions by, and Mergers of Bank Holding Companies, 31603 2017-14275 Federal Trade Federal Trade Commission NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 31604-31608 2017-14078 Financial Crimes Financial Crimes Enforcement Network PROPOSED RULES Special Measure Against Bank of Dandong as Financial Institution of Primary Money Laundering Concern, 31537-31545 2017-14026 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Bank Secrecy Act Recordkeeping Requirements, 31686-31688 2017-14257 Fish Fish and Wildlife Service NOTICES Environmental Assessments; Availability, etc.: Activities Within Eddy County, NM, and Culberson County, TX, 31625-31627 2017-14235 Food Safety Food Safety and Inspection Service NOTICES Guidance: Importing Meat, Poultry, and Egg Products Into the United States, 31549-31550 2017-14287 Foreign Trade Foreign-Trade Zones Board NOTICES Production Activities: Eastman Kodak Co., Foreign-Trade Zone 106, Oklahoma City, OK, 31554-31555 2017-14279 General Services General Services Administration NOTICES Meetings: Presidential Commission on Election Integrity, 31608 2017-14311 Grain Inspection Grain Inspection, Packers and Stockyards Administration NOTICES United States Standards: Beans, 31551-31552 2017-14309 Lentils, 31550-31551 2017-14308 Health and Human Health and Human Services Department See

Centers for Medicare & Medicaid Services

See

Health Resources and Services Administration

See

National Institutes of Health

Health Resources Health Resources and Services Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Delta States Rural Development Network Grant Program, 31612-31613 2017-14305 Poison Help General Population Survey, 31611-31612 2017-14306 Senior Executive Service Performance Review Board: Prospective Members, 31612 2017-14221 Single-Source Awards: Genesee County Health Department, 31610-31611 2017-14274 Homeland Homeland Security Department See

Coast Guard

See

U.S. Customs and Border Protection

Housing Housing and Urban Development Department NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Affirmative Fair Housing Marketing Plan, 31620-31622 2017-14289 Appalachia Economic Development Initiative, 31619-31620 2017-14291 Delta Community Capital Initiative, 31624-31625 2017-14298 Housing Discrimination Information Form, 31618-31619 2017-14300 Implementation of the Housing for Older Persons Act of 1995, 31622-31624 2017-14299 Industry Industry and Security Bureau RULES Export Administration Regulations: Revisions to the Export Administration Regulations Based on the 2016 Missile Technology Control Regime Plenary Agreements, 31442-31449 2017-14312 Institute of Museum and Library Services Institute of Museum and Library Services NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: 2017 Sustaining Indigenous Culture Survey: The Structure, Activities, and Needs of Tribal Archives, Libraries, and Museums Needs Assessment Survey, 31637-31638 2017-14302 Interior Interior Department See

Bureau of Safety and Environmental Enforcement

See

Fish and Wildlife Service

See

Land Management Bureau

International Trade Adm International Trade Administration NOTICES Antidumping or Countervailing Duty Investigations, Orders, or Reviews: Certain Crystalline Silicon Photovoltaic Products From Taiwan: Final Results of Administrative Review; 2014-2016, 31555-31557 2017-14281 Certain Hot-Rolled Flat-Rolled Carbon-Quality Steel Products From the Russian Federation: Final Results of Administrative Review; 2014-2015, 31559-31560 2017-14278 Honey From the People's Republic of China, 31557-31559 2017-14277 International Trade Com International Trade Commission NOTICES Complaints: Certain Shielded Electrical Ribbon Cables and Products Containing the Same, 31634-31635 2017-14249 Investigations; Determinations, Modifications, and Rulings, etc.: Steel Concrete Reinforcing Bar From Japan and Turkey, 31635-31636 2017-14250 Labor Department Labor Department See

Wage and Hour Division

Land Land Management Bureau NOTICES Environmental Impact Statements; Availability, etc.: Normally Pressured Lance Natural Gas Development Project, 31628-31629 2017-14130 Meetings: Northwest Oregon Resource Advisory Council, 31627-31628 2017-14342 National Foundation National Foundation on the Arts and the Humanities See

Institute of Museum and Library Services

National Institute National Institutes of Health NOTICES Meetings: Center for Scientific Review, 31613-31614 2017-14227 2017-14294 National Eye Institute, 31614 2017-14228 National Institute of Allergy and Infectious Diseases, 31615 2017-14229 National Institute on Aging, 31613 2017-14295 National Institute on Deafness and Other Communication Disorders, 31614-31615 2017-14296 National Institute on Minority Health and Health Disparities, 31613 2017-14297 National Oceanic National Oceanic and Atmospheric Administration RULES Fisheries of the Caribbean, Gulf of Mexico, and South Atlantic: 2017 Accountability Measure-based Closures for Commercial and Recreational Species in the U.S. Caribbean off Puerto Rico, 31489-31491 2017-14293 Fisheries of the Northeastern United States: Recreational Management Measures for the Summer Flounder and Scup Fisheries; Fishing Year 2017, 31491-31494 2017-14280 Fisheries Off West Coast States: Pacific Coast Groundfish Fishery; 2017-2018 Biennial Specifications and Management Measures; Inseason Adjustments, 31494-31511 2017-14313 NOTICES Meetings: Fisheries of the Gulf of Mexico; Southeast Data, Assessment, and Review; Post Data-Workshop Webinar Gulf of Mexico Gray Snapper, 31575 2017-14266 Fisheries of the South Atlantic; South Atlantic Fishery Management Council, 31575-31576 2017-14265 Fisheries of the South Atlantic; Southeast Data, Assessment, and Review, 31560-31561 2017-14264 Mid-Atlantic Fishery Management Council, 31561, 31579 2017-14267 2017-14268 Streamlining Regulatory Processes and Reducing Regulatory Burden, 31576-31579 2017-14167 Takes of Marine Mammals: Incidental to Seattle Multimodal Construction Project in Washington State, 31579-31592 2017-14261 Incidental to Site Characterization Surveys off the Coast of New Jersey, 31562-31575 2017-14260 Nuclear Regulatory Nuclear Regulatory Commission RULES List of Approved Spent Fuel Storage Casks: EnergySolutions Corp., VSC-24 Ventilated Storage Cask System, Renewal of Initial Certificate and Amendment Nos. 1-6, 31433-31440 2017-14292 PROPOSED RULES List of Approved Spent Fuel Storage Casks: EnergySolutions Corp., VSC-24 Ventilated Storage Cask System, Renewal of Initial Certificate and Amendment Nos. 1-6, 31512-31514 2017-14290 Presidential Documents Presidential Documents EXECUTIVE ORDERS National Space Council; Revival (EO 13803), 31429-31432 2017-14378 Securities Securities and Exchange Commission NOTICES Applications: Vertical Capital Income Fund and Oakline Advisors, LLC, 31640-31642 2017-14314 Self-Regulatory Organizations; Proposed Rule Changes: Bats BYX Exchange, Inc; Bats BZX Exchange, Inc.; Bats EDGA Exchange, Inc.; et. al, 31656-31668 2017-14245 Bats BZX Exchange, Inc., 31650 2017-14248 Chicago Board Options Exchange, Inc., 31644 2017-14244 ICE Clear Europe Limited, 31648-31649 2017-14246 Miami International Securities Exchange, LLC, 31668-31671 2017-14243 Municipal Securities Rulemaking Board, 31644-31648 2017-14240 NASDAQ PHLX LLC, 31638-31640 2017-14247 NYSE Arca, Inc., 31642-31644, 31651-31656 2017-14241 2017-14242 Small Business Small Business Administration NOTICES Disaster Declarations: Colorado, 31671-31672 2017-14271 Texas, 31672 2017-14270 Transportation Department Transportation Department See

Federal Aviation Administration

See

Federal Highway Administration

See

Federal Motor Carrier Safety Administration

See

Federal Railroad Administration

Treasury Treasury Department See

Financial Crimes Enforcement Network

Customs U.S. Customs and Border Protection NOTICES Determinations: Digital Radiography System, 31615-31618 2017-14310 Wage Wage and Hour Division NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Davis-Bacon Certified Payroll, 31636-31637 2017-14301 Separate Parts In This Issue Part II Education Department, 31690-31713 2017-12126 Reader Aids

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

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

82 129 Friday, July 7, 2017 Rules and Regulations NUCLEAR REGULATORY COMMISSION 10 CFR Part 72 [NRC-2016-0138] RIN 3150-AJ78 List of Approved Spent Fuel Storage Casks: EnergySolutionsTM Corporation, VSC-24 Ventilated Storage Cask System, Renewal of Initial Certificate and Amendment Nos. 1-6 AGENCY:

Nuclear Regulatory Commission.

ACTION:

Direct final rule.

SUMMARY:

The U.S. Nuclear Regulatory Commission (NRC) is amending its spent fuel storage regulations by revising the EnergySolutionsTM Corporation's (EnergySolutions or the applicant) VSC-24 Ventilated Storage Cask System listing within the “List of Approved Spent Fuel Storage Casks” to renew, for an additional 40 years, the initial certificate and Amendment Nos. 1-6 of Certificate of Compliance (CoC) No. 1007. The renewal of the initial certificate and Amendment Nos. 1-6 requires cask users to establish, implement, and maintain written procedures for aging management program (AMP) elements, including a lead cask inspection program, for VSC-24 Storage Cask structures, systems, and components (SSC) important to safety. Users must also conduct periodic “tollgate” assessments of new information on SSC aging effects and mechanisms to determine whether any element of an AMP addressing these effects and mechanisms requires revision to encompass the current state of knowledge. In addition, the renewal of the initial certificate and Amendment Nos. 1-6 makes several other changes, described in Section IV, “Discussion of Changes,” in the SUPPLEMENTARY INFORMATION section of this document.

DATES:

This direct final rule is effective September 20, 2017, unless significant adverse comments are received by August 7, 2017. If this direct final rule is withdrawn as a result of such comments, timely notice of the withdrawal will be published in the Federal Register. Comments received after this date will be considered if it is practical to do so, but the Commission is able to ensure consideration only for comments received on or before this date. Comments received on this direct final rule will also be considered to be comments on a companion proposed rule published in the Proposed Rules section of this issue of the Federal Register.

ADDRESSES:

You may submit comments by any of the following methods:

Federal Rulemaking Web site: Go to http://www.regulations.gov and search for Docket ID NRC-2016-0138. Address questions about NRC dockets to Carol Gallagher; telephone: 301-415-3463; email: [email protected] For technical questions contact the individual listed in the FOR FURTHER INFORMATION CONTACT section of this document.

Email comments to: [email protected] If you do not receive an automatic email reply confirming receipt, then contact us at 301-415-1677.

Fax comments to: Secretary, U.S. Nuclear Regulatory Commission at 301-415-1101.

Mail comments to: Secretary, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, ATTN: Rulemakings and Adjudications Staff.

Hand deliver comments to: 11555 Rockville Pike, Rockville, Maryland 20852, between 7:30 a.m. and 4:15 p.m. (Eastern Time) Federal workdays; telephone: 301-415-1677.

For additional direction on obtaining information and submitting comments, see “Obtaining Information and Submitting Comments” in the SUPPLEMENTARY INFORMATION section of this document.

FOR FURTHER INFORMATION CONTACT:

Robert D. MacDougall, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001; telephone: 301-415-5175; email: [email protected]

SUPPLEMENTARY INFORMATION:

Table of Contents I. Obtaining Information and Submitting Comments II. Rulemaking Procedure III. Background IV. Discussion of Changes V. Voluntary Consensus Standards VI. Agreement State Compatibility VII. Plain Writing VIII. Environmental Assessment and Finding of No Significant Environmental Impact IX. Paperwork Reduction Act Statement X. Regulatory Flexibility Certification XI. Regulatory Analysis XII. Backfitting XIII. Congressional Review Act XIV. Availability of Documents I. Obtaining Information and Submitting Comments A. Obtaining Information

Please refer to Docket ID NRC-2016-0138 when contacting the NRC about the availability of information for this action. You may obtain publicly-available information related to this action by any of the following methods:

Federal Rulemaking Web site: Go to http://www.regulations.gov and search for Docket ID NRC-2016-0138.

NRC's Agencywide Documents Access and Management System (ADAMS): You may obtain publicly-available documents online in the ADAMS Public Documents collection at http://www.nrc.gov/reading-rm/adams.html. To begin the search, select “ADAMS Public Documents” and then select “Begin Web-based ADAMS Search.” For problems with ADAMS, please contact the NRC's Public Document Room (PDR) reference staff at 1-800-397-4209, 301-415-4737, or by email to [email protected] For the convenience of the reader, instructions about obtaining materials referenced in this document are provided in the “Availability of Documents” section.

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

B. Submitting Comments

Please include Docket ID NRC-2016-0138 in your comment submission.

The NRC cautions you not to include identifying or contact information that you do not want to be publicly disclosed in your comment submission. The NRC will post all comment submissions at http://www.regulations.gov as well as enter the comment submissions into ADAMS. The NRC does not routinely edit comment submissions to remove identifying or contact information.

If you are requesting or aggregating comments from other persons for submission to the NRC, then you should inform those persons not to include identifying or contact information that they do not want to be publicly disclosed in their comment submission. Your request should state that the NRC does not routinely edit comment submissions to remove such information before making the comment submissions available to the public or entering the comment into ADAMS.

II. Rulemaking Procedure

This direct final rule is limited to the renewal of the initial certificate and Amendment Nos. 1-6 of CoC No. 1007. The NRC is using the “direct final rule procedure” to issue these renewals because they represent a limited and routine change to an existing CoC that is expected to be noncontroversial. Adequate protection of public health and safety continues to be ensured.

This direct final rule will become effective on September 20, 2017. However, if the NRC receives significant adverse comments on this direct final rule by August 7, 2017, the NRC will publish a document that withdraws this action and will subsequently address the comments received in a final rule as a response to the companion proposed rule published in the Proposed Rule section of this issue of the Federal Register. Absent significant modifications to the proposed revisions requiring republication, the NRC will not initiate a second comment period on this action.

A significant adverse comment is a comment where the commenter explains why the rule would be inappropriate, including challenges to the rule's underlying premise or approach, or would be ineffective or unacceptable without a change. A comment is adverse and significant if:

(1) The comment opposes the rule and provides a reason sufficient to require a substantive response in a notice-and-comment process. For example, a substantive response is required when:

(a) The comment causes the NRC staff to reevaluate (or reconsider) its position or conduct additional analysis;

(b) The comment raises an issue serious enough to warrant a substantive response to clarify or complete the record; or

(c) The comment raises a relevant issue that was not previously addressed or considered by the NRC staff.

(2) The comment proposes a change or an addition to the rule, and it is apparent that the rule would be ineffective or unacceptable without incorporation of the change or addition.

(3) The comment causes the NRC staff to make a change (other than editorial) to the rule, CoC, or technical specifications (TSs).

For detailed instructions on filing comments, please see the companion proposed rule published in the Proposed Rule section of this issue of the Federal Register.

III. Background

Section 218(a) of the Nuclear Waste Policy Act (NWPA) of 1982, as amended, requires that “the Secretary [of the Department of Energy] shall establish a demonstration program, in cooperation with the private sector, for the dry storage of spent nuclear fuel at civilian nuclear power reactor sites, with the objective of establishing one or more technologies that the [Nuclear Regulatory] Commission may, by rule, approve for use at the sites of civilian nuclear power reactors without, to the maximum extent practicable, the need for additional site-specific approvals by the Commission.” Section 133 of the NWPA states, in part, that “[the Commission] shall, by rule, establish procedures for the licensing of any technology approved by the Commission under Section 219(a) [sic: 218(a)] for use at the site of any civilian nuclear power reactor.”

To implement this mandate, the Commission approved dry storage of spent nuclear fuel in NRC-approved casks under a general license by publishing a final rule which added a new subpart K in part 72 of title 10 of the Code of Federal Regulations (10 CFR) entitled, “General License for Storage of Spent Fuel at Power Reactor Sites” (55 FR 29181; July 18, 1990). A general license authorizes a reactor licensee to store spent fuel in NRC-approved casks at a site that is licensed to operate a power reactor under 10 CFR parts 50 or 52. This rule also established a new subpart L in 10 CFR part 72 entitled, “Approval of Spent Fuel Storage Casks,” which contains procedures and criteria for obtaining NRC approval of spent fuel storage cask designs. The NRC subsequently issued a final rule on April 7, 1993 (58 FR 17967), that approved the VSC-24 Storage Cask System design, effective May 7, 1993, and added it to the list of NRC-approved cask designs in 10 CFR 72.214 as CoC No. 1007.

IV. Discussion of Changes

On October 12, 2012, EnergySolutions submitted an application to renew, for an additional 40 years, the initial certificate and Amendment Nos. 1-6 of CoC No. 1007 for the VSC-24 Storage Cask System (ADAMS Accession No. ML12290A139). EnergySolutions supplemented its request on: February 14, 2013 (ADAMS Accession No. ML130500219); April 4, 2014 (ADAMS Accession No. ML14099A192); October 24, 2014 (ADAMS Accession No. ML14301A283); and June 26, 2015 (ADAMS Accession No. ML15182A163). Because EnergySolutions filed its renewal application at least 30 days before the certificate expiration date of May 7, 2013, pursuant to the timely renewal provisions in 10 CFR 72.240(b), the initial issuance of the certificate and Amendment Nos. 1-6 of CoC No. 1007 did not expire.

The renewals of the initial certificate and its amendments were conducted in accordance with the renewal provisions in 10 CFR 72.240. This section of NRC spent fuel storage regulations authorizes the NRC staff to include any additional certificate conditions it deems necessary to ensure that the cask system's SSCs continue to perform their intended safety functions during the certificate's renewal period. The NRC staff has included additional conditions in the renewed certificates requiring the implementation of an approved AMP to ensure that VSC-24 Storage Cask System SSCs important to safety will continue to perform their intended functions during the extended storage period authorized by the renewal. These conditions will require users of the VSC-24 Storage Cask Systems to establish, implement, and maintain written procedures for each AMP element, including the lead cask inspection program, for VSC-24 Storage Cask Systems that will continue to be in use for more than 20 years. These procedures must be consistent with the AMP descriptions in the applicant's Final Safety Analysis Report (FSAR).

The procedures must also include provisions for changing AMP elements as necessary, within the limitations specified in CoC conditions and TSs, to address new information derived from the results of AMP inspections and/or industry operating experience of aging effects. Each VSC-24 Storage Cask System general licensee must make and maintain records of periodic “tollgate” assessments as part of the “Operating Experience” element of each AMP. The purpose of these periodic tollgate assessments is to determine whether any AMP addressing an aging effect or mechanism requires revision to encompass the current state of knowledge. In addition, each future request for an amendment to the renewed CoCs must evaluate the amendment's impacts on aging management activities for the VSC-24 Storage Cask System. This evaluation may require modifications to time-limited aging analyses (TLAAs) and AMPs, including the lead cask inspection program, as appropriate.

The renewed certificates also contain additional conditions requested by EnergySolutions. The renewed initial certificate and Amendment Nos. 1-3 of CoC No. 1007 will prohibit the construction or placement into service of new VSC-24 SSCs under these CoC specifications. General licensee users with VSC-24 Storage Cask Systems under the initial certificate or Amendment Nos. 1-3 that are in service as of the renewal's effective date, however, may continue to perform SSC maintenance and repairs in accordance with the conditions of their applicable renewed CoC. General licensees that meet the conditions of the renewed Amendment Nos. 4-6 of CoC No. 1007 may load and store spent nuclear fuel in new VSC-24 Storage Cask Systems.

This direct final rule also includes additional design and operating conditions on the initial and all amendment certificates and their corresponding TSs to preclude the use of specific cask components, and prohibit the storage of spent fuel above a certain burnup. These conditions were proposed by the certificate holder to ensure that the scope of the aging analyses provided in the renewal application extends only to VSC-24 Storage Cask System SSCs currently in service. The NRC staff confirmed that no VSC-24 Storage Cask Systems currently in service are affected by these design and operating conditions. These conditions would only apply to future VSC-24 Storage Cask System SSCs placed into service.

As documented in its safety evaluation report (SER), the NRC staff performed a detailed safety evaluation of the proposed CoC renewal request. There are no changes to the cask design or fabrication requirements in the proposed CoC renewals. Accordingly, the design of the cask would continue to prevent loss of containment, shielding, and criticality control. In its SER for the renewal of the VSC-24 Storage Cask System, the NRC has determined that if the conditions specified in the CoC to implement these regulations are met, adequate protection of public health and safety will be maintained.

This direct final rule revises the VSC-24 Storage Cask System listing in 10 CFR 72.214 by renewing for 40 more years the initial certificate and Amendment Nos. 1-6 of CoC No. 1007. The renewals consist of the changes previously described, as set forth in the renewed CoCs and their revised TSs. The revised TSs are identified in the SER.

V. Voluntary Consensus Standards

The National Technology Transfer and Advancement Act of 1995 (Pub. L. 104-113) requires that Federal agencies use technical standards that are developed or adopted by voluntary consensus standards bodies unless the use of such a standard is inconsistent with applicable law or otherwise impractical. In this direct final rule, the NRC will revise the VSC-24 Storage Cask System design listed in § 72.214, “List of Approved Spent Fuel Storage Casks.”

This action does not constitute the establishment of a standard that contains generally applicable requirements.

VI. Agreement State Compatibility

Under the “Policy Statement on Adequacy and Compatibility of Agreement State Programs” approved by the Commission on June 30, 1997, and published in the Federal Register on September 3, 1997 (62 FR 46517), this direct final rule is classified as Compatibility Category “NRC.” Compatibility is not required for Category “NRC” regulations. The NRC program elements in this category are those that relate directly to areas of regulation reserved to the NRC by the Atomic Energy Act of 1954, as amended, or the provisions of 10 CFR. Although an Agreement State may not adopt program elements reserved to the NRC, it may wish to inform its licensees of certain requirements using a mechanism consistent with the particular State's administrative procedure laws, but so informing these licensees does not confer regulatory authority on the State.

VII. Plain Writing

The Plain Writing Act of 2010 (Pub. L. 111-274) requires Federal agencies to write documents in a clear, concise, and well-organized manner that also follows other best practices appropriate to the subject or field and the intended audience. The NRC has written this document to be consistent with the Plain Writing Act as well as the Presidential Memorandum, “Plain Language in Government Writing,” published June 10, 1998 (63 FR 31883).

VIII. Environmental Assessment and Finding of No Significant Environmental Impact A. The Action

The action is to amend 10 CFR 72.214 by revising the VSC-24 Storage Cask System listing within the “List of Approved Spent Fuel Storage Casks” to renew, for an additional 40 years, the initial certificate and Amendment Nos. 1-6 of CoC No. 1007. The renewals of the initial certificate and Amendment Nos. 1-6 require each cask user to establish, implement, and maintain written procedures for AMP elements, including lead cask inspection programs, for VSC-24 Storage Cask System SSCs important to safety. Users must also conduct periodic “tollgate” assessments of new information on SSC aging effects and mechanisms to determine whether any element of an AMP addressing these effects and mechanisms requires revision to encompass the current state of knowledge. In addition, the renewal of the initial certificate and Amendment Nos. 1-6 makes several other changes, described in Section IV, “Discussion of Changes,” in the SUPPLEMENTARY INFORMATION section of this document. Finally, as with any NRC-approved cask system, the reactor licensee using these systems under a 10 CFR part 72 general license must also ensure that the reactor site parameters and potential site-boundary doses are within the scope of the cask system safety analysis report and reactor license.

Under the National Environmental Policy Act of 1969, as amended (NEPA), and the NRC's regulations in subpart A of 10 CFR part 51, “Environmental Protection Regulations for Domestic Licensing and Related Regulatory Functions,” the NRC has determined that this direct final rule, if adopted, would not be a major Federal action significantly affecting the quality of the human environment and, therefore, an environmental impact statement (EIS) is not required. The NRC has made a finding of no significant impact on the basis of this environmental assessment (EA).

B. The Need for the Action

This direct final rule is necessary to authorize the continued use of the VSC-24 Storage Cask System design by power reactor licensees for dry spent fuel storage at reactor sites. Specifically, this rule extends the expiration date for the VSC-24 Storage Cask System certificates for an additional 40 years, allowing a reactor licensee to continue using them under general license provisions in an independent spent fuel storage installation (ISFSI), the facility at which a holder of a power reactor operating license stores spent fuel in dry casks in accordance with 10 CFR part 72.

C. Environmental Impacts of the Action

The environmental impacts associated with spent fuel storage have been considered in a variety of NRC environmental reviews. The NUREG-1092, “Environmental Assessment for 10 CFR Part 72—Licensing Requirements for the Independent Storage of Spent Fuel and High-Level Radioactive Waste,” is dated August 1984 (ADAMS Accession No. ML091050510). In the May 27, 1986, proposed rule (51 FR 19106) amending 10 CFR part 72 to address an NWPA requirement, the SUPPLEMENTARY INFORMATION section contains additional analyses showing that the potential environmental impacts from storing spent fuel in dry casks are small. The NRC also evaluated the environmental impacts of spent fuel storage at generally licensed ISFSIs in “Environmental Assessment and Finding of No Significant Impact for Proposed Rule Entitled `Storage of Spent Nuclear Fuel in NRC-Approved Storage Casks at Nuclear Power Reactor Sites,'” published in the Federal Register on May 5, 1989 (54 FR 19379).

On July 18, 1990 (55 FR 29181), the NRC issued a final rule amending 10 CFR part 72 to provide for the storage of spent fuel under a general license in cask designs approved by the NRC. In the EA for the 1990 final rule, the NRC analyzed the potential environmental impacts of using NRC-approved storage casks. This EA for the renewal of the initial certificate and Amendment Nos. 1-6 of CoC No. 1007 tiers off of the EA for the July 18, 1990, final rule. Tiering off of past EAs is a standard process under NEPA.

The NRC staff has determined that the environmental impacts of renewing the VSC-24 Storage Cask System certificates for an additional 40 years remain bounded by the EISs and EAs previously referenced. As required by 10 CFR 72.240, applications for renewal of a spent fuel storage CoC design are required to demonstrate, in TLAAs and a description of an AMP, that SSCs important to safety will continue to perform their intended function for the requested renewal term. As discussed in the NRC staff's SER for the renewal of the VSC-24 Storage Cask System certificates, the NRC staff has approved conditions in the renewed CoCs requiring the general licensee to implement the AMPs described in the renewal application and incorporated into the storage system's FSAR. These conditions ensure that VSC-24 Storage Cask Systems will continue to perform their intended safety functions and provide adequate protection of public health and safety throughout the renewal period.

Incremental impacts from continued use of VSC-24 Storage Cask Systems under a general license for an additional 40 years are not considered significant. When the general licensee follows all procedures and administrative controls, including the conditions established as a result of this renewal, no effluents are expected from the sealed dry storage cask systems. Activities associated with cask loading and decontamination may result in some small incremental liquid and gaseous effluents, but these activities will be conducted under 10 CFR parts 50 or 52 reactor operating licenses, and effluents will be controlled within existing reactor site technical specifications. Because reactor sites are relatively large, any incremental offsite doses due to direct radiation exposure from the spent fuel storage casks are expected to be small, and when combined with the contribution from reactor operations, well within the annual dose equivalent of 0.25 mSv (25 mrem) limit to the whole body specified in 10 CFR 72.104. Incremental impacts on collective occupational exposures due to dry cask spent fuel storage are expected to be only a small fraction of the exposures from operation of the nuclear power station.

The VSC-24 Storage Cask Systems are also designed to mitigate the effects of design basis accidents that could occur during storage. Design basis accidents account for human-induced events and the most severe natural phenomena reported for the site and surrounding area. Postulated accidents analyzed for an ISFSI include tornado winds and tornado-generated missiles, a design basis earthquake, a design basis flood, an accidental cask drop, lightning effects, fire, explosions, and other incidents.

During the promulgation of the amendments that added subpart K to 10 CFR part 72 (55 FR 29181; July 18, 1990), the NRC staff assessed the public health consequences of dry cask system storage accidents and sabotage events. In the supporting analyses for these amendments, the NRC staff determined that a release from a dry cask storage system would be comparable in magnitude to a release from the same quantity of fuel in a spent fuel storage pool. As a result of these evaluations, the NRC staff determined that, because of the physical characteristics of the storage casks and conditions of storage that include specific security provisions, the potential risk to public health and safety due to accidents or sabotage is very small.

Considering the specific design requirements for each accident or sabotage condition, the design of the cask would prevent loss of confinement, shielding, and criticality control. If there is no loss of confinement, shielding, or criticality control, the environmental impacts would be insignificant.

There are no changes to cask design or fabrication requirements in the renewed initial certificate or the renewed Amendment Nos. 1-6 that would result in an increase in occupational exposure or offsite dose rates from the implementation of the renewal of the initial certificate and Amendment Nos. 1-6. Therefore, the occupational exposure or offsite dose rates would remain well within applicable 10 CFR part 20 limits.

Decommissioning of dry cask spent fuel storage systems under a general license would be carried out as part of a power reactor's site decommissioning plan. In general, decommissioning would consist of removing the spent fuel from the site, decontaminating cask surfaces, and decontaminating and dismantling the ISFSI where the casks were deployed. The casks would then be released for reuse or disposal. Under normal and off-normal operating conditions, no residual contamination is expected to be left behind on supporting structures. The incremental impacts associated with decommissioning dry cask storage installations is expected to represent a small fraction of the impacts of decommissioning an entire nuclear power station.

In summary, the proposed CoC changes will not result in any radiological or non-radiological environmental impacts that differ significantly from the environmental impacts evaluated in the EA supporting the July 18, 1990, final rule. Compliance with the requirements of 10 CFR parts 20 and 72 would ensure that adequate protection of public health and safety will continue. The NRC, in its SER for the renewal of the VSC-24 Storage Cask System, has determined that if the conditions specified in the CoC to implement these regulations are met, adequate protection of public health and safety will be maintained.

Based on the previously stated assessments and its SER for the requested renewal of the VSC-24 Storage Cask System certificates, the NRC has determined that the expiration date of this system in 10 CFR 72.214 can be safely extended for an additional 40 years, and that commercial nuclear power reactor licensees can continue using the system during this period under a general license without significant impacts on the human environment.

D. Alternative to the Action

The alternative to this action is to deny approval of the renewals and end this direct final rule. Under this alternative, the NRC would either: (1) Require general licensees using VSC-24 Storage Cask Systems to unload the spent fuel from these systems and either return it to a spent fuel pool or re-load it into a different dry storage cask system listed in 10 CFR 72.214; or (2) require that users of existing VSC-24 Storage Cask Systems request site-specific licensing proceedings to continue storage in these systems.

The environmental impacts of requiring the licensee to unload the spent fuel and either return it to the spent fuel pool or re-load it into another NRC-approved cask system would result in increased radiological doses to workers. These increased doses would be due primarily to direct radiation from the casks while the workers unloaded, transferred, and re-loaded the spent fuel. These activities would consist of transferring the dry storage canisters to a cask handling building, opening the canister lid welds, returning the canister to a spent fuel pool or dry transfer facility, removing the fuel assemblies, and re-loading them, either into a spent fuel pool storage rack or another NRC-approved dry storage system. In addition to the increased occupational doses to workers, these activities may also result in additional liquid or gaseous effluents.

Alternatively, users of the dry cask storage system would need to apply for a site-specific license. Under this option for implementing the no-action alternative, interested licensees would have to prepare, and the NRC would have to review, each separate license application, thereby increasing the administrative burden upon the NRC and the costs to each licensee.

In summary, the no-action alternative would entail either more environmental impacts from transferring the spent fuel now in VSC-24 Storage Cask Systems, or impacts from multiple licensing actions that, in the aggregate, are likely to be less than spent fuel transfer activities but the same as, or more likely, greater than the preferred action.

E. Alternative Use of Resources

Renewal of the initial certificate and Amendment Nos. 1-6 of CoC No. 1007 for the VSC-24 Storage Cask System would not result in irreversible commitments of resources.

F. Agencies and Persons Contacted

No agencies or persons outside the NRC were contacted in connection with the preparation of this EA.

G. Finding of No Significant Impact

The environmental impacts of the action have been reviewed under the requirements in 10 CFR part 51. Based on the foregoing EA, the NRC concludes that this rule entitled, “List of Approved Spent Fuel Storage Casks: EnergySolutions Corporation, VSC-24 Ventilated Storage Cask System, Renewal of Initial Certificate and Amendment Nos. 1-6,” will not have a significant impact on the human environment. Therefore, the NRC has determined that an EIS is not necessary for this direct final rule.

IX. Paperwork Reduction Act Statement

This direct final rule does not require any new or amended collections of information subject to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). Existing collections of information were approved by the Office of Management and Budget (OMB), approval number 3150-0132.

Public Protection Notification

The NRC may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the document requesting or requiring the collection displays a currently valid OMB control number.

X. Regulatory Flexibility Certification

Under the Regulatory Flexibility Act of 1980 (5 U.S.C. 605(b)), the NRC certifies that this direct final rule will not, if issued, have a significant economic impact on a substantial number of small entities. This direct final rule affects only nuclear power plant licensees and the EnergySolutions Corporation. These entities do not fall within the scope of the definition of small entities set forth in the Regulatory Flexibility Act or the size standards established by the NRC (10 CFR 2.810).

XI. Regulatory Analysis

On July 18, 1990 (55 FR 29181), the NRC issued an amendment to 10 CFR part 72 to provide for the storage of spent nuclear fuel under a general license in cask designs approved by the NRC. Under this regulation, any nuclear power reactor licensee can use NRC-approved cask designs to store spent nuclear fuel if the licensee notifies the NRC in advance, the spent fuel is stored under the conditions specified in the cask's CoC, and the conditions of the general license are met. A list of NRC-approved cask designs is contained in 10 CFR 72.214. On April 7, 1993 (58 FR 17967), the NRC issued an amendment to 10 CFR part 72 that approved the VSC-24 Storage Cask System design by adding it to the list of NRC-approved cask designs in 10 CFR 72.214.

On October 12, 2012, EnergySolutions requested a renewal of the initial certificate and Amendment Nos. 1-6 of VSC-24's CoC No. 1007 for an additional 40 years beyond the initial certificate term (ADAMS Accession No. ML12290A139). EnergySolutions supplemented its request on: February 14, 2013 (ADAMS Accession No. ML130500219), April 4, 2014 (ADAMS Accession No. ML14099A192), October 24, 2014 (ADAMS Accession No. ML14301A283), and June 26, 2015 (ADAMS Accession No. ML15182A163). Because EnergySolutions filed its renewal application at least 30 days before the certificate expiration date of May 7, 2013, pursuant to the timely renewal provisions in 10 CFR 72.240(b), the initial issuance of the certificate and Amendment Nos. 1-6 of CoC No. 1007 did not expire.

The alternative to this action is to deny approval of the renewal of the initial certificate and Amendment Nos. 1-6 of CoC No. 1007 and end this direct final rule. Under this alternative, the NRC would either: (1) Require general licensees using VSC-24 Storage Cask Systems to unload spent fuel from these systems and return it to a spent fuel pool or re-load it into a different dry storage cask system listed in 10 CFR 72.214; or (2) require that users of existing VSC-24 Storage Cask Systems request site-specific licensing proceedings to continue storage in these systems. Therefore, the no-action alternative would entail either more environmental impacts from transferring the spent fuel now in VSC-24 Storage Cask Systems, or impacts from multiple licensing actions that, in the aggregate, are likely to be less than spent fuel transfer activities but the same as, or more likely, greater than the preferred action.

Approval of this direct final rule is consistent with previous NRC actions. Further, as documented in the SER and the EA, this direct final rule will have no significant adverse impact on public health and safety or the environment. This direct final rule also has no significant identifiable impact on or benefit to other Government agencies. Based on this regulatory analysis, the NRC concludes that the requirements of this direct final rule are commensurate with the NRC's responsibilities for public health and safety and the common defense and security. No other available alternative is believed to be as satisfactory, and therefore, this action is recommended.

XII. Backfitting and Issue Finality

The NRC has determined that the actions in this direct final rule do not require a backfit analysis because they either do not fall within the definition of backfitting under 10 CFR 72.62 or 10 CFR 50.109(a)(1), or they do not impact any general licensees currently using these systems. Additionally, the actions in this direct final rule do not impact issue finality provisions applicable to combined licenses under part 52.

This direct final rule renews CoC No. 1007 for the VSC-24 Storage Cask System, as currently listed in 10 CFR 72.214, “List of Approved Spent Fuel Storage Casks,” to extend the expiration date of the initial certificate and Amendment Nos. 1-6 by 40 years. The renewed certificates would require implementation of an AMP for the 40 years after the storage cask system's initial 20-year service period. As part of the renewal application, EnergySolutions also requested some changes to the originally-certified systems that go beyond the aging management provisions and impose additional design and operating conditions on the certificates and their corresponding TSs to preclude the use of specified cask components, and prohibit the future storage of spent fuel above a certain burnup limit.

Renewing these certificates does not, with the exceptions noted in this section, fall within the definition of backfit under 10 CFR 72.62 or 10 CFR 50.109, or otherwise represent an inconsistency with the issue finality provisions applicable to combined licenses in 10 CFR part 52. Extending the certificates' effective dates for 40 more years and requiring the implementation of AMPs does not impose any modification or addition to the design of an SSC of a cask system, or to the procedures or organization required to operate the system during the initial 20-year storage period of the system, as authorized by the current certificate. General licensees that have loaded these casks, or that load these casks in the future under the specifications of the applicable certificate, may continue to store spent fuel in these systems for the initial 20-year storage period authorized by the original certificate. The AMPs required to be implemented by this renewal are only required to be implemented after the storage cask system's initial 20-year service period ends. As explained in the 2011 final rule that amended 10 CFR part 72 (76 FR 8872, 8875, Question I), the general licensee's authority to use a particular storage cask design under an approved CoC terminates 20 years after the date that the general licensee first loads the particular cask with spent fuel, unless the cask's CoC is renewed. Because this rulemaking renews the certificates, and renewal is a separate NRC licensing action voluntarily implemented by vendors, the renewal of these CoCs is not an imposition of new or changed requirements from which these licensees would otherwise be protected by the backfitting provisions in 10 CFR 72.62 or 10 CFR 50.109.

Even if renewal of this CoC system could be considered a backfit, EnergySolutions, as the holder of the CoC and vendor of the casks, is not protected by the backfitting provisions in 10 CFR 72.62.

Unlike a vendor, general licensees using the existing systems subject to these renewals would be protected by the backfitting provisions in 10 CFR 72.62 and 10 CFR 50.109 if the renewals constituted new or changed requirements. But as previously explained, renewal of the certificates for these systems does not impose such requirements. The general licensees using these CoCs may continue storing material in their respective cask systems for the initial 20-year storage period identified in the applicable certificate or amendment with no changes. If general licensees choose to continue to store spent fuel in VSC-24 Cask Systems after the initial 20-year period, these general licensees will be required to implement AMPs for any cask systems subject to a renewed CoC, but such continued use is voluntary.

As part of the renewal application, EnergySolutions requested some changes to the originally-certified systems that go beyond the aging management provisions required by NRC regulations. Some of these changes impose additional design and operating conditions on the certificates and their corresponding TSs to preclude the use of specified cask components, and prohibit the future storage of spent fuel above a certain burnup limit. While the imposition of such conditions would be considered a backfit if the general licensees using VSC-24 Storage Cask Systems were using the prohibited components or storing spent fuel with the prohibited burnup, none of these licensees are doing so. These prohibitions were proposed by the certificate holder to avoid having to analyze aging effects that do not and will not apply to any VSC-24 Storage Cask Systems currently in service. The NRC staff confirmed that these proposed design and operating conditions do not affect any VSC-24 Storage Cask Systems currently in service (which are located at the Arkansas Nuclear One, the Point Beach, and the Palisades Nuclear Plant sites). Therefore, these additional conditions and TS changes do not constitute backfitting within the provisions of 10 CFR 72.62 or 10 CFR 50.109.

EnergySolutions also requested a condition that will prohibit the construction or placement into service of new VSC-24 SSCs under the renewed initial CoC No. 1007 certificate and Amendment Nos. 1-3, but this condition will not affect the users of existing casks. General licensees using VSC-24 Storage Cask Systems in service under the initial certificate or Amendment Nos. 1-3 as of the renewal's effective date may continue storing fuel and performing SSC maintenance and repairs in accordance with the conditions of their applicable CoC. Therefore, the requested condition affects only EnergySolutions, since it would be prohibited from manufacturing new systems under the initial certificate or Amendment Nos. 1-3 in the future. As previously mentioned, EnergySolutions, as the holder of the CoC, is not protected from backfitting by 10 CFR 72.62, and in any case, EnergySolutions itself requested the NRC to impose the condition. The vendor did not submit its request in response to new NRC requirements, nor any NRC request for an application to amend this CoC.

For these reasons, renewing the initial certificate and Amendment Nos. 1-6 of CoC No. 1007, and imposing the additional conditions previously discussed, do not constitute backfitting under 10 CFR 72.62 or 10 CFR 50.109(a)(1), or otherwise represent an inconsistency with the issue finality provisions applicable to combined licenses in part 52. Accordingly, the NRC staff has not prepared a backfit analysis for this rulemaking.

XIII. Congressional Review Act

The OMB has not found this to be a major rule as defined in the Congressional Review Act.

XIV. Availability of Documents

The documents identified in the following table are available to interested persons through one or more of the following methods, as indicated.

Document ADAMS
  • Accession No./
  • Federal Register
  • citation
  • Proposed CoC No. 1007 Renewal, Initial Issuance ML16057A127 Proposed TS, Attachment A, CoC No. 1007 Renewal, Initial Issuance ML16057A139 Proposed CoC No. 1007 Renewal, Amendment 1 ML16057A189 Proposed TS, Attachment A, Amendment 1 ML16057A211 Proposed CoC No. 1007 Renewal, Amendment 2 ML16057A216 Proposed TS, Attachment A, Amendment 2 ML16057A322 Proposed CoC No. 1007 Renewal, Amendment 3 ML16057A333 Proposed TS, Attachment A, Amendment 3 ML16057A358 Proposed CoC No. 1007 Renewal, Amendment 4 ML16057A449 Proposed TS, Attachment A, Amendment 4 ML16057A511 Proposed CoC No. 1007 Renewal, Amendment 5 ML16057A593 Proposed TS, Attachment A, Amendment 5 ML16057A600 Proposed CoC No. 1007 Renewal, Amendment 6 ML16057A617 Proposed TS, Attachment A, Amendment 6 ML16057A630 Preliminary SER ML16057A667 Final Safety Analysis Report for the VSC-24 Ventilated Storage Cask System ML060810682 NUREG-1092, “Environmental Assessment for 10 CFR Part 72—Licensing Requirements for the Independent Storage of Spent Fuel and High-Level Radioactive Waste“ ML091050510 Proposed Rule, “Licensing Requirements for the Independent Storage of Spent Nuclear Fuel and High-Level Radioactive Waste” 51 FR 19106 Environmental Assessment and Finding of No Significant Impact for Proposed Rule Entitled “Storage of Spent Nuclear Fuel in NRC-Approved Storage Casks at Nuclear Power Reactor Sites“ 54 FR 19379 Final Rule, “Storage of Spent Fuel In NRC-Approved Storage Casks at Power Reactor Sites” 55 FR 29181 Final Rule, “License and Certificate of Compliance Terms” 76 FR 8872

    The NRC may post materials related to this document, including public comments, on the Federal Rulemaking Web site at http://www.regulations.gov under Docket ID NRC-2016-0138. The Federal Rulemaking Web site allows you to receive alerts when changes or additions occur in a docket folder. To subscribe: (1) Navigate to the docket folder (NRC-2016-0138); (2) click the “Sign up for Email Alerts” link; and (3) enter your email address and select how frequently you would like to receive emails (daily, weekly, or monthly).

    List of Subjects in 10 CFR Part 72

    Administrative practice and procedure, Criminal penalties, Hazardous waste, Indians, Intergovernmental relations, Manpower training programs, Nuclear energy, Nuclear materials, Occupational safety and health, Penalties, Radiation protection, Reporting and recordkeeping requirements, Security measures, Spent fuel, Whistleblowing.

    For the reasons set out in the preamble and under the authority of the Atomic Energy Act of 1954, as amended; the Energy Reorganization Act of 1974, as amended; the Nuclear Waste Policy Act of 1982, as amended; and 5 U.S.C. 552 and 553; the NRC is adopting the following amendments to 10 CFR part 72.

    PART 72—LICENSING REQUIREMENTS FOR THE INDEPENDENT STORAGE OF SPENT NUCLEAR FUEL, HIGH-LEVEL RADIOACTIVE WASTE, AND REACTOR-RELATED GREATER THAN CLASS C WASTE 1. The authority citation for part 72 continues to read as follows: Authority:

    Atomic Energy Act of 1954, secs. 51, 53, 57, 62, 63, 65, 69, 81, 161, 182, 183, 184, 186, 187, 189, 223, 234, 274 (42 U.S.C. 2071, 2073, 2077, 2092, 2093, 2095, 2099, 2111, 2201, 2210e, 2232, 2233, 2234, 2236, 2237, 2238, 2273, 2282, 2021); Energy Reorganization Act of 1974, secs. 201, 202, 206, 211 (42 U.S.C. 5841, 5842, 5846, 5851); National Environmental Policy Act of 1969 (42 U.S.C. 4332); Nuclear Waste Policy Act of 1982, secs. 117(a), 132, 133, 134, 135, 137, 141, 145(g), 148, 218(a) (42 U.S.C. 10137(a), 10152, 10153, 10154, 10155, 10157, 10161, 10165(g), 10168, 10198(a)); 44 U.S.C. 3504 note.

    2. In § 72.214, Certificate of Compliance 1007 is revised to read as follows:
    § 72.214 List of approved spent fuel storage casks.

    Certificate Number: 1007.

    Initial Certificate Effective Date: May 7, 1993, superseded by Renewed Initial Certificate, on September 20, 2017.

    Renewed Initial Certificate Effective Date: September 20, 2017.

    Amendment Number 1 Effective Date: May 30, 2000, superseded by Renewed Amendment Number 1, on September 20, 2017.

    Renewed Amendment Number 1 Effective Date: September 20, 2017.

    Amendment Number 2 Effective Date: September 5, 2000, superseded by Renewed Amendment Number 2, on September 20, 2017.

    Renewed Amendment Number 2 Effective Date: September 20, 2017.

    Amendment Number 3 Effective Date: May 21, 2001, superseded by Renewed Amendment Number 3, on September 20, 2017.

    Renewed Amendment Number 3 Effective Date: September 20, 2017.

    Amendment Number 4 Effective Date: February 3, 2003, superseded by Renewed Amendment Number 4, on September 20, 2017.

    Renewed Amendment Number 4 Effective Date: September 20, 2017.

    Amendment Number 5 Effective Date: September 13, 2005, superseded by Renewed Amendment Number 5, on September 20, 2017.

    Renewed Amendment Number 5 Effective Date: September 20, 2017.

    Amendment Number 6 Effective Date: June 5, 2006, superseded by Renewed Amendment Number 6, on September 20, 2017.

    Renewed Amendment Number 6 Effective Date: September 20, 2017.

    SAR Submitted by: EnergySolutionsTM Corporation.

    SAR Title: Final Safety Analysis Report for the VSC-24 Ventilated Storage Cask System.

    Docket Number: 72-1007.

    Renewed Certificate Expiration Date: May 7, 2053.

    Model Number: VSC-24.

    Dated at Rockville, Maryland, this 31st day of May, 2017.

    For the Nuclear Regulatory Commission.

    Michael R. Johnson, Acting Executive Director for Operations.
    [FR Doc. 2017-14292 Filed 7-6-17; 8:45 am] BILLING CODE 7590-01-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 13 [Docket No. FAA-2016-70104; Amdt. Nos. 13-39A] RIN 2120-AK90 2017 Revisions to the Civil Penalty Inflation Adjustment Tables; Correction AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Final rule; correction.

    SUMMARY:

    The FAA is correcting a final rule published on April 10, 2017. In that rule, the FAA amended its regulations to provide the 2017 inflation adjustment to civil penalty amounts that may be imposed for violations of FAA regulations and the Hazardous Materials Regulations, as required by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. It also finalized the catch-up inflation adjustment interim final rule required by the same Act. The FAA inadvertently stated the effective date for the new maximums/minimums was January 15, 2017, instead of April 10, 2017. This document amends the FAA's regulations to correct that error.

    DATES:

    Effective July 7, 2017.

    FOR FURTHER INFORMATION CONTACT:

    Cole R. Milliard, Attorney, Office of the Chief Counsel, Enforcement Division, AGC-300, Federal Aviation Administration, 800 Independence Avenue SW., Washington, DC 20591; telephone (202) 267-3452; email [email protected]

    SUPPLEMENTARY INFORMATION: Background

    On April 10, 2017, the FAA published a final rule entitled, “2017 Revisions to the Civil Penalty Inflation Adjustment Tables” (82 FR 17097). In that final rule the FAA amended its regulations to provide the 2017 inflation adjustment to civil penalty maximums and minimums provided in title 14 Code of Federal Regulations (14 CFR) 13.301 and 406.9, as required by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015.

    In the regulatory text, the FAA inadvertently stated the effective date for the new maximums/minimums was January 15, 2017. However, the FAA intended only to apply the newly inflated maximums/minimums for violations occurring on or after April 10, 2017. Therefore, the FAA amends § 13.301(c) to reflect the intended date of April 10, 2017.

    List of Subjects in 14 CFR Part 13

    Administrative practice and procedure, Air transportation, Hazardous materials transportation, Investigations, Law enforcement, Penalties.

    The Correcting Amendment

    In consideration of the foregoing, the Federal Aviation Administration amends Chapters I of title 14, Code of Federal Regulations by making the following correction:

    PART 13—INVESTIGATIVE AND ENFORCEMENT PROCEDURES 1. The authority citation for part 13 continues to read as follows: Authority:

    18 U.S.C. 6002, 28 U.S.C. 2461 (note); 49 U.S.C. 106(g), 5121-5124, 40113-40114, 44103-44106, 44701-44703, 44709- 44710, 44713, 44725, 46101-46111, 46301, 46302 (for a violation of 49 U.S.C. 46504), 46304-46316, 46318, 46501-46502, 46504-46507, 47106, 47107, 47111, 47122, 47306, 47531-47532; 49 CFR 1.83.

    2. In § 13.301, revise the heading of the table in paragraph (c) to read as follows:
    § 13.301 Inflation adjustments of civil monetary penalties.

    (c) * * *

    Table of Minimum and Maximum Civil Monetary Penalty Amounts for Certain Violations Occurring on or after April 10, 2017

    Issued under the authority provided by 28 U.S.C. 2461 note, 49 U.S.C. 106(f) and 44701(a), and 51 U.S.C. 50901 in Washington, DC, on June 28, 2017.

    Lirio Liu, Director, Office of Rulemaking.
    [FR Doc. 2017-14223 Filed 7-6-17; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 71 [Docket No. FAA-2015-6751; Airspace Docket No. 15-AWP-18] Amendment of Class E Airspace; Arcata, CA; Fortuna, CA; and Establishment of Class E Airspace; Arcata, CA, and Eureka, CA AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Final rule.

    SUMMARY:

    This action modifies Class E surface area airspace, modifies Class E airspace extending upward from 700 feet, and establishes Class E airspace designated as an extension at Arcata Airport, Arcata, CA. The action also modifies Class E airspace extending upward from 700 feet at Rohnerville Airport, Fortuna, CA, and establishes stand-alone Class E airspace extending upward from 700 feet at Murray Field Airport, Eureka, CA, to accommodate airspace redesign for the safety and management of Instrument Flight Rules (IFR) operations within the National Airspace System. Additionally, this action updates the geographic coordinates of these airports.

    DATES:

    Effective 0901 UTC, October 12, 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.

    ADDRESSES:

    FAA Order 7400.11A, Airspace Designations and Reporting Points, and subsequent amendments can be viewed online at http://www.faa.gov/air_traffic/publications/. For further information, you can contact the Airspace Policy Group, Federal Aviation Administration, 800 Independence Avenue SW., Washington, DC, 20591; telephone: (202) 267-8783. The Order is also available for inspection at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, call (202) 741-6030, or go to http://www.archives.gov/federal_register/code_of_federal-regulations/ibr_locations.html.

    FAA Order 7400.11, Airspace Designations and Reporting Points, is published yearly and effective on September 15.

    FOR FURTHER INFORMATION CONTACT:

    Tom Clark, Federal Aviation Administration, Operations Support Group, Western Service Center, 1601 Lind Avenue SW., Renton, WA 98057; telephone (425) 203-4511.

    SUPPLEMENTARY INFORMATION:

    Authority for This Rulemaking

    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 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 amends Class E airspace at Arcata Airport, Arcata, CA, and Rohnerville Airport, Fortuna, CA, and establishes Class E airspace at Murray Field, Eureka, CA.

    History

    On March 28, 2017, the FAA published in the Federal Register (82 FR 15306) Docket FAA-2015-6751 a notice of proposed rulemaking (NPRM) to amend Class E airspace at Arcata Airport, Arcata, CA; and Rohnerville Airport, Fortuna, CA, and establish Class E airspace at Arcata Airport, Arcata, CA; and Murray Field Airport, Eureka, CA. Interested parties were invited to participate in this rulemaking effort by submitting written comments on the proposal to the FAA. No comments were received.

    Class E airspace designations are published in paragraph 6002, 6004, and 6005, respectively, 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 Class E airspace designations listed in this document will be published subsequently in the Order.

    Availability and Summary of Documents for Incorporation by Reference

    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 ADDRESSES section of this document. FAA Order 7400.11A lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

    The Rule

    This action amends Title 14 Code of Federal Regulations (14 CFR) part 71 by modifying Class E surface area airspace at Arcata Airport, Arcata, CA, and Rohnerville Airport, Fortuna, CA, and establishing Class E airspace designated as an extension at Arcata Airport. Also, stand-alone Class E airspace extending upward from 700 feet above the surface is established at Murray Field Airport, Eureka, CA. This airspace redesign is necessary for the safety and management of IFR operations at these airports, and for efficiency within the National Airspace System.

    Class E surface area airspace is amended at Arcata Airport, Arcata, CA, to within a 4.1 mile radius (increased from a 4-mile radius) of the airport; and the Abeta NDB is removed from the description as it was decommissioned and no longer needed.

    Class E airspace designated as an extension to a Class D or Class E surface area is established within 2.9 miles each side of the 153° bearing from Arcata Airport extending from the 4.1-mile radius to 10.5 miles southeast of the airport.

    Class E airspace extending upward from 700 feet above the surface is reduced to within a 7-mile radius of Arcata Airport, with a segment 4.2 miles wide (2.1 miles each side of the 153° bearing) extending from the 7-mile radius of the airport to 14.1 miles southeast of the airport. Class E airspace extending upward from 1,200 feet above the surface at Arcata Airport is removed, since this airspace is wholly contained within the Rogue Valley Class E en route airspace area.

    Class E airspace extending upward from 700 feet above the surface at Murray Field Airport, Eureka, CA, is established within a 6.3-mile radius of Murray Field Airport, with a segment 6.3 miles wide extending to 23 miles southwest of the airport. This airspace area specifically supports IFR operations at Eureka, CA.

    Class E airspace extending upward from 700 feet above the surface at Rohnerville Airport, Fortuna, CA, is amended to within a 2.7-mile radius (from a 6.5-mile radius) of Rohnerville Airport, with segments extending 7 miles northwest, 5.2 miles west, and 6.1 miles southeast of the airport. Class E airspace upward from 1,200 feet above the surface at Rohnerville Airport is removed since this airspace is wholly contained within the Rogue Valley Class E en route airspace area.

    This action also updates the geographic coordinates for the amended airports in the associated airspace areas to be in concert with the FAA's aeronautical database.

    Regulatory Notices and Analyses

    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, is non-controversial and unlikely to result in adverse or negative comments. It, therefore: (1) Is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); 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.

    Environmental Review

    The FAA has determined that this action qualifies for categorical exclusion under the National Environmental Policy Act in accordance with FAA Order 1050.1F, “Environmental Impacts: Policies and Procedures,” paragraph 5-6.5a. This airspace action is not expected to cause any potentially significant environmental impacts, and no extraordinary circumstances exist that warrant preparation of an environmental assessment.

    Lists of Subjects in 14 CFR Part 71

    Airspace, Incorporation by reference, Navigation (air).

    Adoption of the Amendment

    In consideration of the foregoing, the Federal Aviation Administration amends 14 CFR part 71 as follows:

    PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS 1. The authority citation for part 71 continues to read as follows: Authority:

    49 U.S.C. 106(f), 106(g); 40103, 40113, 40120; E.O. 10854, 24 FR 9565, 3 CFR, 1959-1963 Comp., p. 389.

    § 71.1 [Amended]
    2. The incorporation by reference in 14 CFR 71.1 of FAA Order 7400.11A, Airspace Designations and Reporting Points, dated August 3, 2016, and effective September 15, 2016, is amended as follows: Paragraph 6002 Class E Airspace Designated as Surface Areas. AWP CA E2 Arcata, CA [Modified] Arcata Airport, CA (Lat. 40°58′40″ N., long. 124°06′31″ W.)

    That airspace within a 4.1-mile radius of Arcata Airport.

    Paragraph 6004 Class E Airspace Designated as an Extension to a Class D or Class E Surface Area. AWP CA E4 Arcata, CA [New] Arcata Airport, CA (Lat. 40°58′40″ N., long. 124°06′31″ W.)

    That airspace extending upward from the surface within 2.9 miles each side of the 153° bearing from Arcata Airport extending from the 4.1-mile radius to 10.5 miles southeast of the airport.

    Paragraph 6005 Class E Airspace Areas Extending Upward From 700 Feet or More Above the Surface of the Earth. AWP CA E5 Arcata, CA [Modified] Arcata Airport, CA (Lat. 40°58′40″ N., long. 124°06′31″ W.)

    That airspace extending upward from 700 feet above the surface within a 7-mile radius of the Arcata Airport, and within 2.1 miles each side of the 153° bearing from the airport extending from the 7-mile radius to 14.1 miles southeast of the airport.

    AWP CA E5 Eureka, CA [New] Murray Field Airport, CA (Lat. 40°48′12″ N., long. 124°06′46″ W.)

    That airspace extending upward from 700 feet above the surface within a 6.3-mile radius of Murray Field Airport, and within 6.3 miles east of the Murray Field Airport 217° bearing extending from the 6.3-mile radius to 23 miles southwest of the airport.

    AWP CA E5 Fortuna, CA [Modified] Rohnerville Airport, CA (Lat. 40°33′14″ N., long. 124°07′58″ W.)

    That airspace extending upward from 700 feet above the surface within a 2.7 mile radius of Rohnerville Airport, and within 1.8 miles each side of the 326° bearing from the airport extending from the 2.7 mile radius to 7 miles northwest of the airport, and within 1.1-miles each side of the 307° bearing from the airport extending from the 2.7 mile radius to 5.2 miles west of the airport, and within 1.1-miles each side of the 113° bearing from the airport extending from the 2.7 mile radius to 6.1 miles southeast of the airport.

    Issued in Seattle, Washington, on June 28, 2017. Sam S.L. Shrimpton, Acting Group Manager, Operations Support Group, Western Service Center.
    [FR Doc. 2017-14219 Filed 7-6-17; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF COMMERCE Bureau of Industry and Security 15 CFR Parts 742, 744, 772, and 774 [Docket No. 170202139-7139-01] RIN 0694-AH33 Revisions to the Export Administration Regulations Based on the 2016 Missile Technology Control Regime Plenary Agreements AGENCY:

    Bureau of Industry and Security, Commerce.

    ACTION:

    Final rule.

    SUMMARY:

    The Bureau of Industry and Security (BIS) is amending the Export Administration Regulations (EAR) to reflect changes to the Missile Technology Control Regime (MTCR) Annex that were agreed to by MTCR member countries at the October 2016 Plenary in Busan, South Korea, and the March 2016 Technical Experts Meeting (TEM) in Luxembourg City, Luxembourg. This final rule revises thirteen Export Control Classification Numbers (ECCNs), adds one ECCN, revises two EAR defined terms (including making other EAR conforming changes for the use of these two terms) and makes conforming EAR changes where needed to implement the changes that were agreed to at the meetings and to better align the missile technology (MT) controls on the Commerce Control List (CCL) with the MTCR Annex.

    DATES:

    This rule is effective July 7, 2017.

    FOR FURTHER INFORMATION CONTACT:

    Sharon Bragonje, Nuclear and Missile Technology Controls Division, Bureau of Industry and Security, Phone: (202) 482-0434; Email: [email protected]

    SUPPLEMENTARY INFORMATION: Background

    The Missile Technology Control Regime (MTCR or Regime) is an export control arrangement among 35 nations, including most of the world's suppliers of advanced missiles and missile-related equipment, materials, software and technology. The regime establishes a common list of controlled items (the Annex) and a common export control policy (the Guidelines) that member countries implement in accordance with their national export controls. The MTCR seeks to limit the risk of proliferation of weapons of mass destruction by controlling exports of goods and technologies that could make a contribution to delivery systems (other than manned aircraft) for such weapons.

    In 1993, the MTCR's original focus on missiles for nuclear weapons delivery was expanded to include the proliferation of missiles for the delivery of all types of weapons of mass destruction (WMD), i.e., nuclear, chemical and biological weapons. Such proliferation has been identified as a threat to international peace and security. One way to address this threat is to maintain vigilance over the transfer of missile equipment, material, and related technologies usable for systems capable of delivering WMD. MTCR members voluntarily pledge to adopt the Regime's export Guidelines and to restrict the export of items contained in the Regime's Annex. The Regime's Guidelines are implemented through the national export control laws, regulations and policies of the regime members.

    Amendments to the Export Administration Regulations (EAR)

    This final rule revises the Export Administration Regulations (EAR) to reflect changes to the MTCR Annex agreed to at the October 2016 Plenary in Busan, South Korea, and changes resulting from the March 2016 Technical Experts Meeting (TEM) in Luxembourg City, Luxembourg. References are provided below for the MTCR Annex changes agreed to at the meetings that correspond to the EAR revisions described below. This rule also makes changes to the Commerce Control List (CCL) (Supplement No. 1 to Part 774 of the EAR) and to other EAR provisions in order to conform with the MTCR Annex. All of the changes in this final rule align the MT controls on the CCL and other parts of the EAR with the MTCR Annex. In the discussion below, BIS identifies the origin of each change in the regulatory text of this final rule by using one the following parenthetical phrases: (Busan 2016 Plenary), (Luxembourg 2016 TEM), or (Conforming Change to MTCR Annex).

    § 742.5 (Missile technology). In § 742.5 (Missile technology), this final rule revises the first sentence of paragraph (a)(2), which describes the definition of “missiles.” The term “missiles” is a defined term in § 772.1, but for ease of reference the first sentence of this paragraph (a)(2) restates the definition. As described in the paragraphs below, this final rule revises the definitions of “missiles” and “unmanned aerial vehicles” in § 772.1 of the EAR, so conforming changes are needed in §§ 742.5 and 744.3, as described below.

    Conforming Change to § 742.5(a)(2). This final rule makes conforming changes in paragraph (a)(2) of § 742.5, by replacing the term “ballistic missile systems” with the term “ballistic missiles” (MTCR Annex Change, Category I: Item 1.A.1., Luxembourg 2016 TEM), and by replacing the term “cruise missile systems” with the term “cruise missiles.” (MTCR Annex Change, Category I: Item 1.A.2., Luxembourg 2016 TEM). This final rule also makes a conforming change by replacing the term “unmanned air vehicles” with the term “unmanned aerial vehicles.” (Conforming Change to MTCR Annex). Substantively, there is no difference between the old and revised terms, but this final rule makes these conforming changes to ensure consistent use of the terminology throughout the EAR. These conforming changes are described in more detail in the next three paragraphs, describing the changes that this final rule makes to the EAR definitions of “missiles” and “unmanned aerial vehicles.”

    Conforming Change to § 744.3 (Restrictions on certain rocket systems (including ballistic missile systems and space launch vehicles and sounding rockets) and unmanned air vehicles (including cruise missile systems, target drones and reconnaissance drones) end-uses). This final rule makes conforming changes in § 744.3 by changing the term “ballistic missile systems” to “ballistic missiles” (MTCR Annex Change, Category I: Item 1.A.1., Luxembourg 2016 TEM), and changing the term “cruise missile systems” to “cruise missiles.” (MTCR Annex Change, Category I: Item 1.A.2., Luxembourg 2016 TEM). These conforming changes are described in more detail in the next two paragraphs describing the changes that this final rule makes to the EAR definitions of “missiles” and “unmanned aerial vehicles.” In addition, this final rule makes conforming changes in § 744.3 by replacing the term “unmanned air vehicles” with “unmanned aerial vehicles” wherever this term appears in this section. (Conforming Change to MTCR Annex). Substantively, there is no difference between the old and revised terms, but this final rule makes these conforming changes to ensure consistent use of the terminology throughout the EAR. Lastly, this final rule removes the first reference to “and” in the section heading for the parenthetical phrase providing an illustrative list of examples of rocket systems. This “and” is removed because it is not needed to convey the meaning of the list of examples of rocket systems. These conforming changes are clarifications and will not change any scope of control. These changes are not expected to have any impact on the number of license applications received by BIS.

    Changes and Conforming Amendments in § 772.1 (Definitions of Terms as Used in the Export Administration Regulations (EAR)). In § 772.1, this final rule amends the definition of the term “missiles.” (MTCR Annex Change, Category I: Item 1.A.1., Luxembourg 2016 TEM). Under the definition of “missiles,” this final rule revises the term “ballistic missile systems” by removing the word “systems” and adding an “s” to “missile.” This final rule revises the definition of “missiles” to reflect changes in the description of complete rocket systems in the MTCR Annex. The final rule revises the term “ballistic missile systems” by removing the word “systems,” thus referring only to the flight vehicle. This final rule makes this change to conform to the other items in the illustrative list of “missiles,” and to clarify that a missile is covered under these entries that use this control text, regardless of whether it is part of a larger system (e.g., a system including the flight vehicle and ground support equipment such as launch, recovery, and flight control equipment). This final rule also makes conforming changes to the same terms used in ECCNs 2B018 and 5A101, as described below. This final rule also makes a conforming change in the ECCNs for the use of the term “unmanned air vehicles,” which this final rule replaces with “unmanned aerial vehicles.” (Conforming Change to MTCR Annex). Substantively, there is no difference between the two formulations of the term, but this final rule makes these conforming changes to ensure consistent use of the terminology throughout the EAR. Lastly, this final rule removes the last sentence of the definition and adds it as a note to the definition. This clarifying change is made because the sentence is more appropriately included as a note to the definition. These changes correspond with the U.S. interpretation of the controls, and will not change any scope of control. These changes are not expected to have any impact on the number of license applications received by BIS.

    In addition, in § 772.1, this final rule amends the definition of the revised term, “unmanned aerial vehicle.” (MTCR Annex Change, Category I: Item 1.A.2., Luxembourg 2016 TEM). Under the definition of “unmanned aerial vehicle,” this final rule revises the term “cruise missile systems” by removing the word “systems” and adding an “s” to “missile.” The definition of “unmanned aerial vehicles” has been updated to reflect changes in the description of unmanned aerial vehicles in the MTCR Annex. The term “Cruise missile systems” has been changed by removing the word “systems,” thus referring only to the flight vehicle. This change both conforms to the other items in the illustrative list of unmanned aerial vehicles, and clarifies that an unmanned aerial vehicle is covered under these entries that use this control text, regardless of whether or not it is part of a larger system (e.g., a system including the flight vehicle and ground support equipment such as launch, recovery, and flight control equipment). This final rule also makes conforming changes to similar text used in ECCNs 2B018 and 5A101 described below. These changes correspond with the U.S. interpretation of the controls, and will not change any scope of control. These changes are not expected to have any impact on the number of license applications received by BIS.

    Amendments to the Commerce Control List (CCL)

    In addition, this final rule amends the CCL to reflect changes to the MTCR Annex by amending thirteen ECCNs and adding new ECCN 9B104, as follows:

    ECCN 1C107. This final rule amends ECCN 1C107 by revising the introductory text of paragraph d. and adding a paragraph d.3 in the List of Items Controlled section. This final rule also adds a Note and a Technical Note to ECCN 1C107.d.3 to clarify the scope of paragraph d.3. (MTCR Annex Change, Category II: Item 6.C.6., Busan 2016 Plenary). Specifically, in the introductory text of ECCN 1C107.d, this final rule removes the phrase “silicon carbide materials” and adds in its place the phrase “high-temperature materials.” This change is made because of the addition of certain bulk machinable ceramic composite materials that this final rule adds to ECCN 1C107 under new “items” paragraph d.3. Ultra High Temperature Ceramic Composites (UHTCC) are materials that combine Ultra High Temperature Ceramics (UHTC) with fiber reinforcement. The UHTCs can be used in environments that exhibit extremes in temperature, chemical reactivity, and erosive attack. The combination of the UHTC and fiber reinforcement can mitigate some of the traditional drawbacks associated with ceramics, including a tendency to fracture. Typical end uses for these composites are leading edges for hypersonic vehicles, nose tips for re-entry vehicles, rocket motor throat inserts, jet vanes, and control surfaces, which this final rule adds as examples in the new control text. This final rule also adds a note to 1C107.d.3 to make clear that the UHTC materials that do not have fiber reinforcement are not caught under this control. Additionally, this final rule adds a technical note to 1C107.d to provide examples of UHTCs which are included. This change is expected to result in an increase of 1-3 applications received annually by BIS. This very small increase is because this material is not widely used or exported, but specific to the end uses described in the control text.

    ECCN 1C111. This final rule amends ECCN 1C111 by revising paragraphs b.2 in the List of Items Controlled section to add a CAS (Chemical Abstract Service) Number. CAS Numbers are numerical identifiers assigned by the Chemical Abstracts Service (CAS) to every chemical substance described in open scientific literature, including organic and inorganic compounds, minerals, isotopes and alloys. The inclusion of CAS Numbers will make it easier to identify the materials controlled under this “items” paragraph of 1C111. This final rule revises paragraph b.2 to add the CAS Number (CAS 69102-90-5) after the material “Hydroxy-terminated polybutadiene (including hydroxyl-terminated polybutadiene) (HTPB).” (MTCR Annex Change, Category II: Item 4.C.5.b., Busan 2016 Plenary). This change is not expected to have any impact on the number of license applications received by BIS.

    ECCN 2B018. This final rule amends ECCN 2B018 by revising the “MT” paragraph in the table in the License Requirements section by revising the term “ballistic missile systems” to remove the term “systems” and add an “s” to the term “missile.” (MTCR Annex Change, Category I: Item 1.A.1., Luxembourg 2016 TEM). In addition, in the same “MT” paragraph, this final rule revises the term “cruise missile systems” to remove the term “systems” and add an “s” to the term “missile.” (MTCR Annex Change, Category I: Item 1.A.2., Luxembourg 2016 TEM). Lastly, this final rule makes conforming changes in the same “MT” paragraph by replacing the term “unmanned air vehicles” with “unmanned aerial vehicles” wherever this term appears in this section. (Conforming Change to MTCR Annex). Substantively, there is no difference between the old and revised terms, but this final rule makes these conforming changes to ensure consistent use of the terminology throughout the EAR. These are conforming changes for the changes described above to the definitions of “missiles” and “unmanned aerial vehicles.” This is a clarification and will not change any scope of control. This change is not expected to have any impact on the number of license applications received by BIS.

    ECCN 2B109. This final rule amends ECCN 2B109 by revising the list of examples included in the second technical note. This final rule expands the list of examples to include interstages, because interstages can also be manufactured using the flow forming machines described in ECCN 2B109. (MTCR Annex Change, Category II: Item 3.B.3., Busan 2016 Plenary). This change is not expected to have any impact on the number of license applications received by BIS, because this is only a change to the list of examples of products that can be made by this type of machine, and it does not change the scope of control.

    ECCN 5A101. This final rule amends the heading of ECCN 5A101 by revising the term “ballistic missile systems” to remove the word “systems” and add an “s” to “missile.” (MTCR Annex Change, Category I: Item 1.A.1., Luxembourg 2016 TEM). The final rule revises the heading by revising the term “cruise missile systems” to remove the word “systems” and add an “s” after “missile.” (MTCR Annex Change, Category I: Item 1.A.2., Luxembourg 2016 TEM). These are conforming changes for the changes described above to the definitions of “missiles” and “unmanned aerial vehicles.” In addition, this final rule revises the heading of ECCN 5A101 to create a separate parenthetical phrase for the illustrative list of examples that are unmanned aerial vehicles. This final rule does this by removing the examples of “cruise missiles, target drones, and reconnaissance drones” from the list of examples that followed the terms “unmanned aerial vehicle or rocket systems” in the heading and adding those examples immediately after the term unmanned aerial vehicle. This final rule retains the rest of the examples from the parenthetical that follows the term “rocket systems,” which will make it clearer that this parenthetical list is an illustrative list of “rocket systems.” (Conforming Change to MTCR Annex). These are clarifications and will not change any scope of control. These changes are not expected to have any impact on the number of license applications received by BIS.

    ECCN 7A103. This final rule amends ECCN 7A103 by adding a definition for “inertial measurement equipment and systems” for purposes of ECCN 7A103. In addition, this final rule revises “items” paragraph a and adds Note 3 in the List of Items Controlled section. (MTCR Annex Change, Category II: Item 9.A.6., Luxembourg 2016 TEM). This final rule makes these changes to remove the ambiguous term “other equipment.” Instead, the locally defined term “inertial measurement equipment or systems” that the final rule adds to ECCN 7A103, along with an illustrative list of such equipment and systems, clarifies which types of equipment containing the specified accelerometers or gyros are caught by this entry. This final rule also removes the phrase “and systems incorporating such equipment” because this phrase has been removed from the MTCR Annex. The changes this final rule makes to ECCN 7A103 to increase the clarity of the control should make the control more precise and rule out items not strictly used for navigation purposes. This change is expected to result in a decrease of 3 to 5 license applications received annually by BIS. Lastly, this final rule updates and amends ECCN 7A103 by removing Related Controls paragraph (2), which is no longer accurate after changes were made to the EAR to correspond with changes made to USML Category XII (especially for unmanned aerial vehicles (UAVs) ) that became effective December 31, 2016 (See October 12, 2016, (81 FR 70320) final rule). In addition, this paragraph (2) can be removed because the USML Order of Review and CCL Order of Review will provide sufficient guidance on where items that are subject to the ITAR are classified under the USML and where items that are subject to the EAR are classified in either the “600 series” or in other ECCNs in Category 7 of the CCL. Lastly, as a conforming change to the removal of paragraph (2), this final rule redesignates Related Controls paragraph (3) as new Related Controls paragraph (2).

    ECCNs 9A101, 9E101, and 9E102. This final rule amends ECCN 9E101 by revising the Related Controls paragraph in the List of Items Controlled section to make a conforming change for the use of the term “unmanned air vehicles,” which this final rule changes to “unmanned aerial vehicles.” In addition, this final rule amends ECCN 9E101 and 9E102 by revising the headings of these two ECCNs to make conforming changes for the use of the term “unmanned air vehicles,” which this final rule changes to “unmanned aerial vehicles.” Substantively, there is not a difference in the two formulations of the term, but for consistency with how the term is used in other parts of the EAR, this final rule makes these conforming changes. (Conforming Change to MTCR Annex). This is a clarification and will not change any scope of control. These changes are not expected to have any impact on the number of license applications received by BIS.

    New ECCN 9B104 and Related Conforming Amendments to 9D101, 9E001, and 9E002. This final rule adds new ECCN 9B104 to control certain aerothermodynamic test facilities. The facilities controlled under this new ECCN 9B104 are those that are usable for rockets, missiles, or unmanned aerial vehicles capable of achieving a “range” equal to or greater than 300 km and their subsystems, and having an electrical power supply equal to or greater than 5 MW or a gas supply total pressure equal to or greater than 3 MPa. This final rule adds this new ECCN 9B104 to complement the controls that already exist for aerodynamic test facilities in order to fully cover the types of ground test facilities necessary to reproduce the flight environments that occur during the reentry phase. Plasma arc jet and plasma wind tunnel facilities simulate the atmospheric reentry thermal effects due to high velocity around the vehicles and are key to the qualification of vehicle thermal protection subsystems. This final rule includes values for electrical power supply and gas supply total pressure in new ECCN 9B104 to exclude commercial systems of a similar nature from this new ECCN.

    In addition, this final rule adds a Related Definition as part of new ECCN 9B104 to define the term “aerothermodynamic test facilities”. This definition specifies that these facilities include plasma arc jet facilities and plasma wind tunnels for the study of thermal and mechanical effects of airflow on objects. (MTCR Annex Change, Category II: Item 15.B.6., Luxembourg 2016 TEM). As a conforming change to the addition of ECCN 9B104, this final rule adds 9B104 to the heading of ECCN 9D101 and revises the “MT” paragraph in the table in the License Requirements section of ECCNs 9E001 and 9E002 to add 9B104. The headings of ECCNs 9E001 and 9E002 do not need to be revised to add technology for 9B104, because those two technology ECCNs apply to 9B ECCNs, except for those specifically excluded in the ECCN headings. These changes are expected to result in an increase of no more than 1 application received annually by BIS, because such systems and their software and technology are exported infrequently.

    ECCN 9D104. This final rule amends ECCN 9D104 by adding a note to the List of Items Controlled section. This note clarifies that ECCN 9D104 also includes specific software for the conversion of manned aircraft to an unmanned aerial vehicle. (MTCR Annex Change, Category II: Item 1.D.2., Luxembourg 2016 TEM). This change is expected to result in an increase of 1 to 2 applications received annually by BIS, because, although this software was already controlled here, the note will clarify the scope of ECCN 9D104.

    Savings Clause

    Shipments of items removed from eligibility for a License Exception or export or reexport without a license (NLR) as a result of this regulatory action that were on dock for loading, on lighter, laden aboard an exporting or reexporting carrier, or enroute aboard a carrier to a port of export or reexport, on July 7, 2017, pursuant to actual orders for export or reexport to a foreign destination, may proceed to that destination under the previous eligibility for a License Exception or export or reexport without a license (NLR) so long as they are exported or reexported before August 7, 2017. Any such items not actually exported or reexported before midnight, on August 7, 2017, require a license in accordance with this rule.

    Export Administration Act of 1979

    Although the Export Administration Act of 1979 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 by the Notice of August 4, 2016, 81 FR 52587 (August 8, 2016), has continued the Export Administration Regulations in effect under the International Emergency Economic Powers Act. BIS continues to carry out the provisions of the Export Administration Act of 1979, as appropriate and to the extent permitted by law, pursuant to Executive Order 13222, as amended by Executive Order 13637.

    Executive Order Requirements

    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 final rule has been designated a “significant regulatory action,” although not economically significant, under section 3(f) of Executive Order 12866. The MTCR was formed in 1987 by the U.S. and G-7 countries (Canada, France, Germany, Italy, Japan, and the UK) to address the increasing proliferation of nuclear weapons by addressing the most destabilizing delivery system for such weapons. The MTCR seeks to limit the risk of proliferation of weapons of mass destruction by controlling exports of goods and technologies that could make a contribution to delivery systems (other than manned aircraft) for such weapons. The proliferation of such weapons has been identified as a threat to domestic and international peace and security. Commerce estimates this rule will increase the number of license requests by fewer than four annually.

    This rule does not contain policies with Federalism implications as that term is defined under E.O. 13132.

    For the purposes of E.O. 13771, this rule is issued with respect to a national security function of the United States. The cost-benefit analysis indicates the rule is intended to improve national security as its primary direct benefit, and the regulation qualifies for a good cause exception under 5 U.S.C. 553(b)(B). Accordingly, this rule meets the requirements set forth in the April 5, 2017, OMB guidance implementing E.O 13771, and is, therefore, exempt from the requirements of E.O. 13771.

    Paperwork Reduction Act Requirements

    Notwithstanding any other provision of law, no person may be required to respond to or be subject to a penalty for failure to comply with a collection of information, subject to the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) (PRA), unless that collection of information displays a currently valid Office of Management and Budget (OMB) Control Number.

    This regulation involves a collection currently approved by OMB under control number 0694-0088, Simplified Network Application Processing System. This collection includes, among other things, license applications, and carries a burden estimate of 43.8 minutes for a manual or electronic submission for a total burden estimate of 31,833 hours. BIS expects the burden hours associated with this collection to increase slightly by 2 hours and 19 minutes for an estimated cost increase of $85. This increase is not expected to exceed the existing estimates currently associated with OMB control number 0694-0088. Although this final rule makes important changes to the EAR for items controlled for missile technology reasons, Commerce believes the overall increase in costs and burdens due to this rule will be minimal.

    Any comments regarding the collection of information associated with this rule, including suggestions for reducing the burden, may be sent to Jasmeet K. Seehra, Office of Management and Budget (OMB), by email to [email protected], or by fax to (202) 395-7285.

    Administrative Procedure Act and Regulatory Flexibility Act Requirements

    The provisions of the Administrative Procedure Act (APA) (5 U.S.C. 553) requiring notice of proposed rulemaking, the opportunity for public participation, and a delay in effective date, are inapplicable because this action involves a military and foreign affairs function of the United States (5 U.S.C. 553(a)(1)). Immediate implementation of these amendments fulfills the United States' international commitments to the MTCR. The MTCR contributes to international peace and security by promoting greater responsibility in transfers of missile technology items that could make a contribution to delivery systems (other than manned aircraft) for weapons of mass destruction. The MTCR consists of 35 member countries acting on a consensus basis. The changes discussed in this rule implement agreements reached at the October 2016 Plenary in Busan, South Korea, and the March 2016 Technical Experts Meeting in Luxembourg City, Luxembourg. Since the United States is a significant exporter of the items discussed in this rule, implementation of this provision is necessary for the MTCR to achieve its purpose.

    Although the APA requirements in section 553 are not applicable to this action under the provisions of paragraph (a)(1), this action also falls within two other exceptions in the section. The subsection (b) requirement that agencies publish a notice of proposed rulemaking that includes information on the public proceedings does not apply when an agency for good cause finds that the notice and public procedures are impracticable, unnecessary, or contrary to the public interest, and the agency incorporates the finding (and reasons therefor) in the rule that is issued (5 U.S.C. 553(b)(B)). In addition, the section 553(d) requirement that publication of a rule shall be made not less than 30 days before its effective date can be waived if an agency finds there is good cause to do so.

    The section 553 requirements for notice and public procedures and for a delay in the date of effectiveness do not apply to this rule, as there is good cause to waive such practices. Delay in implementation would disrupt the movement of these potentially national- and international-security-threatening items globally, creating disharmony between export control measures implemented by MTCR members. Export controls work best when all countries implement the same export controls in a timely manner. Delaying this rulemaking would prevent the United States from fulfilling its commitment to the MTCR in a timely manner, would injure the credibility of the United States in this and other multilateral regimes, and may impair the international communities' ability to effectively control the export of certain potentially national- and international-security-threatening materials. Therefore, this regulation is issued in final form, and is effective July 7, 2017.

    Further, no other law requires that a notice of proposed rulemaking and an opportunity for public comment be given for this final rule. Because a notice of proposed rulemaking and an opportunity for public comment are not required to be given for this rule under the Administrative Procedure Act or by any other law, the analytical requirements of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) are not applicable. Accordingly, no regulatory flexibility analysis is required and none has been prepared.

    List of Subjects 15 CFR Part 742

    Exports, Terrorism.

    15 CFR Part 744

    Exports, Reporting and recordkeeping requirements, Terrorism.

    15 CFR Part 772

    Exports.

    15 CFR Part 774

    Exports, Reporting and recordkeeping requirements.

    Accordingly, parts 742, 744, 772 and 774 of the Export Administration Regulations (15 CFR parts 730-774) are amended as follows:

    PART 742—[AMENDED] 1. The authority citation for 15 CFR part 742 continues to read as follows: Authority:

    50 U.S.C. 4601 et seq.; 50 U.S.C. 1701 et seq.; 22 U.S.C. 3201 et seq.; 42 U.S.C. 2139a; 22 U.S.C. 7201 et seq.; 22 U.S.C. 7210; Sec. 1503, Pub. L. 108-11, 117 Stat. 559; E.O. 12058, 43 FR 20947, 3 CFR, 1978 Comp., p. 179; E.O. 12851, 58 FR 33181, 3 CFR, 1993 Comp., p. 608; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; Presidential Determination 2003-23, 68 FR 26459, 3 CFR, 2004 Comp., p. 320; Notice of August 4, 2016, 81 FR 52587 (August 8, 2016); Notice of November 8, 2016, 81 FR 79379 (November 10, 2016).

    2. Section 742.5 is amended by revising the first sentence of paragraph (a)(2) to read as follows:
    § 742.5 Missile technology.

    (a) * * *

    (2) The term “missiles” is defined as rocket systems (including ballistic missiles, space launch vehicles, and sounding rockets) and unmanned aerial vehicle systems (including cruise missiles, target drones, and reconnaissance drones) capable of delivering at least 500 kilograms (kg) payload to a range of at least 300 kilometers (km). * * *

    PART 744—[AMENDED] 3. The authority citation for 15 CFR part 744 continues to read as follows: Authority:

    50 U.S.C. 4601 et seq.; 50 U.S.C. 1701 et seq.; 22 U.S.C. 3201 et seq.; 42 U.S.C. 2139a; 22 U.S.C. 7201 et seq.; 22 U.S.C. 7210; E.O. 12058, 43 FR 20947, 3 CFR, 1978 Comp., p. 179; E.O. 12851, 58 FR 33181, 3 CFR, 1993 Comp., p. 608; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 12947, 60 FR 5079, 3 CFR, 1995 Comp., p. 356; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13099, 63 FR 45167, 3 CFR, 1998 Comp., p. 208; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; E.O. 13224, 66 FR 49079, 3 CFR, 2001 Comp., p. 786; Notice of January 20, 2016, 81 FR 3937 (January 22, 2016); Notice of August 4, 2016, 81 FR 52587 (August 8, 2016); Notice of September 15, 2016, 81 FR 64343 (September 19, 2016); Notice of November 8, 2016, 81 FR 79379 (November 10, 2016); Notice of January 13, 2017, 82 FR 6165 (January 18, 2017).

    4. Section 744.3 is amended: a. By revising the section heading; b. By revising paragraphs (a)(1), (2), (3), and the Note to paragraph (a) of this section; c. By revising paragraph (d)(1); and d. By revising paragraph (d)(2)(ii), (iii), and (v) to read as follows:
    § 744.3 Restrictions on certain rocket systems (including ballistic missiles, space launch vehicles and sounding rockets) and unmanned aerial vehicles (including cruise missiles, target drones and reconnaissance drones) end-uses.

    (a) * * *

    (1) Will be used in the design, development, production or use of rocket systems or unmanned aerial vehicles capable of a range of at least 300 kilometers in or by a country listed in Country Group D:4 of Supplement No. 1 to part 740 of the EAR.

    (2) Will be used, anywhere in the world except by governmental programs for nuclear weapons delivery of NPT Nuclear Weapons States that are also members of NATO, in the design, development, production or use of rocket systems or unmanned aerial vehicles, regardless of range capabilities, for the delivery of chemical, biological, or nuclear weapons; or

    (3) Will be used in the design, development, production or use of any rocket systems or unmanned aerial vehicles in or by a country listed in Country Group D:4, but you are unable to determine:

    (i) The characteristics (i.e., range capabilities) of the rocket systems or unmanned aerial vehicles, or

    (ii) Whether the rocket systems or unmanned aerial vehicles, regardless of range capabilities, will be used in a manner prohibited under paragraph (a)(2) of this section.

    Note to paragraph (a) of this section:

    For the purposes of this section, “Rocket Systems” include, but are not limited to, ballistic missiles, space launch vehicles, and sounding rockets. Also, for the purposes of this section, “unmanned aerial vehicles” include, but are not limited to, cruise missiles, target drones and reconnaissance drones.

    (d) * * *

    (1) Applications to export, reexport or transfer (in-country) the items subject to this section will be considered on a case-by-case basis to determine whether the export, reexport or transfer (in-country) would make a material contribution to the proliferation of certain rocket systems, or unmanned aerial vehicles. When an export, reexport or transfer (in-country) is deemed to make a material contribution, the license will be denied.

    (2) * * *

    (ii) The significance of the export, reexport or transfer in terms of its contribution to the design, development, production or use of certain rocket systems or unmanned aerial vehicles;

    (iii) The capabilities and objectives of the rocket systems or unmanned aerial vehicles of the recipient country;

    (v) The types of assurances or guarantees against design, development, production, or use for certain rocket system or unmanned aerial vehicle delivery purposes that are given in a particular case; and

    PART 772—[AMENDED] 5. The authority citation for 15 CFR part 772 continues to read as follows: Authority:

    50 U.S.C. 4601 et seq.; 50 U.S.C. 1701 et seq.; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783 Notice of August 8, 2016, 81 FR 52587 (August 8, 2016).

    6. Section 772.1 is amended by revising the definitions of “missiles” and “unmanned aerial vehicle (“UAV”)” to read as follows:
    § 772.1 Definitions of terms as used in the Export Administration Regulations (EAR).

    Missiles”. (All) Rocket systems (including ballistic missiles, space launch vehicles, and sounding rockets) and unmanned aerial vehicle systems (including cruise missiles, target drones, and reconnaissance drones) “capable of” delivering at least 500 kilograms payload to a range of at least 300 kilometers. See § 746.3 for definition of a “ballistic missile” to be exported or reexported to Iraq or transferred within Iraq.

    Unmanned aerial vehicle” (“UAV”). (Cat 9) Any “aircraft” capable of initiating flight and sustaining controlled flight and navigation without any human presence on board.

    Note to definition of “Unmanned aerial vehicle” (“UAV”):

    For the purposes of § 744.3 of the EAR, unmanned air vehicles, which are the same as “unmanned aerial vehicles,” include, but are not limited to, cruise missiles, target drones and reconnaissance drones.

    PART 774—[AMENDED] 7. The authority citation for 15 CFR part 774 continues to read as follows: Authority:

    50 U.S.C. 4601 et seq.; 50 U.S.C. 1701 et seq.; 10 U.S.C. 7420; 10 U.S.C. 7430(e); 22 U.S.C. 287c, 22 U.S.C. 3201 et seq.; 22 U.S.C. 6004; 42 U.S.C. 2139a; 15 U.S.C. 1824a; 50 U.S.C. 4305; 22 U.S.C. 7201 et seq.; 22 U.S.C. 7210; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; Notice of August 4, 2016, 81 FR 52587 (August 8, 2016).

    8. In Supplement No. 1 to part 774 (the Commerce Control List), Category 1—Special Materials and Related Equipment, Chemicals, “Microorganisms” and “Toxins,” Export Control Classification Number (ECCN) 1C107 is amended: a. By revising the introductory text of “items” paragraph d. in the List of Items Controlled section; and b. By adding paragraph d.3., including a Note and a Technical Note to 1C107.d.3., to read as follows: Supplement No. 1 to Part 774—The Commerce Control List 1C107 Graphite and ceramic materials, other than those controlled by 1C007, which can be machined to any of the following products as follows (see List of Items Controlled). List of Items Controlled Items:

    d. High-temperature ceramic materials, useable in rockets, missiles, and unmanned aerial vehicles capable of achieving a “range” equal to or greater than 300 km, as follows:

    d.3. Bulk machinable ceramic composite materials consisting of an `Ultra High Temperature Ceramic (UHTC)' matrix with a melting point equal to or greater than 3000 °C and reinforced with fibers or filaments, usable for missile components (such as nose tips, re-entry vehicles, leading edges, jet vanes, control surfaces, or rocket motor throat inserts).

    Note:

    ECCN 1C107.d.3. does not control `Ultra High Temperature Ceramic (UHTC)' materials in non-composite form.

    Technical Note:

    `Ultra High Temperature Ceramics (UHTC)' includes: Titanium diboride (TiB2), zirconium diboride (ZrB2), niobium diboride (NbB2), hafnium diboride (HfB2), tantalum diboride (TaB2), titanium carbide (TiC), zirconium carbide (ZrC), niobium carbide (NbC), hafnium carbide (HfC), tantalum carbide (TaC).

    9. In Supplement No. 1 to part 774 (the Commerce Control List), Category 1—Special Materials and Related Equipment, Chemicals, “Microorganisms” and “Toxins,” Export Control Classification Number (ECCN) 1C111 is amended by revising “items” paragraph b.2. in the List of Items Controlled section to read as follows: 1C111 Propellants and constituent chemicals for propellants, other than those specified in 1C011, as follows (see List of Items Controlled). List of Items Controlled Items:

    b. * * *

    b.2. Hydroxy-terminated polybutadiene (including hydroxyl-terminated polybutadiene) (HTPB) (CAS 69102-90-5), except for hydroxyl-terminated polybutadiene as specified in USML Category V (see 22 CFR 121.1) (also see Related Controls Note #1 for this ECCN);

    10. In Supplement No. 1 to part 774 (the Commerce Control List), Category 2—Materials Processing, Export Control Classification Number (ECCN) 2B018 is amended by revising the “MT” paragraph in the table in the License Requirements section to read as follows: 2B018 Equipment on the Wassenaar Arrangement Munitions List. License Requirements Reason for Control: * * * Control(s) Country chart
  • (See Supp. No. 1 to
  • part 738)
  • *    *    *    *    * MT applies to specialized machinery, equipment, and gear for producing rocket systems (including ballistic missiles, space launch vehicles, and sounding rockets) and unmanned aerial vehicle systems (including cruise missiles, target drones, and reconnaissance drones) usable in systems that are controlled for MT reasons including their propulsion systems and components, and pyrolytic deposition and densification equipment MT Column 1 *    *    *    *    *
    11. In Supplement No. 1 to part 774 (the Commerce Control List), Category 2—Materials Processing, Export Control Classification Number (ECCN) 2B109 is amended by revising Technical Note paragraph 2. at the end of the “items” paragraph in the List of Items Controlled section to read as follows: 2B109 Flow-forming machines, other than those controlled by 2B009, and “specially designed” “parts” and “components” therefor. List of Items Controlled Items: Technical Notes:

    2. 2B109 does not control machines that are not usable in the “production” of propulsion “parts,” “components” and equipment (e.g., motor cases and interstages) for “missiles.”

    12. In Supplement No. 1 to part 774 (the Commerce Control List), Category 5—Telecommunications and “Information Security,” Part 1—Telecommunications, Export Control Classification Number (ECCN) 5A101 is amended: a. By revising the heading, and b. By revising the Note at the end of the “items” paragraph to read as follows: 5A101 Telemetering and telecontrol equipment, including ground equipment, designed or modified for unmanned aerial vehicle (including cruise missiles, target drones, and reconnaissance drones) or rocket systems (including ballistic missiles, space launch vehicles, and sounding rockets) capable of a maximum “range” equal to or greater than 300 km. List of Items Controlled Items: Note:

    ECCN 5A101 does not include items not designed or modified for unmanned aerial vehicles (including cruise missiles, target drones, and reconnaissance drones) or rocket systems (including ballistic missiles, space launch vehicles and sounding rockets) capable of a maximum “range” equal to or greater than 300km (e.g., telemetry circuit cards limited by design to reception only and designed for use in personal computers).

    13. In Supplement No. 1 to part 774 (the Commerce Control List), Category 7—Navigation and Avionics, Export Control Classification Number (ECCN) 7A103 is amended: a. By removing the Related Controls paragraph (2) and redesignating Related Controls paragraph (3) as Related Controls paragraph (2) in the List of Items Controlled section; b. By revising the Related Definitions paragraph in the List of Items Controlled section; c. By revising the introductory text of “items” paragraph a. in the List of Items Controlled section; and d. By adding a Note 3 to “items” paragraph a. in the List of Items Controlled section to read as follows: 7A103 Instrumentation, navigation equipment and systems, other than those controlled by 7A003, and “specially designed” “parts” and “components” therefor, as follows (see List of Items Controlled). List of Items Controlled

    Related Definitions: `Inertial measurement equipment or systems' specified in 7A103.a. incorporate accelerometers or gyros to measure changes in velocity and orientation in order to determine or maintain heading or position without requiring an external reference once aligned.

    Items:

    a. `Inertial measurement equipment or systems' using accelerometers or gyros controlled by 7A001, 7A002, 7A101 or 7A102, and “specially designed” “parts” and “components” therefor;

    Note 3:

    7A103.a. includes Attitude and Heading Reference Systems (AHRSs), gyrocompasses, Inertial Measurement Units (IMUs), Inertial Navigations Systems (INSs), Inertial Reference Systems (IRSs), and Inertial Reference Units (IRUs).

    14. In Supplement No. 1 to part 774 (the Commerce Control List), Category 9—Aerospace and Propulsion, Export Control Classification Number (ECCN) 9A101 is amended by revising the Related Controls paragraph in the List of Items Controlled section to read as follows: 9A101 Turbojet and turbofan engines, other than those controlled by 9A001, as follows (see List of Items Controlled). List of Items Controlled Related Controls: 9A101.b controls only engines for non-military unmanned aerial vehicles [UAVs] or remotely piloted vehicles [RPVs], and does not control other engines designed or modified for use in “missiles”, which are “subject to the ITAR” (see 22 CFR parts 120 through 130). 15. In Supplement No. 1 to part 774 (the Commerce Control List), Category 9—Aerospace and Propulsion, add, between entries for Export Control Classification Numbers (ECCNs) 9B010 and 9B105, ECCN 9B104 to read as follows: 9B104 `Aerothermodynamic test facilities', usable for rockets, missiles, or unmanned aerial vehicles capable of achieving a “range” equal to or greater than 300 km and their subsystems, and having an electrical power supply equal to or greater than 5 MW or a gas supply total pressure equal to or greater than 3 MPa. License Requirements Reasons for Control: MT, AT Control(s) Country Chart
  • (See Supp. No. 1 to
  • part 738)
  • MT applies to entire entry MT Column 1 AT applies to entire entry AT Column 1
    List Based License Exceptions (See Part 740 for a description of all license exceptions) LVS: N/A GBS: N/A CIV: N/A List of Items Controlled Related Controls: See ECCNs 9D101, 9E001 and 9E002. Related Definitions: `Aerothermodynamic test facilities' include plasma arc jet facilities and plasma wind tunnels for the study of thermal and mechanical effects of airflow on objects. Items:

    The list of items controlled is contained in the ECCN heading.

    16. In Supplement No. 1 to part 774 (the Commerce Control List), Category 9—Aerospace and Propulsion, Export Control Classification Number (ECCN) 9D101 is amended by revising the heading to read as follows: 9D101 “Software” “specially designed” or modified for the “use” of commodities controlled by 9B104, 9B105, 9B106, 9B116, or 9B117. 17. In Supplement No. 1 to part 774 (the Commerce Control List), Category 9—Aerospace and Propulsion, Export Control Classification Number (ECCN) 9D104 is amended by adding a Note to the “items” paragraph in the List of Items Controlled section to read as follows: 9D104  “Software” specially designed or modified for the “use” of equipment controlled by ECCN 9A001, 9A012 (for MT controlled items only), 9A101 (except for items in 9A101.b that are “subject to the ITAR,” see 22 CFR part 121), or 9A106.d. List of Items Controlled Items: Note:

    For a manned aircraft converted to operate as an unmanned aerial vehicle specified in 9A012 and controlled for MT reasons, 9D104 includes “software”, as follows:

    a. “Software” “specially designed” or modified to integrate the conversion equipment with the aircraft system functions;

    b. “Software” “specially designed” or modified to operate the aircraft as an unmanned aerial vehicle.

    18. In Supplement No. 1 to part 774 (the Commerce Control List), Category 9—Aerospace and Propulsion, Export Control Classification Number (ECCN) 9E001 is amended by revising the “MT” paragraph in the table in the License Requirements section to read as follows: 9E001 “Technology” according to the General Technology Note for the “development” of equipment or “software”, controlled by 9A001.b, 9A004, 9A012, 9B (except for ECCNs 9B604, 9B610, 9B619, 9B990 and 9B991), or ECCN 9D001 to 9D004, 9D101, or 9D104. License Requirements Reason for Control: * * * Control(s) Country chart
  • (See Supp. No. 1 to
  • part 738)
  • *    *    *    *    * MT applies to “technology” for items controlled by 9A012, 9B001, 9B002, 9B003, 9B004, 9B005, 9B007, 9B104, 9B105, 9B106, 9B115, 9B116, 9B117, 9D001, 9D002, 9D003, or 9D004 for MT reasons MT Column 1 *    *    *    *    *
    19. In Supplement No. 1 to part 774 (the Commerce Control List), Category 9—Aerospace and Propulsion, Export Control Classification Number (ECCN) 9E002 is amended by revising the “MT” paragraph in the table in the License Requirements section to read as follows: 9E002 “Technology” according to the General Technology Note for the “production” of “equipment” controlled by ECCN 9A001.b, 9A004 or 9B (except for ECCNs 9B117, 9B604, 9B610, 9B619, 9B990, and 9B991). License Requirements Reason for Control: * * * Control(s) Country chart
  • (See Supp. No. 1 to part 738)
  • *    *    *    *    * MT applies to “technology” for equipment controlled by 9B001, 9B002, 9B003, 9B004, 9B005, 9B007, 9B104, 9B105, 9B106, 9B115 or 9B116 for MT reasons MT Column 1 *    *    *    *    *
    20. In Supplement No. 1 to part 774 (the Commerce Control List), Category 9—Aerospace and Propulsion, Export Control Classification Number (ECCN) 9E101 is amended by revising the heading to read as follows: 9E101 “Technology” according to the General Technology Note for the “development” or “production” of commodities or “software” controlled by ECCN 9A012 (applies only to “production” “technology” for MT-controlled items in 9A012), 9A101 (except for items in 9A101.b that are “subject to the ITAR,” see 22 CFR part 121), 9A106.d or .e, 9A110 (for items that are “specially designed” for non-military unmanned aerial vehicles controlled by 9A012), 9C110, 9D101, or 9D104. 21. In Supplement No. 1 to part 774 (the Commerce Control List), Category 9—Aerospace and Propulsion, Export Control Classification Number (ECCN) 9E102 is amended by revising the heading to read as follows: 9E102 “Technology” according to the General Technology Note for the “use” of commodities or “software” controlled by ECCN 9A004 (except for items in 9A004 that are “subject to the ITAR,” see 22 CFR part 121), 9A012, 9A101 (except for items in 9A101.b that are “subject to the ITAR,” see 22 CFR part 121), 9A106.d or .e, 9A110 (for items that are “specially designed” for non-military unmanned aerial vehicles controlled by 9A012), 9B105, 9B106, 9B115, 9B116, 9D101, or 9D104. Dated: July 3, 2017. Matthew S. Borman, Deputy Assistant Secretary for Export Administration.
    [FR Doc. 2017-14312 Filed 7-6-17; 8:45 am] BILLING CODE 3510-33-P
    DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 100 [Docket No. USCG-2017-0492] RIN 1625-AA08 [Regattas and Marine Parades; Great Lakes Annual Marine Events AGENCY:

    Coast Guard, DHS.

    ACTION:

    Notice of enforcement of regulation.

    SUMMARY:

    The Coast Guard will enforce various special local regulations for annual regattas and marine parades in the Captain of the Port Detroit zone. Enforcement of these regulations is necessary and intended to ensure safety of life on the navigable waters immediately prior to, during, and after these regattas or marine parades. During the aforementioned period, the Coast Guard will enforce restrictions upon, and control movement of, vessels in a specified area immediately prior to, during, and after regattas or marine parades.

    DATES:

    The regulations in 33 CFR 100.914, 100.915, 100.919, 100.927, 100.928 will be enforced without actual notice at specified dates and times from July 7, 2017 until September 23, 2017. For the purposes of enforcement, actual notice will be used from June 23, 2017, until July 7, 2017.

    FOR FURTHER INFORMATION CONTACT:

    If you have questions on this document, call or email Tracy Girard, Prevention Department, telephone (313) 568-9564, email [email protected]

    SUPPLEMENTARY INFORMATION:

    The Coast Guard will enforce the following special local regulations listed in 33 CFR part 100, Safety of Life on Navigable Waters, on the following dates and times:

    (1) § 100.919 International Bay City Grand Prix (formerly Bay City River Roar), Bay City, MI. This special local regulation will be enforced from 10 a.m. to 7 p.m. each day from June 23 through June 25, 2017.

    (2) § 100.914 Trenton Rotary Roar on the River, Trenton, MI. This special local regulation will be enforced from 8 a.m. to 8 p.m. each day from July 14 through July 16, 2017.

    (3) § 100.915 St. Clair River Classic Offshore Race, St. Clair, MI. This special local regulation will be enforced from 10 a.m. to 7 p.m. each day from July 24 through July 30, 2017.

    (4) § 100.928 Frogtown Race Regatta, Toledo, OH. This special local regulation will be enforced from 5 a.m. to 7 p.m. on September 23, 2017.

    (5) § 100.927 Partnership in Education, Dragon Boat Festival, Toledo, OH. This special local regulation will be enforced from 6 a.m. to 6 p.m. on July 22, 2017.

    Special Local Regulations

    In accordance with § 100.901, entry into, transiting, or anchoring within these regulated areas is prohibited unless authorized by the Coast Guard patrol commander (PATCOM). The PATCOM may restrict vessel operation within the regulated area to vessels having particular operating characteristics.

    Vessels permitted to enter this regulated area must operate at a no-wake speed and in a manner that will not endanger race participants or any other craft.

    The PATCOM may direct the anchoring, mooring, or movement of any vessel within this regulated area. A succession of sharp, short signals by whistle or horn from vessels patrolling the area under the direction of the PATCOM shall serve as a signal to stop. Vessels so signaled shall stop and shall comply with the orders of the PATCOM. Failure to do so may result in expulsion from the area, a Notice of Violation for failure to comply, or both.

    If it is deemed necessary for the protection of life and property, the PATCOM may terminate the marine event or the operation of any vessel within the regulated area.

    In accordance with the general regulations in § 100.35 of this part, the Coast Guard will patrol the regatta area under the direction of a designated Coast Guard Patrol Commander (PATCOM). The PATCOM may be contacted on Channel 16 (156.8 MHz) by the call sign “Coast Guard Patrol Commander.”

    Under the provisions of 33 CFR 100.928, vessels transiting within the regulated area shall travel at a no-wake speed and remain vigilant for event participants and safety craft. Additionally, vessels shall yield right-of-way for event participants and event safety craft and shall follow directions given by the Coast Guard's on-scene representative or by event representatives during the event.

    The “on-scene representative” of the Captain of the Port Detroit is any Coast Guard commissioned, warrant, or petty officer who has been designated by the Captain of the Port Detroit to act on his behalf. The on-scene representative of the Captain of the Port Detroit will be aboard either a Coast Guard or Coast Guard Auxiliary vessel. The Captain of the Port Detroit or his designated on scene representative may be contacted via VHF Channel 16.

    The rules in this section shall not apply to vessels participating in the event or to government vessels patrolling the regulated area in the performance of their assigned duties.

    This document is issued under authority of 33 CFR 100.35 and 5 U.S.C. 552(a). If the Captain of the Port determines that any of these special local regulations need not be enforced for the full duration stated in this document, he may suspend such enforcement and notify the public of the suspension via a Broadcast Notice to Mariners.

    Dated: June 29, 2017. J.W. Novak, Captain, U.S. Coast Guard, Captain of the Port Detroit.
    [FR Doc. 2017-14269 Filed 7-6-17; 8:45 am] BILLING CODE 9110-04-P
    DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [Docket Number USCG-2017-0195] RIN 1625-AA00 Safety Zone; Lake Michigan, Whiting, Indiana AGENCY:

    Coast Guard, DHS.

    ACTION:

    Temporary final rule.

    SUMMARY:

    The Coast Guard is establishing a temporary safety zone on Lake Michigan, near Whiting, Indiana. This action is necessary and intended to ensure safety of life on the navigable waters of the United States immediately prior to, during, and after a high speed competition involving personal water craft. Entry of vessels or persons into this zone is prohibited unless specifically authorized by the Captain of the Port Lake Michigan.

    DATES:

    This rule is effective from 7 a.m. on August 12, 2017 to 5 p.m. on August 13, 2017.

    ADDRESSES:

    To view documents mentioned in this preamble as being available in the docket, go to http://www.regulations.gov, type USCG-2017-0195 in the “SEARCH” box and click “SEARCH.” Click on Open Docket Folder on the line associated with this rule.

    FOR FURTHER INFORMATION CONTACT:

    If you have questions about this rule, call or email LT John Ramos, Marine Safety Unit Chicago, U.S. Coast Guard; telephone (630) 986-2156, email [email protected]

    SUPPLEMENTARY INFORMATION:

    I. Table of Abbreviations CFR Code of Federal Regulations DHS Department of Homeland Security FR Federal Register NPRM Notice of proposed rulemaking § Section U.S.C. United States Code II. Background Information and Regulatory History

    The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are impracticable, unnecessary, or contrary to public interest. Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because doing so would be impracticable and contrary to the public interest. The Coast Guard did not receive the final details for this event until there was insufficient time remaining before the event to publish a NPRM. Delaying the effective date of this rule to wait for a comment period to run would be impracticable and contrary to the public interest because it would inhibit the Coast Guard's ability to protect the public and vessels from the hazards associated with the high speed competition involving personal water craft on August 12, 2017, and August 13, 2017.

    III. Legal Authority and Need for Rule

    The legal basis for the rule is the Coast Guard's authority to establish safety zones: 33 U.S.C. 1231; 33 CFR 1.05-1, 160.5; Department of Homeland Security Delegation No. 0170.1.

    On August 12, 2017, and August 13, 2017, a high speed competition involving personal watercraft will take place on Lake Michigan near Whiting, Indiana. The Captain of the Port Lake Michigan has determined that this competition will pose a significant risk to public safety and property. Such hazards include collisions among participants or spectator vessels. This rule is needed to protect personnel and vessels in the navigable waters within the safety zone while the competition is taking place.

    IV. Discussion of the Rule

    With the aforementioned hazards in mind, the Captain of the Port Lake Michigan has determined that this temporary safety zone is necessary to ensure the safety of the public during the high speed competition involving personal watercraft on Lake Michigan. This safety zone will be enforced from 7 a.m. to 5 p.m. on August 12, 2017 and from 7 a.m. to 5 p.m. on August 13, 2017. This zone will encompass all waters of Lake Michigan near Whiting, Indiana bounded by a line drawn from the shoreline at 41°41.235′ N, 087°29.779′ W., then northeast to 41°41.494′ N., 087°29.559′ W., then south to 41°40.891′ N., 087°28.486′ W., then southwest to the shoreline at 41°40.725′ N., 087°28.633′ W., then along the shoreline back to the point of origin at 41°41.235′ N., 087°29.779′ W. (NAD 83).

    Entry into, transiting, or anchoring within the safety zone is prohibited unless authorized by the Captain of the Port Lake Michigan, or a designated on-scene representative. The Captain of the Port or a designated on-scene representative may be contacted via VHF Channel 16.

    V. Regulatory Analyses

    We developed this rule after considering numerous statutes and Executive orders related to rulemaking. Below we summarize our analyses based on a number of these statutes and Executive orders, and we discuss First Amendment rights of protestors.

    A. Regulatory Planning and Review

    Executive orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. Executive order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rule has not been designated a “significant regulatory action,” under Executive order 12866. Accordingly, it has not been reviewed by the Office of Management and Budget.

    We conclude that this rule is not a significant regulatory action because we anticipate that it will have minimal impact on the economy, will not interfere with other agencies, will not adversely alter the budget of any grant or loan recipients, and will not raise any novel legal or policy issues. The safety zone created by this rule will be relatively small and enforced only on August 12, 2017 from 7 a.m. to 5 p.m., and August 13, 2017, from 7 a.m. to 5 p.m. Under certain conditions, moreover, vessels may still transit through the safety zone when permitted by the Captain of the Port.

    B. Impact on Small Entities

    The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.

    Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered the impact of this temporary rule on small entities. This rule will affect the following entities, some of which might be small entities: The owners or operators of vessels intending to transit on a portion of the Lake Michigan near Whiting, Indiana on August 12, 2017 from 7 a.m. to 5 p.m., and August 13, 2017 from 7 a.m. to 5 p.m.

    This safety zone will not have a significant economic impact on a substantial number of small entities for the reasons cited in the Regulatory Planning and Review section. Additionally, before the enforcement of the zone, we will issue local Broadcast Notice to Mariners and Local Notice to Mariners so vessel owners and operators can plan accordingly.

    Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section.

    Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.

    C. Collection of Information

    This rule will not call for a new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

    D. Federalism and Indian Tribal Governments

    A rule has implications for federalism under Executive order 13132, Federalism, if it has a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this rule under that Order and have determined that it is consistent with the fundamental federalism principles and preemption requirements described in Executive order 13132.

    Also, this rule does not have tribal implications under Executive order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. If you believe this rule has implications for federalism or Indian tribes, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section above.

    E. Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Though this rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

    F. Environment

    We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves the establishment of a safety zone for a high speed competition involving personal watercraft on Lake Michigan near Whiting, Indiana. It is categorically excluded from further review under paragraph 34(g) of Figure 2-1 of the Commandant Instruction. A Record of Environmental Consideration (REC) supporting this determination is available in the docket where indicated in the ADDRESSES section of this preamble. We seek any comments or information that may lead to the discovery of a significant environmental impact from this rule.

    G. Protest Activities

    The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to contact the person listed in the FOR FURTHER INFORMATION CONTACT section to coordinate protest activities so that your message can be received without jeopardizing the safety or security of people, places or vessels.

    List of Subjects in 33 CFR Part 165

    Harbors, Marine safety, Navigation (water), Reporting and record keeping requirements, Security measures, Waterways.

    For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:

    PART 165—REGULATED NAVIGATION AREAS AND LIMITED ACCESS AREAS 1. The authority citation for part 165 continues to read as follows: Authority:

    33 U.S.C. 1231; 50 U.S.C. 191; 33 CFR 1.05-1, 6.04-1, 6.04-6, and 160.5; Department of Homeland Security Delegation No. 0170.1.

    2. Add § 165.T09-0195 to read as follows:
    § 165.T09-0195 Safety Zone; Lake Michigan, Whiting, Indiana.

    (a) Location. All waters of Lake Michigan near Whiting, Indiana bounded by a line drawn from the shoreline at 41°41.235′ N., 087°29.779′ W., then northeast to 41°41.494′ N., 087°29.559′ W., then south to 41°40.891′ N., 087°28.486′ W., then southwest to the shoreline at 41°40.725′ N., 087°28.633′ W., then along the shoreline back to the point of origin at 41°41.235′ N., 087°29.779′ W. (NAD 83).

    (b) Enforcement period. This rule will be enforced on August 12, 2017 from 7 a.m. to 5 p.m. and August 13, 2017 from 7 a.m. to 5 p.m.

    (c) Regulations. (1) In accordance with the general regulations in § 165.23 of this part, entry into, transiting, or anchoring within this safety zone is prohibited unless authorized by the Captain of the Port Lake Michigan or a designated on-scene representative.

    (2) This safety zone is closed to all vessel traffic, except as may be permitted by the Captain of the Port Lake Michigan or a designated on-scene representative.

    (3) The “on-scene representative” of the Captain of the Port Lake Michigan is any Coast Guard commissioned, warrant or petty officer who has been designated by the Captain of the Port Lake Michigan to act on his or her behalf.

    (4) Vessel operators desiring to enter or operate within the safety zone shall contact the Captain of the Port Lake Michigan or an on-scene representative to obtain permission to do so. The Captain of the Port Lake Michigan or an on-scene representative may be contacted via VHF Channel 16. Vessel operators given permission to enter or operate in the safety zone must comply with all directions given to them by the Captain of the Port Lake Michigan, or an on-scene representative.

    Dated: June 29, 2017. A.B. Cocanour, Captain, U.S. Coast Guard, Captain of the Port, Lake Michigan.
    [FR Doc. 2017-14304 Filed 7-6-17; 8:45 am] BILLING CODE 9110-04-P
    DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [Docket Number USCG-2017-0359] RIN 1625-AA00 Safety Zone; Oswego Harborfest 2017 Breakwall and Barge Fireworks Display; Oswego Harbor, Oswego, NY AGENCY:

    Coast Guard, DHS.

    ACTION:

    Temporary final rule.

    SUMMARY:

    The Coast Guard is establishing a temporary safety zone on Oswego Harbor, Oswego, NY. This safety zone is intended to restrict vessels from a portion of the Oswego Harbor during the Oswego Harborfest 2017 Breakwall and Barge Fireworks Display. This temporary safety zone is necessary to protect mariners and vessels from the navigational hazards associated with a fireworks display.

    DATES:

    This rule is effective from 9:15 p.m. on July 29, 2017 until 10:45 p.m. July 30, 2017.

    ADDRESSES:

    To view documents mentioned in this preamble as being available in the docket, go to http://www.regulations.gov, type USCG-2017-0359 in the “SEARCH” box and click “SEARCH.” Click on Open Docket Folder on the line associated with this rule.

    FOR FURTHER INFORMATION CONTACT:

    If you have questions on this rule, call or email LT Michael Collet, Chief of Waterways Management, U.S. Coast Guard Sector Buffalo; telephone 716-843-9322, email [email protected]

    SUPPLEMENTARY INFORMATION:

    I. Table of Abbreviations CFR Code of Federal Regulations DHS Department of Homeland Security FR Federal Register NPRM Notice of proposed rulemaking § Section U.S.C. United States Code II. Background Information and Regulatory History

    The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because doing so would be impracticable. The final details of this event were not known to the Coast Guard until there was insufficient time remaining before the event to publish an NPRM. Thus, delaying the effective date of this rule to wait for a comment period to run would be impracticable because it would inhibit the Coast Guard's ability to protect mariners and vessels from the hazards associated with a maritime fireworks display.

    Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this temporary rule effective less than 30 days after publication in the Federal Register because doing so would be impracticable and contrary to the public interest. Delaying the effective date would be contrary to the rule's objectives of ensuring safety of life on the navigable waters and protection of persons and vessels near the event.

    III. Legal Authority and Need for Rule

    The Coast Guard is issuing this rule under authority in 33 U.S.C. 1231. The Captain of the Port Buffalo (COTP) has determined that a maritime fireworks show presents significant risks to public safety and property. Such hazards include premature and accidental detonations, dangerous projectiles, and falling or burning debris. This rule is needed to protect personnel, vessels, and the marine environment in the navigable waters within the safety zone while the fireworks show is taking place.

    IV. Discussion of the Rule

    This rule establishes a safety zone on July 29, 2017, or in the event of inclement weather July 30, 2017, from 9:15 p.m. until 10:45 p.m. The safety zone will encompass all waters of the Oswego Harbor, Oswego, NY contained within a 700-foot radius of position 43°28′06″ N., 076°31′07″ W. along with a 350-foot radius of the breakwall between positions 43°27′54″ N., 076°31′24″ W. then northeast to 43°27′59″ N., 076°31′12″ W. (NAD 83).

    Entry into, transiting, or anchoring within the safety zone is prohibited unless authorized by the Captain of the Port Buffalo or his designated on-scene representative. The Captain of the Port or his designated on-scene representative may be contacted via VHF Channel 16.

    V. Regulatory Analyses

    We developed this rule after considering numerous statutes and Executive orders related to rulemaking. Below we summarize our analyses based on a number of these statutes and Executive orders, and we discuss First Amendment rights of protestors.

    A. Regulatory Planning and Review

    Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. Executive Order 13771 (“Reducing Regulation and Controlling Regulatory Costs”), directs agencies to reduce regulation and control regulatory costs and provides that “for every one new regulation issued, at least two prior regulations be identified for elimination, and that the cost of planned regulations be prudently managed and controlled through a budgeting process.”

    This rule has not been designated a “significant regulatory action,” under Executive Order 12866. Accordingly, it has not been reviewed by the Office of Management and Budget.

    As this rule is not a significant regulatory action, this rule is exempt from the requirements of Executive Order 13771. See OMB's Memorandum titled “Interim Guidance Implementing Section 2 of the Executive Order of January 30, 2017 titled ‘Reducing Regulation and Controlling Regulatory Costs’ ” (February 2, 2017).

    We conclude that this rule is not a significant regulatory action because we anticipate that it will have minimal impact on the economy, will not interfere with other agencies, will not adversely alter the budget of any grant or loan recipients, and will not raise any novel legal or policy issues. The safety zone created by this rule will be relatively small and enforced for a relatively short time. Also, the safety zone is designed to minimize its impact on navigable waters. Furthermore, the safety zone has been designed to allow vessels to transit around it. Thus, restrictions on vessel movement within that particular area are expected to be minimal. Under certain conditions, moreover, vessels may still transit through the safety zone when permitted by the Captain of the Port.

    B. Impact on Small Entities

    The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.

    While some owners or operators of vessels intending to transit the safety zone may be small entities, for the reasons stated in section V.A above, this rule will not have a significant economic impact on any vessel owner or operator.

    Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section.

    Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.

    C. Collection of Information

    This rule will not call for a new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

    D. Federalism and Indian Tribal Governments

    A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this rule under that Order and have determined that it is consistent with the fundamental federalism principles and preemption requirements described in Executive Order 13132.

    Also, this rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. If you believe this rule has implications for federalism or Indian tribes, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section above.

    E. Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Though this rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

    F. Environment

    We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have determined that it is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule establishes a safety zone to ensure the safety of spectators or public in the area. It is categorically excluded under section 2.B.2, figure 2-1, paragraph 34(g) of the Instruction, which pertains to establishment of safety zones. A Record of Environmental Consideration (REC) supporting this determination is available in the docket where indicated in the ADDRESSES section of this preamble.

    G. Protest Activities

    The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to contact the person listed in the FOR FURTHER INFORMATION CONTACT section to coordinate protest activities so that your message can be received without jeopardizing the safety or security of people, places or vessels.

    List of Subjects in 33 CFR Part 165

    Harbors, Marine safety, Navigation (water), Reporting and record keeping requirements, Security measures, Waterways.

    For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:

    PART 165—REGULATED NAVIGATION AREAS AND LIMITED ACCESS AREAS 1. The authority citation for part 165 continues to read as follows: Authority:

    33 U.S.C. 1231; 50 U.S.C. 191; 33 CFR 1.05-1, 6.04-1, 6.04-6, and 160.5; Department of Homeland Security Delegation No. 0170.1.

    2. Add § 165.T09-0359 to read as follows:
    § 165.T09-0359 Safety Zone; Oswego Harborfest 2017 Breakwall and Barge Fireworks; Oswego Harbor, Oswego, NY.

    (a) Location. This zone will encompass all waters of the Oswego Harbor, Oswego, NY contained within a 700-foot radius of position 43°28′06″ N., 076°31′07″ W. along with a 350-foot radius of the breakwall between positions 43°27′54″ N., 076°31′24″ W. then northeast to 43°27′59″ N., 076°31′12″ W. (NAD 83).

    (b) Enforcement period. This regulation will be enforced from 9:15 p.m. until 10:45 p.m. on July 29, 2017, or in the event of inclement weather, on July 30, 2017, from 9:15 p.m. until 10:45 p.m.

    (c) Regulations. (1) In accordance with the general regulations in § 165.23 of this part, entry into, transiting, or anchoring within this safety zone is prohibited unless authorized by the Captain of the Port Buffalo or his designated on-scene representative.

    (2) This safety zone is closed to all vessel traffic, except as may be permitted by the Captain of the Port Buffalo or his designated on-scene representative.

    (3) The “on-scene representative” of the Captain of the Port Buffalo is any Coast Guard commissioned, warrant or petty officer who has been designated by the Captain of the Port Buffalo to act on his behalf.

    (4) Vessel operators desiring to enter or operate within the safety zone must contact the Captain of the Port Buffalo or his on-scene representative to obtain permission to do so. The Captain of the Port Buffalo or his on-scene representative may be contacted via VHF Channel 16. Vessel operators given permission to enter or operate in the safety zone must comply with all directions given to them by the Captain of the Port Buffalo, or his on-scene representative.

    Dated: June 26, 2017. J.S. Dufresne, Captain, U.S. Coast Guard, Captain of the Port Buffalo.
    [FR Doc. 2017-14258 Filed 7-6-17; 8:45 am] BILLING CODE 9110-04-P
    DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [Docket No. USCG-2017-0642] Safety Zone; Annual Event in the Captain of the Port Buffalo Zone—Brewerton Fireworks AGENCY:

    Coast Guard, DHS.

    ACTION:

    Notice of enforcement of regulation.

    SUMMARY:

    The Coast Guard will enforce a safety zone for the Brewerton Fireworks, Oneida Lake, Brewerton, NY. This action is necessary and intended for the safety of life and property on navigable waters during this event. During the enforcement period, no person or vessel may enter the respective safety zone without the permission of the Captain of the Port Buffalo.

    DATES:

    The regulation in 33 CFR 165.939(a)(8) will be enforced on July 3, 2017, with a rain date of July 8, 2017, from 9 p.m. to 10:30 p.m.

    FOR FURTHER INFORMATION CONTACT:

    If you have questions about this notice of enforcement, call or email LT Michael Collet, Chief of Waterways Management, U.S. Coast Guard Sector Buffalo, 1 Fuhrmann Blvd., Buffalo, NY 14203; telephone 716-843-9322, email [email protected].

    SUPPLEMENTARY INFORMATION:

    The Coast Guard will enforce the Safety Zone; Annual Event in the Captain of the Port Buffalo Zone listed in 33 CFR 165.939(a)(8) for the following event:

    (1) Brewerton Fireworks, Brewerton, NY; The safety zone listed in 33 CFR 165.939(a)(8) will be enforced on July 3, 2017, with a rain date of July 8, 2017, from 9 p.m. to 10:30 p.m. within a 420 foot radius of the barge located at position 43°14′18.32″ N., 076°8′1.90″ W. (NAD83).

    Pursuant to 33 CFR 165.23, entry into, transiting, or anchoring within the safety zone during an enforcement period is prohibited unless authorized by the Captain of the Port Buffalo or his designated representative. Those seeking permission to enter the safety zone may request permission from the Captain of Port Buffalo via channel 16, VHF-FM. Vessels and persons granted permission to enter the safety zone shall obey the directions of the Captain of the Port Buffalo or his designated representative. While within a safety zone, all vessels shall operate at the minimum speed necessary to maintain a safe course.

    This notice of enforcement is issued under authority of 33 CFR 165.939 and 5 U.S.C. 552(a). In addition to this notice of enforcement in the Federal Register, the Coast Guard will provide the maritime community with advance notification of this enforcement period via Broadcast Notice to Mariners or Local Notice to Mariners. If the Captain of the Port Buffalo determines that the safety zone need not be enforced for the full duration stated in this notice he or she may use a Broadcast Notice to Mariners to grant general permission to enter the respective safety zone.

    Dated: July 3, 2017. J.S. Dufresne, Captain, U.S. Coast Guard, Captain of the Port Buffalo.
    [FR Doc. 2017-14307 Filed 7-3-17; 4:15 pm] BILLING CODE 9110-04-P
    DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [Docket No. USCG-2017-0500] RIN 1625-AA00 Safety Zone; Port Huron Blue Water Fest Fireworks, St. Clair River, Port Huron, MI AGENCY:

    Coast Guard, DHS.

    ACTION:

    Temporary final rule.

    SUMMARY:

    The Coast Guard is establishing a temporary safety zone for navigable waters within a 420-foot radius of a portion of the St. Clair River, Port Huron, MI. This zone is necessary to protect spectators and vessels from potential hazards associated with the Port Huron Blue Water Fest Fireworks. Entry of vessels or persons into this zone is prohibited unless specifically authorized by the Captain of the Port Detroit.

    DATES:

    This temporary final rule is effective from 10 p.m. on July 20, 2017, through 10:20 p.m. on July 21, 2017.

    ADDRESSES:

    To view documents mentioned in this preamble as being available in the docket, go to http://www.regulations.gov, type USCG-2017-0500 in the “SEARCH” box and click “SEARCH.” Click on Open Docket Folder on the line associated with this rule.

    FOR FURTHER INFORMATION CONTACT:

    If you have questions on this temporary rule, call or email Tracy Girard, Prevention Department, Sector Detroit, Coast Guard; telephone 313-568-9564, or email [email protected]

    SUPPLEMENTARY INFORMATION:

    I. Table of Abbreviations CFR Code of Federal Regulations DHS Department of Homeland Security FR Federal Register NPRM Notice of Proposed Rulemaking § Section U.S.C. United States Code II. Background Information and Regulatory History

    The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b) (B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because doing so would be impracticable. The Coast Guard did not receive the final details of this fireworks display until there was insufficient time remaining before the event to publish an NPRM.

    We are issuing this rule, and under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this temporary rule effective less than 30 days after publication in the Federal Register. For the same reasons discussed in the preceding paragraph, waiting for a 30 day notice period to run would be impracticable.

    III. Legal Authority and Need for Rule

    The Coast Guard is issuing this rule under authority in 33 U.S.C. 1231. The Captain of the Port Detroit (COTP) has determined that potential hazard associated with fireworks from 10 p.m. to 10:20 p.m. on July 20, 2017 will be a safety concern to anyone within a 420-foot radius of the launch site. This rule is needed to protect personnel, vessels, and the marine environment in the navigable waters within the safety zone while the fireworks are being displayed.

    IV. Discussion of the Rule

    This rule establishes a safety zone from 10 p.m. through 10:20 p.m. on July 20, 2017. In the event of inclement weather the regulated area will be enforced from 10 p.m. through 10:20 p.m. on July 21, 2017. The safety zone will encompass all U.S. navigable waters of the St. Clair River, Port Huron, MI, within a 420-foot radius of position 42°58.846′ N., 082°25.201′ W. (NAD 83). No vessel or person will be permitted to enter the safety zone without obtaining permission from the COTP or a designated representative.

    V. Regulatory Analyses

    We developed this rule after considering numerous statutes and executive orders related to rulemaking. Below we summarize our analyses based on these statutes and executive orders.

    A. Regulatory Planning and Review

    Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. Executive Order 13771 (“Reducing Regulation and Controlling Regulatory Costs”), directs agencies to reduce regulation and control regulatory costs and provides that “for every one new regulation issued, at least two prior regulations be identified for elimination, and that the cost of planned regulations be prudently managed and controlled through a budgeting process.” This rule has not been designated a “significant regulatory action,” under Executive Order 12866. Accordingly, it has not been reviewed by the Office of Management and Budget.

    As this rule is not a significant regulatory action, this rule is exempt from the requirements of Executive Order 13771. See OMB's Memorandum titled “Interim Guidance Implementing Section 2 of the Executive Order of January 30, 2017 titled `Reducing Regulation and Controlling Regulatory Costs' ” (February 2, 2017).

    This regulatory action determination is based on the size, location, duration, and time-of-year of the safety zone. Vessel traffic will be able to safely transit around this safety zone which will impact a small designated area of the St. Clair River from 10:00 p.m. to 10:20 p.m. on July 20 or July 21, 2017. Moreover, the Coast Guard will issue Broadcast Notice to Mariners via VHF-FM marine channel 16 about the zone and the rule allows vessels to seek permission to enter the zone.

    B. Impact on Small Entities

    The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.

    While some owners or operators of vessels intending to transit the safety zone may be small entities, for the reasons stated in section V.A above, this rule will not have a significant economic impact on any vessel owner or operator.

    Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section.

    Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.

    C. Collection of Information

    This rule will not call for a new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

    D. Federalism and Indian Tribal Governments

    A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this rule under that Order and have determined that it is consistent with the fundamental federalism principles and preemption requirements described in Executive Order 13132.

    Also, this rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. If you believe this rule has implications for Federalism or Indian tribes, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section above.

    E. Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Though this rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

    F. Environment

    We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves a safety zone lasting less than thirty minutes that will prohibit entry within 420-feet of the firework launch site. It is categorically excluded under section 2.B.2, figure 2-1, paragraph 34(g) of the Commandant Instruction. A Record of Environmental Consideration (REC) supporting this determination is available in the docket where indicated in the ADDRESSES section of this preamble.

    G. Protest Activities

    The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to contact the person listed in the FOR FURTHER INFORMATION CONTACT section to coordinate protest activities so that your message can be received without jeopardizing the safety or security of people, places or vessels.

    List of Subjects in 33 CFR Part 165

    Harbors, Marine safety, Navigation (water), Reporting and record keeping requirements, Security measures, Waterways.

    For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:

    PART 165—REGULATED NAVIGATION AREAS AND LIMITED ACCESS AREAS 1. The authority citation for part 165 continues to read as follows: Authority:

    33 U.S.C. 1231; 50 U.S.C. 191; 33 CFR 1.05-1, 6.04-1, 6.04-6, and 160.5; Department of Homeland Security Delegation No. 0170.1.

    2. Add § 165.T09-0500 to read as follows:
    § 165.T09-0500 Safety Zone; Port Huron Blue Water Fest Fireworks, St. Clair River, Port Huron, MI.

    (a) Location. A safety zone is established to include all U.S. navigable waters of the St. Clair River, Port Huron, MI within a 420-foot radius of position 42°58.846′ N., 082°25.201′ W. (NAD 83).

    (b) Enforcement period. The regulated area described in paragraph (a) of this section will be enforced from 10 p.m. through 10:20 p.m. on July 20, 2017. In the event of inclement weather, the regulated area will be enforced from 10 p.m. through 10:20 p.m. on July 21, 2017.

    (c) Regulations. (1) No vessel or person may enter, transit through, or anchor within the safety zone unless authorized by the Captain of the Port Detroit, or his on-scene representative.

    (2) The safety zone is closed to all vessel traffic, except as may be permitted by the Captain of the Port Detroit or his on-scene representative.

    (3) The “on-scene representative” of the Captain of the Port Detroit is any Coast Guard commissioned, warrant, or petty officer or a Federal, State, or local law enforcement officer designated by or assisting the Captain of the Port Detroit to act on his behalf.

    (4) Vessel operators shall contact the Captain of the Port Detroit or his on-scene representative to obtain permission to enter or operate within the safety zone. The Captain of the Port Detroit or his on-scene representative may be contacted via VHF Channel 16 or at 313-568-9464. Vessel operators given permission to enter or operate in the regulated area must comply with all directions given to them by the Captain of the Port Detroit or his on-scene representative.

    Dated: July 3, 2017. J.W. Novak, Captain, U.S. Coast Guard, Captain of the Port Detroit.
    [FR Doc. 2017-14303 Filed 7-6-17; 8:45 am] BILLING CODE 9110-04-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R09-OAR-2016-0415; FRL-9962-53-Region 9] Approval of California Air Plan Revisions, Antelope Valley Air Quality Management District AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is taking final action to approve a revision to the Antelope Valley Air Quality Management District (AVAQMD or “District”) portion of the California State Implementation Plan (SIP). This revision concerns emissions of volatile organic compounds (VOCs) and oxides of nitrogen (NOX) from passenger vehicles. We are approving a local rule that encourages the use of rideshare alternatives as a means of travelling to worksites in the District.

    DATES:

    This rule will be effective on August 7, 2017.

    ADDRESSES:

    The EPA has established a docket for this action under Docket ID No. EPA-R09-OAR-2016-0415. All documents in the docket are listed on the http://www.regulations.gov Web site. Although listed in the index, some information is not publicly available, e.g., Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available through http://www.regulations.gov, or please contact the person identified in the FOR FURTHER INFORMATION CONTACT section for additional availability information.

    FOR FURTHER INFORMATION CONTACT:

    Jeffrey Buss, EPA Region IX, (415) 947-4152, [email protected]

    SUPPLEMENTARY INFORMATION:

    Throughout this document, “we,” “us” and “our” refer to the EPA.

    Table of Contents I. Proposed Action II. Public Comments and EPA Responses III. EPA Action IV. Incorporation by Reference V. Statutory and Executive Order Reviews I. Proposed Action

    On March 10, 2017 at 82 FR 13280, the EPA proposed to approve the following rule into the California SIP.

    Local agency Rule No. Rule title Adopted/amended/
  • revised
  • Submitted
    AVAQMD 2200 Transportation Outreach Program 01/19/99 10/29/99

    Rule 2200 provides a mechanism for obtaining documentation of emission reductions resulting from trip reduction programs. According to the District, the rule is expected to help reduce VOC and NOX emissions by encouraging individuals to select rideshare alternatives rather than drive alone, and by educating employees and the public about the health impacts of motor vehicle pollution. We proposed to approve this rule because we determined that it complied with the relevant CAA requirements. Our proposed action contains more information on the rule and our evaluation.1

    1 Our proposed rule mistakenly identified the adoption date of Antelope Valley Rule 2200 as July 20, 1999. The correct adoption date for the rule is January 19, 1999.

    II. Public Comments and EPA Responses

    The EPA's proposed action provided a 30-day public comment period. During this period, we received no comments.

    III. EPA Action

    No comments were submitted. Therefore, as authorized in section 110(k)(3) of the Act, the EPA is fully approving this rule into the California SIP. As we discussed in our proposed action, the rule establishes a framework for documenting emissions reductions from trip reduction programs, but does not require any specific trip reduction programs nor does it contain a good faith estimate of emission reductions. Consequently, it is not appropriate to credit this rule with emission reductions in the SIP.

    IV. Incorporation by Reference

    In this rule, the EPA is finalizing regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, the EPA is finalizing the incorporation by reference of the AVAQMD rule described in the amendments to 40 CFR part 52 set forth below. The EPA has made, and will continue to make, these documents available through www.regulations.gov and at the EPA Region IX Office (please contact the person identified in the FOR FURTHER INFORMATION CONTACT section of this preamble for more information).

    V. Statutory and Executive Order Reviews

    Under the Clean Air Act, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, the EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. Accordingly, this action merely approves state law as meeting federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

    • Is not a significant regulatory action subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);

    • does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);

    • is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.);

    • does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

    • does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

    • is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

    • is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

    • is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the Clean Air Act; and

    • does not provide the EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

    In addition, the SIP is not approved to apply on any Indian reservation land or in any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. The EPA will submit a report containing this action and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

    Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by September 5, 2017. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements (see section 307(b)(2)).

    List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Nitrogen dioxide, Ozone, Reporting and recordkeeping requirements, Volatile organic compounds.

    Dated: April 20, 2017. Alexis Strauss, Acting Regional Administrator, Region IX.

    Part 52, Chapter I, Title 40 of the Code of Federal Regulations is amended as follows:

    PART 52—APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS 1. The authority citation for part 52 continues to read as follows: Authority:

    42 U.S.C. 7401 et seq.

    Subpart F—California 2. Section 52.220 is amended by adding paragraph (c)(270)(i)(E)(2) to read as follows:
    § 52.220 Identification of plan-in part.

    (c) * * *

    (270) * * *

    (i) * * *

    (E) * * *

    (2) Rule 2220, “Transportation Outreach Program,” adopted on January 19, 1999.

    [FR Doc. 2017-14203 Filed 7-6-17; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R05-OAR-2017-0081; FRL-9964-49-Region 5] Air Plan Approval; Wisconsin; Site-Specific Sulfur Dioxide Requirements for USG Interiors, LLC AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Direct final rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is approving, under the Clean Air Act (CAA), a State Implementation Plan (SIP) revision submitted by Wisconsin on January 31, 2017, and supplemented on March 20, 2017. This SIP submittal consists of Wisconsin Administrative Order AM-16-01, which imposes a requirement for a taller cupola exhaust stack, a sulfur dioxide (SO2) emission limit in conjunction with a minimum cupola stack flue gas flow rate, and associated requirements on the mineral wool production process at the USG Interiors LLC facility located in Walworth, Wisconsin (USG-Walworth). Wisconsin submitted this SIP revision to enable the area near USG-Walworth to qualify for being designated “attainment” of the 2010 primary SO2 National Ambient Air Quality Standards (NAAQS), a matter that will be addressed in a separate future rulemaking. EPA is approving AM-16-01 into the Wisconsin SIP, which makes the AM-16-01 requirements federally enforceable.

    DATES:

    This direct final rule will be effective September 5, 2017, unless EPA receives adverse comments by August 7, 2017. If adverse comments are received, EPA will publish a timely withdrawal of the direct final rule in the Federal Register informing the public that the rule will not take effect.

    ADDRESSES:

    Submit your comments, identified by Docket ID No. EPA-R05-OAR-2017-0081 at http://www.regulations.gov, or via email to [email protected] For comments submitted at Regulations.gov, follow the online instructions for submitting comments. Once submitted, comments cannot be edited or removed from Regulations.gov. For either manner of submission, EPA may publish any comment received to its public docket. Do not submit electronically any information you consider to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. Multimedia submissions (audio, video, etc.) must be accompanied by a written comment. The written comment is considered the official comment and should include discussion of all points you wish to make. EPA will generally not consider comments or comment contents located outside of the primary submission (i.e. on the web, cloud, or other file sharing system). For additional submission methods, please contact the person identified in the “For Further Information Contact” section. For the full EPA public comment policy, information about CBI or multimedia submissions, and general guidance on making effective comments, please visit http://www2.epa.gov/dockets/commenting-epa-dockets.

    FOR FURTHER INFORMATION CONTACT:

    Jenny Liljegren, Physical Scientist, Attainment Planning and Maintenance Section, Air Programs Branch (AR-18J), Environmental Protection Agency, Region 5, 77 West Jackson Boulevard, Chicago, Illinois 60604, (312)886-6832, [email protected]

    SUPPLEMENTARY INFORMATION:

    Throughout this document whenever “we,” “us,” or “our” is used, we mean EPA. This supplementary information section is arranged as follows:

    I. Why did Wisconsin issue Administrative Order AM-16-01? II. What is EPA's analysis of the SO2 emission limit and associated requirements in AM-16-01? III. By which Criteria is EPA reviewing this SIP revision? IV. What action is EPA taking? V. Incorporation by reference VI. Statutory and Executive Order reviews I. Why Did Wisconsin issue Administrative Order AM-16-01?

    Wisconsin submitted a SIP revision on January 31, 2017, along with supplemental information on March 20, 2017. The submittal contains Wisconsin Administrative Order AM-16-01 signed on January 31, 2017, by the Director of the Air Management Bureau of the Wisconsin Department of Natural Resources, which establishes a requirement for a taller cupola stack, an SO2 emission limit, and associated requirements for the mineral wool production process at USG-Walworth. Wisconsin established these requirements to enable the area near 1 USG-Walworth to qualify in the future for being designated “attainment” of the 2010 primary SO2 NAAQS.2

    1 The specific area will be identified in a future designations rulemaking to be finalized December 31, 2017, for the 2010 SO2 NAAQS.

    2 On June 3, 2010, EPA revised the primary (health based) SO2 NAAQS by establishing a new one-hour standard at a level of 75 parts per billion (ppb) which is attained when the three-year average of the 99th percentile of one-hour daily maximum concentrations does not exceed 75 ppb (75 FR 35520 and 40 CFR 50.17). EPA determined this is the level necessary to protect public health with an adequate margin of safety, especially for children, the elderly, and those with asthma. These groups are particularly susceptible to the health effects associated with breathing SO2.

    USG-Walworth cannot demonstrate modeled attainment of the 2010 SO2 NAAQS in accordance with EPA's Draft SO2 NAAQS Designations Modeling Technical Assistance Document 3 in absence of new requirements pertaining to the mineral wool production process. Therefore, Wisconsin conducted air dispersion modeling using the American Meteorological Society/Environmental Protection Agency Regulatory Model (AERMOD) version 16216 (released on December 20, 2016) and 16216r (released on January 17, 2017) in accordance with appendix W of part 51 of chapter 40 of the Code of Federal Regulations (CFR) to determine a new set of requirements, including an increase in the cupola stack height from 68.5 feet to 175 feet above ground and an SO2 emission limit for the mineral wool production process at USG-Walworth in conjunction with a minimum cupola stack flue gas flow rate. The air quality modeling of these conditions supports Wisconsin's conclusion that these limits provide for attainment of the 2010 SO2 NAAQS.

    3Draft SO2 NAAQS Designations Modeling Technical Assistance Document. December 2013. http://www3.epa.gov/airquality/sulfurdioxide/pdfs/SO2ModelingTAD.pdf

    The purpose of this rulemaking is to take action on Wisconsin's request to approve AM-16-01 into the Wisconsin SIP and thereby make federally enforceable the requirement for the taller stack, the SO2 emission limit, and the associated requirements therein. Once these requirements have become federally enforceable, Wisconsin intends to use them to demonstrate AERMOD-modeled attainment for the 2010 SO2 NAAQS for the area near USG-Walworth. EPA intends to designate the area near USG-Walworth for the 2010 SO2 NAAQS, under a separate future rulemaking to be finalized by December 31, 2017.4

    4 The EPA has issued designations for a total of 94 areas throughout the U.S. for the 2010 SO2 NAAQS in previous final actions signed by the EPA Administrator in “Round 1” on August 5, 2013 (78 FR 47191) and in “Round 2” on July 12, 2016 (81 FR 45039) and December 13, 2016 (81 FR 89870). The EPA is under a December 31, 2017, deadline to designate additional areas as required by the U.S. District Court for the Northern District of California [Sierra Club v. McCarthy, No. 3-13-cv-3953 (SI) (N.D. Cal. Mar. 2, 2015)]. We are referring to the set of designations being finalized by the December 31, 2017, deadline as “Round 3” of the designations process for the 2010 SO2 NAAQS. EPA intends to address the area near USG-Walworth as part of the Round 3 designations.

    II. What is EPA's analysis of the SO2 emission limit and associated requirements in AM-16-01?

    Wisconsin issued AM-16-01 on January 31, 2017, for USG-Walworth, with a compliance date of October 1, 2017. This order established a cupola stack height increase from 68.5 feet to 175 feet above ground level, a cupola stack flue gas flow rate of 23,200 actual cubic feet per minute (ACFM) in conjunction with an SO2 emission limit of 301.3 pounds per hour (lbs/hr), and other associated requirements for the mineral wool production process at USG-Walworth.

    Dispersion techniques, such as increasing the final exhaust plume rise by manipulation of source parameters like increasing stack heights and flue gas flow rates, are not approvable in most circumstances. EPA's stack height provisions codified at 40 CFR 51.118 arise out of CAA section 123(a), which states that the degree of emission limitation required for control of any air pollutant under an applicable implementation plan under this subchapter shall not be affected in any manner by so much of the stack height of any source as exceeds good engineering practice (as determined under regulations promulgated by the Administrator), or any other dispersion technique.

    “Dispersion technique,” as defined at 40 CFR 51.100(hh)(1), means any technique which attempts to affect the concentration of a pollutant in the ambient air by: Using that portion of a stack which exceeds good engineering practice stack height; varying the rate of emission of a pollutant according to atmospheric conditions or ambient concentrations of that pollutant; or increasing final exhaust gas plume rise by manipulating source process parameters, exhaust gas parameters, stack parameters, or combining exhaust gases from several existing stacks into one stack; or other selective handling of exhaust gas streams so as to increase the exhaust gas plume rise.

    In the case of USG-Walworth, the raising of the stack to 175 feet does not exceed good engineering practice stack height as defined at § 51.100(ii), and AM-16-01 does not provide for the allowable rate of emissions to vary according to atmospheric conditions or ambient pollutant concentrations as per § 51.100(hh)(1)(ii). In some cases, increasing the final exhaust plume rise by manipulation of the stack height and flue gas flow rate is a dispersion technique as per § 51.100(hh)(1)(iii). However, there is an exception under 40 CFR 51.100(hh)(2)(v) where dispersion techniques under § 51.100(hh)(1)(iii) do not include techniques that increase the final exhaust gas plume rise where the resulting allowable emissions of sulfur dioxide from the facility do not exceed 5,000 tons per year. Such an increase of plume rise is not considered a dispersion technique when the resulting allowable emissions of SO2 from the facility do not exceed 5,000 tons per year (TPY). The AM-16-01 SO2 emission limit of 301.3 lbs/hr is equivalent to 1,319.69 TPY, which accounts for over 99% of the allowable SO2 emitted by all emission units at USG-Walworth. Additionally, AM-16-01 includes a requirement that USG-Walworth only fire natural gas in the other emission units at the facility, including the boiler (B10), the acoustical tile dryer (P32), and the finishing/curing ovens (P34A and P38A). Therefore, the facility-wide allowable SO2 emissions from USG-Walworth resulting from the AM-16-01 requirement to increase the cupola stack height from 68.5 feet to 175 feet above ground level do not exceed 5,000 TPY. Therefore, EPA proposes to approve the increase in the cupola stack height.

    Wisconsin set an SO2 emission limit of 301.3 lbs/hr for the mineral wool production process in conjunction with a cupola stack flue gas flow rate of 23,200 ACFM. For emission rates less than 301.3 lbs/hr, Wisconsin established a required minimum cupola stack flue gas flow rate which varies based on the SO2 emission rate. AM-16-01 requires that the cupola stack flue gas flow rate in ACFM shall be equal to or greater than the flow rate calculated according to Equation 1.

    Equation 1: Required Flue Gas Flow Rate (ACFM) = [SO2 Emission Rate (lbs/hr) × 79.192] − 664.62

    To develop Equation 1, Wisconsin plotted the worst case (highest) SO2 emissions versus worst case (lowest) flue gas flow rates as estimated from information contained in 2015 and 2010 stack testing reports and an August 2014-August 2016 dataset provided by USG-Walworth. Wisconsin fit a trend line (Equation 1) to the plot and included this equation in AM-16-01 as the minimum flue gas flow rate requirement for USG-Walworth (e.g. for a given SO2 emission rate less than 301.3 lbs/hr, USG-Walworth must use Equation 1 to determine the corresponding required minimum flue gas flow rate under which it must operate). When emissions are the full allowable 301.3 lbs/hr, the minimum flow rate is 23,200 ACFM; lower minimum flow rates apply at lower emission levels.

    Wisconsin's AM-16-01 method of determining compliance with the minimum flue gas flow rate (EPA Method 2) is to be conducted on the same schedule, described below, as that for compliance with the SO2 emission limit (EPA Method 6C). AM-16-01 also requires operation of the thermal oxidizer and baghouse whenever the cupola is in operation/fired and additional requirements for monitoring and maintaining these control devices to ensure they are functioning properly, including an interlock system which only allows operation of the cupola if the thermal oxidizer incinerator chamber temperature is at or above 1,300 degrees Fahrenheit averaged over any one-hour period.

    In addition to the 1-hour limit of 301.3 lbs/hour in AM-16-01, Wisconsin opted to set a 30-day rolling average limit of 238.0 lbs/hour. EPA's April 2014 “Guidance for 1-Hour SO2 Nonattainment Area SIP Submissions” discusses the option to establish limits with averaging times up to 30 days in length, recommends that any such limit be established at a level that is comparably stringent to the one-hour average limit, and recommends a detailed procedure for determining such a comparably stringent limit. Wisconsin followed the recommendations of the 2014 guidance in determining an appropriate level for this limit. Therefore, the state has applied an appropriate adjustment, yielding a 30-day rolling average emission limit that has comparable stringency to the one-hour average limit. Wisconsin used an adjustment factor of 0.79, which EPA identified in its 2014 guidance as an appropriate adjustment factor for determining equivalent emission limitation between 1-hour and 30-day rolling average timeframes for uncontrolled coal-fired boilers based on a national analysis of utility coal boiler emissions.

    Wisconsin's method of determining compliance with the 301.3 lbs/hr limit as set forth in AM-16-01 uses EPA-approved stack testing methods, and includes an initial stack test that must be conducted no later than April 1, 2018, which is 180 days after the AM-16-01 compliance date of October 1, 2017, and periodic stack testing conducted every five years within 90 days of the anniversary date of the initial stack test. Wisconsin's method of determining continuous compliance, as set forth in AM-16-01, requires a mass balance calculation to demonstrate compliance with the 238.0 lbs/hr limit on a 30-day rolling average basis. Under this rule, stack tests at the facility must show compliance with the 1-hour emission limit of 301.3 lbs/hr, but continuous emissions data, collected from routine mass balance calculations, are used to assess compliance with the 30-day average emission limit of 238.0 lbs/hr. Wisconsin has thereby established a two-tiered enforcement regime, in which stack tests provide occasional assessment of compliance, tested against a 1-hour limit, and continuous emissions data, as collected via routine mass balance calculations, provide a continuous assessment of compliance, tested against a 30-day average limit.

    Wisconsin's mass balance equation in AM-16-01 is the difference between the sum of the estimated sulfur content of all the materials loaded into the cupola and the sum of the estimated sulfur content in the mineral wool product output from the cupola in lbs/day divided by the operating hours per day and multiplied by the molecular weight ratio of SO2 to sulfur. AM-16-01 requires USG-Walworth to develop a compliance and monitoring plan and to monitor, record, and report the information necessary for calculating the 30-day rolling average SO2 emission limit via the mass balance equation, such as operating hours, operating days, coke and all other material usage amounts. AM-16-01 includes requirements to sample the sulfur, moisture, and heat content of each of the materials input to the cupola and the sulfur content of the mineral wool product or waste material output from the cupola. The sampling requirements include initial material sampling, ongoing material sampling, ongoing low sulfur material sampling, mineral wool product and waste sampling, alternate sampling frequency which increases if the 30-day rolling average SO2 emission rate is equal to or greater than 95% of the limit for three or more operating days during the previous 12 calendar months. Likewise, sampling frequency can be decreased if the 30-day rolling average SO2 emission rate is equal to or less than 70% of the limit for 12 consecutive months. The sampling requirements include sample collection and preparation methods as per those of ASTM International, formerly the American Society for Testing and Materials (ASTM). Finally, AM-16-01 includes a requirement for USG-Walworth to submit a revision request to incorporate the applicable requirements of AM-16-01 into the USG-Walworth operating permit by June 23, 2019.

    III. By which criteria is EPA reviewing this SIP revision?

    EPA is evaluating AM-16-01 on the basis of whether its requirements are measurable (and thus enforceable) and whether it strengthens Wisconsin's SIP. When imposing quantitative requirements such as emission limits, it is important that these requirements be measurable so as to determine compliance. While the use of an electronic continuous emissions monitoring system (CEMS) would be an ideal way to measure the SO2 emission rate from the mineral wool production process and the flue gas flow rate from the cupola stack for compliance determination purposes, EPA's analysis, above, of Wisconsin's AM-16-01 compliance requirements shows that Wisconsin has developed a conservative mass balance approach that allows for the ongoing measurement of the USG-Walworth mineral wool production process SO2 emission rate to determine compliance with the SO2 emission limit contained in AM-16-01. The AM-16-01 requirements are carefully designed such that compliance with the SO2 emission limit can be determined via a combination of testing, sampling, monitoring, recordkeeping, and reporting making the SO2 emission limit and associated requirements contained in AM-16-01 measureable and enforceable. Therefore, in the absence of a CEMS, EPA finds acceptable the AM-16-01 mass balance approach of compliance monitoring in conjunction with required periodic stack testing.

    The USG-Walworth mineral wool production process is already subject to Wisconsin rule NR 417.07(2)(b), which is a statewide SO2 emission limit of 5.5 pounds per Million British Thermal Units (lbs/MMBTU) that applies to any steam generating unit or other fuel-burning equipment firing solid fossil fuel at a facility that has a total heat input capacity on solid fossil fuel of less than 250 MMBTU/hr and which was incorporated into the Wisconsin SIP in 1993 (58 FR 29537). This SIP requirement will not be removed with the approval of AM-16-01 into the Wisconsin SIP. AM-16-01 provides additional requirements to the 5.5 lbs/MMBTU emission limit already in the Wisconsin SIP. Therefore, EPA's approval of AM-16-01 would strengthen the Wisconsin SIP. Since the current SO2 emission limit of 5.5 lbs/MMBTU will remain in the SIP (58 FR 29537), EPA's approval of AM-16-01 into the Wisconsin SIP would not cause there to be any relaxation of the SO2 emission limit in the Wisconsin SIP with respect to USG-Walworth and would, therefore, not interfere with CAA section 110(l), which is the anti-backsliding provision of the CAA. Therefore, EPA is approving AM-16-01 into the Wisconsin SIP.

    As previously stated, EPA intends to designate the area near USG-Walworth for the 2010 SO2 NAAQS under a separate future rulemaking to be finalized by December 31, 2017. If AM-16-01 becomes SIP-approved and thereby federally enforceable in a timely fashion, EPA will formally evaluate the adequacy of the AM-16-01 requirements to provide for attainment as part of the rulemaking on the 2010 SO2 NAAQS designation for the area near USG-Walworth.

    IV. What action is EPA taking?

    EPA is approving into the Wisconsin SIP AM-16-01, which contains a requirement for a taller cupola stack, an SO2 emission limit, and associated requirements for the mineral wool production process at USG-Walworth. EPA confirms that the requirements contained in AM-16-01 are measureable, enforceable, and strengthen the Wisconsin SIP. By approving AM-16-01 into the Wisconsin SIP, the stack height requirement, the SO2 emission limit, and the associated requirements will become Federally enforceable.

    We are publishing this action without prior proposal because we view this as a noncontroversial amendment and anticipate no adverse comments. However, in the proposed rules section of this Federal Register publication, we are publishing a separate document that will serve as the proposal to approve the state plan if relevant adverse written comments are filed. This rule will be effective September 5, 2017 without further notice unless we receive relevant adverse written comments by August 7, 2017. If we receive such comments, we will withdraw this action before the effective date by publishing a subsequent document that will withdraw the final action. All public comments received will then be addressed in a subsequent final rule based on the proposed action. EPA will not institute a second comment period. Any parties interested in commenting on this action should do so at this time. Please note that if EPA receives adverse comment on an amendment, paragraph, or section of this rule and if that provision may be severed from the remainder of the rule, EPA may adopt as final those provisions of the rule that are not the subject of an adverse comment. If we do not receive any comments, this action will be effective September 5, 2017.

    V. Incorporation by Reference

    In this rule, EPA is finalizing regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, EPA is finalizing the incorporation by reference of the Wisconsin Regulations described in the amendments to 40 CFR part 52 set forth below. EPA has made, and will continue to make, these documents generally available through www.regulations.gov and/or at the EPA Region 5 Office (please contact the person identified in the For Further Information Contact section of this preamble for more information).

    VI. Statutory and Executive Order Reviews

    Under the CAA, the Administrator is required to approve a SIP submission that complies with the provisions of the CAA and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

    • Is not a significant regulatory action subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);

    • Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);

    • Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.);

    • Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

    • Does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

    • Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

    • Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

    • Is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and

    • Does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

    In addition, the SIP is not approved to apply on any Indian reservation land or in any other area where EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this action and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

    Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by September 5, 2017. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. Parties with objections to this direct final rule are encouraged to file a comment in response to the parallel notice of proposed rulemaking for this action published in the proposed rules section of this Federal Register, rather than file an immediate petition for judicial review of this direct final rule, so that EPA can withdraw this direct final rule and address the comment in the proposed rulemaking. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

    List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Reporting and recordkeeping requirements, Sulfur oxides.

    Dated: June 20, 2017. Robert A. Kaplan, Acting Regional Administrator, Region 5.

    40 CFR part 52 is amended as follows:

    PART 52—APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS 1. The authority citation for part 52 continues to read as follows: Authority:

    42 U.S.C. 7401 et seq.

    2. Section 52.2570 is amended by adding paragraph (c)(136) to read as follows:
    § 52.2570 Identification of plan.

    (c) * * *

    (136) On January 31, 2017 (supplemented on March 20, 2017), the Wisconsin Department of Natural Resources submitted a request to incorporate Wisconsin Administrative Order AM-16-01 into its State Implementation Plan. AM-16-01 imposes a requirement for a taller cupola exhaust stack, a sulfur dioxide (SO2) emission limit in conjunction with a minimum cupola stack flue gas flow rate, and associated requirements on the mineral wool production process at the USG Interiors LLC facility located in Walworth, Wisconsin (USG-Walworth). Wisconsin intends to use the requirements of AM-16-01 to support an attainment designation.

    (i) Incorporation by reference. Wisconsin Administrative Order AM-16-01, issued by the Wisconsin Department of Natural Resources on January 31, 2017, to USG Interiors LLC for its facility located in Walworth, Wisconsin.

    [FR Doc. 2017-14212 Filed 7-6-17; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R04-OAR-2017-0136; FRL-9964-56-Region 4] Air Plan Approval; TN: Non-Interference Demonstration for Federal Low-Reid Vapor Pressure Requirement in Shelby County AGENCY:

    Environmental Protection Agency.

    ACTION:

    Final rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is approving a noninterference demonstration that evaluates whether the change for the Federal Reid Vapor Pressure (RVP) requirements in Shelby County (hereinafter referred to as the “Area”) would interfere with the Area's ability to meet the requirements of the Clean Air Act (CAA or Act). Tennessee submitted through the Tennessee Department of Environment and Conservation (TDEC), on April 12, 2017, a noninterference demonstration on behalf of the Shelby County Health Department requesting that EPA change the RVP requirements for Shelby County. Specifically, Tennessee's noninterference demonstration concludes that relaxing the federal RVP requirement from 7.8 pounds per square inch (psi) to 9.0 psi for gasoline sold between June 1 and September 15 of each year in Shelby County would not interfere with attainment or maintenance of the national ambient air quality standards (NAAQS or standards) or with any other CAA requirement.

    DATES:

    This rule is effective July 7, 2017.

    ADDRESSES:

    EPA has established a docket for this action under Docket Identification No. EPA-R04-OAR-2017-0136. All documents in the docket are listed on the www.regulations.gov Web site. Although listed in the index, some information is not publicly available, i.e., Confidential Business Information or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available either electronically through www.regulations.gov or in hard copy at the Air Regulatory Management Section, Air Planning and Implementation Branch, Air, Pesticides and Toxics Management Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth Street SW., Atlanta, Georgia 30303-8960. EPA requests that if at all possible, you contact the person listed in the FOR FURTHER INFORMATION CONTACT section to schedule your inspection. The Regional Office's official hours of business are Monday through Friday 8:30 a.m. to 4:30 p.m., excluding federal holidays.

    FOR FURTHER INFORMATION CONTACT:

    Sean Lakeman, Air Regulatory Management Section, Air Planning and Implementation Branch, Air, Pesticides and Toxics Management Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth Street SW., Atlanta, Georgia 30303-8960. Mr. Lakeman can be reached via telephone at (404) 562-9043 or via electronic mail at [email protected].

    SUPPLEMENTARY INFORMATION: I. What is the background for this final action?

    On April 12, 2017, Tennessee submitted a request that EPA relax the federal RVP requirement from 7.8 psi to 9.0 psi for gasoline sold between June 1 and September 15 of each year (i.e., during high ozone season) in Shelby County. As part of that request, Tennessee evaluated whether removal of this requirement would interfere with air quality in Shelby County. To make this demonstration of noninterference, Tennessee completed a technical analysis, including modeling, to estimate the change in emissions that would result from a switch to 9.0 psi RVP fuel in Shelby County. In a notice of proposed rulemaking (NPR) published on May 11, 2017 (82 FR 21966), EPA proposed to approve the State's noninterference demonstration. The details of Tennessee's submittal and the rationale for EPA's actions are explained in the NPR. EPA did not receive any adverse comments on the proposed action.

    II. Final Action

    EPA is approving Tennessee's April 12, 2017, noninterference demonstration supporting the State's request to relax the RVP standard to 9.0 psi in Shelby County. EPA has determined that the change in the RVP requirements for Shelby County will not interfere with attainment or maintenance of any NAAQS or with any other applicable requirement of the CAA.

    EPA has determined that Tennessee's April 12, 2017, RVP-related SIP revision is consistent with the applicable provisions of the CAA for the reasons provided in the NPR. Through this action, EPA is not removing the federal 7.8 psi RVP requirement for Shelby County. Any such action would occur in a separate rulemaking.

    In accordance with 5 U.S.C. 553(d), EPA finds that there is good cause for this action to become effective immediately upon publication. This is because a delayed effective date is unnecessary because today's action approves a noninterference demonstration that will serve as the basis of a subsequent action to relieve the Area from certain CAA requirements that would otherwise apply to it. The immediate effective date for this action is authorized under both 5 U.S.C. 553(d)(1), which provides that rulemaking actions may become effective less than 30 days after publication if the rule grants or recognizes an exemption or relieves a restriction, and section 553(d)(3), which allows an effective date less than 30 days after publication as otherwise provided by the agency for good cause found and published with the rule. The purpose of the 30-day waiting period prescribed in section 553(d) is to give affected parties a reasonable time to adjust their behavior and prepare before the final rule takes effect. This rule, however, does not create any new regulatory requirements such that affected parties would need time to prepare before the rule takes effect. Rather, this rule will serve as a basis for a subsequent action to relieve the Area from certain CAA requirements. For these reasons, EPA finds good cause under 5 U.S.C. 553(d)(3) for this action to become effective on the date of publication of this action.

    III. Statutory and Executive Order Reviews

    Under the CAA, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable federal regulations. See 42 U.S.C. 7410(k); 40 CFR part 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely approves state law as meeting federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

    • Is not a significant regulatory action subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);

    • Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);

    • Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.);

    • Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

    • Does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

    • Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

    • Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

    • Is not subject to requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and

    • Does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

    The SIP is not approved to apply on any Indian reservation land or in any other area where EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), nor will it impose substantial direct costs on tribal governments or preempt tribal law.

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this action and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

    Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by September 5, 2017. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. See section 307(b)(2).

    List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Nitrogen dioxide, Ozone, Particulate matter, Reporting and recordkeeping requirements, Volatile organic compounds.

    Dated: June 22, 2017. V. Anne Heard, Acting Regional Administrator, Region 4.

    40 CFR part 52 is amended as follows:

    PART 52—APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS 1. The authority citation for part 52 continues to read as follows: Authority:

    42 U.S.C. 7401 et seq.

    Subpart RR—Tennessee 2. In § 52.2220, the table in paragraph (e) is amended by adding the entry “Non-interference Demonstration for Federal Low-Reid Vapor Pressure Requirement in Shelby County” at the end of the table to read as follows:
    § 52.2220 Identification of plan.

    (e) * * *

    EPA-Approved Tennessee Non-Regulatory Provisions Name of non-regulatory SIP provision Applicable geographic or
  • nonattainment area
  • State effective date EPA approval date Explanation
    *         *         *         *         *         *         * Non-interference Demonstration for Federal Low-Reid Vapor Pressure Requirement in Shelby County Shelby County 4/12/2016 7/7/2017 [Insert Federal Register citation]
    [FR Doc. 2017-14202 Filed 7-6-17; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R03-OAR-2016-0561; FRL-9964-58-Region 3] Approval and Promulgation of Air Quality Implementation Plans; Pennsylvania; Volatile Organic Compound Reasonably Available Control Technology for 1997 Ozone Standard AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Direct final rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is taking direct final action to approve revisions to the Commonwealth of Pennsylvania state implementation plan (SIP). This SIP revision pertains to the requirements for reasonably available control technology (RACT) controls for certain sources of volatile organic compounds (VOCs) under the 1997 ozone national ambient air quality standard (NAAQS). This SIP revision includes Pennsylvania's certification that previously adopted RACT controls in Pennsylvania's SIP that were approved by EPA under the 1-hour ozone NAAQS are based on the currently available technically and economically feasible controls, and that they continue to represent RACT for the 1997 ozone NAAQS and a negative declaration that certain categories of sources do not exist in Pennsylvania. This SIP revision does not address Pennsylvania's May 2016 VOC and nitrogen oxides (NOX) RACT rule, “Additional RACT Requirements for Major Sources of NOX and VOCs,” also known as RACT II. EPA will take separate action on RACT II. EPA is approving these revisions addressing VOC RACT for the 1997 ozone NAAQS in accordance with the requirements of the Clean Air Act (CAA).

    DATES:

    This rule is effective on October 5, 2017 without further notice, unless EPA receives adverse written comment by August 7, 2017. If EPA receives such comments, it will publish a timely withdrawal of the direct final rule in the Federal Register and inform the public that the rule will not take effect.

    ADDRESSES:

    Submit your comments, identified by Docket ID No. EPA-R03-OAR-2016-0561 at https://www.regulations.gov, or via email to [email protected] For comments submitted at Regulations.gov, follow the online instructions for submitting comments. Once submitted, comments cannot be edited or removed from Regulations.gov. For either manner of submission, EPA may publish any comment received to its public docket. Do not submit electronically any information you consider to be confidential business information (CBI) or other information whose disclosure is restricted by statute. Multimedia submissions (audio, video, etc.) must be accompanied by a written comment. The written comment is considered the official comment and should include discussion of all points you wish to make. EPA will generally not consider comments or comment contents located outside of the primary submission (i.e. on the web, cloud, or other file sharing system). For additional submission methods, please contact the person identified in the “For Further Information Contact” section. For the full EPA public comment policy, information about CBI or multimedia submissions, and general guidance on making effective comments, please visit http://www2.epa.gov/dockets/commenting-epa-dockets.

    FOR FURTHER INFORMATION CONTACT:

    Maria A Pino, (215) 814-2181, or by email at [email protected]

    SUPPLEMENTARY INFORMATION:

    On September 25, 2006, the Commonwealth of Pennsylvania through the Pennsylvania Department of Environmental Protection (PADEP) submitted a revision to its SIP that addresses certain requirements of RACT under the 1997 ozone NAAQS. The SIP revision was entitled, “Pennsylvania Department of Environmental Protection Reasonably Available Control Technology (RACT) State Implementation Plan (SIP) Revision Under the 8-Hour Ozone National Ambient Air Quality Standard (NAAQS),” September 2006, and will be referred to in this rulemaking action as “the 2006 RACT SIP.” On June 27, 2016, PADEP withdrew from EPA review portions of the 2006 RACT SIP revision related to RACT for major stationary sources of VOC and NOX. EPA has included in the docket a redacted version of the 2006 RACT SIP to identify which portions of this document remain before EPA and are the subject of this notice of proposed rulemaking. Pennsylvania addressed the remaining RACT requirements for the 1997 ozone NAAQS (which Pennsylvania withdrew from the 2006 RACT SIP) in a subsequent SIP revision submittal, which will be the subject of a separate rulemaking action.

    I. Background

    Ozone is formed in the atmosphere by photochemical reactions between VOCs, NOX, and carbon monoxide (CO) in the presence of sunlight. In order to reduce ozone concentrations in the ambient air, the CAA requires all nonattainment areas to apply control on VOC and NOX emission sources to achieve emission reductions. Among effective control measures, RACT controls significantly reduce VOC and NOX emissions from major stationary sources.

    RACT is defined as the lowest emission limitation that a particular source is capable of meeting by the application of control technology that is reasonably available considering technological and economic feasibility (44 FR 53761 at 53762, September 17, 1979). Section 182 of the CAA sets forth two separate RACT requirements for ozone nonattainment areas. The first requirement, contained in section 182(a)(2)(A) of the CAA, and referred to as RACT fix-up requires the correction of RACT rules for which EPA identified deficiencies before the CAA was amended in 1990. Pennsylvania previously corrected its deficiencies under the 1-hour ozone standard and has no further deficiencies to correct under this section of the CAA. The second requirement, set forth in section 182(b)(2) of the CAA, applies to moderate (or worse) ozone nonattainment area as well as to marginal and attainment areas in ozone transport regions (OTRs) established pursuant to section 184 of the CAA, and requires these areas to implement RACT controls on all major VOC and NOX emission sources and on all sources and source categories covered by a control technique guideline (CTG) issued by EPA.1 See CAA section 182(b)(2) and 184(b). Alternatively, if a state has no sources in a particular source category covered by an EPA CTG, the state may submit a negative declaration in a SIP submittal asserting no subject sources are within the state.

    1 CTGs are documents issued by EPA intended to provide state and local air pollution control authorities information to assist them in determining RACT for VOC from various sources. The recommendations in the CTG are based upon available data and information and may not apply to a particular situation based upon the circumstances. States can follow the CTG and adopt state regulations to implement the recommendations contained therein, or they can adopt alternative approaches. In either case, states must submit their RACT rules to EPA for review and approval as part of the SIP process. Pursuant to section 184(b)(1)(B) of the CAA, all areas in the OTR must implement RACT with respect to sources of VOCs in the state covered by a CTG issued before or after November 15, 1990.

    In 1997, EPA revised the health-based NAAQS for ozone, setting it at 0.08 parts per million (ppm) averaged over an 8-hour time frame. EPA set the 8-hour ozone standard based on scientific evidence demonstrating that ozone causes adverse health effects at lower ozone concentrations and over longer periods of time, than was understood when the pre-existing 1-hour ozone standard was set. EPA determined that the 8-hour standard would be more protective of human health, especially children and adults who are active outdoors, and individuals with a preexisting respiratory disease, such as asthma. EPA subsequently revised the ozone NAAQS in 2008 and again in 2015. This rulemaking only addresses SIP requirements under the 1997 ozone NAAQS.

    The entire Commonwealth of Pennsylvania is in the OTR. Therefore, under CAA section 184, the entire Commonwealth was subject to RACT requirements under the 1-hour ozone standard. Pennsylvania has implemented numerous RACT controls to meet the CAA RACT requirements under the 1-hour and 1997 8-hour ozone NAAQS. These RACT controls were promulgated in title 25 of the Pennsylvania Code, chapter 129, Standards for Sources.

    EPA requires under the 1997 ozone NAAQS that states meet the CAA RACT requirements, either through a certification that previously adopted RACT controls in their SIP revisions approved by EPA under the 1-hour ozone NAAQS represent adequate RACT control levels for 1997 ozone NAAQS attainment purposes, or through the adoption of new or more stringent regulations that represent RACT control levels. A certification must be accompanied by appropriate supporting information such as consideration of information received during the public comment period and consideration of new data. This information may supplement existing RACT guidance documents that were developed for the 1-hour standard, such that the State's SIP accurately reflects RACT for the 8-hour ozone standard based on the current availability of technically and economically feasible controls. Adoption of new RACT regulations will occur when states have new stationary sources not covered by existing RACT regulations, or when new data or technical information indicates that a previously adopted RACT measure does not represent a newly available RACT control level. Pursuant to section 184(b)(1)(B) of the CAA, Pennsylvania had the obligation for the 1997 ozone NAAQS to implement RACT with respect to sources of VOCs in the Commonwealth covered by a CTG issued before or after November 15, 1990 (but before September 15, 2006 when SIP requirements were due for the 1997 ozone NAAQS). Another 1997 ozone NAAQS requirement for RACT is to submit a negative declaration that there are no CTG or non-CTG major sources of VOC and NOX emissions within the Commonwealth of Pennsylvania. The RACT requirements for the 1997 ozone NAAQS were due to EPA as SIP revisions by September 15, 2006. As stated above, PADEP submitted its 2006 RACT SIP on September 25, 2006 to address RACT requirements for certain VOC sources and for CTG sources.

    II. Summary of SIP Revision

    Pennsylvania's 2006 RACT SIP revision satisfies certain RACT requirements for the 1997 ozone NAAQS through certification that previously adopted RACT controls in Pennsylvania's SIP that were approved by EPA under the 1-hour ozone NAAQS are based on the currently available technically and economically feasible controls, and continues to represent RACT for the 1997 ozone NAAQS and negative declarations that certain CTG source categories do not exist in Pennsylvania.

    CTG Source Categories

    Table 1 lists the CTG source categories due which were required to have RACT rules under the 1997 ozone NAAQS as these CTGs were issued by EPA prior to the due date for SIP requirements for this NAAQS (i.e., September 15, 2006). Table 1 also shows the regulations which PADEP has adopted for those source categories, their state effective dates, and the date and Federal Register (FR) citation of EPA's approval of each regulation. In addition, Table 1 shows the source categories for which Pennsylvania has submitted negative declarations as none of these sources existed in the Commonwealth for those specific categories. In its 2006 RACT SIP, PADEP has certified that these rules constitute RACT for the 1997 ozone NAAQS.

    Table 1— Pennsylvania RACT Rules for CTG VOC Source Categories CTG VOC source category Pennsylvania rule
  • (25 Pa. Code)
  • State effective date EPA Approval date & FR citation
    Aerospace Section 129.73 Aerospace manufacturing and rework 4/10/99 6/25/01, 66 FR 33645. Bulk Gasoline Plants Section 129.60 Bulk gasoline plants 8/3/91 5/13/93, 58 FR 28362. Equipment Leaks from Natural Gas/Gasoline Processing Plants Negative Declaration. Factory Surface Coating of Flat Wood Paneling Negative Declaration. Fugitive Emissions from Synthetic Organic Chemical Polymer and Resin Manufacturing Equipment Section 129.71 Synthetic organic chemical and polymer manufacturing—fugitive sources 5/23/92 12/22/94, 59 FR 65971. Graphic Arts—Rotogravure and Flexography Section 129.67 Graphic arts systems 8/3/91 5/13/93, 58 FR 28362. 9/5/1998 7/26/2000, 65 FR 45918. 6/28/2014 6/25/2015, 80 FR 36481. Large Petroleum Dry Cleaners Negative declaration. Leaks from Gasoline Tank Trucks and Vapor Collection Systems Section 129.62 General standards for bulk gasoline terminals, bulk gasoline plants, and small gasoline storage tanks 5/23/94 12/22/94, 59 FR 65971. Leaks from Petroleum Refinery Equipment Section 129.58 Petroleum refineries—fugitive sources 8/13/83 7/27/84, 49 FR 30183. Manufacture of High-Density Polyethylene, Polypropylene, and Polystyrene Resins Section 129.71 Synthetic organic chemical and polymer manufacturing—fugitive sources 5/23/92 12/22/94, 59 FR 65971. Manufacture of Pneumatic Rubber Tires Section 129.69 Manufacture of pneumatic rubber tires 5/23/92 12/22/94, 59 FR 65971. Manufacture of Synthesized Pharmaceutical Products Section 129.68 Manufacture of synthesized pharmaceutical products 8/3/91 5/13/93, 58 FR 28362. 8/11/92, 57 FR 3577. Petroleum Liquid Storage in External Floating Roof Tanks Section 129.56 Storage tanks greater than 40,000 gallons capacity containing VOCs 9/5/98 7/26/00, 65 FR 45920. Refinery Vacuum Producing Systems, Wastewater Separators, and Process Unit Turnarounds Section 129.55 Petroleum refineries—specific sources 6/20/81 1/19/83, 48 FR 2319. SOCMI Air Oxidation Processes Negative declaration. SOCMI Distillation and Reactor Processes Negative declaration. Shipbuilding/repair Negative declaration. Solvent Metal Cleaning Section 129.63 Degreasing operations 12/22/01 1/16/03, 68 FR 2208. Stage I Vapor Control Systems—Gasoline Service Stations Section 129.61 Small gasoline storage tank control (Stage I control) 8/3/91 5/13/93, 58 FR 28362. Storage of Petroleum Liquids in Fixed Roof Tanks Section 129.56 Storage tanks greater than 40,000 gallons capacity containing VOCs 9/5/98 7/26/00, 65 FR 45920. • Surface Coating for Insulation of Magnet Wire Section 129.52 Surface coating processes 6/10/2000 7/20/01, 66 FR 37908. • Surface Coating of Automobiles and Light-Duty Trucks 11/20/10 8/24/2011, 76 FR 52870. • Surface Coating of Cans • Surface Coating of Coils • Surface Coating of Fabrics • Surface Coating of Large Appliances • Surface Coating of Metal Furniture • Surface Coating of Miscellaneous Metal Parts and Products • Surface Coating of Paper Tank Truck Gasoline Loading Terminals Section 129.59 Bulk gasoline terminals 8/3/91 5/13/93, 58 FR 28362. Use of Cutback Asphalt Section 129.64 Cutback asphalt paving 8/13/83 7/27/84, 49 FR 30183. Wood Furniture Sections 129.101-107 Wood Furniture Manufacturing Operations 6/10/00 7/20/01, 66 FR 37908.
    Non-CTG VOC Source Categories

    In its 2006 RACT SIP, PADEP has also certified that three regulations constitute RACT for certain VOC sources for the 1997 ozone NAAQS based on the currently available technically and economically feasible controls. Table 2 lists these source categories, their state effective dates, and the date and FR citation of EPA's approval of each regulation.

    Table 2—Pennsylvania RACT Rules for Non-CTG VOC Sources Pennsylvania non-CTG VOC rule
  • (25 Pa. Code)
  • State effective date EPA approval date & FR citation
    Section 129.65 Ethylene production plants 8/1/79 5/20/80, 45 FR 33607. Section 129.72 Manufacture of surface active agents 5/23/92 12/22/94, 59 FR 65971. Section 129.75 Mobile equipment repair and refinishing 11/27/99 8/14/00, 65 FR 49501. Section 129.51 Sources of VOC, General
  • (This section lists general requirements for all sources of VOCs, and does not include RACT controls.)
  • 4/10/1999
  • 6/28/2014
  • 6/25/2001, 66 FR 33645.
  • 6/25/2015, 80 FR 36482.
  • III. Final Action

    EPA's review of this material indicates that Pennsylvania's 2006 RACT SIP meets certain RACT requirements for the 1997 ozone NAAQS for applicable CTG source categories and for three non-CTG VOC categories: manufacture of surface active agents, mobile equipment repair and refinishing, and ethylene production plants to address sections 182(b) and 184(b) of the CAA.

    EPA is approving Pennsylvania's 2006 RACT SIP, which was submitted on September 25, 2006. This SIP revision consists of (1) Pennsylvania's certification that previously adopted and SIP approved RACT controls for CTG source categories and three non-CTG source categories are based on the currently available technically and economically feasible controls, and that they continue to represent RACT for the 8-hour implementation purposes and (2) negative declaration that there are no sources in the Commonwealth of Pennsylvania for five CTG source categories. EPA finds this 2006 RACT SIP meets requirements for RACT in CAA section 182(b) and 184(b) with respect to these CTG categories, to the negative declarations, and to these specific VOC source categories. Pennsylvania has addressed its remaining obligations to address major stationary source RACT for VOC and NOX sources in a subsequent SIP submittal for which EPA will take later, separate rulemaking action.

    EPA is publishing this rule without prior proposal because EPA views this as a noncontroversial amendment and anticipates no adverse comment. However, in the “Proposed Rules” section of today's Federal Register, EPA is publishing a separate document that will serve as the proposal to approve the SIP revision if adverse comments are filed. This rule will be effective on October 5, 2017 without further notice unless EPA receives adverse comment by August 7, 2017. If EPA receives adverse comment, EPA will publish a timely withdrawal in the Federal Register informing the public that the rule will not take effect. EPA will address all public comments in a subsequent final rule based on the proposed rule. EPA will not institute a second comment period on this action. Any parties interested in commenting must do so at this time.

    IV. Statutory and Executive Order Reviews A. General Requirements

    Under the CAA, the Administrator is required to approve a SIP submission that complies with the provisions of the CAA and applicable federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely approves state law as meeting federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

    • Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);

    • does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);

    • is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.);

    • does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Public Law 104-4);

    • does not have federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

    • is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

    • is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

    • is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and

    • does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

    In addition, this rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not approved to apply in Indian country located in the state, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law. B. Submission to Congress and the Comptroller General

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this action and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

    C. Petitions for Judicial Review

    Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by September 5, 2017. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. Parties with objections to this direct final rule are encouraged to file a comment in response to the parallel notice of proposed rulemaking for this action published in the proposed rules section of today's Federal Register, rather than file an immediate petition for judicial review of this direct final rule, so that EPA can withdraw this direct final rule and address the comment in the proposed rulemaking action.

    This action approving Pennsylvania's 2006 RACT SIP may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

    List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Ozone, Particulate matter, Reporting and recordkeeping requirements, Volatile organic compounds.

    Dated: June 22, 2017. Cecil Rodrigues, Acting Regional Administrator, Region III.

    40 CFR part 52 is amended as follows:

    PART 52—APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS 1. The authority citation for part 52 continues to read as follows: Authority:

    42 U.S.C. 7401 et seq.

    Subpart NN—Pennsylvania 2. In § 52.2020, the table in paragraph (e)(1) is amended by adding an entry for “Reasonably Available Control Technology (RACT) for the 1997 ozone national ambient air quality standard (NAAQS)” at the end of the table to read as follows:
    52.2020 Identification of plan.

    (e) * * *

    (1) * * *

    Name of non-regulatory SIP revision Applicable geographic area State submittal date EPA approval date Additional explanation *         *         *         *         *         *         * Reasonably Available Control Technology (RACT) for the 1997 ozone national ambient air quality standard (NAAQS) Statewide 9/25/2006 7/7/2017, [Insert Federal Register citation] Pertaining only to control technique guideline (CTG) source categories and three non-CTG volatile organic compound (VOC) source categories: Manufacture of surface active agents, mobile equipment repair and refinishing, and ethylene production plants. Remainder of submittal withdrawn 6/27/2016.
    [FR Doc. 2017-14204 Filed 7-6-17; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 180 [EPA-HQ-OPP-2016-0013; FRL-9962-15] Flonicamid; Pesticide Tolerances AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule.

    SUMMARY:

    This regulation establishes tolerances for residues of flonicamid in or on multiple commodities which are identified and discussed later in this document. Interregional Research Project Number 4 (IR-4) requested these tolerances under the Federal Food, Drug, and Cosmetic Act (FFDCA).

    DATES:

    This regulation is effective July 7, 2017. Objections and requests for hearings must be received on or before September 5, 2017, and must be filed in accordance with the instructions provided in 40 CFR part 178 (see also Unit I.C. of the SUPPLEMENTARY INFORMATION).

    ADDRESSES:

    The docket for this action, identified by docket identification (ID) number EPA-HQ-OPP-2016-0013, is available at http://www.regulations.gov or at the Office of Pesticide Programs Regulatory Public Docket (OPP Docket) in the Environmental Protection Agency Docket Center (EPA/DC), West William Jefferson Clinton Bldg., Rm. 3334, 1301 Constitution Ave. NW., Washington, DC 20460-0001. The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Public Reading Room is (202) 566-1744, and the telephone number for the OPP Docket is (703) 305-5805. Please review the visitor instructions and additional information about the docket available at http://www.epa.gov/dockets.

    FOR FURTHER INFORMATION CONTACT:

    Michael L. Goodis, Director, Registration Division (7505P), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001; main telephone number: (703) 305-7090; email address: [email protected]

    SUPPLEMENTARY INFORMATION:

    I. General Information A. Does this action apply to me?

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

    • Crop production (NAICS code 111).

    • Animal production (NAICS code 112).

    • Food manufacturing (NAICS code 311).

    • Pesticide manufacturing (NAICS code 32532).

    B. How can I get electronic access to other related information?

    You may access a frequently updated electronic version of EPA's tolerance regulations at 40 CFR part 180 through the Government Printing Office's e-CFR site at http://www.ecfr.gov/cgi-bin/text-idx?&c=ecfr&tpl=/ecfrbrowse/Title40/40tab_02.tpl.

    C. How can I file an objection or hearing request?

    Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2016-0013 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before September 5, 2017. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

    In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2016-0013, by one of the following methods:

    Federal eRulemaking Portal: http://www.regulations.gov. Follow the online instructions for submitting comments. Do not submit electronically any information you consider to be CBI or other information whose disclosure is restricted by statute.

    Mail: OPP Docket, Environmental Protection Agency Docket Center (EPA/DC), (28221T), 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001.

    Hand Delivery: To make special arrangements for hand delivery or delivery of boxed information, please follow the instructions at http://www.epa.gov/dockets/contacts.html.

    Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at http://www.epa.gov/dockets.

    II. Summary of Petitioned-For Tolerance

    In the Federal Register of May 19, 2016 (81 FR 31581) (FRL-9946-02), EPA issued a document pursuant to FFDCA section 408(d)(3), 21 U.S.C. 346a(d)(3), announcing the filing of a pesticide petition (PP) 5E8428 submitted by IR-4 Project Headquarters, Rutgers, The State University of New Jersey, 500 College Road East, Suite 201 W, Princeton, NJ 08540. The petition requests that 40 CFR 180.613 be amended by establishing tolerances for residues of the fungicide flonicamid, N-(cyanomethyl)-4-(trifluoromethyl)-3-pyridinecarboxamide, and its metabolites, TFNA (4-trifluoromethylinicotinic acid), TFNA-AM (4-trifluoromethylnicotinamide), and TFNG, N-(4-trifluoromethylnicotinoyl)glycine, calculated as the stoichiometric equivalent of flonicamid, in or on pea and bean, dried shelled, except soybean, subgroup 6C at 3.0 parts per million (ppm); Pea and bean, succulent shelled, subgroup 6B at 6.0 ppm; and Vegetable, legume, edible podded, subgroup 6A at 4.0 ppm. This petition contains an additional request to increase the existing tolerance on Vegetable, fruiting, group 8-10 from 0.4 to 1.50 ppm, but EPA has already taken action on that specific request, in a final tolerance rule published in the Federal Register on May 11, 2017 (82 FR 21941) (FRL-9959-91).

    A summary of the petition prepared by ISK Biosciences Corporation, the registrant, is available in the docket, http://www.regulations.gov, at docket #: EPA-HQ-OPP-2016-0013. One comment was received on the notice of filing. EPA's response to the comment is discussed in Unit IV.C.

    Based upon review of the data supporting the petition, EPA is establishing a tolerance for Pea and bean, succulent shelled, subgroup 6B that varies slightly from what the petitioner requested. The reason for this change is explained in Unit IV.D.

    III. Aggregate Risk Assessment and Determination of Safety

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

    Consistent with FFDCA section 408(b)(2)(D), and the factors specified in FFDCA section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure for flonicamid including exposure resulting from the tolerances established by this action, consistent with FFDCA section 408(b)(2).

    In the Federal Register of May 11, 2017 (82 FR 21941) (FRL-9959-91), EPA established tolerances for residues of flonicamid in or on several commodities. The risk assessments supporting that action aggregated dietary and non-occupational exposures from existing and proposed uses of flonicamid, including from the exposures associated with the tolerances requested in this action. That assessment, which included the tolerances in today's action, concluded that the tolerances are safe; therefore, EPA is relying upon that Federal Register document and the risk assessments supporting the findings in that document to support the safety finding for the tolerances that are the subject of this action.

    Specific information on the studies received and the nature of the adverse effects caused by flonicamid as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies can be found at http://www.regulations.gov in the document, “Subject: Flonicamid. Human Health Risk Assessment for New Uses on Legume Vegetables, Subgroups 6A, 6B, and 6C; Add Directions for use on Greenhouse Grown Peppers and Increase the Tolerance for Residues on Fruiting Vegetables, Group 8-10; New Use on Citrus Fruits, Group 10-10; and a Tolerance without U.S. Registration for residues in/on Dried Tea” in docket ID number, EPA-HQ-OPP-2016-0013.

    Based on the findings of the May 11, 2017 Federal Register document and the supporting documents, EPA concludes that there is a reasonable certainty that no harm will result to the general population, or to infants and children from aggregate exposure to flonicamid residues.

    IV. Other Considerations A. Analytical Enforcement Methodology

    Adequate enforcement methodology (FMC Method No. P-3561M, a liquid chromatography with tandem mass spectrometry (LC/MS/MS) method) is available to enforce the tolerance expression for flonicamid and its metabolites in or on plant commodities.

    The method may be requested from: Chief, Analytical Chemistry Branch, Environmental Science Center, 701 Mapes Rd., Ft. Meade, MD 20755-5350; telephone number: (410) 305-2905; email address: [email protected]

    B. International Residue Limits

    In making its tolerance decisions, EPA seeks to harmonize U.S. tolerances with international standards whenever possible, consistent with U.S. food safety standards and agricultural practices. EPA considers the international maximum residue limits (MRLs) established by the Codex Alimentarius Commission (Codex), as required by FFDCA section 408(b)(4). The Codex Alimentarius is a joint United Nations Food and Agriculture Organization/World Health Organization food standards program, and it is recognized as an international food safety standards-setting organization in trade agreements to which the United States is a party. EPA may establish a tolerance that is different from a Codex MRL; however, FFDCA section 408(b)(4) requires that EPA explain the reasons for departing from the Codex level.

    The Codex has not established a MRL for flonicamid.

    C. Response to Comments

    Comment: One anonymous comment on the notice of filing of petition 5E8428 was received. The commenter claims that flonicamid is a “toxic pesticide” and residues at any level in food commodities should not be allowed and requested that EPA deny setting tolerances for the petition-for new uses of flonicamid. The comment stated that the proposed flonicamid use would add to about 25,000 toxic chemicals currently in the environment and combine to create even more toxic chemical residues in food and drinking water further increasing harmful effects to humans and environment.

    Agency response: The Agency recognizes that some individuals believe that pesticides should be banned completely. However, under the existing legal framework provided by FFDCA section 408, EPA is authorized to establish pesticide tolerances or exemptions where persons seeking such tolerances or exemptions have demonstrated that the pesticide meets the safety standard imposed by that statute. In this instance, EPA has examined all the relevant and available data and concluded that the tolerances are safe. The commenter has not provided any information to support a conclusion by the Agency that the tolerances are not safe.

    D. Revisions to Petitioned-For Tolerances

    EPA is establishing a slightly higher tolerance for Pea and bean, succulent shelled, subgroup 6B at 7.0 ppm compared to the petitioner's request of a tolerance at 6.0 ppm. EPA's decision is based on the Organization for Economic Cooperation and Development (OECD) tolerance calculation procedures and available field trial data.

    V. Conclusion

    Therefore, tolerances are established for residues of flonicamid, N-(cyanomethyl)-4-(trifluoromethyl)-3-pyridinecarboxamide, and its metabolites, TFNA (4-trifluoromethylinicotinic acid), TFNA-AM (4-trifluoromethylnicotinamide), and TFNG, N-(4-trifluoromethylnicotinoyl)glycine, calculated as the stoichiometric equivalent of flonicamid, in or on Pea and bean, succulent shelled, subgroup 6B at 7.0 ppm; Pea and bean, dried shelled, except soybean, subgroup 6C at 3.0 ppm; and Vegetable, legume, edible podded, subgroup 6A at 4.0 ppm.

    VI. Statutory and Executive Order Reviews

    This action establishes tolerances under FFDCA section 408(d) in response to a petition submitted to the Agency. The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled “Regulatory Planning and Review” (58 FR 51735, October 4, 1993). Because this action has been exempted from review under Executive Order 12866, this action is not subject to Executive Order 13211, entitled “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001) or Executive Order 13045, entitled “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997). This action does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA) (44 U.S.C. 3501 et seq.), nor does it require any special considerations under Executive Order 12898, entitled “Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations” (59 FR 7629, February 16, 1994).

    Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.), do not apply.

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

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

    VII. Congressional Review Act

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

    List of Subjects in 40 CFR Part 180

    Environmental protection, Administrative practice and procedure, Agricultural commodities, Pesticides and pests, Reporting and recordkeeping requirements.

    Dated: June 2, 2017. Michael L. Goodis, Director, Registration Division, Office of Pesticide Programs.

    Therefore, 40 CFR chapter I is amended as follows:

    PART 180—[AMENDED] 1. The authority citation for part 180 continues to read as follows: Authority:

    21 U.S.C. 321(q), 346a and 371.

    2. In § 180.613, add alphabetically the following commodities “Pea and bean, succulent shelled, subgroup 6B”; “Pea and bean, dried shelled, except soybean, subgroup 6C”; and “Vegetable, legume, edible podded, subgroup 6A” to the table in paragraph (a)(1) to read as follows:
    § 180.613 Flonicamid; tolerances for residues.

    (a) * * *

    (1) * * *

    Commodity Parts per
  • million
  • *    *    *    *    * Pea and bean, succulent shelled, subgroup 6B 7.0 Pea and bean, dried shelled, except soybean, subgroup 6C 3.0 *    *    *    *    * Vegetable, legume, edible podded, subgroup 6A 4.0 *    *    *    *    *
    [FR Doc. 2017-14339 Filed 7-6-17; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 180 [EPA-HQ-OPP-2016-0218; FRL-9962-97] Prosulfuron; Pesticide Tolerances AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule.

    SUMMARY:

    This regulation establishes tolerances for residues of prosulfuron in or on grain, cereal, forage, fodder, and straw, group 16, stover; grain, cereal, forage, fodder, and straw, group 16, forage; grain, cereal, forage, fodder, and straw, group 16, hay; grain, cereal, forage, fodder, and straw, group 16, straw; and grain, cereal, group 15. Syngenta Crop Protection, LLC requested these tolerances under the Federal Food, Drug, and Cosmetic Act (FFDCA).

    DATES:

    This regulation is effective July 7, 2017. Objections and requests for hearings must be received on or before September 5, 2017, and must be filed in accordance with the instructions provided in 40 CFR part 178 (see also Unit I.C. of the SUPPLEMENTARY INFORMATION).

    ADDRESSES:

    The docket for this action, identified by docket identification (ID) number EPA-HQ-OPP-2016-0218, is available at http://www.regulations.gov or at the Office of Pesticide Programs Regulatory Public Docket (OPP Docket) in the Environmental Protection Agency Docket Center (EPA/DC), West William Jefferson Clinton Bldg., Rm. 3334, 1301 Constitution Ave. NW., Washington, DC 20460-0001. The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Public Reading Room is (202) 566-1744, and the telephone number for the OPP Docket is (703) 305-5805. Please review the visitor instructions and additional information about the docket available at http://www.epa.gov/dockets.

    FOR FURTHER INFORMATION CONTACT:

    Michael L. Goodis, Registration Division (7505P), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001; main telephone number: (703) 305-7090; email address: [email protected]

    SUPPLEMENTARY INFORMATION:

    I. General Information A. Does this action apply to me?

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

    • Crop production (NAICS code 111).

    • Animal production (NAICS code 112).

    • Food manufacturing (NAICS code 311).

    • Pesticide manufacturing (NAICS code 32532).

    B. How can I get electronic access to other related information?

    You may access a frequently updated electronic version of EPA's tolerance regulations at 40 CFR part 180 through the Government Printing Office's e-CFR site at http://www.ecfr.gov/cgi-bin/text-idx?&c=ecfr&tpl=/ecfrbrowse/Title40/40tab_02.tpl.

    C. How can I file an objection or hearing request?

    Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2016-0218 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before September 5, 2017. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

    In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2016-0218, by one of the following methods:

    Federal eRulemaking Portal: http://www.regulations.gov. Follow the online instructions for submitting comments. Do not submit electronically any information you consider to be CBI or other information whose disclosure is restricted by statute.

    Mail: OPP Docket, Environmental Protection Agency Docket Center (EPA/DC), (28221T), 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001.

    Hand Delivery: To make special arrangements for hand delivery or delivery of boxed information, please follow the instructions at http://www.epa.gov/dockets/contacts.html.

    Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at http://www.epa.gov/dockets.

    II. Summary of Petitioned-For Tolerance

    In the Federal Register of May 19, 2016 (81 FR 31581) (FRL-9946-02), EPA issued a document pursuant to FFDCA section 408(d)(3), 21 U.S.C. 346a(d)(3), announcing the filing of a pesticide petition (PP 6F8455) by Syngenta Crop Protection, LLC, P.O. Box 18300, Greensboro, NC 27419. The petition requested that 40 CFR 180.481 be amended by establishing tolerances for residues of the herbicide prosulfuron, (N-[[(4-methoxy-6-methyl-1,3,5-triazin-2-yl)amino]carbonyl]-2-(3,3,3-trifluoropropyl)benzenesulfonamide), in or on grain, cereal, forage, fodder, and straw, group 16, fodder at 0.01 parts per million (ppm); grain, cereal, forage, fodder, and straw, group 16, forage at 0.10 ppm; grain, cereal, forage, fodder, and straw, group 16, hay at 0.20 ppm; grain, cereal, forage, fodder, and straw, group 16, straw at 0.02 ppm; and grain, cereal, group 15 at 0.01 ppm. That document referenced a summary of the petition prepared by Syngenta Crop Protection, LLC, the registrant, which is available in the docket, http://www.regulations.gov. There were no comments received in response to the notice of filing.

    Based upon review of the data supporting the petition, EPA has revised the commodity definition from grain, cereal, forage, fodder, and straw, group 16, fodder to grain, cereal, forage, fodder, and straw, group 16, stover. The reason for this change is explained in Unit IV.C.

    III. Aggregate Risk Assessment and Determination of Safety

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

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

    A. Toxicological Profile

    EPA has evaluated the available toxicity data and considered its validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children. The most prevalent effect observed across species and study durations following administration of prosulfuron was decreased body weight observed in subchronic and chronic oral toxicity studies in rats and dogs. Additionally, subchronic and chronic oral toxicity studies in dogs showed decreased hematological parameters and hepatic toxicity. Evidence of neurotoxicity was observed in an acute neurotoxicity study but not in the subchronic neurotoxicity study. The neurological effects seen in the acute neurotoxicity study were transient, affecting primary sensorimotor and gait functions. In a developmental range-finding study in rabbits, ataxia, hypoactivity, and neuropathology were observed starting at doses of 150 mg/kg/day. However, these potential signs of neurotoxicity were not consistent with findings in the two main developmental studies in rabbits where there were no signs of neurotoxicity observed up to 200 mg/kg/day. Additionally, other repeated dosing studies in the rat, mouse, and dog did not show evidence of neurotoxicity. There is no evidence that prosulfuron is an immunotoxic chemical. Prosulfuron is classified as “Not Likely to Be Carcinogenic to Humans” based on the lack of evidence of carcinogenicity in mice and rats and no concern for mutagenicity. Prosulfuron has low acute toxicity by the oral, dermal, and inhalation routes of exposure, it is not considered an eye or skin irritant and it is not a skin sensitizer.

    There was no evidence from the developmental and reproductive studies of increased susceptibility in rat or rabbit fetuses. In the first of two rabbit developmental studies, there were no signs of maternal or developmental toxicity. The second rabbit (tested using higher doses than the first) and the rat developmental studies showed dose-related increases in small fetuses and skeletal effects but these occurred at maternally toxic doses. In the reproductive study in rats, decreases in body weights were noted for both the adults of the P0 and P1 generations and for the F1 and F2 pups.

    Specific information on the studies received and the nature of the adverse effects caused by prosulfuron as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies can be found at http://www.regulations.gov in document Prosulfuron. Human Health Risk Assessment in Support of a Section 3 Petition for the Expansion of Crop Groups 15 and 16 to Include Permanent Tolerances for Residues of Prosulfuron in Rice, pages 9-12 in docket ID number EPA-HQ-OPP-2016-0218.

    B. Toxicological Points of Departure/Levels of Concern

    Once a pesticide's toxicological profile is determined, EPA identifies toxicological points of departure (POD) and levels of concern to use in evaluating the risk posed by human exposure to the pesticide. For hazards that have a threshold below which there is no appreciable risk, the toxicological POD is used as the basis for derivation of reference values for risk assessment. PODs are developed based on a careful analysis of the doses in each toxicological study to determine the dose at which no adverse effects are observed (the NOAEL) and the lowest dose at which adverse effects of concern are identified (the LOAEL). Uncertainty/safety factors are used in conjunction with the POD to calculate a safe exposure level—generally referred to as a population-adjusted dose (PAD) or a reference dose (RfD)—and a safe margin of exposure (MOE). For non-threshold risks, the Agency assumes that any amount of exposure will lead to some degree of risk. Thus, the Agency estimates risk in terms of the probability of an occurrence of the adverse effect expected in a lifetime. For more information on the general principles EPA uses in risk characterization and a complete description of the risk assessment process, see http://www2.epa.gov/pesticide-science-andassessing-pesticide-risks/assessing-human-health-risk-pesticides.

    A summary of the toxicological endpoints for prosulfuron used for human risk assessment is shown in Table 1 of this unit.

    Table 1—Summary of Toxicological Doses and Endpoints for Prosulfuron for Use in Human Health Risk Assessment Exposure/scenario Point of departure and uncertainty/
  • safety factors
  • RfD, PAD, LOC for risk assessment Study and toxicological effects
    Acute dietary (Females 13-49 years of age) (General population including infants and children) NOAEL = 10 mg/kg/day
  • UFA = 10x
  • UFH = 10x FQPA SF = 1x
  • Acute RfD = 0.1 mg/kg/day
  • aPAD = 0.1 mg/kg/day
  • Acute Neurotoxicity Study—Rat
  • MRID 43387703
  • LOAEL = 250 mg/kg/day based on abnormal gait in females.
  • Chronic dietary (All populations) NOAEL = 5.3 mg/kg/day
  • UFA = 10x
  • UFH = 10x
  • FQPA SF = 1x
  • Chronic RfD = 0.053 mg/kg/day
  • cPAD = 0.053 mg/kg/day
  • Subchronic Oral Toxicity Study—Dog
  • MRID 42685230
  • LOAEL = 54 mg/kg/day based on decreased feed efficiency, hematological findings and hepatotoxicity in both sexes.
  • Cancer (Oral, dermal, inhalation) Prosulfuron is classified as “Not Likely to Be Carcinogenic to Humans” based on the lack of evidence of carcinogenicity in mice and rats and no concern for mutagenicity. FQPA SF = Food Quality Protection Act Safety Factor. LOAEL = lowest-observed-adverse-effect-level. LOC = level of concern. mg/kg/day = milligram/kilogram/day. MOE = margin of exposure. NOAEL = no-observed-adverse-effect-level. PAD = population adjusted dose (a = acute, c = chronic). RfD = reference dose. UF = uncertainty factor. UFA = extrapolation from animal to human (interspecies). UFH = potential variation in sensitivity among members of the human population (intraspecies).
    C. Exposure Assessment

    1. Dietary exposure from food and feed uses. In evaluating dietary exposure to prosulfuron, EPA considered exposure under the petitioned-for tolerances as well as all existing prosulfuron tolerances in 40 CFR 180.481. EPA assessed dietary exposures from prosulfuron in food as follows:

    i. Acute exposure. Quantitative acute dietary exposure and risk assessments are performed for a food-use pesticide, if a toxicological study has indicated the possibility of an effect of concern occurring as a result of a 1-day or single exposure.

    Such effects were identified for prosulfuron. In estimating acute dietary exposure, EPA used food consumption information from the United States Department of Agriculture (USDA) Nationwide Health and Nutrition Examination Survey, What We Eat In America (NHANES/WWEIA) conducted from 2003-2008. As to residue levels in food, the acute dietary analysis was obtained from the Dietary Exposure Evaluation Model using the Food Commodity Intake Database (DEEM-FCID; version 3.18) and assumed 100 percent crop treated (PCT) and tolerance-level residues.

    ii. Chronic exposure. In conducting the chronic dietary exposure assessment, EPA used the food consumption data from the USDA NHANES/WWEIA conducted from 2003-2008. As to residue levels in food, the chronic dietary analysis was obtained from the DEEM-FCID; version 3.18 database and assumed 100 PCT and tolerance-level residues.

    iii. Cancer. EPA has concluded that prosulfuron does not pose a cancer risk to humans. Therefore, a dietary exposure assessment for the purpose of assessing cancer risk is unnecessary.

    iv. Anticipated residue and percent crop treated (PCT) information. EPA did not use anticipated residue and/or PCT information in the dietary assessment for prosulfuron. Tolerance-level residues and/or 100 PCT were assumed for all food commodities.

    2. Dietary exposure from drinking water. The Agency used screening-level water exposure models in the dietary exposure analysis and risk assessment for prosulfuron in drinking water. These simulation models take into account data on the physical, chemical, and fate/transport characteristics of prosulfuron. Further information regarding EPA drinking water models used in pesticide exposure assessment can be found at http://www2.epa.gov/pesticidescience-and-assessing-pesticide-risks/about-water-exposure-models-used-pesticide.

    Based on the Tier 1 Rice Model and Pesticide Root Zone Model Ground Water (PRZM GW), the estimated drinking water concentrations (EDWCs) of prosulfuron for both acute exposures and chronic exposures for non-cancer assessments are estimated to be 37 parts per billion (ppb) for both surface water and ground water.

    Modeled estimates of drinking water concentrations were directly entered into the dietary exposure model. For acute and chronic dietary risk assessment, the water concentration value of 37 ppb was used to assess the contribution to drinking water.

    3. From non-dietary exposure. The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure (e.g., for lawn and garden pest control, indoor pest control, termiticides, and flea and tick control on pets). Prosulfuron is not registered for any specific use patterns that would result in residential exposure.

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

    EPA has not found prosulfuron to share a common mechanism of toxicity with any other substances, and prosulfuron does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that prosulfuron does not have a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see EPA's Web site at http://www2.epa.gov/pesticide-science-and-assessing-pesticide-risks/cumulativeassessment-risk-pesticides.

    D. Safety Factor for Infants and Children

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

    2. Prenatal and postnatal sensitivity. The prenatal and postnatal toxicity database for prosulfuron includes a developmental toxicity study in the rat, two developmental toxicity studies and a range-finding developmental study in the rabbit, and a 2-generation reproduction toxicity study in the rat. There was no evidence of increased susceptibility of fetuses or offspring in any of these studies.

    There were no maternal or fetal effects observed at any dose in the first of two rabbit developmental toxicity studies. In the second rabbit study and in the rat developmental toxicity study, a dose-related increase in small fetuses and skeletal effects was observed, but only in the presence of maternal toxicity (decreased body weight gain in the rat study; and increases in abortions, decreases in food consumption and decreased mean body weight gain in the rabbit study).

    In the developmental range-finding study in rabbits, ataxia, hypoactivity, and neuropathology were observed starting at doses of 150 mg/kg/day. However, these potential signs of neurotoxicity were not consistent with findings in the two main developmental studies in rabbits where there were no signs of neurotoxicity observed up to 200 mg/kg/day. In the 2-generation reproduction study in the rat, decreases in body weight were observed in the F1 and F2 offspring but these occurred at doses in which parental toxicity was also observed. There was no evidence of neurotoxicity to fetuses or offspring observed in any of the developmental or reproduction toxicity studies.

    3. Conclusion. EPA has determined that reliable data show the safety of infants and children would be adequately protected if the Food Quality Protection Act Safety Factor (FQPA SF) were reduced to 1x. That decision is based on the following findings:

    i. The toxicity database for prosulfuron is complete.

    ii. Although there was evidence of neurotoxicity in the acute neurotoxicity study and the range-finding developmental toxicity rabbit study, the selected endpoints are protective of these effects since they were seen at dose levels in excess of those where systemic toxicity occurred and at doses at least 15-fold higher than the no-observed adverse effect levels (NOAELs) selected for risk assessment. Concern is also low since no neurotoxicity was observed in the rest of the prosulfuron toxicological database, including the subchronic neurotoxicity study in rats.

    iii. As discussed in Unit III.D.2., there is no evidence that prosulfuron results in increased susceptibility in in utero rats or rabbits in the prenatal developmental studies or in young rats in the 2-generation reproduction study.

    iv. There are no residual uncertainties identified in the exposure databases. The dietary food exposure assessments were performed based on 100 PCT and tolerance-level residues. EPA made conservative (protective) assumptions in the ground and surface water modeling used to assess exposure to prosulfuron in drinking water. These assessments will not underestimate the exposure and risks posed by prosulfuron.

    E. Aggregate Risks and Determination of Safety

    EPA determines whether acute and chronic dietary pesticide exposures are safe by comparing aggregate exposure estimates to the acute PAD (aPAD) and chronic PAD (cPAD). For linear cancer risks, EPA calculates the lifetime probability of acquiring cancer given the estimated aggregate exposure. Short-, intermediate-, and chronic-term risks are evaluated by comparing the estimated aggregate food, water, and residential exposure to the appropriate PODs to ensure that an adequate MOE exists.

    1. Acute risk. Using the exposure assumptions discussed in this unit for acute exposure, the acute dietary exposure from food and water to prosulfuron will occupy 6.4% of the aPAD for all infants (< 1 years old), the population group receiving the greatest exposure.

    2. Chronic risk. Using the exposure assumptions described in this unit for chronic exposure, EPA has concluded that chronic exposure to prosulfuron from food and water will utilize 3.9% of the cPAD for all infants (< 1 years old), the population group receiving the greatest exposure. There are no residential uses for prosulfuron.

    3. Short-term risk. Short-term aggregate exposure takes into account short-term residential exposure plus chronic exposure to food and water (considered to be a background exposure level).

    A short-term adverse effect was identified; however, prosulfuron is not registered for any use patterns that would result in short-term residential exposure. Short-term risk is assessed based on short-term residential exposure plus chronic dietary exposure. Because there is no short-term residential exposure and chronic dietary exposure has already been assessed under the appropriately protective cPAD (which is at least as protective as the POD used to assess short-term risk), no further assessment of short-term risk is necessary, and EPA relies on the chronic dietary risk assessment for evaluating short-term risk for prosulfuron.

    4. Intermediate-term risk. Intermediate-term aggregate exposure takes into account intermediate-term residential exposure plus chronic exposure to food and water (considered to be a background exposure level).

    An intermediate-term adverse effect was identified; however, prosulfuron is not registered for any use patterns that would result in intermediate-term residential exposure. Intermediate-term risk is assessed based on intermediate-term residential exposure plus chronic dietary exposure. Because there is no intermediate-term residential exposure and chronic dietary exposure has already been assessed under the appropriately protective cPAD (which is at least as protective as the POD used to assess intermediate-term risk), no further assessment of intermediate-term risk is necessary, and EPA relies on the chronic dietary risk assessment for evaluating intermediate-term risk for prosulfuron.

    5. Aggregate cancer risk for U.S. population. Based on the lack of evidence of carcinogenicity in two adequate rodent carcinogenicity studies, prosulfuron is not expected to pose a cancer risk to humans.

    6. Determination of safety. Based on these risk assessments, EPA concludes that there is a reasonable certainty that no harm will result to the general population, or to infants and children from aggregate exposure to prosulfuron residues.

    IV. Other Considerations A. Analytical Enforcement Methodology

    Adequate enforcement methodology, Method AG-590C (a high performance liquid chromatography method with column switching and ultraviolet (UV) detection), is available to enforce the tolerance expression.

    The method may be requested from: Chief, Analytical Chemistry Branch, Environmental Science Center, 701 Mapes Rd., Ft. Meade, MD 20755-5350; telephone number: (410) 305-2905; email address: [email protected]

    B. International Residue Limits

    In making its tolerance decisions, EPA seeks to harmonize U.S. tolerances with international standards whenever possible, consistent with U.S. food safety standards and agricultural practices. EPA considers the international maximum residue limits (MRLs) established by the Codex Alimentarius Commission (Codex), as required by FFDCA section 408(b)(4). The Codex Alimentarius is a joint United Nations Food and Agriculture Organization/World Health Organization food standards program, and it is recognized as an international food safety standards-setting organization in trade agreements to which the United States is a party. EPA may establish a tolerance that is different from a Codex MRL; however, FFDCA section 408(b)(4) requires that EPA explain the reasons for departing from the Codex level.

    The Codex has not established a MRL for prosulfuron.

    C. Revisions to Petitioned-For Tolerances

    EPA has revised the commodity definition from “grain, cereal, forage, fodder, and straw, group 16, fodder” to “grain, cereal, forage, fodder, and straw, group 16, stover” to be consistent with the general food and feed commodity vocabulary EPA uses for tolerances and exemptions.

    V. Conclusion

    Therefore, tolerances are established for residues of prosulfuron, (N-[[(4-methoxy-6-methyl-1,3,5-triazin-2-yl)amino]carbonyl]-2-(3,3,3-trifluoropropyl)benzenesulfonamide), including its metabolites and degradates, in or on grain, cereal, forage, fodder, and straw, group 16, stover at 0.01 ppm; grain, cereal, forage, fodder, and straw, group 16, forage at 0.10 ppm; grain, cereal, forage, fodder, and straw, group 16, hay at 0.20 ppm; grain, cereal, forage, fodder, and straw, group 16, straw at 0.02 ppm; and grain, cereal, group 15 at 0.01 ppm.

    In addition, EPA has revised the tolerance expression to clarify (1) that, as provided in FFDCA section 408(a)(3), the tolerance covers metabolites and degradates of prosulfuron not specifically mentioned; and (2) that compliance with the specified tolerance levels is to be determined by measuring only the specific compounds mentioned in the tolerance expression. EPA has determined that it is reasonable to make this change final without prior proposal and opportunity for comment, because public comment is not necessary, in that the change has no substantive effect on the tolerance, but rather is merely intended to clarify the existing tolerance expression.

    VI. Statutory and Executive Order Reviews

    This action establishes tolerances under FFDCA section 408(d) in response to a petition submitted to the Agency. The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled “Regulatory Planning and Review” (58 FR 51735, October 4, 1993). Because this action has been exempted from review under Executive Order 12866, this action is not subject to Executive Order 13211, entitled “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001) or Executive Order 13045, entitled “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997). This action does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA) (44 U.S.C. 3501 et seq.), nor does it require any special considerations under Executive Order 12898, entitled “Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations” (59 FR 7629, February 16, 1994).

    Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.), do not apply.

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

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

    VII. Congressional Review Act

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

    List of Subjects in 40 CFR Part 180

    Environmental protection, Administrative practice and procedure, Agricultural commodities, Pesticides and pests, Reporting and recordkeeping requirements.

    Dated: June 8, 2017. Michael L. Goodis, Director, Registration Division, Office of Pesticide Programs.

    Therefore, 40 CFR chapter I is amended as follows:

    PART 180—[AMENDED] 1. The authority citation for part 180 continues to read as follows: Authority:

    21 U.S.C. 321(q), 346a and 371.

    2. In § 180.481, paragraph (a) is revised to read as follows:
    § 180.481 Prosulfuron; tolerances for residues.

    (a) General. Tolerances are established for residues of prosulfuron, including its metabolites and degradates, in or on the commodities in the table below. Compliance with the tolerance levels specified below is to be determined by measuring only prosulfuron (N-[[(4-methoxy-6-methyl-1,3,5-triazin-2-yl)amino]carbonyl]-2-(3,3,3-trifluoropropyl)benzenesulfonamide) in or on the commodity.

    Commodity Parts per
  • million
  • Grain, cereal, forage, fodder, and straw, group 16, forage 0.10 Grain, cereal, forage, fodder, and straw, group 16, hay 0.20 Grain, cereal, forage, fodder, and straw, group 16, stover 0.01 Grain, cereal, forage, fodder, and straw, group 16, straw 0.02 Grain, cereal, group 15 0.01
    [FR Doc. 2017-14315 Filed 7-6-17; 8:45 am] BILLING CODE 6560-50-P
    DEPARTMENT OF TRANSPORTATION Federal Railroad Administration 49 CFR Part 269 [Docket No. FRA-2016-0023; Notice No. 4] RIN 2130-AC60 Competitive Passenger Rail Service Pilot Program AGENCY:

    Federal Railroad Administration (FRA), Department of Transportation (DOT).

    ACTION:

    Final rule.

    SUMMARY:

    This final rule implements a pilot program for competitive selection of eligible petitioners in lieu of Amtrak to operate not more than three long-distance routes operated by Amtrak. The final rule is required by statute.

    DATES:

    This final rule is effective on September 5, 2017.

    FOR FURTHER INFORMATION CONTACT:

    Brandon White, Office of Railroad Policy and Development, FRA, 1200 New Jersey Ave. SE., Washington, DC 20590, (202) 493-1327, or Zeb Schorr, Office of Chief Counsel, FRA, 1200 New Jersey Ave. SE., Mail Stop 10, Washington, DC 20590, (202) 493-6072.

    SUPPLEMENTARY INFORMATION:

    I. Background a. Executive Summary of Final Rule

    This final rule implements a pilot program for competitive selection of eligible petitioners in lieu of Amtrak to operate not more than three long-distance routes (as defined in 49 U.S.C. 24102), and operated by Amtrak on the date of enactment of the Passenger Rail Reform and Investment Act of 2015 (title XI of the Fixing America's Surface Transportation (FAST) Act, Pub. L. 114-94, 129 Stat. 1312, 1660-1664 (2015)). The final rule establishes a petition, notification, and bid process by which FRA will evaluate, and ultimately select, bids to provide passenger rail service over particular long-distance routes. The final rule also, among other things, addresses FRA's execution of a contract with the winning bidder awarding the right and obligation to provide intercity passenger rail service over the route, along with an operating subsidy, subject to the 49 U.S.C. 24405 grant conditions and such performance standards as the Secretary of Transportation (Secretary) may require.

    b. Procedural History

    By notice of proposed rulemaking (NPRM) published on June 22, 2016 (81 FR 40624), FRA proposed a competitive passenger rail service pilot program in response to a statutory mandate in section 11307 of the FAST Act. In response to a request for a public hearing, FRA held a public hearing on September 7, 2016. FRA also extended the comment period for the NPRM to October 7, 2016 to allow time for interested parties to submit written comments in response to information provided at the public hearing.

    FRA received comments from the American Association of Private Railroad Car Owners, the Association of Independent Passenger Rail Operators, the National Association of Railroad Passengers, Herzog Transit Services, Corridor Capital, Iowa Pacific Holdings, Florida East Coast Industries, Erie Lackawanna Railroad, the North Carolina Department of Transportation, the National Railroad Passenger Corporation (Amtrak), the Brotherhood of Maintenance of Way Employees Division/International Brotherhood of Teamsters, the Brotherhood of Railroad Signalmen, the International Association of Sheet Metal, Air, Rail, and Transportation Workers/Mechanical Division, the Transportation Trades Department of the American Federation of Labor-Congress of Industrial Organizations, and one individual.

    Comments are addressed in the preamble. Some comments were generally supportive of the NPRM, and other comments were generally unsupportive of the NPRM.

    c. Timelines Established by the Final Rule

    The final rule establishes deadlines for filing petitions, filing bids, and the execution of contract(s) with winning bidders.

    As to the filing of petitions, § 269.7(b) of the final rule requires the filing of a petition with FRA no later than 180 days after the effective date of the final rule implementing the pilot program (petition window). In the NPRM, FRA proposed a 60 day petition window from the publication of the final rule. Several commenters stated the proposed 60 day petition window should be extended to 120 or 180 days. Other commenters stated the petition window should remain 60 days. Still other commenters stated the petition window should be eliminated and the pilot program should remain available indefinitely.

    After careful consideration of these comments, the final rule establishes a 180 day petition window, balancing the need for sufficient time to produce quality petitions and bids with the desire to encourage competition and efficiently use Federal and Amtrak resources. This extended time period will ensure an eligible petitioner has an adequate amount of time to file a petition. It is important to also note the final rule establishes the effective date of the final rule as the trigger for the 180 day period (rather than the date the final rule is published, as proposed in the NPRM). This change effectively gives eligible petitioners 60 more days (in addition to the 180 days) to file a petition. The final rule does not adopt the suggestion of some commenters that the pilot program be “evergreen.” First, the FAST Act does not require the pilot program to remain available indefinitely. Second, an evergreen pilot program may unduly burden the FRA and Amtrak by imposing an indefinite regulatory burden to maintain program readiness. Finally, FRA believes competition is best fostered by a limited duration petition window allowing FRA to evaluate multiple bidders competing for the same route.

    When an eligible petitioner files a petition, under § 269.9(a) of the final rule, FRA will notify the petitioner and Amtrak of receipt of the petition, and publish a notice of receipt in the Federal Register, not later than 30 days after receipt. See 49 U.S.C. 24711(b)(1)(B)(i).

    Section 269.9(b) of the final rule addresses the filing of bids. This section requires both the bidder and Amtrak, if Amtrak so chooses, to submit complete bids to FRA not later than 120 days after FRA publishes a notice of receipt in the Federal Register under § 269.9(a).

    As to the award and execution of contracts with winning bidders (who are not or do not include Amtrak), § 269.11(b)(1) of the final rule first requires FRA to publish a notice for public comment for 30 days in the Federal Register announcing the selection. Section 269.13(a) then requires FRA to execute a contract with a winning bidder not later than 270 days after the § 269.9(b) bid deadline.

    A commenter stated FRA should notify Amtrak of the date when the winning bidder's service will replace Amtrak's service on the affected route. The commenter recommended requiring a minimum 210-day notice period to allow Amtrak sufficient time to notify impacted employees, suppliers, and passengers. As discussed, § 269.11(b)(1), consistent with the requirements of the FAST Act, requires FRA to publish a notice identifying the winning bidder and the route, among other things, for public comment for 30 days.

    In addition, the FAST Act, and this final rule, requires FRA to execute a contract with a winning bidder not later than 270 days after the bid deadline § 269.9 establishes. The NPRM did not specifically address when a winning bidder would assume operation of a route. The precise timing of a new operation will depend upon the winning bidder's readiness to assume operations, the availability and amount of an operating subsidy, as well as the resolution of logistics associated with a change in operator. It may be most appropriate for the new operator to begin operations at the beginning of a new Federal fiscal year, which would facilitate both the payment of the operating subsidy, if one is requested and available, and FRA's efficient administration of the pilot program. FRA will work with the winning bidder and Amtrak to identify a safe, timely, and reasonable date on which the winning bidder will assume operations.

    d. Operating Subsidy

    The FAST Act requires the Secretary to award an operating subsidy to a winning bidder that is not or does not include Amtrak (although a bidder may elect to not receive an operating subsidy). 49 U.S.C. 24711(b)(1)(E)(ii). Specifically, the operating subsidy, as determined by the Secretary, is for the first year at a level that does not exceed 90 percent of the level in effect for that specific route during the fiscal year preceding the fiscal year the petition was received, adjusted for inflation, and any subsequent years under the same calculation, adjusted for inflation.

    In addition, the FAST Act requires FRA to provide to Amtrak an appropriate portion of the applicable appropriations to cover any cost directly attributable to the termination of Amtrak service on the route and any indirect costs to Amtrak imposed on other Amtrak routes as a result of losing service on the route operated by the winning bidder. 49 U.S.C. 24711(e)(2). Any amount FRA provides to Amtrak under the prior sentence would not be deducted from, or have any effect on, the operating subsidy 49 U.S.C. 24711(b)(1)(E)(ii) requires.

    Consistent with the requirements of the FAST Act, § 269.13(b)(1) of the NPRM required FRA to award to a winning bidder that is not or does not include Amtrak an operating subsidy “as determined by FRA” for the first year at a level that does not exceed 90 percent of the level in effect for that specific route during the fiscal year preceding the fiscal year in which the petition was received, adjusted for inflation.

    Commenters requested more clarity on FRA's determination of the operating subsidy amount. Because the operating portion of FRA's annual grant to Amtrak's National Network is the authorized source of funding for the operating subsidy, only cost categories associated with the operating portion of Amtrak's grant are eligible costs for the operating subsidy under this pilot program. Consequently, § 269.13(b)(1) of the final rule states the operating subsidy is based on Amtrak's publically-reported fully-allocated operating costs of the route for the prior fiscal year, excluding costs related to Other Postretirement Employee Benefits (OPEB's), Amtrak Performance Tracking System (APT) Asset Allocations, Project Related Costs, and Amtrak Office of Inspector General activities. This data is publicly available on Amtrak's Web site in a comprehensive Monthly Performance Report (the final audited September report contains information for the entire fiscal year). Amtrak also reports this data to Congress and the Secretary in the monthly National Railroad Passenger Corporation Progress Report.

    To avoid confusion, FRA will post, and update as necessary, the calculation and maximum subsidy amount available for each route based on the most recent full fiscal year data available on its Web site. For subsequent fiscal years, FRA will award the same operating subsidy, adjusted for inflation, again subject to the availability of Congressional appropriations. FRA will also provide the operating subsidy calculations for each long-distance route on the FRA Web site for reference by eligible petitioners.

    One commenter questioned the accuracy of Amtrak's fully-allocated route costs, favoring instead reporting of variable costs by route at a detailed account level. FRA disagrees. Fully allocated costs are a component of the cost accounting methodology formed by the creation of APT, a statutorily mandated system developed by FRA, in close collaboration with Amtrak. Amtrak has used APT effectively since 2009 to assign costs at a route level. While an untested, non-public measure may provide different detail, the utility of publically available data that best aligns with Amtrak's grant is most appropriate here.

    Commenters stated FRA should ensure it is using consistent, accurate financial data and that bidders should have access to actual, fully-allocated route costs for the five most recent years Amtrak operated the service. Amtrak has included the publicly reported fully-allocated operating costs in the Monthly Performance Report for at least the past five years, though reports are only posted for one year following publication. Using archived copies of these reports, FRA will post on its Web site Amtrak's fully allocated operating loss for each Long Distance route since FY2012.

    Commenters also stated FRA should provide more detail about the costs comprising the total operating subsidy, including route specific costs. Another commenter, on the other hand, objected to the disclosure of Amtrak's route specific information. FRA declines to provide the more detail requested. FRA notes that the summary financial results reported in Amtrak's Monthly Performance Reports list actual costs on a system-wide basis across various revenue and expense categories. In addition, FRA believes a bidder should base its costs on its own needs and business case, rather than Amtrak route specific information.

    Some commenters suggested FRA include interest and depreciation costs in the operating subsidy to account for equipment related expenses associated with operating the service. Another commenter stated the operating subsidy should exclude capital costs, depreciation, and other non-cash costs. The final rule does not include depreciation and interest costs in the formulation of the operating subsidy. This approach is consistent with the operating portions of FRA's annual grants to Amtrak for the Northeast Corridor and National Network accounts, which do not include Amtrak rolling stock depreciation or interest-incurring debt.

    A commenter stated FRA should ensure any award to a winning bidder is consistent with the objective of reducing Federal funding requirements for long distance routes. FRA will make judicious operating subsidy determinations to ensure the efficient use of Federal funds.

    A commenter also stated FRA should address how it will reimburse costs that non-Amtrak service sponsors may incur. FRA is not authorized under the FAST Act to directly reimburse sponsors of Amtrak service. As discussed, the FAST Act directs the Secretary to provide Amtrak an appropriate portion of the applicable appropriations to cover any cost directly attributable to the termination of Amtrak service on the route and any indirect costs to Amtrak imposed on other Amtrak routes as a result of losing service on the route operated by the winning bidder. See 49 U.S.C. 24711(e)(2).

    A commenter sought clarity regarding the basis upon which FRA may not provide funding to a winning bidder. FRA is not authorized to provide funding in excess of appropriated levels. The FAST Act authorizes the Secretary to fund the operating subsidy by withholding such sums as are necessary from the amount appropriated to the Secretary for the use of Amtrak for activities associated with Amtrak's National Network. FAST Act sec. 11101(e). However, if Congress does not appropriate funds in a manner so as to allow the Secretary to pay an operating subsidy under this pilot program, then the Secretary cannot award an operating subsidy to a winning bidder. In other words, the award of any operating subsidy to a winning bidder is subject to the availability of funding. Accordingly, the Secretary's contract with a winning bidder will not award an operating subsidy unless the award is authorized by both the FAST Act and the applicable appropriations act. In addition, the Secretary will award the operating subsidy to the winning bidder annually and, again, only as authorized by the FAST Act and the applicable appropriations act (i.e., the Secretary will not award all four years of the operating subsidy at one time).

    A commenter expressed concern that, in the event Congress reduces Amtrak appropriations, a winning bidder may receive disproportionately less subsidy as compared to the services remaining with Amtrak. Subject to the availability of funding for long distance services, FRA will award an operating subsidy to a winning bidder that is the same amount, adjusted for inflation, throughout the term of the contract.

    e. Agreements With Infrastructure Owners

    Under the FAST Act, an entity may only be an eligible petitioner for this pilot program if it owns the relevant rail infrastructure or has a “written agreement” with the relevant rail infrastructure owner (in addition to meeting the other eligible petitioner requirements discussed elsewhere in this preamble). 49 U.S.C. 24711(b)(3). The FAST Act also requires a winning bidder who does not own the relevant infrastructure to enter into a “written agreement governing access issues” with the owners of such infrastructure. 49 U.S.C. 24711(b)(5).

    Section 269.9(b)(2)(i) of the NPRM required a bid to include any applicable agreement(s) necessary for the operation of passenger service over right-of-way on the route that is not owned by the bidder. The NPRM did not address the nature of the “written agreement” necessary for an entity to submit a petition under § 269.7(b).

    Because a “written agreement” is an eligibility requirement for many potential petitioners, § 269.7(b)(4) of the final rule requires an eligible petitioner to include, in its petition, agreements with all entities that own or control infrastructure on the long-distance route or routes over which the eligible petitioner wants to provide intercity passenger rail transportation. However, these written agreements are not required to completely address infrastructure access; rather, they must demonstrate the infrastructure owner's support for the petition.

    In addition, like the NPRM, § 269.9(b)(2)(i) of the final rule then requires a bidder to submit, in its bid package, executed agreement(s) necessary for the operation of passenger service over right-of-way on the route that is not owned by the bidder.

    Several comments sought further clarity on the meaning of the term “written agreement.” One commenter stated a petitioner should submit written agreements with each rail carrier that owns or controls any infrastructure along the route, with their petition filed under § 269.7(b), and such agreements should address the petitioner's ability to access the infrastructure necessary for the operation of the petitioned route. Other commenters stated that negotiating the detailed terms of such access agreements take a long time, and instead proposed that, when submitting a petition, a petitioner should only need to submit a written agreement in which the infrastructure owners express a willingness to enter into a good faith discussion with the bidder.

    FRA generally agrees with the latter commenters. Specifically, to ensure the efficient use of FRA and Amtrak resources, and recognizing the challenges executing agreements that completely address infrastructure access, as discussed, the final rule requires a petition to include agreements with all entities that own or control infrastructure on the long-distance route or routes over which the eligible petitioner wants to provide intercity passenger rail transportation. As described, these agreements are not required to completely address infrastructure access; rather, they must demonstrate the infrastructure owner's support for the petition. As noted, the final rule also requires an eligible petitioner to submit, as part of the bid package, executed agreement(s) necessary for the operation of passenger service over right-of-way on the route that is not owned by the eligible petitioner.

    Some commenters expressed concern Amtrak, as an owner of infrastructure on most of the long distance routes, could refuse to enter into access agreements with eligible petitioners. However, in the event of such a dispute, the statute and the final rule make clear the Surface Transportation Board (STB) may require Amtrak to provide access to Amtrak facilities if such access is necessary to operate the pilot route. 49 U.S.C. 24711(g). Access to Amtrak-owned facilities, among other things, is discussed elsewhere in this preamble.

    Lastly, several commenters stated an eligible petitioner could develop an operating plan that contracts with Amtrak to provide operating crews and uses Amtrak's existing access agreement, as long as the infrastructure owners agreed with the operating plan. FRA disagrees. First, private partnerships between Amtrak and third parties may of course occur outside of this pilot program, and, are, in fact encouraged by section 216 of PRIIA and 49 U.S.C. 24101. Second, the FAST Act does not authorize an eligible petitioner to use Amtrak's right to access infrastructure owned by a third party. See 49 U.S.C. 11307(b)(5) (requiring a winning bidder to enter into a written agreement governing access with the relevant infrastructure owners); 49 U.S.C. 11307(b)(3) (defining a petitioner as eligible where it owns the infrastructure or has a written agreement with a rail carrier that owns the infrastructure); and 49 U.S.C. 11307(j) (stating that nothing in section 11307 shall affect Amtrak's access rights to railroad rights-of-way and facilities). Finally, the FAST Act states the requirement that the Secretary award an operating subsidy to a winning bidder “shall not apply to a winning bidder that is or includes Amtrak.” 49 U.S.C. 11307(b)(2). In other words, a bidder who is partnering with Amtrak to provide a service under the pilot program would not be entitled to an operating subsidy award under the pilot program.

    f. Level of Service

    Section 269.9(b)(1) of the final rule, in part, requires a bidder to provide FRA with sufficient information to evaluate the level of service described in the bid. In addition, § 269.13(b)(4) requires a winning bidder to provide intercity passenger rail transportation over the route that is no less frequent, nor over a shorter distance, than Amtrak provided on the route.

    One commenter stated the final rule should provide that, upon request, the Secretary would make available a detailed and specific definition of Amtrak's level of service for any route subject to the pilot program. FRA disagrees. As described, the final rule requires, at minimum, a winning bidder to provide a level of service that is no less frequent, nor over a shorter distance than Amtrak provided on the route. See 49 CFR 269.13(b)(4). The frequency and distance of Amtrak's long-distance routes is publically available. It is important to note, as described in § 269.9(b)(1), beyond the frequency and distance requirements, FRA's bid evaluations will take into account all aspects of service described in the bid.

    Several commenters stated the final rule should allow a bidder to operate alternate service alignments between the endpoints of a route. Similarly, a commenter stated the final rule should allow a bidder to vary the schedule and services of the particular train. One other commenter, on the other hand, stated a winning bidder must serve all of the same stations Amtrak currently serves on the route. The final rule does not prohibit a bidder from proposing to operate an alternate alignment between the endpoints of a route. However, a bid proposing the relocation, elimination, or addition of a station at which the service will stop should be accompanied by evidence of significant support from the communities impacted by such changes so FRA may understand and evaluate the proposed service.

    A commenter stated FRA should favorably weight bids that maintain existing connections with other intercity passenger trains and buses to promote the national passenger train and connecting intercity bus network. A commenter also stated the final rule should encourage innovative ideas, including enhanced food and beverage service, and improved connectivity and amenities. As stated, FRA's bid evaluations will take into account all aspects of service described in the bid. 49 CFR 269.9(b)(1).

    Finally, one commenter stated the final rule should expand the pilot program to discontinued Amtrak long distance routes. However, the FAST Act limits the pilot program to the long distance routes defined in 49 U.S.C. 24102 and operated by Amtrak on the date of enactment of the FAST Act. See 49 U.S.C. 24711(a).

    g. Performance Standards

    The FAST Act requires a winning bidder to, at a minimum, meet the performance “required of or achieved by Amtrak on the applicable route during the last fiscal year” and subjects any award to a winning bidder “to such performance standards.” 49 U.S.C. 24711(b)(1)(E)(i) and (b)(4). In addition, the FAST Act authorizes the Secretary to require performance standards above that achieved by Amtrak. 49 U.S.C. 24711(b)(1)(E)(i). The final rule requires bidders to describe how the passenger rail service would meet or exceed the performance required of or achieved by Amtrak on the applicable route during the last fiscal year, and states that, at a minimum, the description must include, for each Federal fiscal year fully or partially covered by the bid, a projection of the route's expected Passenger Miles per Train Mile, End-Point and All Stations On-Time Performance, Host Railroad and Operator Responsible Delays per 10,000 train miles, Percentage of Passenger Trips to/from Underserved Communities, Service Interruptions per 10,000 Train Miles due to Equipment-Related Problems, and customer service quality. 49 CFR 269.9(b)(9). Likewise, the final rule conditions the operating subsidy rights upon the winning bidder's compliance with performance standards FRA may require, but which, at a minimum, must meet or exceed the performance required of or achieved by Amtrak on the applicable route during the fiscal year immediately preceding the year the bid is submitted. 49 CFR 269.13(b)(5).

    Commenters sought additional clarity on the performance standards and, in particular, how FRA would evaluate the performance of a winning bidder. To determine whether a winning bidder has met or exceeded the performance achieved by Amtrak on the applicable route during the last fiscal year, as required by the FAST Act, FRA will require a winning bidder to report the performance standards discussed in the previous paragraph to FRA on a quarterly basis. These performance categories are available publically in the Quarterly Report on the Performance and Service Quality of Intercity Passenger Train Operations available on FRA's Web site. Additionally, a winning bidder must also provide a monthly ridership report to FRA. Finally, a bidder must explain in its bid submission how it will achieve and report on these performance standards.

    A commenter stated FRA should define, or otherwise make available, the Amtrak performance standards achieved on each long-distance route. This data is publicly available on FRA's Web site in the Quarterly Reports on the Performance and Service Quality of Intercity Passenger Train Operations.

    One commenter stated the final rule should impose performance standards on Amtrak if it submits a bid. Another commenter stated, on the other hand, FRA is not authorized to impose such standards on Amtrak. The FAST Act does not require the imposition of performance standards on Amtrak. However, if Amtrak submits a bid and is selected, then Amtrak should comply with the performance standards described in the bid.

    Lastly, a commenter stated the final rule should require Amtrak to identify future savings or new revenues if their counterbid is lower than Amtrak's current route costs. FRA does not believe the final rule needs to specifically require Amtrak to produce such information. Section 269.9(b) requires bidders and Amtrak to submit bids containing a financial plan, among other requirements, which enables FRA to fully evaluate the bids. Furthermore, if FRA does not receive sufficient information, FRA may request supplemental information from the bidder and/or Amtrak under § 269.9(c).

    h. Access

    Section 24711(c) of the FAST Act requires Amtrak, if necessary to carry out the purposes of the pilot program, to provide access to the “Amtrak-owned reservation system, stations, and facilities directly related to operations of the awarded routes to the eligible petitioner awarded a contract.” Section 24711(g) further provides, in the event Amtrak and the winning bidder cannot agree upon the terms of such access, either party may petition the STB to determine “whether access to Amtrak's facility or equipment, or the provisions of services by Amtrak is necessary . . . and whether the operation of Amtrak's other services will not be unreasonably impaired by such access.” Section 24711(g) goes on to provide, if the STB determines such access is necessary and Amtrak's other services will not be unreasonably impaired, then the STB must issue an order requiring Amtrak “to provide the applicable facilities, equipment, and services . . . and determine[] reasonable compensation, liability, and other terms for the use of the facilities and equipment and the provision of the services.”

    The final rule provides, consistent with the FAST Act and the NPRM, if an award is made to a bidder other than Amtrak, Amtrak must provide access to the Amtrak-owned reservation system, stations, and facilities directly related to operations of the awarded route(s) to the bidder. 49 CFR 269.15(a). For additional clarity, the final rule added a sentence stating that, if Amtrak and the eligible petitioner awarded a route cannot agree on the terms of access, then either party may petition the STB under 49 U.S.C. 24711(g). 49 CFR 269.15(a).

    Commenters sought clarity regarding the meaning of the term “facilities.” One commenter stated “facilities” should include coach yards, repair shops, and Amtrak-owned track. FRA understands the term “facilities” to include Amtrak-owned coach yards, repair shops, and track. A commenter also stated the final rule should require Amtrak to provide access to “Amtrak controlled” track. However, the FAST Act only authorizes access for “Amtrak-owned” facilities. 49 U.S.C. 24711(c)(1).

    Several commenters stated the final rule should require Amtrak to provide access to Amtrak-owned rolling stock. As stated, section 24711(c)(1) of the FAST Act specifically requires Amtrak to provide access to the “Amtrak-owned reservation system, stations, and facilities,” but it does not reference rolling stock. However, section 24711(g) states the STB may adjudicate disputes regarding whether Amtrak should be required to provide services or equipment. As such, either party may petition the STB for a determination about the necessity of access to Amtrak-owned equipment (to include rolling stock), among other things.

    At least one commenter stated Amtrak's statutory right to access track is a “facility” and, therefore, Amtrak should be required to provide its access rights to a winning bidder. Another commenter stated FRA should invoke Amtrak's statutory right to access track on behalf of a winning bidder. FRA disagrees with both comments. Amtrak's right to access track is not transferrable unless specifically authorized by law. See Application of Nat'l R. Passenger Corp. Under 49 U.S.C. 24308(a)—Springfield Terminal R. Co., Boston & M. Corp. and Portland Terminal Co., 3 S.T.B. 157 (1998) (stating the “access rights that the Act allows us to grant to Amtrak belong only to Amtrak and may not be transferred to a third party `successor or assign' unless the Act or some other provision of law specifically provides otherwise.”). Here, section 24711(j) of the FAST Act states nothing in the pilot program “shall affect Amtrak's access rights to railroad rights-of-way and facilities.”

    Similarly, a commenter stated the final rule should allow an eligible petitioner to use Amtrak train and engine crews to access track via the existing Amtrak access agreement with the host railroad. A commenter also stated Amtrak should be required to provide Amtrak train crews to a bidder, as it would constitute a “provision of services” allowed under section 24711(g)(1)(A) of the FAST Act. First, as discussed, Amtrak's right to access track may not be transferred under this pilot program. Further, a bidder who is partnering with Amtrak to provide a service under the pilot program would not be entitled to an operating subsidy award under the pilot program. The FAST Act makes clear that an operating subsidy is only available to a winning bidder who is not or does not include Amtrak. 49 U.S.C. 24711(b)(2).

    A commenter stated Amtrak need only provide access if FRA determines the access is necessary. However, section 24711(g) of the FAST Act states the STB, not the FRA, is responsible for determining whether access is necessary.

    Some commenters stated the cost allocation policy developed under section 209 of the Passenger Rail Investment and Improvement Act of 2008 should be used to calculate cost for the use of Amtrak's assets. Another commenter stated FRA, not other bidders, should request from Amtrak the cost of providing access to specific facilities and services a bidder wants Amtrak to provide. However, neither approach is required by the FAST Act. Rather, the parties must agree on cost and, if they cannot, either party may petition the STB for a determination. See 49 U.S.C. 24711(g) (stating that, in the event of a dispute, the STB “determines reasonable compensation, liability, and other terms,” among other things). It is the bidder's sole responsibility to initiate the request to Amtrak to provide the access, to carry out any resulting negotiations, and to determine impacts on the bid.

    A commenter stated the rule should require FRA to publish Amtrak's costs to provide access to its reservation system, stations, and facilities, and FRA should condition Amtrak's receipt of Federal operating funds on Amtrak's participation. Similarly, a commenter stated FRA should set forth minimum conditions of cooperation, along with reasonable ranges of costs for the joint use of facilities and services. Another commenter stated FRA should articulate clear definitions, prior to the submittal of any bids, of the costs for Amtrak to operate facilities or equipment. Lastly, a commenter suggested there should be a set rate for Amtrak equipment used by a winning bidder. FRA disagrees and does not believe these approaches are necessary or consistent with the FAST Act. As described above, section 24711(g) provides, in the event Amtrak and the winning bidder cannot agree upon the terms of access, either party may petition the STB to resolve the dispute.

    A commenter stated that, if a dispute between Amtrak and a bidder is submitted to the STB for resolution, then a bidder may use the Amtrak-owned facilities during the period of time the dispute is with the STB. FRA disagrees. Indeed, the dispute may involve whether the bidder is in fact entitled to access the facilities at issue. Further, a bidder should not need to access the facilities because the terms of access would have to be resolved in advance of bidder operations.

    A commenter also stated the final rule should require Amtrak to provide access to its data relating to operations, costs, facilities, ridership and other information to enable a bidder to develop an informed business plan and proposal. The FAST Act does not authorize this approach. As discussed, the bidder is responsible for collecting the information necessary to prepare their business plan and proposal.

    i. Employee Protections

    The FAST Act subjects winning bidders to the grant conditions in 49 U.S.C. 24405. See 49 U.S.C. 24711(c)(3) (“If the Secretary awards the right and obligation to provide intercity rail passenger transportation over a route described in this section to an eligible petitioner . . . the winning bidder . . . shall be subject to the grant conditions under section 24405.”).

    The NPRM and this final rule likewise subject winning bidders to these grant conditions. See 49 CFR 269.13(b)(6) (“[T]he contract between FRA and a winning bidder that is not or does not include Amtrak must . . . [s]ubject the winning bidder to the grant conditions established by 49 U.S.C. 24405.”). Section 24405(c), among other things, states the Secretary shall require, and “the applicant agrees to comply with . . . the protective arrangements that are equivalent to the protective arrangements established under section 504 of the Railroad Revitalization and Regulatory Reform Act of 1976” (4R Act). 49 U.S.C. 24405(c)(2)(B). The protective arrangements established under the 4R Act are set forth in a Secretary of Labor letter and appendix dated July 6, 1976.

    Several commenters sought clarification about the 49 U.S.C. 24405 grant condition concerning employee protections. One commenter stated the 4R Act employee protections should not apply to this pilot program. FRA disagrees. The FAST Act subjects a winning bidder to the grant conditions of section 24405, which include the 4R Act equivalent employee protections. See 49 U.S.C. 24711(c)(3).

    Several commenters stated the FRA should adopt employee protections equivalent to those established under the 4R Act but adjusted to fit the pilot program, and should issue guidance on the adjusted protections. FRA declines to use this rulemaking to adopt employee protections equivalent to the almost forty-year old 4R Act employee protections set forth by the Secretary of Labor for the purpose of resolving imprecisions in the application of those protections to this pilot program. The FAST Act subjects winning bidders, some of whom may not be railroads, to the grant conditions under section 24405. In so doing, the FAST Act recognizes the possibility that a non-railroad winning bidder may directly provide the 4R Act equivalent employee protections.

    A commenter also stated FRA should issue guidance on a winning bidder's responsibility to employees under the FAST Act, while also stating such employee costs should be included in any petition filed with FRA under the pilot program. If needed, FRA may issue pilot program guidance. However, FRA disagrees with the suggestion to include employee costs in the petition. The petition requirements under § 269.7 require basic information from eligible petitioners; it is premature to require detailed cost information in the petition. It is in the bid where an eligible petitioner provides FRA with the information necessary to evaluate a bid, including the submission of a required staffing plan that addresses the terms of work for prospective and current employees for the proposed service, among other things. See § 269.9(b)(5).

    Commenters also stated the NPRM did not indicate how FRA would apply the employee protections. FRA disagrees. Consistent with the FAST Act requirement, the NPRM and the final rule require compliance with section 24405 in the contract between FRA and a winning bidder. See 49 CFR 269.13(b)(6). FRA declines to adopt the suggestion of some commenters to require a winning bidder to directly provide the 4R Act equivalent employee protections. As discussed, a winning bidder must comply with section 24405, which includes the 4R Act equivalent employee protections. However, the FAST Act does not require this obligation to take the form of an agreement directly between the winning bidder and the relevant union. Although that approach is certainly permissible, a winning bidder may also by agreement bestow the obligation to provide the employee protections on another appropriate entity (such as the applicable railroad). In other words, a winning bidder may comply with the 4R Act equivalent employee protections requirement of section 24405 directly or by agreement.

    Lastly, one commenter suggested costs associated with providing the 4R Act equivalent employee protections should not be deducted from the operating subsidy awarded to a winning bidder. The 4R Act equivalent employee protection costs are the responsibility of a winning bidder that is not or does not include Amtrak and do not impact the calculation of the operating subsidy.

    II. Section-by-Section Analysis Section 269.1 Purpose

    This section provides that the final rule carries out the statutory mandate in 49 U.S.C. 24711 requiring FRA, on behalf of the Secretary, to implement a pilot program to competitively select eligible petitioners in lieu of Amtrak to operate not more than three long-distance routes, as defined in 49 U.S.C. 24102, and operated by Amtrak on the date of enactment of the FAST Act.

    A commenter stated an eligible petitioner should be able to decide the route(s) on which they bid and should be able to bid on inactive routes. The pilot program does not apply to inactive routes. The FAST Act limits the pilot program to the long-distance routes, as defined in 49 U.S.C. 24102, operated by Amtrak on the date of enactment of the FAST Act. 49 U.S.C. 24711(a).

    A commenter also stated FRA should take primary responsibility in any contract with a winning bidder to “launch” the service. FRA disagrees. The FAST Act directs FRA to implement the pilot program for the competitive selection of eligible petitioners in lieu of Amtrak to operate not more than three-long distance routes. The FAST Act does not require the FRA to take primary responsibility for a winning bidder's execution of the service.

    Section 269.3 Application

    Paragraph (a) of this section provides the pilot program is not available to more than three Amtrak long-distance routes, as defined in 49 U.S.C. 24102. This paragraph is based on the statutory directive in 49 U.S.C. 24711(a).

    Paragraph (b) of this section provides that any eligible petitioner awarded a contract to provide passenger rail service under the pilot program can only provide such service for a period not to exceed four years from the date the winning bidder commenced service and, at FRA's discretion on behalf of the Secretary, FRA may renew such service for one additional operation period of four years. This paragraph is based on the statutory directive in 49 U.S.C. 24711(b)(1)(A).

    A commenter stated FRA should address the transition of service from a successful winning bidder back to Amtrak. Although there may be challenges that arise in such a situation, the FAST Act does not require FRA to address this issue in the rulemaking, nor is it prudent in this rulemaking to attempt to address possible outcomes that may occur many years from now.

    Commenters also stated the length of the contract should be longer than four years, for various reasons. However, the FAST Act requires one four year term, and allows for one four year renewal term at the discretion of the Secretary.

    Section 269.5 Definitions

    This section contains the definitions for the final rule. This section defines the following terms: Act; Administrator; Amtrak; Eligible petitioner; File and Filed; Financial plan; FRA; Operating plan; and Long-distance route.

    This section defines “eligible petitioner” to mean: A rail carrier or rail carriers that own the infrastructure over which Amtrak operates a long-distance route, or another rail carrier that has a written agreement with a rail carrier or rail carriers that own such infrastructure; a State, group of States, or State-supported joint powers authority or other sub-State governance entity responsible for providing intercity rail passenger transportation with a written agreement with the rail carrier or rail carriers that own the infrastructure over which Amtrak operates a long-distance route and that host or would host the intercity rail passenger transportation; or a State, group of States, or State-supported joint powers authority or other sub-State governance entity responsible for providing intercity rail passenger transportation and a rail carrier with a written agreement with another rail carrier or rail carriers that own the infrastructure over which Amtrak operates a long-distance route and that host or would host the intercity rail passenger transportation.

    A commenter stated the final rule should amend the definition of the term “eligible petitioner” to make clear it is not necessary for a petitioner to obtain a written agreement with Amtrak for Amtrak-owned infrastructure prior to submitting a petition. However, the definition used in the final rule is taken directly from the FAST Act. 49 U.S.C. 24711(b)(3). With that said, Amtrak is required to provide access to Amtrak-owned facilities, among other things. 49 U.S.C. 24711(c)(1). As such, FRA will take both of these FAST Act directives into account when reviewing petitions received under this program.

    This section defines “financial plan” to mean a plan that contains, for each Federal fiscal year fully or partially covered by the bid: An annual projection of the revenues, expenses, capital expenditure requirements, and cash flows (from operating activities, investing activities, and financing activities, showing sources and uses of funds, including the operating subsidy amount) attributable to the route; and a statement of the assumptions underlying the financial plan's contents.

    In addition, this section defines “operating plan” to mean a plan that contains, for each Federal fiscal year fully or partially covered by the bid: A complete description of the service planned to be offered, including the train schedules, frequencies, equipment consists, fare structures, and such amenities as sleeping cars and food service provisions; station locations; hours of operation; provisions for accommodating the traveling public, including proposed arrangements for stations shared with other routes; expected ridership; passenger-miles; revenues by class of service between each city-pair proposed to be served; connectivity with other intercity transportation services; compliance with applicable Service Outcome Agreements, and a statement of the assumptions underlying the operating plan's contents. The final rule added “connectivity with other intercity transportation services” and “compliance with applicable Service Outcome Agreements” in response to comments. The final rule requires bidders to include a financial plan and an operating plan—as those terms are defined here—in their bids. These definitions ensure that bids contain sufficient information for evaluation.

    A commenter stated the final rule should specifically state that, for purposes of the operating plan, a bidder may assume access to Amtrak facilities and stations. This revision is not necessary. The final rule requires a bidder to describe the assumptions underlying the operating plan's contents. And, as discussed elsewhere in this preamble, the final rule states that Amtrak must provide access to the Amtrak-owned reservation system, stations, and facilities directly related to operations of the awarded route(s) to the bidder.

    This section also defines “long-distance route” to mean those routes described in 49 U.S.C. 24102(5) and operated by Amtrak on the date the FAST Act was enacted. This definition is based on the statutory directive in 49 U.S.C. 24711(a).

    Section 269.7 Petitions

    Paragraph (a) of this section provides an eligible petitioner may petition FRA to provide intercity passenger rail transportation over a long-distance route in lieu of Amtrak for a period of time consistent with the time limitations described in § 269.3(c). This paragraph is based on the statutory directive in 49 U.S.C. 24711(b)(1)(A).

    Paragraph (b) of this section provides a petition submitted to FRA under this rule must: Be filed with FRA no later than 180 days after the effective date of the competitive passenger rail service pilot program final rule; describe the petition as a “Petition to Provide Passenger Rail Service under 49 CFR part 269”; describe the long-distance route or routes over which the petitioner wants to provide intercity passenger rail transportation and the Amtrak service the petitioner wants to replace; and, if applicable, provide an executed copy of all written agreements with all entities that own infrastructure on the long-distance route or routes over which the eligible petitioner wants to provide intercity passenger rail transportation. This paragraph is intended to ensure a petition provides clear notice to FRA and the petitioner is statutorily eligible to participate in the program.

    Section 269.9 Bid Process

    Paragraph (a) of this section provides that FRA would notify the eligible petitioner and Amtrak of receipt of a petition filed with FRA by publishing a notice of receipt in the Federal Register not later than 30 days after FRA receives a petition. This paragraph is based on the statutory directive in 49 U.S.C. 24711(b)(1)(B)(i).

    Paragraph (b) of this section describes the bid requirements, including that a bid must be filed with FRA no later than 120 days after FRA publishes the notice of receipt in the Federal Register under § 269.9(a). Paragraph (b) further provides the detailed information such bids must include. This paragraph is based on the statutory directive in 49 U.S.C. 24711(b)(1)(C).

    A commenter stated a bidder should not be constrained due to their prior experience with passenger rail service. The final rule's bid requirements apply to all bidders and Amtrak, regardless of experience in passenger rail service.

    A commenter also stated the final rule should require a bidder to provide written documentation that any state(s) providing funding for a route concur with a bid to provide service over the route. Another commenter, on the other hand, disagreed and stated FRA should be responsible for obtaining concurrence from a state providing funding for a route. For routes receiving funding from a state or states, section 24711(b)(1)(D) of the FAST Act requires for each bid received, “the Secretary have the concurrence of the State of States that provide funding for that route.” FRA understands this requirement to be the obligation of the bidder, not FRA. The bidder is in the best position to obtain such concurrence, and, of course, the support of the state or states is critically important to the bidder's ability to operate the service. The final rule incorporates this requirement in § 269.9(b)(12).

    A commenter stated the description of the capital needs for the planned service under § 269.9(b)(6) should include projected capital expenditures for each Federal fiscal year fully or partially covered by the bid. FRA agrees, and the final rule, like the NPRM, requires this information. Specifically, § 269.9(b)(2)(i) requires a bid to include a financial plan, and § 269.5 defines the term “financial plan” as a plan that contains, for each Federal fiscal year fully or partially covered by the bid, an annual projection of the capital expenditure requirements attributable to the route, among other things.

    A commenter also stated a bid should include a breakdown of the projected capital expenditures required to comply with the Americans with Disabilities Act, applicable FRA safety regulations, and other applicable laws and regulations. In response to this comment, FRA amended: (1) § 269.9(b)(11) of the final rule to require an eligible petitioner to describe its compliance with all applicable Federal, state, and local laws; and (2) § 269.9(b)(6) of the final rule to make clear that an eligible petitioner's description of the capital needs for the passenger rail service include in detail any costs associated with compliance with Federal law and regulations. These revisions will help FRA evaluate the bid and whether the bid credibly assesses the capital expenditures required to lawfully operate service on the route.

    Lastly, a commenter stated the final rule should specify the documentation requirements and procedures applicable to bidders who are new passenger rail service operators to ensure compliance with all applicable safety requirements. Section 269.9(b)(7) of the final rule requires an eligible petitioner in its bid package to describe in detail the bidder's plans for meeting all FRA safety requirements. It is not necessary for this rulemaking to fully describe the regulatory process a new operator will use to initiate service.

    Paragraph (c) of this section provides FRA may request supplemental information from a bidder and/or Amtrak if FRA determines it needs such information to adequately evaluate a bid. Such a request may seek information about the costs related to the service Amtrak would still incur following the cessation of service, including the increased costs for other services. FRA will establish a deadline by which the bidder and/or Amtrak must submit the supplemental information to FRA.

    A commenter stated this section should require FRA to seek such information from Amtrak, including information from Amtrak about the feasibility of the proposed service, the potential impairment to Amtrak's other services, or the cost of providing access to Amtrak's facilities or equipment. FRA agrees that, when evaluating a bid, additional information may be needed, and FRA may request supplemental information under § 269.9(c). However, requiring FRA to request supplemental information is not necessary, and would overly burden FRA when it does not need supplemental information to evaluate a bid.

    Section 269.11 Evaluation

    Paragraph (a) of this section provides that FRA will select a winning bidder by evaluating the bids based on the requirements of part 269.

    A commenter stated the evaluation criteria should include the impact of an award on the Federal funding requirements for intercity passenger rail. Another commenter, on the other hand, stated that any claimed increase in Amtrak's cost, or other negative financial performance impacts, should not be evaluated under § 269.11 (and referenced 49 U.S.C. 24711(e)(2)). As stated above, FRA will evaluate the bids based on the requirements of part 269, and § 269.9(b)(10) of the final rule requires a bidder, as part of the bid package, to analyze the reasonably foreseeable effects, both positive and negative, of the passenger rail service on other intercity passenger rail services. Section 24711(e)(2) of the FAST Act is not relevant to the evaluation of bids. Rather, section 24711(e)(2) concerns the calculation of attributable costs that may be provided to Amtrak if there is a winning bidder other than Amtrak (and states these attributable costs “shall not be deducted from” the operating subsidy awarded to the winning bidder).

    Commenters also stated low cost, or high cost, should not drive the evaluation, but rather overall bid quality should be the basis for selection. FRA will evaluate all aspects of a bid in making its determination.

    A commenter stated DOT/FRA may have a conflict of interest in administering the pilot program because the Secretary is a member of the Amtrak Board of Directors. The Secretary's roles administering the pilot program and as a member of the Amtrak Board of Directors are mandated by statute. With that said, FRA will administer the pilot program fairly, in good faith, and consistent with the FAST Act.

    Paragraph (b) of this section provides that, upon selecting a winning bidder, FRA will publish a notice in the Federal Register identifying the winning bidder, the long-distance route the bidder would operate, a detailed justification of the reasons why FRA selected the bid, and any other information the Secretary determines appropriate. FRA will request public comment for 30 days after the date FRA selects the bid. This paragraph is based on the statutory directive in 49 U.S.C. 24711(b)(1)(B)(iii).

    Section 269.13 Award

    Paragraph (a) of this section provides that FRA will execute a contract with a winning bidder that is not or does not include Amtrak, consistent with the requirements of § 269.13, and as FRA may otherwise require, not later than 270 days after the bid deadline § 269.9(b) establishes. This paragraph is based on the statutory directive in 49 U.S.C. 24711(b)(1)(E).

    Paragraph (b) of this section discusses required elements of the contract between FRA and the winning bidder that is not or does not include Amtrak. This paragraph is based on the statutory directives in 49 U.S.C. 24711(b)(1)(E), (b)(4), and (c)(3).

    Commenters stated FRA must ensure that any construction work contractors of a winning bidder perform complies with Davis-Bacon prevailing wage requirements. Section 269.13(b)(6) subjects winning bidders to the section 24405 grant conditions, including section 24405(c)(2)(A), which addresses prevailing wage requirements. Commenters similarly stated FRA must ensure a winning bidder complies with the applicable Buy America requirement. Likewise, § 269.13(b)(6) subjects winning bidders to the section 24405 grant conditions, including section 24405(a), which addresses the Buy America requirement.

    A commenter also stated the NPRM did not address how FRA will ensure winning bidders comply with the requirement of the FAST Act subjecting winning bidders to the grant conditions in section 24405. FRA disagrees. Section 269.13(b)(6) of the NPRM and the final rule provides that any contract between FRA and a winning bidder that is not or does not include Amtrak must subject the winning bidder to these grant conditions. And, § 269.17(a) of the final rule states the FRA Administrator shall take any necessary action consistent with title 49 of the United States Code to enforce the contract where a winning bidder fails to fulfill its obligations under the contract required under § 269.13. See 49 U.S.C. 24711(d).

    A commenter stated the contract should require the winning bidder to comply with all statutory and other legal requirements that apply to Amtrak's use of the appropriated funds. FRA agrees. For purposes of clarity, FRA added another element to the final rule stating a contract between FRA and a winning bidder must make the winning bidder subject to the requirements of the appropriations act(s) funding the contract. See 49 CFR 269.13(b)(7).

    A commenter stated the award of the contract must also be conditioned on the bidder's demonstration, prior to the initiation of service, of compliance with all applicable Federal and state laws and regulations as well as the maintenance of adequate liability coverage for claims through insurance and self-insurance required by 49 U.S.C. 28103(c). First, as stated above, § 269.9(b)(11) of the final rule requires a bid to describe the bidder's compliance with all applicable Federal, state, and local laws. Furthermore, § 269.13(a) makes clear FRA has the discretion to not award a contract if the winning bidder is not in compliance with the law. Second, as to mandatory insurance, 49 U.S.C. 28103(c) applies to Amtrak; it does not apply to other railroads. Nor does the FAST Act impose mandatory insurance beyond that required by 49 U.S.C. 28103. Consequently, the final rule does not impose mandatory insurance beyond what is already required by law. FRA also notes that 49 U.S.C. 28103(a)(2) establishes a rail passenger transportation liability cap, which is currently set at $294,278,983. See 81 FR 1289 (Jan. 11, 2016).

    A commenter also stated the contract should be conditioned on the winning bidder's payment of penalties, specified in its contract with FRA, should the winning bidder fail to meet performance standards. FRA did not intend for the final rule to fully address all aspects of the contract between FRA and a winning bidder. As such, contract details concerning penalty payments are not addressed in this final rule and, instead, may be addressed at the time a winning bidder is selected.

    A commenter stated that a winning bidder would be subject to the requirement in 49 U.S.C. 24321 prohibiting the use of Federal funds to cover any operating loss associated with providing food and beverage service on a route. The requirements of section 24321 apply to a winning bidder under this pilot program. See 49 U.S.C. 24321(d).

    Lastly, a commenter stated any non-Amtrak winning bidders should be required to deal with private rail car owners in a positive manner. FRA disagrees. The FAST Act imposes no such requirement, and FRA declines to regulate how a non-Amtrak winning bidder addresses contracting with private rail car owners.

    Paragraph (c) of this section provides that the winning bidder would make their bid available to the public after the bid award with any appropriate confidential or proprietary information redactions. This paragraph is based on the statutory directive in 49 U.S.C. 24711(b)(1)(C)(ii).

    Section 269.15 Access to Facilities; Employees

    Paragraph (a)(1) of this section provides, if an award under § 269.13 is made to a bidder other than Amtrak, Amtrak must provide access to the Amtrak-owned reservation system, stations, and facilities directly related to operations of the awarded route(s) to the bidder. For additional clarity, the final rule added a new paragraph (a)(2) stating that, if Amtrak and the eligible petitioner awarded a route cannot agree on the terms of access, then either party may petition the STB under 49 U.S.C. 24711(g). This paragraph is based on the statutory directive in 49 U.S.C. 24711(c) and (g).

    Paragraph (b) of this section implements 49 U.S.C. 24711(c)(2), which states that an employee of any person, except as provided in a collective bargaining agreement, used by such eligible petitioner in the operation of a route under this section shall be considered an employee of that eligible petitioner and subject to the applicable Federal laws and regulations governing similar crafts or classes of employees of Amtrak.

    A commenter stated the final rule should specifically subject a winning bidder to the same rail laws as Amtrak. Section 269.15(b) of the final rule clearly provides, as stated above, that employees are subject to the applicable Federal laws and regulations governing similar crafts or classes of employees of Amtrak. Moreover, a winning bidder is subject to the section 24405 grant conditions. That includes the section 24405(b) provision that a person conducting rail operations shall be considered a rail carrier under section 10102(5). A commenter also stated the final rule should allow an eligible petitioner to contract with Amtrak for Amtrak to provide train and engine personnel. As noted above, the FAST Act limits the availability of the pilot program to a winning bidder that is not or does not include Amtrak. Furthermore, the FAST Act does not require Amtrak to provide personnel services to an eligible petitioner.

    Paragraph (c) of this section states a winning bidder must provide hiring preference to qualified Amtrak employees displaced by the award of the bid, consistent with the staffing plan the winning bidder submits and the grant conditions 49 U.S.C. 24405 establish. This paragraph is based on the statutory directive in 49 U.S.C. 24711(c)(3).

    Some commenters stated FRA should incorporate the FAST Act's hiring preference requirements in 49 U.S.C. 24711(c)(3) and 24405(d) into the final rule. To alert eligible petitioners of these related requirements of the FAST Act, FRA revised § 269.15(c) of the final rule to reference the section 24405 grant conditions. In addition, § 269.13(b)(6) of the NPRM and final rule incorporate the section 24405 requirements. A commenter also stated FRA must ensure that winning bidders comply with these hiring preference requirements. Section 269.13(b)(6) of the final rule provides that any contract between FRA and a winning bidder that is not or does not include Amtrak must subject the winning bidder to the section 24405 grant conditions. And, § 269.17(a) of the final rule states the FRA Administrator shall take any necessary action consistent with title 49 of the United States Code to enforce the contract where a winning bidder fails to fulfill its obligations under the contract required under § 269.13.

    Section 269.17 Cessation of Service

    This section provides under paragraph (a) that, if a bidder awarded a route under this rule ceases to operate the service, or fails to fulfill its obligations under the contract required under § 269.13, the Administrator, in collaboration with the STB, would take any necessary action consistent with title 49 of the United States Code to enforce the contract and ensure the continued provision of service, including installing an interim service rail carrier, providing to the interim rail carrier an operating subsidy necessary to provide service, and re-bidding the contract to operate the service. This section further provides under paragraph (b) that the entity providing interim service would either be Amtrak or an eligible petitioner under § 269.5. This section is based on the statutory directive in 49 U.S.C. 24711(d).

    III. Regulatory Impact and Notices 1. Executive Orders 12866 and 13563 and DOT Regulatory Policies and Procedures

    FRA evaluated this final rule consistent with Executive Orders 12866 and 13563 and DOT policies and procedures. See 44 FR 11034 (Feb. 26, 1979). FRA prepared and placed in the docket a regulatory impact analysis addressing the economic impact of the final rule.

    FRA does not expect any regulatory costs because this final rule is voluntary and does not require an eligible petitioner to take any action. In addition, the final rule is limited to not more than three long-distance routes as defined in 49 U.S.C. 24102 and operated by Amtrak on the date the FAST Act was enacted. Furthermore, the current market conditions and the investment necessary to operate a long-distance service may further serve to limit the number of eligible petitioners submitting petitions under the pilot program. Of course, if no eligible petitioners participate in the pilot program, then no costs or benefits would be incurred because of the final rule. However, FRA is estimating the costs and benefits generated when three eligible petitioners submit bids to operate long-distance rail service.

    As discussed above, FRA assumed three entities will submit bids to estimate costs for the bidding scenario. The costs are solely due to preparing and filing a bid to operate service. Amtrak may submit a bid only if another entity submitted a petition to bid on a route. To estimate the cost for preparing and submitting a bid, FRA estimated the time and cost for FRA to review each bid. FRA estimates its review cost would be approximately $49,834 per bid. Based on the costs of collecting and analyzing data, drafting a bid, and gaining approval within the organization, FRA estimates a railroad or other entity that bids on a route would incur a cost of approximately three times as much as FRA's review cost—approximately $149,503 per bid. If an entity bids on a route, for this analysis, we assumed Amtrak would also submit a bid for the same route. Amtrak should have some of the data necessary to prepare the bid available. Therefore, their cost should be lower than another entity. Based on the costs of analyzing data, drafting a bid, and gaining approval within the organization, FRA estimated Amtrak's cost to prepare and submit a bid would be twice FRA's review cost —approximately $99,669. All bid costs would be incurred during the first year. The table below shows the estimated cost for an entity and Amtrak to bid on one long-distance route.

    FRA review cost Railroad/other entity bidder cost
  • (FRA cost * 3)
  • Amtrak cost
  • (FRA cost * 2)
  • Total Cost per Bid $49,834 $149,503 $99,669

    As stated above, FRA's total burden estimate assumes three bids are submitted for long-distance routes. The total cost to entities other than Amtrak would be approximately $448,509. The total cost to Amtrak would be approximately $299,007. The sum of these two costs is $747,516. Since all petitions and bids would occur during the first year, the total cost would be approximately $747,516 over the four-year period (which could become 8 years if the Secretary renews a contract).

    Some benefits are possible from this final rule. FRA cannot quantify the benefits but discussed them qualitatively in the regulatory impact analysis. If no eligible petitioners submit a bid for operating service, Amtrak would continue to operate service as it currently does. Therefore, no benefits would occur because of this final rule. However, if other entities are awarded contracts, those entities may be able to operate the service in a manner that would be beneficial to passengers.

    Possible benefits include better service and lower cost. The introduction of competition in the bidding process may increase passenger rail efficiency and generate public benefits by lowering the operational subsidy, and possibly leading to better service and/or lower operating costs to society. FRA expects no change to railroad safety due to this regulation.

    2. Regulatory Flexibility Act

    The Regulatory Flexibility Act of 1980 (5 U.S.C. 601 et seq.) and Executive Order 13272 (67 FR 53461, Aug. 16, 2002) require agency review of proposed and final rules to assess their impacts on small entities. An agency must prepare a Final Regulatory Flexibility Analysis (FRFA) unless it determines and certifies that a rule, if promulgated, would not have a significant economic impact on a substantial number of small entities. FRA is certifying this final rule will not have a significant economic impact on a substantial number of small entities.

    FRA published an Initial Regulatory Flexibility Analysis (IRFA) in the NPRM to discuss the potential small business impacts of the requirements in this final rule. FRA requested comments from interested parties regarding the potential economic impact on small entities that would result from the adoption of the proposals in this regulation. FRA received no comments to the NPRM on the economic impact on small entities.

    Statement of the Need for and Objective of the Rule

    FRA is revising 49 CFR part 269 to comply with a statutory mandate requiring the Secretary to promulgate a rule to implement a pilot program for competitive selection of eligible petitioners in lieu of Amtrak to operate not more than three long-distance routes. The objective of this final rule is to implement the statutory mandate in FAST Act section 11307.

    A Description and Estimate of the Number of Small Entities to Which the Final Rule Will Apply

    As stated above, the Regulatory Flexibility Act requires a review of proposed and final rules to assess their impact on small entities, unless the Secretary certifies the rule would not have a significant economic impact on a substantial number of small entities. “Small entity” is defined in 5 U.S.C. 601 as a small business concern that is independently owned and operated, and is not dominant in its field of operation. The U.S. Small Business Administration (SBA) has authority to regulate issues related to small businesses, and stipulates in its size standards that a “small entity” in the railroad industry is a for profit “line-haul railroad” that has fewer than 1,500 employees, a “short line railroad” with fewer than 500 employees, or a “commuter rail system” with annual receipts of less than seven million dollars. See “Size Eligibility Provisions and Standards,” 13 CFR part 121, subpart A.

    Federal agencies may adopt their own size standards for small entities in consultation with the SBA and in conjunction with public comment. Under that authority, FRA has published a final statement of agency policy that formally establishes “small entities” or “small businesses” as railroads, contractors, and hazardous materials shippers that meet the revenue requirements of a Class III railroad in 49 CFR 1201.1-1, which is $20 million or less in inflation-adjusted annual revenues, and commuter railroads or small governmental jurisdictions that serve populations of 50,000 or less. See 68 FR 24891, May 9, 2003 (codified at appendix C to 49 CFR part 209).

    The $20 million limit is based on STB's revenue threshold for a Class III railroad carrier. Railroad revenue is adjusted for inflation by applying a revenue deflator formula under 49 CFR 1201.1-1. FRA is using this definition for the final rule. For other entities, the same dollar limit in revenues governs whether a railroad, contractor, or other respondent is a small entity.

    This final rule applies to the following eligible petitioners: (1) A rail carrier or rail carriers that own the infrastructure over which Amtrak operates a long-distance route, or another rail carrier that has a written agreement with a rail carrier or rail carriers that own such infrastructure; (2) a State, group of States, or State-supported joint powers authority or other sub-State governance entity responsible for provision of intercity rail passenger transportation with a written agreement with the rail carrier or rail carriers that own the infrastructure over which Amtrak operates a long-distance route and that host or would host the intercity rail passenger transportation; or (3) a State, group of States, or State-supported joint powers authority or other sub-State governance entity responsible for provision of intercity rail passenger transportation and a rail carrier with a written agreement with another rail carrier or rail carriers that own the infrastructure over which Amtrak operates a long-distance route and that host or would host the intercity rail passenger transportation. The only petitioners that may be considered a small entity would be small railroads.

    This final rule is voluntary for all eligible petitioners. Therefore, there are no mandates placed on large or small railroads. In addition, the final rule is limited to not more than three long-distance routes operated by Amtrak. Consequently, this final rule is not likely to affect a substantial number of small entities, and most likely will not impact any small entities. FRA requested comments on this and received none.

    Small railroads face the same requirements for entry in the pilot program as other railroads. The railroad must own the infrastructure over which Amtrak operates those long-distance routes described in 49 U.S.C. 24102. Any small entity would likely only bid on a route if it was in its financial interest to do so. Accordingly, any impact on small entities would be positive. The pilot program will allow small railroads to enter a market which currently has substantial barriers.

    FRA notes this final rule does not disproportionately place any small railroads that are small entities at a significant competitive disadvantage. Small railroads are not excluded from participation if they are statutorily eligible. This final rule and the underlying statute concern the potential selection of eligible petitioners to operate an entire long-distance route. If Amtrak uses 30 miles of a small railroad's infrastructure on a route that is 750 miles long, that small railroad could not apply under this final rule to operate service only over the 30 mile segment it owns (the small railroad would have to apply to operate service over the whole route). Thus, the ability to bid on a route is not constrained by a railroad's size.

    This final rule allows small railroads to participate in the pilot program, but does not require them to take any action. If small entities do not believe it would be beneficial to participate in the pilot program, they are not required to take any action. Therefore, there is no significant economic impact on any small entities as a result of this final rule.

    Under the Regulatory Flexibility Act (5 U.S.C. 605(b)), FRA certifies this final rule does not have a significant economic impact on a substantial number of small entities.

    3. Paperwork Reduction Act

    Under the Paperwork Reduction Act of 1995 and the Office of Management and Budget's (OMB) Implementing Guidance at 5 CFR 1320.3(c), collection of information means, except as provided in § 1320.4, the obtaining, causing to be obtained, soliciting, or requiring the disclosure to an agency, third parties or the public of information by or for an agency by means of identical questions posed to, or identical reporting, recordkeeping, or disclosure requirements imposed on, ten or more persons, whether such collection of information is mandatory, voluntary, or required to obtain or retain a benefit.

    FRA expects the requirements of this final rule will affect less than 10 “persons” as defined in 5 CFR 1320.3(c)(4). Consequently, no information collection submission is necessary, and no approval is being sought from OMB at this time.

    4. Environmental Impact

    FRA evaluated this final rule consistent with its “Procedures for Considering Environmental Impacts” (FRA's Procedures) (64 FR 28545, May 26, 1999) as required by the National Environmental Policy Act (42 U.S.C. 4321 et seq.), other environmental statutes, Executive Orders, and related regulatory requirements. FRA determined this final rule is not a major FRA action (requiring the preparation of an environmental impact statement or environmental assessment) because the rulemaking would not result in a change in current passenger service; instead, the program would only potentially result in a change in the operator of such service. Under section 4(c) and (e) of FRA's Procedures, FRA concludes no extraordinary circumstances exist for this final rule that might trigger the need for a more detailed environmental review. As a result, FRA finds this final rule is not a major Federal action significantly affecting the quality of the human environment.

    5. Federalism Implications

    Executive Order 13132, “Federalism” (64 FR 43255, Aug. 4, 1999), requires FRA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” “Policies that have federalism implications” are defined in the Executive Order to include regulations that have “substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.” Under Executive Order 13132, the agency may not issue a regulation with federalism implications that imposes substantial direct compliance costs and that is not required by statute, unless the Federal government provides the funds necessary to pay the direct compliance costs incurred by State and local governments, or the agency consults with State and local government officials early in the process of developing the regulation. Where a regulation has federalism implications and preempts State law, the agency seeks to consult with State and local officials in the process of developing the regulation.

    FRA has analyzed this final rule consistent with the principles and criteria in Executive Order 13132. This final rule complies with a statutory mandate, and, thus, is in compliance with Executive Order 13132.

    In addition, this final rule will not have a substantial effect on the States, on the relationship between the Federal government and the States, or on the distribution of power and responsibilities among the various levels of government. In addition, this final rule will not have any federalism implications that impose substantial direct compliance costs on State and local governments. Accordingly, FRA has determined that preparation of a federalism summary impact statement for this final rule is not required.

    6. Unfunded Mandates Reform Act of 1995

    Under Section 201 of the Unfunded Mandates Reform (UMR) Act of 1995 (Pub. L. 104-4, 2 U.S.C. 1531), each Federal agency “shall, unless otherwise prohibited by law, assess the effects of Federal regulatory actions on State, local, and tribal governments, and the private sector (other than to the extent that such regulations incorporate requirements specifically set forth in law).” Section 202 of the UMR Act (2 U.S.C. 1532) further requires that before promulgating any general notice of proposed rulemaking that is likely to result in the promulgation of any rule that includes any Federal mandate that may result in expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100,000,000 or more (adjusted annually for inflation) in any 1 year, and before promulgating any final rule for which a general notice of proposed rulemaking was published, the agency shall prepare a written statement [detailing the effect on State, local, and tribal governments and the private sector].

    The $100,000,000 has been adjusted to $155,000,000 to account for inflation. This final rule will not result in expenditure of more than $155,000,000 by the public sector in any one year, and, thus, preparation of such a statement is not required.

    7. Energy Impact

    Executive Order 13211 requires Federal agencies to prepare a Statement of Energy Effects for any “significant energy action.” 66 FR 28355, May 22, 2001. Under the Executive Order, a “significant energy action” is defined as any action by an agency (normally published in the Federal Register) that promulgates or is expected to lead to the promulgation of a final rule or regulation, including any notice of inquiry, advance notice of proposed rulemaking, and notice of proposed rulemaking that: (1)(i) Is a significant regulatory action under Executive Order 12866 or any successor order, and (ii) is likely to have a significant adverse effect on the supply, distribution, or use of energy; or (2) the Administrator of the OMB Office of Information and Regulatory Affairs designates as a significant energy action. FRA evaluated this final rule consistent with Executive Order 13211. FRA determined this final rule will not have a significant adverse effect on the supply, distribution, or use of energy. Consequently, FRA concludes this regulatory action is not a “significant energy action” under Executive Order 13211.

    Executive Order 13783 requires Federal agencies to review regulations to determine whether they potentially burden the development or use of domestically produced energy resources, with particular attention to oil, natural gas, coal, and nuclear energy resources. Executive Order 13783 defines “burden” to mean unnecessarily obstruct, delay, curtail, or otherwise impose significant costs on the siting, permitting, production, utilization, transmission, or delivery of energy resources. FRA determined this final rule will not potentially burden the development or use of domestically produced energy resources.

    8. Privacy Act Information

    Interested parties should be aware that anyone can search the electronic form of all written communications and comments received into any agency docket 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 Federal Register published on Apr. 11, 2000, 65 FR 19477, or you may visit http://www.dot.gov/privacy.html. Under 5 U.S.C. 553(c), DOT solicits comments from the public to better inform its rulemaking process. DOT posts these comments, without edit, including any personal information the commenter provides, to www.regulations.gov, as described in the system of records notice (DOT/ALL-14 FDMS), which can be reviewed at www.dot.gov/privacy.

    List of Subjects in 49 CFR Part 269

    Railroad employees, Railroads.

    The Rule

    For the reasons discussed in the preamble, FRA revises part 269 of chapter II, subtitle B, title 49 of the Code of Federal Regulations to read as follows:

    PART 269—COMPETITIVE PASSENGER RAIL SERVICE PILOT PROGRAM Sec. 269.1 Purpose. 269.3 Limitations. 269.5 Definitions. 269.7 Petitions. 269.9 Bid process. 269.11 Evaluation. 269.13 Award. 269.15 Access to facilities; employees. 269.17 Cessation of service. Authority:

    Sec. 11307, Pub. L. 114-94; 49 U.S.C. 24711; and 49 CFR 1.89.

    § 269.1 Purpose.

    The purpose of this part is to carry out the statutory mandate in 49 U.S.C. 24711 requiring the Secretary to implement a pilot program for competitive selection of eligible petitioners in lieu of Amtrak to operate not more than three long-distance routes.

    § 269.3 Limitations.

    (a) Route limitations. The pilot program this part implements is available for not more than three Amtrak long-distance routes.

    (b) Time limitations. An eligible petitioner awarded a contract to provide passenger rail service under the pilot program this part implements shall only provide such service for a period not to exceed four years from the date of commencement of service. The Administrator has the discretion to renew such service for one additional operation period of four years.

    § 269.5 Definitions.

    As used in this part—

    Act means the Fixing America's Surface Transportation Act (Pub. L. 114-94 (Dec. 4, 2015)).

    Administrator means the Federal Railroad Administrator, or the Federal Railroad Administrator's delegate.

    Amtrak means the National Railroad Passenger Corporation.

    Eligible petitioner means one of the following entities, other than Amtrak, that has submitted a petition to FRA under § 269.7:

    (1) A rail carrier or rail carriers that own the infrastructure over which Amtrak operates a long-distance route, or another rail carrier that has a written agreement with a rail carrier or rail carriers that own such infrastructure;

    (2) A State, group of States, or State-supported joint powers authority or other sub-State governance entity responsible for providing intercity rail passenger transportation with a written agreement with the rail carrier or rail carriers that own the infrastructure over which Amtrak operates a long-distance route and that host or would host the intercity rail passenger transportation; or

    (3) A State, group of States, or State-supported joint powers authority or other sub-State governance entity responsible for providing intercity rail passenger transportation and a rail carrier with a written agreement with another rail carrier or rail carriers that own the infrastructure over which Amtrak operates a long-distance route and that host or would host the intercity rail passenger transportation.

    File and filed mean submission of a document under this part to FRA at [email protected] on the date the document was emailed to FRA.

    Financial plan means a plan that contains, for each Federal fiscal year fully or partially covered by the bid:

    (1) An annual projection of the revenues, expenses, capital expenditure requirements, and cash flows (from operating activities, investing activities, and financing activities, showing sources and uses of funds, including the operating subsidy amount) attributable to the route; and

    (2) A statement of the assumptions underlying the financial plan's contents.

    FRA means the Federal Railroad Administration.

    Operating plan means a plan that contains, for each Federal fiscal year fully or partially covered by the bid:

    (1) A complete description of the service planned to be offered, including the train schedules, frequencies, equipment consists, fare structures, and such amenities as sleeping cars and food service provisions; station locations; hours of operation; provisions for accommodating the traveling public, including proposed arrangements for stations shared with other routes; expected ridership; passenger-miles; revenues by class of service between each city-pair proposed to be served; connectivity with other intercity transportation services; and compliance with applicable Service Outcome Agreements; and

    (2) A statement of the assumptions underlying the operating plan's contents.

    Long-distance route means those routes described in 49 U.S.C. 24102(5) and operated by Amtrak on the date of enactment of the Act.

    § 269.7 Petitions.

    (a) In general. An eligible petitioner may petition FRA to provide intercity passenger rail transportation over a long-distance route in lieu of Amtrak for a period of time consistent with the time limitations described in § 269.3(b).

    (b) Petition requirements. Eligible petitioners must:

    (1) File the petition with FRA no later than 180 days after September 5, 2017;

    (2) Describe the petition as a “Petition to Provide Passenger Rail Service under 49 CFR part 269”;

    (3) Describe the long-distance route or routes over which the eligible petitioner wants to provide intercity passenger rail transportation and the Amtrak service that the eligible petitioner wants to replace; and

    (4) If applicable, provide an executed copy of all written agreements with all entities that own infrastructure on the long-distance route or routes over which the eligible petitioner wants to provide intercity passenger rail transportation. The written agreement(s) must demonstrate the infrastructure owner's support for the petition.

    § 269.9 Bid process.

    (a) Notification. FRA will notify the eligible petitioner and Amtrak of receipt of a petition filed with FRA and will publish a notice of receipt in the Federal Register not later than 30 days after FRA's receipt of such petition.

    (b) Bid requirements. An eligible petitioner that has filed a timely petition under § 269.7 and Amtrak, if Amtrak desires, may file a bid with FRA not later than 120 days after FRA publishes the notice of receipt in the Federal Register under paragraph (a) of this section. Each such bid must:

    (1) Provide FRA with sufficient information to evaluate the level of service described in the proposal, and to evaluate the proposal's compliance with the requirements in § 269.13(b);

    (2) Describe how the bidder would operate the route;

    (i) This description must include, but is not limited to, an operating plan, a financial plan and, if applicable, any executed agreement(s) necessary for the operation of passenger service over right-of-way on the route that is not owned by the bidder.

    (ii) In addition, if the bidder intends to generate any revenues from ancillary activities (i.e., activities other than passenger transportation, accommodations, and food service) as part of its proposed operation of the route, then the bidder must fully describe such ancillary activities and identify their incremental impact in all relevant sections of the operating plan and the financial plan, and on the route's performance, together with the assumptions underlying the estimates of such incremental impacts.

    (3) Describe what passenger equipment the bidder would need, including how it would be procured;

    (4) Describe in detail, including amounts, timing, and intended purpose, what sources of Federal and non-Federal funding the bidder would use, including but not limited to any Federal or State operating subsidy and any other Federal or State payments;

    (5) Contain a staffing plan describing the number of employees the bidder needs to operate the service, the job assignments and requirements, and the terms of work for prospective and current employees of the bidder for the service outlined in the bid;

    (6) Describe the capital needs for the passenger rail service including in detail any costs associated with compliance with Federal law and regulations;

    (7) Describe in detail the bidder's plans for meeting all FRA safety requirements, including equipment, employee, and passenger parameters;

    (8) Describe, for each Federal fiscal year fully or partially covered by the bid, a projection of the passenger rail service route's total revenue, total costs, total contribution/loss, and net cash used in operating activities per passenger-mile attributable to the route;

    (9) Describe how the passenger rail service would meet or exceed the performance required of or achieved by Amtrak on the applicable route during the last fiscal year, and how the bidder would report on the performance standards. At a minimum, this description must include, for each Federal fiscal year fully or partially covered by the bid a projection of the route's expected Passenger Miles per Train Mile, End-Point and All Stations On-Time Performance, Host Railroad and Operator Responsible Delays per 10,000 Train Miles, Percentage of Passenger Trips to/from Underserved Communities, Service Interruptions per 10,000 Train Miles due to Equipment-Related Problems, and customer service quality;

    (10) Analyze the reasonably foreseeable effects, both positive and negative, of the passenger rail service on other intercity passenger rail services;

    (11) Describe the bidder's compliance with all applicable Federal, state, and local laws; and

    (12) Provide State or States written concurrence of the bid for a route that receives funding from a State or States.

    (c) Supplemental information. (1) FRA may request supplemental information from a bidder and/or Amtrak if FRA determines it needs such information to evaluate a bid.

    (2) FRA's request may seek information about the costs related to the service that Amtrak would still incur following the cessation of service, including the increased costs for other services.

    (3) FRA will establish a deadline by which the bidder and/or Amtrak must file the supplemental information with FRA.

    § 269.11 Evaluation.

    (a) Evaluation. FRA will select a winning bidder by evaluating the bids based on the requirements of this part.

    (b) Notification. (1) Upon selecting a winning bidder, FRA will publish a notice in the Federal Register describing the identity of the winning bidder, the long-distance route the bidder will operate, a detailed justification explaining why FRA selected the bid, and any other information the Administrator determines appropriate.

    (2) The notice under this paragraph (b) will be open for public comment for 30 days after the date FRA selects the bid.

    § 269.13 Award.

    (a) Award. FRA will execute a contract with a winning bidder that is not or does not include Amtrak, consistent with the requirements of this section and as FRA may otherwise require, not later than 270 days after the bid deadline established by § 269.9(b).

    (b) Contract requirements. Among other things, the contract between FRA and a winning bidder that is not or does not include Amtrak must:

    (1) Award to the winning bidder the right and obligation to provide intercity passenger rail transportation over that route subject to such performance standards as FRA may require for a duration consistent with § 269.3(b);

    (2) Award to the winning bidder an operating subsidy, as determined by FRA and based on Amtrak's final audited publically-reported fully-allocated operating costs of the route for the prior fiscal year, excluding costs related to Other Postretirement Employee Benefits, Amtrak Performance Tracking System Asset Allocations, Project Related Costs, and Amtrak Office of Inspector General activities, subject to the availability of funding, for the first year at a level that does not exceed 90 percent of the level in effect for that specific route during the fiscal year preceding the fiscal year in which the petition was received, adjusted for inflation;

    (3) State that any award of an operating subsidy is made annually, is subject to the availability of funding, and is based on the amount calculated under paragraph (b)(2) of this section, adjusted for inflation;

    (4) Condition the operating and subsidy rights upon the winning bidder providing intercity passenger rail transportation over the route that is no less frequent, nor over a shorter distance, than Amtrak provided on that route before the award;

    (5) Condition the operating and subsidy rights upon the winning bidder's compliance with performance standards FRA may require, but which, at a minimum, must meet or exceed the performance required of or achieved by Amtrak on the applicable route during the fiscal year immediately preceding the year the bid is submitted;

    (6) Subject the winning bidder to the grant conditions established by 49 U.S.C. 24405; and

    (7) Subject the winning bidder to the requirements of the appropriations act(s) funding the contract.

    (c) Publication. The winning bidder shall make their bid available to the public after the bid award with any appropriate redactions for confidential or proprietary information.

    § 269.15 Access to facilities; employees.

    (a) Access to facilities. (1) If the award under § 269.13 is made to an eligible petitioner, Amtrak must provide that eligible petitioner access to the Amtrak-owned reservation system, stations, and facilities directly related to operations of the awarded route(s).

    (2) If Amtrak and the eligible petitioner awarded a route cannot agree on the terms of access, either party may petition the Surface Transportation Board under 49 U.S.C. 24711(g).

    (b) Employees. The employees of any person, except as provided in a collective bargaining agreement, an eligible petitioner uses in the operation of a route under this part shall be considered an employee of that eligible petitioner and subject to the applicable Federal laws and regulations governing similar crafts or classes of employees of Amtrak.

    (c) Hiring preference. The winning bidder must provide hiring preference to qualified Amtrak employees displaced by the award of the bid, consistent with the staffing plan the winning bidder submits and the grant conditions established by 49 U.S.C. 24405.

    § 269.17 Cessation of service.

    (a) If an eligible petitioner awarded a route under this part ceases to operate the service or fails to fulfill its obligations under the contract required under § 269.13, the Administrator, in collaboration with the Surface Transportation Board, shall take any necessary action consistent with title 49 of the United States Code to enforce the contract and ensure the continued provision of service, including the installment of an interim service and re-bidding the contract to operate the service.

    (b) In re-bidding the contract, the entity providing service must either be Amtrak or an eligible petitioner.

    Issued in Washington, DC, on July 3, 2017. Patrick Warren, Executive Director.
    [FR Doc. 2017-14355 Filed 7-5-17; 4:15 pm] BILLING CODE 4910-06-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration 50 CFR Part 622 [Docket No. 170126124-7124-01] RIN 0648-XF488 Fisheries of the Caribbean, Gulf of Mexico, and South Atlantic; 2017 Accountability Measure-Based Closures for Commercial and Recreational Species in the U.S. Caribbean off Puerto Rico AGENCY:

    National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

    ACTION:

    Temporary rule; closures.

    SUMMARY:

    Through this temporary rule, NMFS implements accountability measures (AMs) for species and species groups in the exclusive economic zone (EEZ) of the U.S. Caribbean off Puerto Rico (Puerto Rico management area) for the 2017 fishing year. NMFS has determined that annual catch limits (ACLs) in the Puerto Rico management area were exceeded for spiny lobster; the commercial sectors of triggerfish and filefish (combined), and Snapper Unit 2; and the recreational sectors of triggerfish and filefish (combined), and jacks, based on average landings during the 2013-2015 fishing years. This temporary rule reduces the lengths of the 2017 fishing seasons for these species and species groups by the amounts necessary to ensure, to the extent practicable, that landings do not exceed the applicable ACLs in 2017. NMFS closes the applicable sectors for these species and species groups beginning on the dates specified in the DATES section and continuing until October 1, 2017. These AMs are necessary to protect the Caribbean reef fish and spiny lobster resources in the Puerto Rico management area.

    DATES:

    This rule is effective August 7, 2017, until 12:01 a.m., local time, on October 1, 2017. The AM-based closures apply in the Puerto Rico management area for the following species and species groups, and fishing sectors, at the times and dates specified below, until 12:01 a.m., local time, on October 1, 2017.

    • Triggerfish and filefish, combined (commercial) effective at 12:01 a.m., local time, on August 13, 2017;

    • Spiny lobster (commercial and recreational) effective at 12:01 a.m., local time, on September 7, 2017;

    • Snapper Unit 2 (commercial) effective at 12:01 a.m., local time, on September 15, 2017;

    • Triggerfish and filefish, combined (recreational) effective at 12:01 a.m., local time, on September 18, 2017;

    • Jacks (recreational) effective at 12:01 a.m., local time, on September 28, 2017.

    FOR FURTHER INFORMATION CONTACT:

    María del Mar López, NMFS Southeast Regional Office, telephone: 727-824-5305, email: [email protected]

    SUPPLEMENTARY INFORMATION:

    The reef fish fishery of the Caribbean EEZ includes triggerfish and filefish, snappers in Snapper Unit 2, and jacks, and is managed under the Fishery Management Plan (FMP) for the Reef Fish Fishery of Puerto Rico and the U.S. Virgin Islands (Reef Fish FMP). Caribbean spiny lobster is managed under the FMP for the Spiny Lobster Fishery of Puerto Rico and the U.S. Virgin Islands (Spiny Lobster FMP). The FMPs were prepared by the Caribbean Fishery Management Council (Council) and are implemented by NMFS under the authority of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act) by regulations at 50 CFR part 622.

    The 2010 Caribbean ACL Amendment (which includes, along with another amendment, Amendment 5 to the Reef Fish FMP) and the 2011 Caribbean ACL Amendment (which includes, among other amendments, Amendment 6 to the Reef Fish FMP and Amendment 5 to the Spiny Lobster FMP) revised the Reef Fish and Spiny Lobster FMPs. Among other actions, the 2010 and 2011 Caribbean ACL Amendments and the associated final rules (76 FR 82404, December 30, 2011, and 76 FR 82414, December 30, 2011, respectively) established ACLs and AMs for Caribbean reef fish and spiny lobster, including the species and species groups identified in this temporary rule. The 2010 and 2011 Caribbean ACL Amendments and final rules also allocated ACLs among three Caribbean island management areas, i.e., the Puerto Rico, St. Croix, and St. Thomas/St. John management areas of the Caribbean EEZ, as specified in Appendix E to part 622. The ACLs for species and species groups in the Puerto Rico management area, except for spiny lobster, were further allocated between the commercial and recreational sectors, and AMs apply to each of these sectors separately.

    On May 11, 2016, NMFS published the final rule implementing the Comprehensive Amendment to the U.S. Caribbean FMPs: Application of AMs (81 FR 29166). Among other items, the final rule clarified that the spiny lobster ACL for the Puerto Rico management area is applied as a single ACL for both the commercial and recreational sectors, consistent with the Council's intent in the 2011 Caribbean ACL Amendment, and the AM applies to both sectors. Additionally, the final rule clarified the fishing restrictions that occur in the Caribbean EEZ when an ACL is exceeded, and an AM is triggered and implemented. The Puerto Rico management area encompasses the EEZ off Puerto Rico.

    In addition, on June 8, 2017, NMFS implemented the final rule for Amendment 8 to the Reef Fish FMP, Amendment 7 to the Spiny Lobster FMP, and Amendment 6 to the FMP for Corals and Reef Associated Plants and Invertebrates of Puerto Rico and the U.S. Virgin Islands (collectively referred to as the AM Timing Amendment) (82 FR 21475, May 9, 2017). The final rule implementing the AM Timing Amendment modified the date for initiating an AM-based closure in the event of an ACL overage for the species and species groups managed by the Council under the aforementioned FMPs. Instead of initiating an AM-based closure on December 31 and counting backward into the year for the number of days necessary to achieve the reduction in landings required so landings do not exceed the applicable ACL, the AM-based closure period will be applied on September 30 and count backward toward the beginning of the fishing year.

    The ACLs for the applicable species and species groups, and fishing sectors in the Puerto Rico management area covered by this temporary rule are as follows and are given in round weight:

    • The commercial ACL for triggerfish and filefish, combined, is 58,475 lb (26,524 kg), as specified in § 622.12(a)(1)(i)(Q).

    • The ACL for spiny lobster (applicable to the commercial and recreational sectors) is 327,920 lb (148,742 kg), as specified in § 622.12(a)(1)(iii).

    • The commercial ACL for Snapper Unit 2 is 145,916 lb (66,186 kg), as specified in § 622.12(a)(1)(i)(D).

    • The recreational ACL for triggerfish and filefish, combined, is 21,929 lb (9,947 kg), as specified in § 622.12(a)(1)(ii)(Q).

    • The recreational ACL for jacks is 51,001 lb (23,134 kg), as specified in § 622.12(a)(1)(ii)(M).

    NMFS has determined that landings for the species and species groups in this temporary rule from the Puerto Rico management area exceeded the applicable ACLs. Therefore, in accordance with regulations at 50 CFR 622.12(a), the Assistant Administrator for NOAA Fisheries (AA) is filing a notification with the Office of the Federal Register to reduce the lengths of the fishing seasons for the applicable species or species groups in the 2017 fishing year by the amount necessary to ensure, to the extent practicable, that landings do not exceed the applicable ACLs. As described in the Reef Fish and Spiny Lobster FMPs, and in this temporary rule, any required fishing season reduction will be applied from September 30 backward, toward the beginning of the fishing year. If the length of the required fishing season reduction exceeds the time period of January 1 through September 30, any additional fishing season reduction will be applied from October 1 forward, toward the end of the fishing year on December 31. NMFS evaluates landings relative to the applicable ACL based on a moving 3-year average of landings, as described in the FMPs.

    Based on the most recent available landings data, from the 2013-2015 fishing years, NMFS has determined that the ACLs for spiny lobster; the commercial sectors for triggerfish and filefish (combined), and Snapper Unit 2; and the recreational sectors of triggerfish and filefish (combined), and jacks in the Puerto Rico management area have been exceeded. In addition, NMFS has determined that the ACLs for these species and species groups were exceeded because of increased catches and not as a result of enhanced data collection and monitoring efforts.

    This temporary rule implements AMs for the identified commercial and recreational sectors for the species and species groups listed in this temporary rule, to reduce the respective 2017 fishing season lengths to ensure that landings do not exceed the applicable ACLs in the 2017 fishing year. The 2017 fishing seasons for the applicable sectors for these species and species groups in the Puerto Rico management area of the Caribbean EEZ are closed at the times and dates listed below. These closures remain in effect until 12:01 a.m., local time, on October 1, 2017.

    • The commercial sector for triggerfish and filefish, combined, is closed effective at 12:01 a.m., local time, on August 13, 2017. Triggerfish and filefish, combined, includes ocean, queen, and sargassum triggerfish; scrawled and whitespotted filefish; and black durgon;

    • The commercial and recreational sectors for spiny lobster are closed effective at 12:01 a.m., local time, on September 7, 2017;

    • The commercial sector for Snapper Unit 2 is closed effective at 12:01 a.m., local time, on September 15, 2017. Snapper Unit 2 includes queen and cardinal snapper;

    • The recreational sector for triggerfish and filefish, combined, is closed effective at 12:01 a.m., local time, on September 18, 2017. Triggerfish and filefish, combined, includes ocean, queen, and sargassum triggerfish; scrawled and whitespotted filefish; and black durgon; and

    • The recreational sector for jacks is closed effective at 12:01 a.m., local time, on September 28, 2017. Jacks includes horse-eye, black, almaco, bar, and yellow jack; greater amberjack; and blue runner.

    After these specified closures, on October 1, 2017, these applicable species and species groups will reopen through December 31, 2017, the end of the current fishing year.

    During the Puerto Rico commercial sector closures announced in this temporary rule for the species above, except for spiny lobster, which is described below, the commercial harvest of the indicated species or species groups is prohibited. All harvest or possession of the indicated species or species groups in or from the Puerto Rico management area is limited to the recreational bag and possession limits specified in § 622.437, unless the recreational sector for the species or species group is closed, and the sale or purchase of the indicated species or species group in or from the Puerto Rico management area is prohibited.

    During the Puerto Rico recreational sector closures announced in this temporary rule for the species above, except for spiny lobster, which is described below, all recreational harvest of the indicated species groups is prohibited, and the recreational bag and possession limits for the indicated species groups in or from the Puerto Rico management area are zero.

    During the Puerto Rico spiny lobster closure announced in this temporary rule, both the commercial and recreational sectors for spiny lobster are closed. The harvest, possession, purchase, or sale of spiny lobster in or from the Puerto Rico management area is prohibited. The bag and possession limits for spiny lobster in or from the Puerto Rico management area are zero.

    Classification

    The Regional Administrator for the NMFS Southeast Region has determined this temporary rule is necessary for the conservation and management of the species and species groups included in this temporary rule, in the Puerto Rico management area, and is consistent with the Magnuson-Stevens Act and other applicable laws.

    This action is taken under 50 CFR 622.12(a) and is exempt from review under Executive Order 12866.

    These measures are exempt from the procedures of the Regulatory Flexibility Act because the temporary rule is issued without opportunity for prior notice and comment.

    This action responds to the best scientific information available. The AA finds good cause to waive the requirements to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such prior notice and opportunity for public comment is unnecessary and contrary to the public interest. Such procedures are unnecessary because the rules implementing the ACLs and AMs for these species and species groups have been subject to notice and comment, and all that remains is to notify the public that the ACLs were exceeded and that the AMs are being implemented for the 2017 fishing year. Prior notice and opportunity for public comment on this action would be contrary to the public interest because many of those affected by the length of the commercial and recreational fishing seasons, including commercial operations, and charter vessel and headboat operations that book trips for clients in advance, need advance notice to adjust their business plans to account for the reduced commercial and recreational fishing seasons.

    Authority:

    16 U.S.C. 1801 et seq.

    Dated: July 3, 2017. Jennifer M. Wallace, Acting Director, Office of Sustainable Fisheries, National Marine Fisheries Service.
    [FR Doc. 2017-14293 Filed 7-6-17; 8:45 am] BILLING CODE 3510-22-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration 50 CFR Part 648 [Docket No. 170314268-7582-0] RIN 0648-BG68 Fisheries of the Northeastern United States; Recreational Management Measures for the Summer Flounder and Scup Fisheries; Fishing Year 2017 AGENCY:

    National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

    ACTION:

    Final rule.

    SUMMARY:

    In this rule, NMFS implements management measures for the 2017 summer flounder and scup recreational fisheries. The implementing regulations for these fisheries require NMFS to publish recreational measures for the fishing year. The intent of these measures is to constrain recreational catch to established limits and prevent overfishing of the summer flounder and scup resources.

    DATES:

    This rule is effective July 7, 2017. The management measures for the 2017 summer flounder and scup recreational fisheries are effective July 7, 2017, through December 31, 2017.

    ADDRESSES:

    Copies of the Supplemental Information Report (SIR) and other supporting documents for the recreational harvest measures are available from Dr. Christopher M. Moore, Executive Director, Mid-Atlantic Fishery Management Council, Suite 201, 800 N. State Street, Dover, DE 19901. The recreational harvest measures document is also accessible via the Internet at: http://www.greateratlantic.fisheries.noaa.gov.

    The Final Regulatory Flexibility Analysis (FRFA) consists of the IRFA, public comments and responses contained in this final rule, and the summary of impacts and alternatives contained in this final rule. Copies of the small entity compliance guide are available from John K. Bullard, Regional Administrator, Greater Atlantic Region, National Marine Fisheries Service, 55 Great Republic Drive, Gloucester, MA 01930-2298.

    FOR FURTHER INFORMATION CONTACT:

    Emily Gilbert, Fishery Policy Analyst, (978) 281-9244.

    SUPPLEMENTARY INFORMATION:

    Summary of Final Management Measures

    In this rule, NMFS specifies management measures for the 2017 summer flounder and scup recreational fisheries consistent with the recommendations of the Mid-Atlantic Fishery Management Council and the Atlantic States Marine Fisheries Commission.

    NMFS is implementing measures that apply in the Federal waters of the exclusive economic zone. These measures apply to all federally-permitted party/charter vessels with applicable summer flounder and scup permits, regardless of where they fish, unless the state in which they land implements measures that are more restrictive. These measures are intended to achieve, but not exceed, the previously established 2017 recreational harvest limits for scup published on December 28, 2015 (80 FR 80689), and for summer flounder published on December 22, 2016 (81 FR 93842).

    Summer Flounder Recreational Management Measures

    NMFS is implementing conservation equivalency to manage the 2017 summer flounder recreational fishery, as proposed on April 19, 2017 (82 FR 18411). These measures are consistent with the recommendation of the Council and Commission. Additional information on the development of the 2017 measures is provided in the proposed rule and not repeated here.

    Conservation equivalency, as established by Framework Adjustment 2 (July 29, 2001; 66 FR 36208), allows each state to establish its own recreational management measures (possession limits, minimum fish size, and fishing seasons) to achieve its state harvest limit established by the Commission from the coastwide recreational harvest limit, as long as the combined effect of all of the states' management measures achieves the same level of conservation as would Federal coastwide measures. Framework Adjustment 6 (July 26, 2006; 71 FR 42315) allowed states to form regions for conservation equivalency in order to minimize differences in regulations for anglers fishing in adjacent waters.

    The Commission implemented Addendum XXVIII to its Summer Flounder Fishery Management Plan (FMP) to continue regional conservation equivalency for fishing year 2017. The Commission has adopted the following regions, which are consistent with the 2016 regions: (1) Massachusetts; (2) Rhode Island; (3) Connecticut and New York; (4) New Jersey; (5) Delaware, Maryland, and Virginia; and (6) North Carolina. To provide the maximum amount of flexibility and to address the state-by-state differences in fish availability, each state in a region is required by the Council and Commission to establish fishing seasons of the same length, with identical minimum fish sizes and possession limits. Addendum XXVIII requires each state or region, with the exception of North Carolina, to increase the 2017 summer flounder minimum size by 1 inch (2.5 cm) from the 2016 size limit. The 2017 measures also reduce the bag limit for most of the states and regions, while the season length remains the same as in 2016. More information on this addendum is available from the Commission (www.asmfc.org).

    The Commission certified, by letter dated April 5, 2017, that the Addendum XXVIII measures required to be implemented by individual states and regions, when combined, are the conservation equivalent of coastwide measures that would be expected to result in the 2017 recreational harvest limit being achieved, but not exceeded.

    Following this determination, New Jersey proposed and subsequently implemented on May 25, 2017, alternative measures for its state waters (i.e., 18-inch (45.7-cm) fish size, 3-fish bag limit, and a 104-day season). The Summer Flounder Management Board requested these measures be reviewed by the Commission's Technical Committee when they were proposed. The Technical Committee found New Jersey's measures are not the conservation equivalent of Addendum XXVIII measures. Using the Technical Committee's information, the Management Board found that New Jersey's measures were not conservationally equivalent to Addendum XXVIII and recommended New Jersey be found out of compliance with the Commission's FMP. The Commission's Interstate Fisheries Management Policy Board and Commission as a whole met on June 1, 2017, to consider the Management Board's non-compliance recommendation for the state of New Jersey. Both the Policy Board and the Commission found New Jersey out of compliance with the Commission's FMP for summer flounder. The Commission has referred the matter to NMFS under delegation of authority from the Secretary of Commerce, for federal non-compliance review under the provisions of the Atlantic Coastal Fisheries Cooperative Management Act. NMFS will review the Commission's non-compliance referral through a separate process.

    Based on the April 5, 2017, recommendation of the Commission, we find that the recreational summer flounder fishing measures required to be implemented for 2017 in state waters are, collectively, the conservation equivalent of the season, minimum size, and possession limit prescribed in §§ 648.104(b), 648.105, and 648.106(a). According to § 648.107(a)(1), vessels subject to the recreational fishing measures are not subject to Federal measures, and instead are subject to the recreational fishing measures implemented by the state in which they land. Section 648.107(a) is amended through this rule to recognize state-implemented measures as conservation equivalent of the coastwide recreational management measures for 2016. As mentioned above, New Jersey has not implemented Addendum XXVIII's required measures. NMFS' review and findings regarding the non-compliance recommendation for New Jersey will begin with publishing a notice in the Federal Register.

    In addition, this action implements default coastwide measures (a 19-inch (48.3-cm) minimum size, 4-fish possession limit, and June 1 through September 15 open fishing season), that become effective January 1, 2018, when the 2017 conservation equivalency program expires. These measures will remain effective until replaced by the 2018 recreational management measures in the spring of next year.

    Scup Recreational Management Measures

    This rule maintains status quo scup measures for the 2017 fishery: A 9-inch (22.9-cm) minimum fish size, 50-fish per person possession limit, and year-round season.

    Comments and Responses

    On April 19, 2017, NMFS published the proposed 2017 summer flounder and scup recreational management measures for public notice and comments. NMFS received 17 comments, of which 14 were related to measures provided in the proposed rule. New Jersey submitted a comment letter focused on their dissatisfaction with the specific measures outlined in Addendum XXVIII. New Jersey's concerns will be considered through the non-compliance proceedings and are not responded to in this action. Other comments received related to preferences for lower quotas for summer flounder and scup, as well as opinions that the Council favors the commercial industry.

    No changes to the proposed specifications were made as a result of these comments.

    Comment 1: One commenter from the State of Rhode Island stated that the measures contained within Addendum XXVIII were not restrictive enough to constrain catch within the 2017 summer flounder harvest limit. The commenter noted concern that more restrictive measures proposed by the State of Rhode Island were rejected by the Commission's Management Board.

    Response: The Commission and its Technical Committee has expertise in determining whether or not state-implemented measures are conservationally equivalent to those measures recommended by the Council. The Commission has determined that the addendum's measures achieve conservation equivalency and are likely to constrain catch within the 2017 recreational harvest limit.

    Comment 2: Eleven commenters raised concerns about state-specific summer flounder regulations which are outside the scope of this action, each specifically requesting that the State of Delaware not be penalized for anything that results from New Jersey's public opposition to the Commission's Addendum.

    Response: As previously mentioned, the non-compliance determination process for New Jersey will happen outside of this action. Delaware has implemented measures outlined in the Commission's Addendum XXVIII. No further action is required by the State of Delaware for 2017.

    Comment 3: One commenter was concerned about the summer flounder precautionary default season, stating that he would prefer the season to begin in May, rather than July.

    Response: Because the Commission did not request that the precautionary default measures be applied to any state, these measures are not applicable for 2017. Instead, this rule implements the Commission and Council recommended measures, as previously proposed, for conservation equivalency in 2017. The coastwide default measures will be effective to the start of the 2018 fishing year.

    Classification

    The Administrator, Greater Atlantic Region, NMFS, determined that this final rule is necessary for the conservation and management of the summer flounder fishery and that it is consistent with the Magnuson-Stevens Fisheries Conservation and Management Act (Magnuson-Stevens Act) and other applicable laws.

    The Assistant Administrator for Fisheries, NOAA, finds good cause under 5 U.S.C. 553(d)(3) to waive the 30-day delay of effectiveness period for this rule, to ensure that the final management measures are in place as soon as possible. A delay in this rule's effectiveness would unfairly prejudice federally permitted charter/party vessels. Recreational fisheries are already underway for summer flounder and scup. The linchpin of NMFS's decision whether to proceed with the coastwide measures or adopt the conservation equivalent measures is advice from the Commission following review of the individual state plans. Rulemaking has been delayed while final information regarding the status of New Jersey through the Commission's conservation equivalency process has been evaluated. The Commission's Summer Flounder Management Board met on June 1, 2017, to discuss whether or not to find New Jersey out of compliance with Addendum XXVIII. NMFS did not want to cause public confusion by releasing a final rule prior to the Commission's final determination on New Jersey's summer flounder management measures.

    Based on historic effort and landings information, and the importance of summer flounder as a recreational fishery target species, participation and landings are expected to be high from the onset of the fishery that is already underway. Party and charter vessels from the various states are the largest component of the recreational fishery that fish in the EEZ. The Federal coastwide regulatory measures for summer flounder that were codified last year remain in effect until the 2017 recreational measures are made effective. These measures do not achieve the necessary reduction in recreational landings to constrain the fishery to the 2017 recreational harvest limit. Although the states' summer flounder fisheries are already open, additional delay in implementing the measures of this rule will increase confusion on what measures are in place in Federal waters. This will disadvantage Federally permitted charter/party vessels and increase the likelihood of illegal landings due to misunderstood regulations. The resulting disconnect in the regulations that exist until this rule's measures are implemented may potentially compromise the mortality objectives of the summer flounder fishery.

    Unlike actions that require an adjustment period to comply with new rules, charter/party operators will not have to purchase new equipment or otherwise expend time or money to comply with these management measures. Rather, complying with this final rule simply means adhering to the published management measures for each relevant species of fish while the charter/party operators are engaged in fishing activities.

    For these reasons, the Assistant Administrator finds good cause to waive the 30-day delay and to implement this rule upon publication in the Federal Register.

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

    A FRFA was prepared pursuant to 5 U.S.C. 604(a), and incorporates the IRFA, a summary of any significant issues raised by the public comments in response to the IRFA and NMFS's responses to those comments, and a summary of the analyses completed to support the action. A copy of the SIR/IRFA is available from the Council (see ADDRESSES).

    The classification to the proposed rule included a detailed summary of the analyses contained in the IRFA, and that discussion is not repeated here.

    Final Regulatory Flexibility Analysis A Summary of Significant Issues Raised by the Public in Response to the Summary of the Agency's Assessment of Such Issues, and a Statement of Any Changes Made in the Final Rule as a Result

    Our responses to all of the comments received on the proposed rule, including those that raised significant issues with the proposed action, can be found in the Comments and Responses section of this rule. Aside from the comment from the State of New Jersey that will be considered through a separate process, none of the comments received raised specific issues regarding the economic analyses summarized in the IRFA. No changes to the proposed rule were required to be made as a result of public comments.

    Description and Estimate of Number of Small Entities to Which the Rule Will Apply

    Available ownership data for the for-hire fleet indicate that there were 411 for-hire affiliate firms generating revenues from fishing recreationally for various species during the 2013-2015 period, all of which are categorized as small businesses. Although it is not possible to derive what proportion of the overall revenues came from specific fishing activities, given the popularity of summer flounder and scup as a recreational species, it is likely that revenues generated from summer flounder and scup recreational fishing are important for some, if not all, of these firms. The three-year average (2013-2015) gross receipts for these small entities ranged from $10,000 for 121 entities to over $1 million for 10 entities (highest value was $2.7 million).

    Description of Projected Reporting, Recordkeeping, and Other Compliance Requirements

    No additional reporting, recordkeeping, or other compliance requirements are included in this final rule.

    Description of the Steps the Agency Has Taken To Minimize the Significant Economic Impact on Small Entities Consistent With the Stated Objectives of Applicable Statutes

    In seeking to minimize the impact of recreational management measures (minimum fish size, possession limit, and fishing season) on small entities (i.e., Federal party/charter permit holders), NMFS is constrained to implementing measures that meet the conservation objectives of the FMP and Magnuson-Stevens Act requirements. The only other summer flounder management measure alternative considered was the less restrictive status quo alternative (i.e., the non-preferred coastwide 2016 measures). State-specific implications of the no-action (coastwide) alternative of an 18-inch (45.7-cm) minimum fish size, a 4-fish bag limit, and closed season of May 1 through September 30, would not achieve the mortality objectives required by the FMP, and, therefore, cannot be continued for the 2017 fishing season.

    The conservation equivalency approach implemented by this action allows states some degree of flexibility in the specification of management measures, unlike the application of one set of uniform coastwide measures. The degree of flexibility available to states under conservation equivalency is constrained to a combined suite of minimum fish size, per angler possession limit, and fishing season that will likely constrain catch to the 2017 recreational harvest limit. This provides the opportunity for states to construct measures that achieve the conservation objective while providing a state-specific set of measures in lieu of the one-size-fits-all coastwide measure.

    Small Entity Compliance Guide

    Section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996 states that, for each rule or group of related rules for which an agency is required to prepare a FRFA, the agency shall publish one or more guides to assist small entities in complying with the rule, and shall designate such publications as “small entity compliance guides.” The agency shall explain the actions a small entity is required to take to comply with a rule or group of rules.

    As part of this rulemaking process, a small entity compliance guide will be sent to all holders of Federal party/charter permits issued for the summer flounder and scup fisheries. In addition, copies of this final rule and guide (i.e., permit holder letter) are available from NMFS (see ADDRESSES) and at the following Web site: http://www.greateratlantic.fisheries.noaa.gov.

    List of Subjects in 50 CFR Part 648

    Fisheries, Fishing, Reporting and recordkeeping requirements.

    Dated: July 3, 2017. Chris Oliver, Assistant Administrator for Fisheries, National Marine Fisheries Services.

    For the reasons set out in the preamble, 50 CFR part 648 is amended as follows:

    PART 648—FISHERIES OF THE NORTHEASTERN UNITED STATES 1. The authority citation for part 648 continues to read as follows: Authority:

    16 U.S.C. 1801 et seq.

    2. In § 648.104, paragraph (b) is revised to read as follows:
    § 648.104 Summer flounder minimum fish sizes.

    (b) Party/charter permitted vessels and recreational fishery participants. Unless otherwise specified pursuant to § 648.107, the minimum size for summer flounder is 19 inches (48.3 cm) TL for all vessels that do not qualify for a moratorium permit under § 648.4(a)(3), and charter boats holding a moratorium permit if fishing with more than three crew members, or party boats holding a moratorium permit if fishing with passengers for hire or carrying more than five crew members.

    3. Section 648.105 is revised to read as follows:
    § 648.105 Summer flounder recreational fishing season.

    Unless otherwise specified pursuant to § 648.107, vessels that are not eligible for a moratorium permit under § 648.4(a)(3), and fishermen subject to the possession limit, may fish for summer flounder from June 1 through September 15. This time period may be adjusted pursuant to the procedures in § 648.102.

    4. In § 648.106, paragraph (a) is revised to read as follows:
    § 648.106 Summer flounder possession restrictions.

    (a) Party/charter and recreational possession limits. Unless otherwise specified pursuant to § 648.107, no person shall possess more than four summer flounder in, or harvested from, the EEZ, per trip unless that person is the owner or operator of a fishing vessel issued a summer flounder moratorium permit, or is issued a summer flounder dealer permit. Persons aboard a commercial vessel that is not eligible for a summer flounder moratorium permit are subject to this possession limit. The owner, operator, and crew of a charter or party boat issued a summer flounder moratorium permit are subject to the possession limit when carrying passengers for hire or when carrying more than five crew members for a party boat, or more than three crew members for a charter boat. This possession limit may be adjusted pursuant to the procedures in § 648.102.

    5. In § 648.107, introductory text to paragraph (a) and paragraph (b) are revised to read as follows:
    § 648.107 Conservation equivalent measures for the summer flounder fishery.

    (a) The Regional Administrator has determined that the recreational fishing measures proposed to be implemented by the states of Maine through North Carolina for 2017 are the conservation equivalent of the season, minimum size, and possession limit prescribed in §§ 648.102, 648.103, and 648.105(a), respectively. This determination is based on a recommendation from the Summer Flounder Board of the Atlantic States Marine Fisheries Commission.

    (b) Federally permitted vessels subject to the recreational fishing measures of this part, and other recreational fishing vessels registered in states and subject to the recreational fishing measures of this part, whose fishery management measures are not determined by the Regional Administrator to be the conservation equivalent of the season, minimum size and possession limit prescribed in §§ 648.102, 648.103(b), and 648.105(a), respectively, due to the lack of, or the reversal of, a conservation equivalent recommendation from the Summer Flounder Board of the Atlantic States Marine Fisheries Commission shall be subject to the following precautionary default measures: Season—July 1 through August 31; minimum size—20 inches (50.8 cm); and possession limit—two fish.

    [FR Doc. 2017-14280 Filed 7-6-17; 8:45 am] BILLING CODE 3510-22-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration 50 CFR Part 660 [Docket No. 160808696-7010-02] RIN 0648-BG95 Magnuson-Stevens Act Provisions; Fisheries Off West Coast States; Pacific Coast Groundfish Fishery; 2017-2018 Biennial Specifications and Management Measures; Inseason Adjustments AGENCY:

    National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

    ACTION:

    Final rule; inseason adjustments to biennial groundfish management measures.

    SUMMARY:

    This final rule announces inseason changes to management measures in the Pacific Coast groundfish fisheries. This action, which is authorized by the Pacific Coast Groundfish Fishery Management Plan (PCGFMP), is intended to allow fisheries to access more abundant groundfish stocks while protecting overfished and depleted stocks.

    DATES:

    This final rule is effective July 3, 2017.

    FOR FURTHER INFORMATION CONTACT:

    Karen Palmigiano, phone: 206-526-4491, fax: 206-526-6736, or email: [email protected]

    SUPPLEMENTARY INFORMATION:

    Electronic Access

    This rule is accessible via the Internet at the Office of the Federal Register Web site at https://www.federalregister.gov. Background information and documents are available at the Pacific Fishery Management Council's Web site at http://www.pcouncil.org/.

    Background

    The PCGFMP and its implementing regulations at title 50 in the Code of Federal Regulations (CFR), part 660, subparts C through G, regulate fishing for over 90 species of groundfish off the coasts of Washington, Oregon, and California. Groundfish specifications and management measures are developed by the Pacific Fishery Management Council (Council), and are implemented by NMFS.

    The final rule to implement the 2017-2018 harvest specifications and management measures for most species of the Pacific coast groundfish fishery was published on February 7, 2017 (82 FR 9634).

    The Council, in coordination with Pacific Coast Treaty Indian Tribes and the States of Washington, Oregon, and California, recommended three changes to current groundfish management measures at its June 9-14, 2017 meeting. The changes the Council recommended include: (1) Increasing the limited entry (LE) and open access (OA) fixed gear trip limits for lingcod both north and south of 40°10′ North latitude (N. lat.), (2) modifying the shoreward boundary of the non-trawl rockfish conservation area (RCA) between 40°10′ N. lat. and 34°27′ N. lat., and (3) distributing the deductions initially made from the ACL (i.e. the off-the-top deductions, or “buffer”), 25 metric tons (mt) of Pacific ocean perch (POP) and 50 mt of darkblotched rockfish, and making it available to the mothership (MS) and catcher/processor (C/P) sectors of the at-sea Pacific whiting fishery; 12.5 mt of POP and 25 mt of darkblotched rockfish, to each sector.

    Fishery Management Measures for Lingcod LE and OA Fixed Gear North and South of 40°10′ N. lat.

    To increase harvest opportunities for LE and OA fixed gear sectors north and south of 40°10′ N. lat., the Council considered increases to lingcod trip limits for all remaining periods in 2017. Trip limits for lingcod north and south of 40°10′ N. lat. have been designated at 50 CFR 660.60(c)(1)(i) and in Section 6.2.1 of the PCGFMP as routine management measures.

    Lingcod are distributed coastwide with harvest specifications based on two area stock assessments that were conducted in 2009 for the areas north and south of the California-Oregon border at 42° N. latitude. The stock assessments indicated west coast lingcod stocks are healthy with the stock depletion estimated for lingcod off of Washington and Oregon to be at 62 percent of its unfished biomass, and lingcod off of California estimated to be at 74 percent of its unfished biomass at the start of 2009. Trip limit increases, for species such as lingcod, are intended to reduce discarding (i.e., turn discards into landed catch and thereby improve catch accounting) and increase attainment of the non-trawl harvest guideline (HG). This change may result in a small increase in the catch of some overfished species, such as yelloweye rockfish, but such an increase is very unlikely to result in exceeding overfished species ACLs when combined with the harvest from all other sources.

    To assist the Council in evaluating increases to lingcod trip limits, the Groundfish Management Team (GMT) made model-based landings projections for the LE and OA fixed gear sector for north and south of 40°10′ N. lat. for the remainder of the year. For these projections, the GMT included four recent updates to the discard mortality rates used by the West Coast Groundfish Observer Program (WCGOP) to estimate discard mortality each year and, by the GMT, in the nearshore model to project future discard mortality. The updates included: (1) Updating the gear proportions by depth with recent data; (2) calculating regional discard mortality rates to match the WCGOP estimate strata (i.e. north and south of 40°10′ N. lat.); (3) utilizing the Council approved changes to the “sport-like” surface discard mortality rates; and (4) incorporating a bias modifier to calibrate the gear proportions from WCGOP (a sub-sample of landings to reflect the gear proportions from fish tickets in the Pacific Fishery Information Network (PacFIN)). These landings projections also were based on the most recent information available.

    The model, using the new discard mortality rates, predicted a projected harvest of 71.2 mt, or 4.2 percent attainment of the 2017 non-trawl allocation (1,680 mt), of lingcod north of 40°10′ N. lat. for both OA and LE fixed gear under the current trip limits, and an increase in projected harvest to 75 mt, or 4.4 percent attainment of the non-trawl allocation, of lingcod north of 40°10′ N. lat. for both OA and LE fixed gear under the recommended increased trip limits. The model also predicted a projected harvest of 91.8 mt, or 13 percent attainment of the non-trawl allocation (683 mt), of lingcod south of 40°10′ N. lat. for both OA and LE fixed gear under the current trip limits, and an increase in projected harvest to 133.8 mt, or 19.6 percent attainment of the non-trawl allocation, of lingcod south of 40°10′ N. lat. for both OA and LE fixed gear under the recommended increased trip limits. Using the updated discard mortality rates, the model also predicted that under the current regulations harvest of yelloweye rockfish through the end of the year would be 0.7 mt lower (1.4 mt out of a 2.1 mt HG) than was anticipated at the start of this year.

    Yelloweye rockfish is an overfished species currently managed under a rebuilding plan. The projected impacts to yelloweye rockfish would increase under the increased trip limits for lingcod. Based on the GMT's analysis, the changes to the trip limits north of 40°10′ N. lat. are projected to result in an increase in lingcod landings through the end of the year of approximately 3.8 mt and a projected increase in yelloweye rockfish discard mortality of 0.06 mt. The same GMT analysis showed that an increase in trip limits for lingcod south of 40°10′ N. lat. would result in an increase in projected lingcod landings through the end of the year of 55 mt and an increase in yelloweye rockfish discard mortality of 0.21 mt. This increase in trip limits, and subsequent increase in lingcod landings, does not change total projected impacts to co-occurring overfished species from those anticipated in the 2017-18 harvest specifications and management measures, as the total projected impacts for those species assumes that the entire lingcod ACL is harvested.

    Therefore, the Council recommended and NMFS is implementing, by modifying Tables 2 (North and South) to part 660, subpart E and Tables 3 (North and South) to part 660, subpart F in the CFR, trip limit changes for the LE and OA fixed gear fisheries north and south of 40°10′ N. lat. The trip limits for lingcod in the LE fixed gear fishery north of 40°10′ N. lat. are increased from “1,200 lb (544 kg) bimonthly” to “1,400 lb (635 kg) bimonthly” during periods 4 through 5; from “600 lb (272 kg) per month” to “700 lb (318 kg) bimonthly” during the month of November; and from “200 lb (91 kg) per month” to “400 lb (181 kg) bimonthly” during the month of December. The trip limits for lingcod in the LE fixed gear fishery south of 40°10′ N. lat. are increased from “800 lb (363 kg) bimonthly” to “1,200 lb (544 kg) bimonthly” during periods 4 through 5; from “400 lb (181 kg) bimonthly” to “600 lb (272 kg) per month” during the month of November; and from “200 lb (91 kg) per month” to “300 lb (136 kg) bimonthly” during the month of December.

    The trip limits for lingcod in the OA fixed gear fishery north of 40°10′ N. lat. are increased from “600 lb (272 kg) per month” to “700 lb (318 kg) per month” during periods 4 through 5 and during the month of November; and from “100 lb (45 kg) per month” to “200 lb (181 kg) per month” during the month of December. The trip limits for lingcod in the OA fixed gear fishery south of 40°10′ N. lat. are increased from “400 lb (181 kg) per month” to “600 lb (272 kg) per month” during periods 3 through 5; and are increased from “100 lb (45 kg) per month” to “150 lb (68 kg) per month” during the month of December.

    For the OA fixed gear fishery south of 40°10′ N. lat., the Council recommended a “200 lb (91 kg) per month” trip limit for lingcod during the month of November, which is lower than the current lingcod trip limit for November in the OA fixed gear fishery south of 40°10′ N. lat. at “400 lb (181 kg) per month.” The Council recommended trip limit was based on an error in the GMT report and is inconsistent with the report's analysis of the estimated impacts, which analyzed a “600 lb per month” trip limit for lingcod during the month of November. NMFS understands the Council intent with the recommendations for changes to lingcod trip limits was to increase trip limits from what is currently in regulation to provide additional access and harvest a greater proportion of the lingcod ACL. It was not the Council's intent to reduce harvesting opportunities by reducing the OA fixed gear lingcod trip limits north of 40°10′ N. lat. for the month of November from 400 lb to 200 lb. Therefore, NMFS is not implementing the lower November trip limit for lingcod (200 lb (91 kg) per month) in the OA fixed gear fishery south of 40°10′ N. lat. for the month of November, and the trip limit for that month will remain at “400 lb (181 kg) per month.” This trip limit during the month of November would reduce the projected lingcod impacts from those presented to the Council (146.7 mt) to 133.8 mt.

    Fishery Management Measures for the Non-Trawl RCA between 40°10′ N. lat. and 34°27′ N. lat.

    The non-trawl RCA applies to vessels that take, retain, possess, or land groundfish using non-trawl gears, unless they are incidental fisheries that are exempt from the non-trawl RCA (e.g. the pink shrimp non-groundfish trawl fishery). The seaward and shoreward boundaries of the non-trawl RCAs vary along the coast, and are divided at various commonly used geographic coordinates, defined in § 660.11, subpart C. Modifications to RCAs are designated as a routine management measure in § 660.60(c)(3)(i) and section 6.2.1 of the PCGFMP.

    RCAs were originally established in the early 2000s to protect bocaccio and canary rockfishes which had recently been declared overfished.1 These large area closures were intended to close off areas to fishing in the main portion of the species' depth range to reduce encounters and subsequent mortality. At that same time, conservative trip limits, including no retention, were implemented to further reduce catches and overall mortality, and ensure the stocks would rebuild more quickly. Unfortunately, implementing RCAs also greatly reduced access to many healthy target stocks which were found in similar depths to overfished species. As a result, an important shelf rockfish fishery which used to operate south of 40°10′ N lat. was severely impacted.

    1 Both canary rockfish and bocaccio were declared rebuilt in 2015 and 2017, respectively.

    In 2009, the shoreward boundary of the non-trawl RCA was established based on fishery information indicating that fishing in some areas in the non-trawl fishery have higher yelloweye rockfish catch rates than in others, and the RCA boundaries were adjusted to reduce mortality of yelloweye rockfish in these areas.

    Between 40°10′ N. lat. and 34°27′ N. lat., the non-trawl RCA is currently defined by the boundary lines approximating the 30 fm and 125 fm depth contours. All fishing with non-trawl gear must occur shoreward of the boundary line approximating the 30 fm depth contour, or seaward of the boundary line approximating the 125 fm depth contour. Changes to the non-trawl RCA shoreward boundary between 40°10′ N. lat. and 34°27′ N. lat., to shift the shoreward boundary deeper and open additional fishing area shoreward of the non-trawl RCA, were previously recommended by the California Department of Fish and Wildlife (CDFW) during the 2017-18 Harvest Specifications and Management Measures process. The Council did not ultimately recommend a boundary line change, at that time, due to the increased yelloweye rockfish projected impacts when fishing was opened in those areas.

    The GMT's recent updates to the discard mortality rates—discussed further under the preamble subheading Fishery Management Measures for Lingcod LE and OA Fixed Gear North and South of 40°10′ N. lat.—resulted in projected impacts to yelloweye rockfish through the end of the year that were lower than anticipated during the development of the 2017-18 harvest specifications and management measures. The Council has recommended modifying the shoreward non-trawl RCA boundary from the boundary line approximating the 30 fm depth contour to the boundary line approximating the 40 fm depth contour in the area from 40°10′ N. lat., and 34°27′ N. lat. The change to the non-trawl RCA shoreward boundary line in this area opens areas that have been closed since 2009, and may increase fishing efficiency and reduce gear conflicts by spreading the nearshore fleet over a larger fishing area. Opening this area is anticipated to increase overall landings of both target and non-target groundfish species, but mortality is anticipated to remain below the allocations or harvest limits for all species.

    Modifying the shoreward boundary of the non-trawl RCA in this area would provide harvest opportunities for many important target stocks, specifically deeper nearshore rockfish (blue, brown, copper, and olive rockfishes) and shelf rockfish species (chilipepper, greenblotched, Mexican, and vermilion rockfishes). Non-trawl harvest of groundfish is managed with cumulative trip limits, and any increased attainment is expected to remain within allowable harvest limits. Relatively small impacts to canary, bocaccio, and yelloweye rockfish are expected. All projected bocaccio and canary rockfish impacts would remain within the nearshore fishery share of the non-trawl allocations for those species.

    The GMT presented an updated analysis to the Council regarding the projected yelloweye rockfish impacts from modifying the shoreward boundary of the non-trawl RCA. The GMT assumed that effort would remain unchanged within the 0 fm to 10 fm depth bin, and all remaining effort would shift into deeper water (30 to 40 fm depth bin) when the boundary was modified. Yelloweye rockfish is an overfished species that is encountered primarily north of 40°10′ N. lat. Few encounters occur south of 40°10′ N. lat., and no encounters occur south of 34°27′ N. lat. While some encounters may occur from modifying the non-trawl RCA shoreward boundary, they are expected to be rare. Projected impacts of yelloweye rockfish through the end of the year, including impacts of the increased lingcod trip limits discussed above, are within California's nearshore yelloweye rockfish HG share of 0.7 mt. Based on the GMT's projections, the expected increase in yelloweye rockfish impacts is 0.15 mt from what was projected to occur in the absence of the inseason adjustments to management measures implemented in this action.

    Therefore, based on the new information available regarding the discard mortality of yellow-eye rockfish, the Council recommended and NMFS is adjusting the shoreward boundary of the non-trawl RCA between 40°10′ N lat. and 34°27′ N. lat., by modifying Table 2 (South) to part 660, subpart E and Table 3 (South) to part 660, subpart F in the CFR, so that the boundary lines approximating the 40 fm and 125 fm depth contours, in this area, will define the non-trawl RCA in this area.

    Transferring POP and Darkblotched Rockfish to the MS and C/P Sectors

    As part of the biennial harvest specifications and management measures process, annual ACLs are set for non-whiting groundfish species, deductions are made “off-the-top” from the ACL for various sources of mortality (including non-groundfish fisheries that catch groundfish incidentally, also called incidental open access fisheries) and the remainder, the fishery HG, is allocated among the groundfish fisheries. Regulations at § 660.60(c)(3)(ii) allow NMFS to distribute these “off-the-top” deductions from the ACL to any sector through routine inseason action to make fish that would otherwise go unharvested available to other fisheries during the fishery year, and after the Council has made the appropriate considerations. Also consistent with section 6.5.2 of the PCGFMP, NMFS has the authority to implement management measures to reduce bycatch of non-groundfish species and, under certain circumstances, the measures may be implemented inseason. However, under no circumstances may the intention of such management measures be simply to provide more fish to a different user group or to achieve other allocation objectives. Therefore, distribution of POP and darkblocked rockfish to the at-sea sectors meets the criteria specified in regulation at § 660.60(c)(3)(ii) and the PCGFMP for a routine management measure.

    During development of the 2017-18 harvest specifications and management measures, the Council recommended, and NMFS implemented, a new category of “off-the-top” deduction, known as a “buffer” (81 FR 75266). The buffer consists of an amount of yield that is deducted from the ACLs for canary and darkblotched rockfish, and POP, as described at § 660.55(b) and specified in the footnotes to Tables 1a and 2a to subpart C. This new management measure set the fishery HG at an amount after the buffer was subtracted from the ACL. The result was a specific amount of yield for each of the three species (25 mt for POP, 50 mt for darkblotched rockfish, and 188 mt for canary rockfish) that was unallocated at the start of the year, but is held in reserve as a buffer, and can be distributed to fisheries in need after an unforeseen catch event occurs inseason. Distribution of the buffer must go to a sector that has demonstrated a need for receiving such a distribution and not for the sole purpose of extending a fishery before a need is demonstrated. Additionally, under the buffer approach, all sectors received a lower allocation of darkblotched rockfish and POP in 2017 than they would have if the entire ACL was allocated; thereby, creating a potential for foregone yield by most sectors. However, foregone yield is expected to be inconsequential because historic attainment of these species has been low, with an average attainment from 2011-2014 of 41 percent of the darkblotched rockfish ACLs and 35 percent of the POP ACLs.

    Pacific whiting fisheries encounter Klamath River Chinook salmon incidentally, particularly when fishing off the central and southern Oregon coast. At its March 2017 meeting, the Council received the most recent projections of salmon stock status (Preseason Report I) and considered that Klamath River Chinook will not meet escapement goals for 2017 by a historically large margin. At its April 2017 meeting, the Council recommended complete closure of commercial salmon fisheries off southern Oregon and northern California (approximately 44° N. lat. to 40°10′ N. lat.) and closure of recreational salmon fisheries in similar areas (approximately 42°45′ N. lat. to 40°10′ N. lat.) to protect Klamath River Chinook salmon.

    Chinook salmon bycatch in the Pacific whiting fishery varies by latitude, with 81 percent of Chinook being taken when fishing between Cape Falcon (45°46′ N. lat.) and Cape Blanco (42°50′ N. lat.). This is a similar area in which Klamath River Chinook stocks are commonly encountered, where all commercial and recreational salmon fishing in 2017 is closed. At-sea processing of Pacific whiting is currently prohibited south of 42° N. lat. (the Oregon-California border) per regulations at § 660.131(e). Both the MS and C/P sectors expressed willingness at the April 2017 Council meeting to modify operations to avoid Chinook salmon bycatch, but acknowledged that difficulties were likely given their rockfish allocations and historically high Pacific whiting allocations. While moving harvesting operations north to Washington and northern Oregon has likely reduced impacts of the Pacific whiting fishery on Klamath River Chinook, catch of POP in the Pacific whiting fisheries has traditionally been highest when fishing off Washington.

    The limited availability of overfished species that can be taken as incidental catch in the Pacific whiting fisheries, particularly darkblotched rockfish and POP, led NMFS to implement sector-specific allocations for these species to the Pacific whiting fisheries. If the sector-specific allocation for a non-whiting species is reached, NMFS may close one or more of the at-sea sectors automatically, per regulations at § 660.60(d). At the start of 2017, the MS and C/P sectors of the Pacific whiting fishery were allocated 9.0 mt and 12.7 mt of POP, respectively, per regulations at § 660.55(c)(1)(i)(B).

    At the Council's April meeting, the MS sector requested an increase to their POP set-aside to accommodate northern movement of the fleet to reduce harvest of Klamath River Chinook and to prevent closure of the MS sector prior to harvesting their full allocation of Pacific whiting. To accommodate movement of the at-sea fleets farther north, away from Klamath River Chinook and into waters with historically higher catch rates of POP, the Council recommended, and NMFS implemented a distribution of 7 mt of POP, from the off-the-top deductions that were made at the start of the 2017-2018 biennium, to the MS and C/P sectors, 3.5 mt to each sector, to accommodate potential catch of POP as each sector prosecutes their 2017 Pacific whiting allocations in areas where bycatch of Klamath River Chinook is less likely (May 16, 2017, 82 FR 22428). The Council's intent in distributing the POP, that would otherwise go unharvested, was to maintain 2017 harvest opportunities for the MS and C/P sectors of the Pacific whiting fishery, while protecting Klamath River Chinook.

    At the June 2017 Council meeting, the MS and C/P sectors requested access to the darkblotched rockfish and POP “buffers” to continue to accommodate the northern movement of the fleet to reduce harvest of Klamath River Chinook and to prevent closure of either sector prior to harvesting their full allocation of Pacific whiting. In response to this request, the GMT analyzed the current attainments of Pacific whiting, darkblotched and canary rockfishes, and POP, as well as provided some model projections of the estimated needs of the MS and C/P sectors for the 2017 fishing season.

    Based on the GMT's analysis, as of June 11, 2017, the MS sector had attained 7.6 percent of their total darkblotched rockfish allocation (0.9 mt out of 11.8 mt), 20.2 percent of their total POP allocation (2.5 mt out of 12.5 mt), and 22.2 percent of their total Pacific whiting allocation (19,334 mt out of 87,044 mt). Over the past 6 years, (2011-2016) by June 11th of each year, the MS sector has harvested an average of 0.84 mt of darkblotched rockfish, 1.65 mt of POP, and 14,689.21 mt of Pacific whiting.

    Based on the GMT's analysis, as of June 11, 2017, the C/P sector had attained 26 percent of their total darkblotched rockfish allocation (4.3 mt out of 16.4 mt), 51.1 percent of their total POP allocation (8.3 mt out of 16.2 mt), and 31.9 percent of their total Pacific whiting allocation (39,973.5 mt out of 123,312 mt). Over the past 6 years, (2011-2016) by June 11th of each year, the C/P sector has harvested an average of 1.05 mt of darkblotched rockfish, 1.35 mt of POP, and 31,595.85 mt of Pacific whiting.

    On June 20, 2017, NMFS considered additional POP, darkblotched rockfish, and Pacific whiting landing information for the C/P and MS sectors. As of that date, the C/P sector had harvested 28.6 percent (4.69 mt out of 16.4 mt) of their total darkblotched rockfish allocation, 89.81 percent (14.55 mt out of 16.2 mt) of their total POP allocation, and 37.64 percent (46,413.13 mt out of 123,312 mt) of their total Pacific whiting allocation. Additionally, as of the same date, the MS sector had harvested 8.56 percent (1.01 mt out of 11.8 mt) of their total darkblotched rockfish allocation, 22.64 percent (2.83 mt out of 12.5 mt) of their total POP allocation, and 27.48 percent (23,921.03 mt out of 87,044 mt) of their total Pacific whiting allocation.

    To continue to accommodate movement of the at-sea fleets farther north, away from Klamath River Chinook and into waters with historically higher catch rates of POP, both sectors would need additional darkblotched rockfish and POP quota to prevent their fishery from closing due to exceeding their overfished species allocations. The Council's intent is to provide fisheries with a demonstrated need access to quota that would otherwise go unharvested, maintain 2017 harvesting opportunities for the MS and C/P sectors of the Pacific whiting fishery, and continue protecting Klamath River Chinook.

    Therefore, after reviewing the best available information on interactions between the Pacific whiting fleet and salmon, POP, and darkblotched rockfish, the Council recommended and NMFS is implementing a distribution of 25 mt of POP, from the off-the-top deductions that were made at the start of the 2017-2018 biennium, to the MS and C/P sectors, 12.5 mt to each sector, to accommodate potential catch of POP as each sector prosecutes their 2017 Pacific whiting allocations in areas where bycatch of Klamath River Chinook is less likely. Additionally, the Council recommended and NMFS is implementing a distribution of 50 mt of darkblotched rockfish, from the “off-the-top” deductions that were made at the start of the 2017-2018 biennium, to the MS and C/P sectors, 25 mt to each sector, to accommodate potential catch of darkblotched rockfish as each sector prosecutes their 2017 Pacific whiting harvest in areas where bycatch of Klamath River Chinook is less likely. These changes are implemented through modifications to the footnotes for Table 1a and Table 1b to Part 660, Subpart C of the CFR.

    This rule distributes 25 mt of POP and 50 mt of darkblotched rockfish that is anticipated to go unharvested through the end of 2017 to the MS and C/P sectors, implementing the Council's recommendation increases the POP allocations to 25 mt for the MS sector and 28.7 mt for the C/P sector and the darkblotched rockfish set-asides to 36.8 mt for the MS sector and 41.4 mt for the C/P sector. This rule also provides the fleet added flexibility to fish in areas where Klamath River Chinook are less likely to be encountered while reducing the risk of closure of the MS and C/P sectors prior to full attainment of the Pacific whiting allocation if higher catch rates of POP and darkblotched rockfish continue for the remainder of the 2017 fishing season. Transfer of POP and darkblotched rockfish to the MS and C/P sectors, when combined with projected impacts from all other sources, is not expected to result in greater impacts to POP, darkblotched rockfish, or other overfished species than originally projected through the end of the year.

    Classification

    This final rule makes routine inseason adjustments to groundfish fishery management measures, based on the best available information, consistent with the PCGFMP and its implementing regulations.

    This action is taken under the authority of 50 CFR 660.60(c) and is exempt from review under Executive Order 12866.

    The aggregate data upon which these actions are based are available for public inspection at the Office of the Administrator, West Coast Region, NMFS, during business hours.

    NMFS finds good cause to waive prior public notice and comment on the revisions to groundfish management measures under 5 U.S.C. 553(b) because notice and comment would be impracticable and contrary to the public interest. Also, for the same reasons, NMFS finds good cause to waive the 30-day delay in effectiveness pursuant to 5 U.S.C. 553(d)(3), so that this final rule may become effective July 3, 2017. The adjustments to management measures in this document affect commercial fisheries in Washington, Oregon and California. No aspect of this action is controversial, and changes of this nature were anticipated in the biennial harvest specifications and management measures established through a notice and comment rulemaking for 2017-18.

    Accordingly, for the reasons stated below, NMFS finds good cause to waive prior notice and comment and to waive the delay in effectiveness.

    Fishery Management Measures for Lingcod LE and OA Fixed Gear North and South of 40°10′ N. lat.

    At its June 2017 meeting, the Council recommended an increase to LE and OA fixed gear lingcod trip limits north and south of 40°10′ N. lat. be implemented as quickly as possible to allow harvest of lingcod to better attain, but not exceed, the 2017 ACLs. There was not sufficient time after that meeting to undergo proposed and final rulemaking before this action needs to be in effect. Affording the time necessary for prior notice and opportunity for public comment would prevent NMFS from managing the LE and OA fixed gear fishery using the best available science to increase harvesting opportunities without exceeding the ACLs for federally managed species in accordance with the PCGFMP and applicable law. These increases to trip limits must be implemented as quickly as possible to allow LE and OA fixed gear fishermen an opportunity to harvest higher limits for lingcod coastwide.

    It is in the public interest for fishermen to have an opportunity to harvest more of the lingcod ACLs, north and south of 40°10′ N. lat., because the lingcod fishery contributes revenue to the coastal communities of Washington, Oregon, and California. This action, if implemented quickly, is anticipated to allow increased catch of lingcod through the end of the year, and allows harvest as intended by the Council, consistent with the best scientific information available.

    The Council considered updated discard mortality rates and the resulting best available projections of yelloweye rockfish harvest that became available at its June 2017 meeting. Projected impacts to yelloweye rockfish through the end of the year were 0.7 mt below the nearshore fishery's 2.1 mt share of the non-trawl allocation. Based on the new information showing lower than anticipated yelloweye rockfish discard mortality, and the need to provide additional harvesting opportunities for healthy and underutilized groundfish species, the Council recommended modifying the shoreward boundary of the non-trawl RCA to open additional area, while keeping harvest of yelloweye rockfish within its HGs and rebuilding ACL.

    Fishery Management Measures for the Non-Trawl RCA between 40°10′ N. lat. and 34°27′ N. lat.

    It is in the public interest for fisherman to have increased access to fishing areas where high-value target species, such as canary and chilipepper rockfish, are available, because the commercial non-trawl fisheries contribute revenue to the coastal communities of Washington, Oregon, and California. This action, if implemented quickly, is anticipated to allow increased catch of healthy and underutilized groundfish, and allows harvest as intended by the Council, consistent with the best scientific information available.

    Transferring POP to the MS and C/P Sectors

    At its June 2017 meeting, the Council recommended that the distribution of POP and darkblotched rockfish “buffers” to the MS and C/P sectors and be implemented as quickly as possible to facilitate fishing for Pacific whiting in northern waters to avoid bycatch of Klamath River Chinook salmon. There was not sufficient time after that meeting to undergo proposed and final rulemaking before this action needs to be in effect. Affording the time necessary for prior notice and opportunity for public comment would postpone transfer of POP and darkblotched rockfish to the MS and C/P sectors until later in the season, or potentially eliminate the possibility or doing so during the 2017 calendar year entirely, and is therefore impractical. Failing to reapportion POP and darkblotched rockfish to the MS and C/P sectors in a timely manner could result in additional impacts to Klamath River Chinook salmon if catch of POP or darkblotched rockfish approaches the MS or C/P sectors' POP and darkblotched rockfish allocations and the fleet moves south to prevent a closure prior to their Pacific whiting allocations being harvested. Additionally, failing to reapportion the POP and darkblotched rockfish “buffers” in a timely manner could leave quota unharvested through the end of the year, which would prevent harvest as intended by the Council. New information and analyses that became available to the Council in June indicate that both the MS and C/P sectors need additional POP and darkblotched rockfish to decrease the likelihood of closing one or more of these sectors due to attainment of their rockfish allocations. Therefore, distribution of the POP and darkblotched rockfish buffers is consistent with regulations at § 660.60(c)(3)(ii).

    It is in the public interest for the MS and C/P sectors to have an opportunity to harvest their allocations of Pacific whiting without interruption because the Pacific whiting fishery contributes a large amount of revenue to the coastal communities of Washington and Oregon. Additionally, it is in the public interest to continue to protect Klamath River Chinook and reduce potential fishing impacts from the Pacific whiting fishery in areas where directed salmon fishing has been prohibited. Providing more POP and darkblotched rockfish to the MS and C/P sector would allow them to fish further north, lowering the chances of encountering Klamath River Chinook. This action facilitates fleet dynamics to avoid bycatch of Klamath River Chinook salmon, and allows harvest as intended by the Council, consistent with the best scientific information available.

    List of Subjects in 50 CFR Part 660

    Fisheries, Fishing, and Indian Fisheries.

    Dated: July 3, 2017. Jennifer M. Wallace, Acting Director, Office of Sustainable Fisheries, National Marine Fisheries Service.

    For the reasons set out in the preamble, 50 CFR part 660 is amended as follows:

    PART 660—FISHERIES OFF WEST COAST STATES 1. The authority citation for part 660 continues to read as follows: Authority:

    16 U.S.C. 1801 et seq., 16 U.S.C. 773 et seq., and 16 U.S.C. 7001 et seq.

    2. Tables 1a and 1b to part 660, subpart C, are revised to read as follows: ER07JY17.008

    a Annual catch limits (ACLs), annual catch targets (ACTs) and harvest guidelines (HGs) are specified as total catch values.

    b Fishery HGs means the HG or quota after subtracting Pacific Coast treaty Indian tribes allocations and projected catch, projected research catch, deductions for fishing mortality in non-groundfish fisheries, and deductions for EFPs from the ACL or ACT.

    c Bocaccio. A stock assessment was conducted in 2015 for the bocaccio stock between the U.S.-Mexico border and Cape Blanco. The stock is managed with stock-specific harvest specifications south of 40°10' N. lat. and within the Minor Shelf Rockfish complex north of 40°10' N. lat. A historical catch distribution of approximately 7.4 percent was used to apportion the assessed stock to the area north of 40°10' N. lat. The bocaccio stock was estimated to be at 36.8 percent of its unfished biomass in 2015. The OFL of 2,139 mt is projected in the 2015 stock assessment using an FMSY proxy of F50%. The ABC of 2,044 mt is a 4.4 percent reduction from the OFL (σ=0.36/P*=0.45) because it is a category 1 stock. The 790 mt ACL is based on the current rebuilding plan with a target year to rebuild of 2022 and an SPR harvest rate of 77.7 percent. 15.4 mt is deducted from the ACL to accommodate the incidental open access fishery (0.8 mt), EFP catch (10 mt) and research catch (4.6 mt), resulting in a fishery HG of 774.6 mt. The California recreational fishery has an HG of 326.1 mt.

    d Cowcod. A stock assessment for the Conception Area was conducted in 2013 and the stock was estimated to be at 33.9 percent of its unfished biomass in 2013. The Conception Area OFL of 58 mt is projected in the 2013 rebuilding analysis using an FMSY proxy of F50%. The OFL contribution of 12 mt for the unassessed portion of the stock in the Monterey area is based on depletion-based stock reduction analysis. The OFLs for the Monterey and Conception areas were summed to derive the south of 40°10' N. lat. OFL of 70 mt. The ABC for the area south of 40°10' N. lat. is 63 mt. The assessed portion of the stock in the Conception Area is considered category 2, with a Conception area contribution to the ABC of 53 mt, which is an 8.7 percent reduction from the Conception area OFL (σ=0.72/P*=0.45). The unassessed portion of the stock in the Monterey area is considered a category 3 stock, with a contribution to the ABC of 10 mt, which is a 16.6 percent reduction from the Monterey area OFL (σ=1.44/P*=0.45). A single ACL of 10 mt is being set for both areas combined. The ACL of 10 mt is based on the rebuilding plan with a target year to rebuild of 2020 and an SPR harvest rate of 82.7 percent, which is equivalent to an exploitation rate (catch over age 11+ biomass) of 0.007. 2 mt is deducted from the ACL to accommodate the incidental open access fishery (less than 0.1 mt), EFP fishing (less than 0.1 mt) and research activity (2 mt), resulting in a fishery HG of 8 mt. Any additional mortality in research activities will be deducted from the ACL. A single ACT of 4 mt is being set for both areas combined.

    e Darkblotched rockfish. A 2015 stock assessment estimated the stock to be at 39 percent of its unfished biomass in 2015. The OFL of 671 mt is projected in the 2015 stock assessment using an FMSY proxy of F50%. The ABC of 641 mt is a 4.4 percent reduction from the OFL (σ=0.36/P*=0.45) because it is a category 1 stock. The ACL is set equal to the ABC, as the stock is projected to be above its target biomass of B40% in 2017. 77.3 mt is deducted from the ACL to accommodate the Tribal fishery (0.2 mt), the incidental open access fishery (24.5 mt), EFP catch (0.1 mt), research catch (2.5 mt) and an additional deduction for unforeseen catch events (50 mt), resulting in a fishery HG of 563.8 mt. Of the 50 mt initially deducted from the ACL to account for unforeseen catch events, 50 mt is distributed to the mothership and catcher/processor sectors inseason, 25 mt to each sector, consistent with 660.60(c)(3)(ii).

    f Pacific ocean perch. A stock assessment was conducted in 2011 and the stock was estimated to be at 19.1 percent of its unfished biomass in 2011. The OFL of 964 mt for the area north of 40°10' N. lat. is based on an updated catch-only projection of the 2011 rebuilding analysis using an F50% FMSY proxy. The ABC of 922 mt is a 4.4 percent reduction from the OFL (σ=0.36/P*=0.45) because it is a category 1 stock. The ACL is based on the current rebuilding plan with a target year to rebuild of 2051 and a constant catch amount of 281 mt in 2017 and 2018, followed in 2019 and beyond by ACLs based on an SPR harvest rate of 86.4 percent. 49.4 mt is deducted from the ACL to accommodate the Tribal fishery (9.2 mt), the incidental open access fishery (10 mt), research catch (5.2 mt) and an additional deduction for unforeseen catch events (25 mt), resulting in a fishery HG of 231.6 mt. Of the 10 mt initially deducted from the ACL to account for mortality in the incidental open access fishery, a total of 7 mt is distributed to the mothership and catcher/processor sectors inseason, 3.5 mt to each sector consistent with 660.60(c)(3)(ii), resulting in a 3 mt deduction from the ACL for mortality in the incidental open access fishery. Of the 25 mt initially deducted from the ACL to account for unforeseen catch events, 25 mt is distributed to the mothership and catcher/processor sectors inseason, 12.5 mt to each sector, consistent with 660.60(c)(3)(ii).

    g Yelloweye rockfish. A stock assessment update was conducted in 2011. The stock was estimated to be at 21.4 percent of its unfished biomass in 2011. The 57 mt coastwide OFL is based on a catch-only update of the 2011 stock assessment, assuming actual catches since 2011 and using an FMSY proxy of F50%. The ABC of 47 mt is a 16.7 percent reduction from the OFL (σ=0.72/P*=0.40) because it is a category 2 stock. The 20 mt ACL is based on the current rebuilding plan with a target year to rebuild of 2074 and an SPR harvest rate of 76.0 percent. 5.4 mt is deducted from the ACL to accommodate the Tribal fishery (2.3 mt), the incidental open access fishery (0.4 mt), EFP catch (less than 0.1 mt) and research catch (2.7 mt), resulting in a fishery HG of 14.6 mt. Recreational HGs are: 3.3 mt (Washington); 3 mt (Oregon); and 3.9 mt (California).

    h Arrowtooth flounder. The arrowtooth flounder stock was last assessed in 2007 and was estimated to be at 79 percent of its unfished biomass in 2007. The OFL of 16,571 mt is derived from a catch-only update of the 2007 stock assessment assuming actual catches since 2007 and using an F30% FMSY proxy. The ABC of 13,804 mt is a 16.7 percent reduction from the OFL (σ=0.72/P*=0.40) because it is a category 2 stock. The ACL is set equal to the ABC because the stock is above its target biomass of B25%. 2,098.1 mt is deducted from the ACL to accommodate the Tribal fishery (2,041 mt), the incidental open access fishery (40.8 mt), and research catch (16.4 mt), resulting in a fishery HG of 11,705.9 mt.

    i Big skate. The OFL of 541 mt is based on an estimate of trawl survey biomass and natural mortality. The ABC of 494 mt is an 8.7 percent reduction from the OFL (σ=0.72/P*=0.45) as it is a category 2 stock. The ACL is set equal to the ABC. 57.4 mt is deducted from the ACL to accommodate the Tribal fishery (15 mt), the incidental open access fishery (38.4 mt), and research catch (4 mt), resulting in a fishery HG of 436.6 mt.

    j Black rockfish (California). A 2015 stock assessment estimated the stock to be at 33 percent of its unfished biomass in 2015. The OFL of 349 mt is projected in the 2015 stock assessment using an FMSY proxy of F50%. The ABC of 334 mt is a 4.4 percent reduction from the OFL (σ=0.36/P*=0.45) because it is a category 1 stock. The ACL is set equal to the ABC because the stock is projected to be above its target biomass of B40% in 2017. 1 mt is deducted from the ACL to accommodate EFP catch (1 mt), resulting in a fishery HG of 333 mt.

    k Black rockfish (Oregon). A 2015 stock assessment estimated the stock to be at 60 percent of its unfished biomass in 2015. The OFL of 577 mt is projected in the 2015 stock assessment using an FMSY proxy of F50%. The ABC of 527 mt is an 8.7 percent reduction from the OFL (σ=0.72/P*=0.45) because it is a category 2 stock. The ACL is set equal to the ABC because the stock is above its target biomass of B40%. 0.6 mt is deducted from the ACL to accommodate the incidental open access fishery (0.6 mt), resulting in a fishery HG of 526.4 mt.

    l Black rockfish (Washington). A 2015 stock assessment estimated the stock to be at 43 percent of its unfished biomass in 2015. The OFL of 319 mt is projected in the 2015 stock assessment using an FMSY proxy of F50%. The ABC of 305 mt is a 4.4 percent reduction from the OFL (σ=0.36/P*=0.45) because it is a category 1 stock. The ACL is set equal to the ABC because the stock is above its target biomass of B40%. 18 mt is deducted from the ACL to accommodate the Tribal fishery, resulting in a fishery HG of 287 mt.

    m Blackgill rockfish. Blackgill rockfish contributes to the harvest specifications for the Minor Slope Rockfish South complex. See footnote/pp.

    n Cabezon (California). A cabezon stock assessment was conducted in 2009. The cabezon spawning biomass in waters off California was estimated to be at 48.3 percent of its unfished biomass in 2009. The OFL of 157 mt is calculated using an FMSY proxy of F45%. The ABC of 150 mt is based on a 4.4 percent reduction from the OFL (σ=0.36/P*=0.45) because it is a category 1 stock. The ACL is set equal to the ABC because the stock is above its target biomass of B40%. 0.3 mt is deducted from the ACL to accommodate the incidental open access fishery, resulting in a fishery HG of 149.7 mt.

    o Cabezon (Oregon). A cabezon stock assessment was conducted in 2009. The cabezon spawning biomass in waters off Oregon was estimated to be at 52 percent of its unfished biomass in 2009. The OFL of 49 mt is calculated using an FMSY proxy of F45%. The ABC of 47 mt is based on a 4.4 percent reduction from the OFL (σ=0.36/P*=0.45) because it is a category 1 species. The ACL is set equal to the ABC because the stock is above its target biomass of B40%. There are no deductions from the ACL so the fishery HG is also equal to the ACL of 47 mt.

    p California scorpionfish. A California scorpionfish assessment was conducted in 2005 and was estimated to be at 79.8 percent of its unfished biomass in 2005. The OFL of 289 mt is based on projections from a catch-only update of the 2005 assessment assuming actual catches since 2005 and using an FMSY harvest rate proxy of F50%. The ABC of 264 mt is an 8.7 percent reduction from the OFL (σ=0.72/P*=0.45) because it is a category 2 stock. The ACL is set at a constant catch amount of 150 mt. 2.2 mt is deducted from the ACL to accommodate the incidental open access fishery (2 mt) and research catch (0.2 mt), resulting in a fishery HG of 147.8 mt. An ACT of 111 mt is established.

    q Canary rockfish. A stock assessment was conducted in 2015 and the stock was estimated to be at 55.5 percent of its unfished biomass coastwide in 2015. The coastwide OFL of 1,793 mt is projected in the 2015 assessment using an FMSY harvest rate proxy of F50%. The ABC of 1,714 mt is a 4.4 percent reduction from the OFL (σ=0.36/P*=0.45) because it is a category 1 stock. The ACL is set equal to the ABC because the stock is above its target biomass of B40%. 247 mt is deducted from the ACL to accommodate the Tribal fishery (50 mt), the incidental open access fishery (1.2 mt), EFP catch (1 mt), research catch (7.2 mt), and an additional deduction for unforeseen catch events (188 mt), resulting in a fishery HG of 1,466.6 mt. Recreational HGs are: 50 mt (Washington); 75 mt (Oregon); and 135 mt (California).

    r Chilipepper. A coastwide update assessment of the chilipepper stock was conducted in 2015 and estimated to be at 64 percent of its unfished biomass in 2015. Chilipepper are managed with stock-specific harvest specifications south of 40°10′ N. lat. and within the Minor Shelf Rockfish complex north of 40°10′ N. lat. Projected OFLs are stratified north and south of 40°10′ N. lat. based on the average historical assessed area catch, which is 93 percent for the area south of 40°10′ N. lat. and 7 percent for the area north of 40°10′ N. lat. The OFL of 2,727 mt for the area south of 40°10′ N. lat. is projected in the 2015 assessment using an FMSY proxy of F50%. The ABC of 2,607 mt is a 4.4 percent reduction from the OFL (σ=0.36/P*=0.45) because it is a category 1 stock. The ACL is set equal to the ABC because the stock is above its target biomass of B40%. 45.9 mt is deducted from the ACL to accommodate the incidental open access fishery (5 mt), EFP fishing (30 mt), and research catch (10.9 mt), resulting in a fishery HG of 2,561.1 mt.

    s Dover sole. A 2011 Dover sole assessment estimated the stock to be at 83.7 percent of its unfished biomass in 2011. The OFL of 89,702 mt is based on an updated catch-only projection from the 2011 stock assessment assuming actual catches since 2011 and using an FMSY proxy of F30%. The ABC of 85,755 mt is a 4.4 percent reduction from the OFL (σ=0.36/P*=0.45) because it is a category 1 stock. The ACL could be set equal to the ABC because the stock is above its target biomass of B25%. However, the ACL of 50,000 mt is set at a level below the ABC and higher than the maximum historical landed catch. 1,593.7 mt is deducted from the ACL to accommodate the Tribal fishery (1,497 mt), the incidental open access fishery (54.8 mt), and research catch (41.9 mt), resulting in a fishery HG of 48,406.3 mt.

    t English sole. A 2013 stock assessment was conducted, which estimated the stock to be at 88 percent of its unfished biomass in 2013. The OFL of 10,914 mt is projected in the 2013 assessment using an FMSY proxy of F30%. The ABC of 9,964 mt is an 8.7 percent reduction from the OFL (σ=0.72/P*=0.45) because it is a category 2 stock. The ACL is set equal to the ABC because the stock is above its target biomass of B25%. 212.8 mt is deducted from the ACL to accommodate the Tribal fishery (200 mt), the incidental open access fishery (7.0 mt) and research catch (5.8 mt), resulting in a fishery HG of 9,751.2 mt.

    u Lingcod north. The 2009 lingcod assessment modeled two populations north and south of the California-Oregon border (42° N. lat.). Both populations were healthy with stock depletion estimated at 62 and 74 percent for the north and south, respectively in 2009. The OFL is based on an updated catch-only projection from the 2009 assessment assuming actual catches since 2009 and using an FMSY proxy of F45%. The OFL is apportioned north of 40°10′ N. lat. by adding 48% of the OFL from California, resulting in an OFL of 3,549 mt for the area north of 40°10′ N. lat. The ABC of 3,333 mt is based on a 4.4 percent reduction (σ=0.36/P*=0.45) from the OFL contribution for the area north of 42° N. lat. because it is a category 1 stock, and an 8.7 percent reduction (σ=0.72/P*=0.45) from the OFL contribution for the area between 42° N. lat. and 40°10′ N. lat. because it is a category 2 stock. The ACL is set equal to the ABC because the stock is above its target biomass of B40%. 278.2 mt is deducted from the ACL for the Tribal fishery (250 mt), the incidental open access fishery (16 mt), EFP catch (0.5 mt) and research catch (11.7 mt), resulting in a fishery HG of 3,054.8 mt.

    v Lingcod south. The 2009 lingcod assessment modeled two populations north and south of the California-Oregon border (42° N. lat.). Both populations were healthy with stock depletion estimated at 62 and 74 percent for the north and south, respectively in 2009.The OFL is based on an updated catch-only projection of the 2009 stock assessment assuming actual catches since 2009 using an FMSY proxy of F45%. The OFL is apportioned by subtracting 48% of the California OFL, resulting in an OFL of 1,502 mt for the area south of 40°10′ N. lat. The ABC of 1,251 mt is based on a 16.7 percent reduction from the OFL (σ=0.72/P*=0.40) because it is a category 2 stock. The ACL is set equal to the ABC because the stock is above its target biomass of B40%. 9 mt is deducted from the ACL to accommodate the incidental open access fishery (6.9 mt), EFP fishing (1 mt), and research catch (1.1 mt), resulting in a fishery HG of 1,242 mt.

    w Longnose skate. A stock assessment was conducted in 2007 and the stock was estimated to be at 66 percent of its unfished biomass. The OFL of 2,556 mt is derived from the 2007 stock assessment using an FMSY proxy of F50%. The ABC of 2,444 mt is a 4.4 percent reduction from the OFL (σ=0.36/P*=0.45) because it is a category 1 stock. The ACL of 2,000 mt is a fixed harvest level that provides greater access to the stock and is less than the ABC. 147 mt is deducted from the ACL to accommodate the Tribal fishery (130 mt), incidental open access fishery (3.8 mt), and research catch (13.2 mt), resulting in a fishery HG of 1,853 mt.

    x Longspine thornyhead. A 2013 longspine thornyhead coastwide stock assessment estimated the stock to be at 75 percent of its unfished biomass in 2013. A coastwide OFL of 4,571 mt is projected in the 2013 stock assessment using an F50% FMSY proxy. The coastwide ABC of 3,808 mt is a 16.7 percent reduction from the OFL (σ=0.72/P*=0.40) because it is a category 2 stock. For the portion of the stock that is north of 34°27′ N. lat., the ACL is 2,894 mt, and is 76 percent of the coastwide ABC based on the average swept-area biomass estimates (2003-2012) from the NMFS NWFSC trawl survey. 46.8 mt is deducted from the ACL to accommodate the Tribal fishery (30 mt), the incidental open access fishery (3.3 mt), and research catch (13.5 mt), resulting in a fishery HG of 2,847.2 mt. For that portion of the stock south of 34°27′ N. lat. the ACL is 914 mt and is 24 percent of the coastwide ABC based on the average swept-area biomass estimates (2003-2012) from the NMFS NWFSC trawl survey. 3.2 mt is deducted from the ACL to accommodate the incidental open access fishery (1.8 mt), and research catch (1.4 mt), resulting in a fishery HG of 910.8 mt.

    y Pacific cod. The 3,200 mt OFL is based on the maximum level of historic landings. The ABC of 2,221 mt is a 30.6 percent reduction from the OFL (σ=1.44/P*=0.40) because it is a category 3 stock. The 1,600 mt ACL is the OFL reduced by 50 percent as a precautionary adjustment. 509 mt is deducted from the ACL to accommodate the Tribal fishery (500 mt), research catch (7 mt), and the incidental open access fishery (2 mt), resulting in a fishery HG of 1,091 mt.

    z Pacific whiting. The coastwide (U.S. and Canada) stock assessment was published in 2017 and estimated the spawning stock to be at 89 percent of its unfished biomass. The 2017 coastwide OFL of 969,840 mt is based on the 2017 assessment with an F40% FMSY proxy. The 2017 coastwide, unadjusted Total Allowable Catch (TAC) of 531,501 mt is based on the 2017 stock assessment and the recommendation by the Joint Management Committee (JMC), based on a precautionary approach. The U.S. TAC is 73.88 percent of the coastwide TAC, or 392,673 mt unadjusted TAC for 2017. 15 percent of each party's unadjusted 2016 TAC (48,760 mt for the U.S) is added to each party's 2017 unadjusted TAC, resulting in a U.S. adjusted 2017 TAC of 431,433 mt. The 2017 fishery HG for Pacific whiting is 362,682 mt. This amount was determined by deducting from the total U.S. TAC of 431,433 mt, the 77,251 mt tribal allocation, along with 1,500 mt for scientific research catch and fishing mortality in non-groundfish fisheries.

    aa Petrale sole. A 2015 stock assessment update was conducted, which estimated the stock to be at 31 percent of its unfished biomass in 2015. The OFL of 3,280 mt is projected in the 2015 assessment using an FMSY proxy of F30%. The ABC of 3,136 mt is a 4.4 percent reduction from the OFL (σ=0.36/P*=0.45) because it is a category 1 stock. The ACL is set equal to the ABC because the stock is above its target biomass of B25%. 240.9 mt is deducted from the ACL to accommodate the Tribal fishery (220 mt), the incidental open access fishery (3.2 mt) and research catch (17.7 mt), resulting in a fishery HG of 2,895.1 mt.

    bb Sablefish north. A coastwide sablefish stock assessment update was conducted in 2015. The coastwide sablefish biomass was estimated to be at 33 percent of its unfished biomass in 2015. The coastwide OFL of 8,050 mt is projected in the 2015 stock assessment using an FMSY proxy of F45%. The ABC of 7,350 mt is an 8.7 percent reduction from the OFL (σ=0.36/P*=0.40). The 40-10 adjustment is applied to the ABC to derive a coastwide ACL value because the stock is in the precautionary zone. This coastwide ACL value is not specified in regulations. The coastwide ACL value is apportioned north and south of 36° N. lat., using the 2003-2014 average estimated swept area biomass from the NMFS NWFSC trawl survey, with 73.8 percent apportioned north of 36° N. lat. and 26.2 percent apportioned south of 36° N. lat. The northern ACL is 5,252 mt and is reduced by 525 mt for the Tribal allocation (10 percent of the ACL north of 36° N. lat.). The 525 mt Tribal allocation is reduced by 1.5 percent to account for discard mortality. Detailed sablefish allocations are shown in Table 1c.

    cc Sablefish south. The ACL for the area south of 36° N. lat. is 1,864 mt (26.2 percent of the calculated coastwide ACL value). 5 mt is deducted from the ACL to accommodate the incidental open access fishery (2 mt) and research catch (3 mt), resulting in a fishery HG of 1,859 mt.

    dd Shortbelly rockfish. A non-quantitative shortbelly rockfish assessment was conducted in 2007. The spawning stock biomass of shortbelly rockfish was estimated to be 67 percent of its unfished biomass in 2005. The OFL of 6,950 mt is based on the estimated MSY in the 2007 stock assessment. The ABC of 5,789 mt is a 16.7 percent reduction of the OFL (σ=0.72/P*=0.40) because it is a category 2 stock. The 500 mt ACL is set to accommodate incidental catch when fishing for co-occurring healthy stocks and in recognition of the stock's importance as a forage species in the California Current ecosystem. 10.9 mt is deducted from the ACL to accommodate the incidental open access fishery (8.9 mt) and research catch (2 mt), resulting in a fishery HG of 489.1 mt.

    ee Shortspine thornyhead. A 2013 coastwide shortspine thornyhead stock assessment estimated the stock to be at 74.2 percent of its unfished biomass in 2013. A coastwide OFL of 3,144 mt is projected in the 2013 stock assessment using an F50% FMSY proxy. The coastwide ABC of 2,619 mt is a 16.7 percent reduction from the OFL (σ=0.72/P*=0.40) because it is a category 2 stock. For the portion of the stock that is north of 34°27′ N. lat., the ACL is 1,713 mt. The northern ACL is 65.4 percent of the coastwide ABC based on the average swept-area biomass estimates (2003-2012) from the NMFS NWFSC trawl survey. 59 mt is deducted from the ACL to accommodate the Tribal fishery (50 mt), the incidental open access fishery (1.8 mt), and research catch (7.2 mt), resulting in a fishery HG of 1,654 mt for the area north of 34°27′ N. lat. For that portion of the stock south of 34°27′ N. lat. the ACL is 906 mt. The southern ACL is 34.6 percent of the coastwide ABC based on the average swept-area biomass estimates (2003-2012) from the NMFS NWFSC trawl survey. 42.3 mt is deducted from the ACL to accommodate the incidental open access fishery (41.3 mt) and research catch (1 mt), resulting in a fishery HG of 863.7 mt for the area south of 34°27′ N. lat.

    ff Spiny dogfish. A coastwide spiny dogfish stock assessment was conducted in 2011. The coastwide spiny dogfish biomass was estimated to be at 63 percent of its unfished biomass in 2011. The coastwide OFL of 2,514 mt is derived from the 2011 assessment using an FMSY proxy of F50%. The coastwide ABC of 2,094 mt is a 16.7 percent reduction from the OFL (σ=0.72/P*=0.40) because it is a category 2 stock. The ACL is set equal to the ABC because the stock is above its target biomass of B40%. 338 mt is deducted from the ACL to accommodate the Tribal fishery (275 mt), the incidental open access fishery (49.5 mt), EFP catch (1 mt), and research catch (12.5 mt), resulting in a fishery HG of 1,756 mt.

    gg Splitnose rockfish. A coastwide splitnose rockfish assessment was conducted in 2009 that estimated the stock to be at 66 percent of its unfished biomass in 2009. Splitnose rockfish in the north is managed in the Minor Slope Rockfish complex and with stock-specific harvest specifications south of 40°10′ N. lat. The coastwide OFL is projected in the 2009 assessment using an FMSY proxy of F50%. The coastwide OFL is apportioned north and south of 40°10′ N. lat. based on the average 1916-2008 assessed area catch, resulting in 64.2 percent of the coastwide OFL apportioned south of 40°10′ N. lat., and 35.8 percent apportioned for the contribution of splitnose rockfish to the northern Minor Slope Rockfish complex. The southern OFL of 1,841 mt results from the apportionment described above. The southern ABC of 1,760 mt is a 4.4 percent reduction from the southern OFL (σ=0.36/P*=0.45) because it is a category 1 stock. The ACL is set equal to the ABC because the stock is estimated to be above its target biomass of B40%. 10.7 mt is deducted from the ACL to accommodate the incidental open access fishery (0.2 mt), research catch (9 mt) and EFP catch (1.5 mt), resulting in a fishery HG of 1,749.3 mt.

    hh Starry flounder. The stock was assessed in 2005 and was estimated to be above 40 percent of its unfished biomass in 2005 (44 percent in Washington and Oregon, and 62 percent in California). The coastwide OFL of 1,847 mt is set equal to the 2016 OFL, which was derived from the 2005 assessment using an FMSY proxy of F30%. The ABC of 1,282 mt is a 30.6 percent reduction from the OFL (σ=1.44/P*=0.40) because it is a category 3 stock. The ACL is set equal to the ABC because the stock was estimated to be above its target biomass of B25% in 2017. 10.3 mt is deducted from the ACL to accommodate the Tribal fishery (2 mt), and the incidental open access fishery (8.3 mt), resulting in a fishery HG of 1,271.7 mt.

    ii Widow rockfish. The widow rockfish stock was assessed in 2015 and was estimated to be at 75 percent of its unfished biomass in 2015. The OFL of 14,130 mt is projected in the 2015 stock assessment using the F50% FMSY proxy. The ABC of 13,508 mt is a 4.4 percent reduction from the OFL (σ=0.36/P*=0.45) because it is a category 1 stock. The ACL is set equal to the ABC because the stock is above its target biomass of B40%. 217.7 mt is deducted from the ACL to accommodate the Tribal fishery (200 mt), the incidental open access fishery (0.5 mt), EFP catch (9 mt) and research catch (8.2 mt), resulting in a fishery HG of 13,290.3 mt.

    jj Yellowtail rockfish. A 2013 yellowtail rockfish stock assessment was conducted for the portion of the population north of 40°10′ N. lat. The estimated stock depletion was 67 percent of its unfished biomass in 2013. The OFL of 6,786 mt is projected in the 2013 stock assessment using an FMSY proxy of F50%. The ABC of 6,196 mt is an 8.7 percent reduction from the OFL (σ=0.72/P*=0.45) because it is a category 2 stock. The ACL is set equal to the ABC because the stock is above its target biomass of B40%. 1,030 mt is deducted from the ACL to accommodate the Tribal fishery (1,000 mt), the incidental open access fishery (3.4 mt), EFP catch (10 mt) and research catch (16.6 mt), resulting in a fishery HG of 5,166.1 mt.

    kk Minor Nearshore Rockfish north. The OFL for Minor Nearshore Rockfish north of 40°10′ N. lat. of 118 mt is the sum of the OFL contributions for the component species managed in the complex. The ABCs for the minor rockfish complexes are based on a sigma value of 0.72 for category 2 stocks (blue/deacon rockfish in California, brown rockfish, China rockfish, and copper rockfish) and a sigma value of 1.44 for category 3 stocks (all others) with a P* of 0.45. The resulting ABC of 105 mt is the summed contribution of the ABCs for the component species. The ACL of 105 mt is the sum of contributing ABCs of healthy assessed stocks and unassessed stocks, plus the ACL contributions for blue/deacon rockfish in California where the 40-10 adjustment was applied to the ABC contribution for this stock because it is in the precautionary zone. 1.8 mt is deducted from the ACL to accommodate the Tribal fishery (1.5 mt) and the incidental open access fishery (0.3 mt), resulting in a fishery HG of 103.2 mt. Between 40°10′ N. lat. and 42° N. lat. the Minor Nearshore Rockfish complex north has a HG of 40.2 mt. Blue/deacon rockfish south of 42° N. lat. has a stock-specific HG, described in footnote nn/.

    ll Minor Shelf Rockfish north. The OFL for Minor Shelf Rockfish north of 40°10′ N. lat. of 2,303 mt is the sum of the OFL contributions for the component species within the complex. The ABCs for the minor rockfish complexes are based on a sigma value of 0.36 for a category 1 stock (chilipepper), a sigma value of 0.72 for category 2 stocks (greenspotted rockfish between 40°10′ and 42° N. lat. and greenstriped rockfish), and a sigma value of 1.44 for category 3 stocks (all others) with a P* of 0.45. The resulting ABC of 2,049 mt is the summed contribution of the ABCs for the component species. The ACL of 2,049 mt is the sum of contributing ABCs of healthy assessed stocks and unassessed stocks, plus the ACL contribution of greenspotted rockfish in California where the 40-10 adjustment was applied to the ABC contribution for this stock because it is in the precautionary zone. 83.8 mt is deducted from the ACL to accommodate the Tribal fishery (30 mt), the incidental open access fishery (26 mt), EFP catch (3 mt), and research catch (24.8 mt), resulting in a fishery HG of 1,965.2 mt.

    mm Minor Slope Rockfish north. The OFL for Minor Slope Rockfish north of 40°10′ N. lat. of 1,897 mt is the sum of the OFL contributions for the component species within the complex. The ABCs for the Minor Slope Rockfish complexes are based on a sigma value of 0.39 for aurora rockfish, a sigma value of 0.36 for the other category 1 stock (splitnose rockfish), a sigma value of 0.72 for category 2 stocks (rougheye rockfish, blackspotted rockfish, and sharpchin rockfish), and a sigma value of 1.44 for category 3 stocks (all others) with a P* of 0.45. A unique sigma of 0.39 was calculated for aurora rockfish because the variance in estimated spawning biomass was greater than the 0.36 used as a proxy for other category 1 stocks. The resulting ABC of 1,755 mt is the summed contribution of the ABCs for the component species. The ACL is set equal to the ABC because all the assessed component stocks (i.e., rougheye rockfish, blackspotted rockfish, sharpchin rockfish, and splitnose rockfish) are above the target biomass of B40%. 65.1 mt is deducted from the ACL to accommodate the Tribal fishery (36 mt), the incidental open access fishery (18.6 mt), EFP catch (1 mt), and research catch (9.5 mt), resulting in a fishery HG of 1,689.9 mt.

    nn Minor Nearshore Rockfish south. The OFL for the Minor Nearshore Rockfish complex south of 40°10′ N. lat. of 1,329 mt is the sum of the OFL contributions for the component species within the complex. The ABC for the southern Minor Nearshore Rockfish complex is based on a sigma value of 0.72 for category 2 stocks (i.e., blue/deacon rockfish north of 34°27′ N. lat., brown rockfish, China rockfish, and copper rockfish) and a sigma value of 1.44 for category 3 stocks (all others) with a P* of 0.45. The resulting ABC of 1,166 mt is the summed contribution of the ABCs for the component species. The ACL of 1,163 mt is the sum of the contributing ABCs of healthy assessed stocks and unassessed stocks, plus the ACL contribution for blue/deacon rockfish north of 34°27′ N. lat. and China rockfish where the 40-10 adjustment was applied to the ABC contributions for these two stocks because they are in the precautionary zone. 4.1 mt is deducted from the ACL to accommodate the incidental open access fishery (1.4 mt) and research catch (2.7 mt), resulting in a fishery HG of 1,158.9 mt. Blue/deacon rockfish south of 42° N. lat. has a stock-specific HG set equal to the 40-10-adjusted ACL for the portion of the stock north of 34°27′ N lat. (243.7 mt) plus the ABC contribution for the unassessed portion of the stock south of 34°27′ N. lat. (60.8 mt). The California (i.e. south of 42° N. lat.) blue/deacon rockfish HG is 304.5 mt.

    oo Minor Shelf Rockfish south. The OFL for the Minor Shelf Rockfish complex south of 40°10′ N. lat. of 1,917 mt is the sum of the OFL contributions for the component species within the complex. The ABC for the southern Minor Shelf Rockfish complex is based on a sigma value of 0.72 for category 2 stocks (greenspotted and greenstriped rockfish) and a sigma value of 1.44 for category 3 stocks (all others) with a P* of 0.45. The resulting ABC of 1,624 mt is the summed contribution of the ABCs for the component species. The ACL of 1,623 mt is the sum of contributing ABCs of healthy assessed stocks and unassessed stocks, plus the ACL contribution of greenspotted rockfish in California where the 40-10 adjustment was applied to the ABC contribution for this stock because it is in the precautionary zone. 47.2 mt is deducted from the ACL to accommodate the incidental open access fishery (8.6 mt), EFP catch (30 mt), and research catch (8.6 mt), resulting in a fishery HG of 1,575.8 mt.

    pp Minor Slope Rockfish south. The OFL of 827 mt is the sum of the OFL contributions for the component species within the complex. The ABC for the southern Minor Slope Rockfish complex is based on a sigma value of 0.39 for aurora rockfish, a sigma value of 0.72 for category 2 stocks (blackgill rockfish, rougheye rockfish, blackspotted rockfish, and sharpchin rockfish) and a sigma value of 1.44 for category 3 stocks (all others) with a P* of 0.45. A unique sigma of 0.39 was calculated for aurora rockfish because the variance in estimated biomass was greater than the 0.36 used as a proxy for other category 1 stocks. The resulting ABC of 718 mt is the summed contribution of the ABCs for the component species. The ACL of 707 mt is the sum of the contributing ABCs of healthy assessed stocks and unassessed stocks, plus the ACL contribution of blackgill rockfish where the 40-10 adjustment was applied to the ABC contribution for this stock because it is in the precautionary zone. 20.2 mt is deducted from the ACL to accommodate the incidental open access fishery (17.2 mt), EFP catch (1 mt), and research catch (2 mt), resulting in a fishery HG of 686.8 mt. Blackgill rockfish has a stock-specific HG for the entire groundfish fishery south of 40°10' N lat. set equal to the species' contribution to the 40-10-adjusted ACL. Harvest of blackgill rockfish in all groundfish fisheries counts against this HG of 120.2 mt. Nontrawl fisheries are subject to a blackgill rockfish HG of 44.5 mt.

    qq Other Flatfish. The Other Flatfish complex is comprised of flatfish species managed in the PCGFMP that are not managed with stock-specific OFLs/ABCs/ACLs. Most of the species in the Other Flatfish complex are unassessed and include: butter sole, curlfin sole, flathead sole, Pacific sanddab, rock sole, sand sole, and rex sole. The Other Flatfish OFL of 11,165 mt is based on the sum of the OFL contributions of the component stocks. The ABC of 8,510 mt is based on a sigma value of 0.72 for a category 2 stock (rex sole) and a sigma value of 1.44 for category 3 stocks (all others) with a P* of 0.40. The ACL is set equal to the ABC. The ACL is set equal to the ABC because all of the assessed stocks (i.e., Pacific sanddabs and rex sole) were above their target biomass of B25%. 204 mt is deducted from the ACL to accommodate the Tribal fishery (60 mt), the incidental open access fishery (125 mt), and research catch (19 mt), resulting in a fishery HG of 8,306 mt.

    rr Other Fish. The Other Fish complex is comprised of kelp greenling coastwide, cabezon off Washington, and leopard shark coastwide. The 2015 assessment for the kelp greenling stock off of Oregon projected an estimated depletion of 80 percent in 2015. All other stocks are unassessed. The OFL of 537 mt is the sum of the OFL contributions for kelp greenling coastwide, cabezon off Washington, and leopard shark coastwide. The ABC for the Other Fish complex is based on a sigma value of 0.44 for kelp greenling off Oregon and a sigma value of 1.44 for category 3 stocks (all others) with a P* of 0.45. A unique sigma of 0.44 was calculated for kelp greenling off Oregon because the variance in estimated spawning biomass was greater than the 0.36 sigma used as a proxy for other category 1 stocks. The resulting ABC of 474 mt is the summed contribution of the ABCs for the component species. The ACL is set equal to the ABC because all of the assessed stocks (kelp greenling off Oregon) were above their target biomass of B40%. There are no deductions from the ACL so the fishery HG is equal to the ACL of 474 mt.

    ER07JY17.009
    3. Tables 2 (North) and 2 (South) to part 660, subpart E, are revised to read as follows: 4. Tables 3 (North) and 3 (South) to part 660, subpart F, are revised to read as follows: BILLING CODE 3510-22-P ER07JY17.010 ER07JY17.011 ER07JY17.012 ER07JY17.013 ER07JY17.014 ER07JY17.015
    [FR Doc. 2017-14313 Filed 7-3-17; 4:15 pm] BILLING CODE 3510-22-C
    82 129 Friday, July 7, 2017 Proposed Rules NUCLEAR REGULATORY COMMISSION 10 CFR Part 72 [NRC-2016-0138] RIN 3150-AJ78 List of Approved Spent Fuel Storage Casks: EnergySolutionsTM Corporation, VSC-24 Ventilated Storage Cask System, Renewal of Initial Certificate and Amendment Nos. 1-6 AGENCY:

    Nuclear Regulatory Commission.

    ACTION:

    Proposed rule.

    SUMMARY:

    The U.S. Nuclear Regulatory Commission (NRC) is amending its spent fuel storage regulations by revising the EnergySolutionsTM Corporation's (EnergySolutions or the applicant) VSC-24 Ventilated Storage Cask System listing within the “List of Approved Spent Fuel Storage Casks” to renew, for an additional 40 years, the initial certificate and Amendment Nos. 1-6 of Certificate of Compliance (CoC) No. 1007. The renewal of the initial certificate and Amendment Nos. 1-6 requires cask users to establish, implement, and maintain written procedures for aging management program (AMP) elements, including a lead cask inspection program, for VSC-24 Storage Cask structures, systems, and components (SSCs) important to safety. Users must also conduct periodic “tollgate” assessments of new information on SSC aging effects and mechanisms to determine whether any element of an AMP addressing these effects and mechanisms requires revision to encompass the current state of knowledge. In addition, the renewal of the initial certificate and Amendment Nos. 1-6 makes several other changes, described in Section IV, “Discussion of Changes,” in the SUPPLEMENTARY INFORMATION section of the companion direct final rule published in the Rules and Regulations section of this issue of the Federal Register.

    DATES:

    Submit comments by August 7, 2017. Comments received after this date will be considered if it is practical to do so, but the Commission is able to ensure consideration only for comments received on or before this date.

    ADDRESSES:

    You may submit comments by any of the following methods:

    Federal Rulemaking Web site: Go to http://www.regulations.gov and search for Docket ID NRC-2016-0138. Address questions about NRC dockets to Carol Gallagher; telephone: 301-415-3463; email: [email protected] For technical questions contact the individual listed in the FOR FURTHER INFORMATION CONTACT section of this document.

    Email comments to: [email protected] If you do not receive an automatic email reply confirming receipt, contact us at 301-415-1677.

    Fax comments to: Secretary, U.S. Nuclear Regulatory Commission at 301-415-1101.

    Mail comments to: Secretary, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, ATTN: Rulemakings and Adjudications Staff.

    Hand deliver comments to: 11555 Rockville Pike, Rockville, Maryland 20852, between 7:30 a.m. and 4:15 p.m. (Eastern Time) Federal workdays; telephone: 301-415-1677.

    For additional direction on obtaining information and submitting comments, see “Obtaining Information and Submitting Comments” in the SUPPLEMENTARY INFORMATION section of this document.

    FOR FURTHER INFORMATION CONTACT:

    Robert D. MacDougall, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001; telephone: 301-415-5175; email: [email protected]

    SUPPLEMENTARY INFORMATION:

    Table of Contents I. Obtaining Information and Submitting Comments II. Rulemaking Procedure III. Background IV. Plain Writing V. Availability of Documents I. Obtaining Information and Submitting Comments A. Obtaining Information

    Please refer to Docket ID NRC-2016-0138 when contacting the NRC about the availability of information for this action. You may obtain publicly-available information related to this action by any of the following methods:

    Federal Rulemaking Web site: Go to http://www.regulations.gov and search for Docket ID NRC-2016-0138.

    NRC's Agencywide Documents Access and Management System (ADAMS): You may obtain publicly-available documents online in the ADAMS Public Documents collection at http://www.nrc.gov/reading-rm/adams.html. To begin the search, select “ADAMS Public Documents” and then select “Begin Web-based ADAMS Search.” For problems with ADAMS, please contact the NRC's Public Document Room (PDR) reference staff at 1-800-397-4209, 301-415-4737, or by email to [email protected] For the convenience of the reader, instructions about obtaining materials referenced in this document are provided in the “Availability of Documents” section.

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

    B. Submitting Comments

    Please include Docket ID NRC-2016-0138 in your comment submission.

    The NRC cautions you not to include identifying or contact information that you do not want to be publicly disclosed in your comment submission. The NRC will post all comment submissions at http://www.regulations.gov as well as enter the comment submissions into ADAMS. The NRC does not routinely edit comment submissions to remove identifying or contact information.

    If you are requesting or aggregating comments from other persons for submission to the NRC, then you should inform those persons not to include identifying or contact information that they do not want to be publicly disclosed in their comment submission. Your request should state that the NRC does not routinely edit comment submissions to remove such information before making the comment submissions available to the public or entering the comment into ADAMS.

    II. Rulemaking Procedure

    This proposed rule is limited to the renewal of the initial certificate and Amendment Nos. 1-6 of CoC No. 1007. Because the NRC considers this action noncontroversial and routine, the NRC is publishing this proposed rule concurrently with a direct final rule in the Rules and Regulations section of this issue of the Federal Register. Adequate protection of public health and safety continues to be ensured.

    The direct final rule will become effective on September 20, 2017. However, if the NRC receives significant adverse comments on this proposed rule by August 7, 2017, then the NRC will publish a document that withdraws the direct final rule. If the direct final rule is withdrawn, the NRC will address the comments received in response to these proposed revisions in a subsequent final rule. Absent significant modifications to the proposed revisions requiring republication, the NRC will not initiate a second comment period on this action in the event the direct final rule is withdrawn.

    A significant adverse comment is a comment where the commenter explains why the rule would be inappropriate, including challenges to the rule's underlying premise or approach, or would be ineffective or unacceptable without a change. A comment is adverse and significant if:

    (1) The comment opposes the rule and provides a reason sufficient to require a substantive response in a notice-and-comment process. For example, a substantive response is required when:

    (a) The comment causes the NRC staff to reevaluate (or reconsider) its position or conduct additional analysis;

    (b) The comment raises an issue serious enough to warrant a substantive response to clarify or complete the record; or

    (c) The comment raises a relevant issue that was not previously addressed or considered by the NRC staff.

    (2) The comment proposes a change or an addition to the rule, and it is apparent that the rule would be ineffective or unacceptable without incorporation of the change or addition.

    (3) The comment causes the NRC staff to make a change (other than editorial) to the rule, CoC, or technical specifications.

    For additional procedural information and the regulatory analysis, see the direct final rule published in the Rules and Regulations section of this issue of the Federal Register.

    III. Background

    Section 218(a) of the Nuclear Waste Policy Act (NWPA) of 1982, as amended, requires that “the Secretary [of the Department of Energy] shall establish a demonstration program, in cooperation with the private sector, for the dry storage of spent nuclear fuel at civilian nuclear power reactor sites, with the objective of establishing one or more technologies that the [Nuclear Regulatory] Commission may, by rule, approve for use at the sites of civilian nuclear power reactors without, to the maximum extent practicable, the need for additional site-specific approvals by the Commission.” Section 133 of the NWPA states, in part, that “[the Commission] shall, by rule, establish procedures for the licensing of any technology approved by the Commission under Section 219(a) [sic: 218(a)] for use at the site of any civilian nuclear power reactor.”

    To implement this mandate, the Commission approved dry storage of spent nuclear fuel in NRC-approved casks under a general license by publishing a final rule which added a new subpart K in part 72 of title 10 of the Code of Federal Regulations (10 CFR) entitled, “General License for Storage of Spent Fuel at Power Reactor Sites” (55 FR 29181; July 18, 1990). A general license authorizes a reactor licensee to store spent fuel in NRC-approved casks at a site that is licensed to operate a power reactor under 10 CFR parts 50 or 52. This rule also established a new subpart L in 10 CFR part 72 entitled, “Approval of Spent Fuel Storage Casks,” which contains procedures and criteria for obtaining NRC approval of spent fuel storage cask designs. The NRC subsequently issued a final rule on April 7, 1993 (58 FR 17967), that approved the VSC-24 Cask System design effective May 7, 1993, and added it to the list of NRC-approved cask designs in 10 CFR 72.214 as CoC No. 1007.

    IV. Plain Writing

    The Plain Writing Act of 2010 (Pub. L. 111-274) requires Federal agencies to write documents in a clear, concise, well-organized manner that also follows other best practices appropriate to the subject or field and the intended audience. The NRC has written this document to be consistent with the Plain Writing Act as well as the Presidential Memorandum, “Plain Language in Government Writing,” published June 10, 1998 (63 FR 31883). The NRC requests comment on the proposed rule with respect to the clarity and effectiveness of the language used.

    V. Availability of Documents

    The documents identified in the following table are available to interested persons through one or more of the following methods, as indicated.

    Document ADAMS
  • Accession No./
  • Federal
  • Register
  • Citation
  • Proposed CoC No. 1007 Renewal, Initial Issuance ML16057A127 Proposed Technical Specification (TS), Attachment A, CoC No. 1007 Renewal, Initial Issuance ML16057A139 Proposed CoC No. 1007 Renewal, Amendment 1 ML16057A189 Proposed TS, Attachment A, Amendment 1 ML16057A211 Proposed CoC No. 1007 Renewal, Amendment 2 ML16057A216 Proposed TS, Attachment A, Amendment 2 ML16057A322 Proposed CoC No. 1007 Renewal, Amendment 3 ML16057A333 Proposed TS, Attachment A, Amendment 3 ML16057A358 Proposed CoC No. 1007 Renewal, Amendment 4 ML16057A449 Proposed TS, Attachment A, Amendment 4 ML16057A511 Proposed CoC No. 1007 Renewal, Amendment 5 ML16057A593 Proposed TS, Attachment A, Amendment 5 ML16057A600 Proposed CoC No. 1007 Renewal, Amendment 6 ML16057A617 Proposed TS, Attachment A, Amendment 6 ML16057A630 Preliminary Safety Evaluation Report ML16057A667 Final Safety Analysis Report for the VSC-24 Ventilated Storage Cask System ML060810682 NUREG-1092, “Environmental Assessment for 10 CFR Part 72—Licensing Requirements for the Independent Storage of Spent Fuel and High-Level Radioactive Waste” ML091050510 Proposed Rule, “Licensing Requirements for the Independent Storage of Spent Nuclear Fuel and High-Level Radioactive Waste” 51 FR 19106 Environmental Assessment and Finding of No Significant Impact for Proposed Rule Entitled “Storage of Spent Nuclear Fuel in NRC-Approved Storage Casks at Nuclear Power Reactor Sites” 54 FR 19379 Final Rule, “Storage of Spent Fuel In NRC-Approved Storage Casks at Power Reactor Sites” 55 FR 29181 Final Rule, “License and Certificate of Compliance Terms” 76 FR 8872

    The NRC may post materials related to this document, including public comments, on the Federal Rulemaking Web site at http://www.regulations.gov under Docket ID NRC-2016-0138. The Federal Rulemaking Web site allows you to receive alerts when changes or additions occur in a docket folder. To subscribe: (1) Navigate to the docket folder (NRC-2016-0138); (2) click the “Sign up for Email Alerts” link; and (3) enter your email address and select how frequently you would like to receive emails (daily, weekly, or monthly).

    List of Subjects in 10 CFR Part 72

    Administrative practice and procedure, Criminal penalties, Hazardous waste, Indians, Intergovernmental relations, Manpower training programs, Nuclear energy, Nuclear materials, Occupational safety and health, Penalties, Radiation protection, Reporting and recordkeeping requirements, Security measures, Spent fuel, Whistleblowing.

    For the reasons set out in the preamble and under the authority of the Atomic Energy Act of 1954, as amended; the Energy Reorganization Act of 1974, as amended; the Nuclear Waste Policy Act of 1982, as amended; and 5 U.S.C. 552 and 553; the NRC is proposing to adopt the following amendments to 10 CFR part 72.

    PART 72—LICENSING REQUIREMENTS FOR THE INDEPENDENT STORAGE OF SPENT NUCLEAR FUEL, HIGH-LEVEL RADIOACTIVE WASTE, AND REACTOR-RELATED GREATER THAN CLASS C WASTE 1. The authority citation for part 72 continues to read as follows: Authority:

    Atomic Energy Act of 1954, secs. 51, 53, 57, 62, 63, 65, 69, 81, 161, 182, 183, 184, 186, 187, 189, 223, 234, 274 (42 U.S.C. 2071, 2073, 2077, 2092, 2093, 2095, 2099, 2111, 2201, 2210e, 2232, 2233, 2234, 2236, 2237, 2238, 2273, 2282, 2021); Energy Reorganization Act of 1974, secs. 201, 202, 206, 211 (42 U.S.C. 5841, 5842, 5846, 5851); National Environmental Policy Act of 1969 (42 U.S.C. 4332); Nuclear Waste Policy Act of 1982, secs. 117(a), 132, 133, 134, 135, 137, 141, 145(g), 148, 218(a) (42 U.S.C. 10137(a), 10152, 10153, 10154, 10155, 10157, 10161, 10165(g), 10168, 10198(a)); 44 U.S.C. 3504 note.

    2. In § 72.214, Certificate of Compliance 1007 is revised to read as follows:
    § 72.214 List of approved spent fuel storage casks.

    Certificate Number: 1007.

    Initial Certificate Effective Date: May 7, 1993, superseded by Renewed Initial Certificate, on September 20, 2017.

    Renewed Initial Certificate Effective Date: September 20, 2017.

    Amendment Number 1 Effective Date: May 30, 2000, superseded by Renewed Amendment Number 1, on September 20, 2017.

    Renewed Amendment Number 1 Effective Date: September 20, 2017.

    Amendment Number 2 Effective Date: September 5, 2000, superseded by Renewed Amendment Number 2, on September 20, 2017.

    Renewed Amendment Number 2 Effective Date: September 20, 2017.

    Amendment Number 3 Effective Date: May 21, 2001, superseded by Renewed Amendment Number 3, on September 20, 2017.

    Renewed Amendment Number 3 Effective Date: September 20, 2017.

    Amendment Number 4 Effective Date: February 3, 2003, superseded by Renewed Amendment Number 4, on September 20, 2017.

    Renewed Amendment Number 4 Effective Date: September 20, 2017.

    Amendment Number 5 Effective Date: September 13, 2005, superseded by Renewed Amendment Number 5, on September 20, 2017.

    Renewed Amendment Number 5 Effective Date: September 20, 2017.

    Amendment Number 6 Effective Date: June 5, 2006, superseded by Renewed Amendment Number 6, on September 20, 2017.

    Renewed Amendment Number 6 Effective Date: September 20, 2017.

    SAR Submitted by: EnergySolutionsTM Corporation.

    SAR Title: Final Safety Analysis Report for the VSC-24 Ventilated Storage Cask System.

    Docket Number: 72-1007.

    Renewed Certificate Expiration Date: May 7, 2053.

    Model Number: VSC-24.

    Dated at Rockville, Maryland, this 31st day of May 2017.

    For the Nuclear Regulatory Commission.

    Michael R. Johnson, Acting Executive Director for Operations.
    [FR Doc. 2017-14290 Filed 7-6-17; 8:45 am] BILLING CODE 7590-01-P
    FEDERAL HOUSING FINANCE AGENCY 12 CFR Part 1282 RIN 2590-AA81 2018-2020 Enterprise Housing Goals Correction

    Proposed Rule document 2017-14039 appearing on pages 31009 through 31030 in the issue of Wednesday, July 5, 2017 was withdrawn from public inspection and published in error. It should be removed.

    [FR Doc. C1-2017-14039 Filed 7-6-17; 8:45 am] BILLING CODE 1301-00-D
    FEDERAL HOUSING FINANCE AGENCY 12 CFR Part 1282 RIN 2590-AA81 2018-2020 Enterprise Housing Goals AGENCY:

    Federal Housing Finance Agency.

    ACTION:

    Proposed rule.

    SUMMARY:

    The Federal Housing Finance Agency (FHFA) is issuing a proposed rule with request for comments on the housing goals for Fannie Mae and Freddie Mac (the Enterprises) for 2018 through 2020. The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (the Safety and Soundness Act) requires FHFA to establish annual housing goals for mortgages purchased by the Enterprises. The housing goals include separate categories for single-family and multifamily mortgages on housing that is affordable to low-income and very low-income families, among other categories.

    The existing housing goals for the Enterprises include benchmark levels for each housing goal through the end of 2017. This proposed rule would establish benchmark levels for each of the housing goals and subgoals for 2018 through 2020. In addition, the proposed rule would make a number of clarifying and conforming changes, including revisions to the requirements for the housing plan that an Enterprise may be required to submit in response to a failure to achieve one or more of the housing goals.

    DATES:

    FHFA will accept written comments on the proposed rule on or before September 5, 2017.

    ADDRESSES:

    You may submit your comments on the proposed rule, identified by regulatory information number (RIN) 2590-AA81, by any one of the following methods:

    Agency Web site: www.fhfa.gov/open-for-comment-or-input.

    Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments. If you submit your comment to the Federal eRulemaking Portal, please also send it by email to FHFA at [email protected] to ensure timely receipt by FHFA. Include the following information in the subject line of your submission: Comments/RIN 2590-AA81.

    Hand Delivered/Courier: The hand delivery address is: Alfred M. Pollard, General Counsel, Attention: Comments/RIN 2590-AA81, Federal Housing Finance Agency, Eighth Floor, 400 Seventh Street SW., Washington, DC 20219. Deliver the package at the Seventh Street entrance Guard Desk, First Floor, on business days between 9 a.m. and 5 p.m.

    U.S. Mail, United Parcel Service, Federal Express, or Other Mail Service: The mailing address for comments is: Alfred M. Pollard, General Counsel, Attention: Comments/RIN 2590-AA81, Federal Housing Finance Agency, Eighth Floor, 400 Seventh Street SW., Washington, DC 20219. Please note that all mail sent to FHFA via U.S. Mail is routed through a national irradiation facility, a process that may delay delivery by approximately two weeks.

    FOR FURTHER INFORMATION CONTACT:

    Ted Wartell, Manager, Housing & Community Investment, Division of Housing Mission and Goals, at (202) 649-3157. This is not a toll-free number. The mailing address is: Federal Housing Finance Agency, 400 Seventh Street SW., Washington, DC 20219. The telephone number for the Telecommunications Device for the Deaf is (800) 877-8339.

    SUPPLEMENTARY INFORMATION:

    I. Comments

    FHFA invites comments on all aspects of the proposed rule and will take all comments into consideration before issuing the final rule. Copies of all comments will be posted without change, including any personal information you provide such as your name, address, email address, and telephone number, on the FHFA Web site at http://www.fhfa.gov. In addition, copies of all comments received will be available for examination by the public on business days between the hours of 10 a.m. and 3 p.m., at the Federal Housing Finance Agency, 400 Seventh Street SW., Washington, DC 20219. To make an appointment to inspect comments, please call the Office of General Counsel at (202) 649-3804.

    Commenters are encouraged to review and comment on all aspects of the proposed rule, including the single-family benchmark levels, the multifamily benchmark levels, and other changes to the regulation.

    II. Background A. Statutory and Regulatory Background for the Existing Housing Goals

    The Safety and Soundness Act requires FHFA to establish annual housing goals for several categories of both single-family and multifamily mortgages purchased by Fannie Mae and Freddie Mac.1 The annual housing goals are one measure of the extent to which the Enterprises are meeting their public purposes, which include “an affirmative obligation to facilitate the financing of affordable housing for low- and moderate-income families in a manner consistent with their overall public purposes, while maintaining a strong financial condition and a reasonable economic return.” 2

    1See 12 U.S.C. 4561(a).

    2See 12 U.S.C. 4501(7).

    The housing goals provisions of the Safety and Soundness Act were substantially revised in 2008 with the enactment of the Housing and Economic Recovery Act, which amended the Safety and Soundness Act.3 Under this revised structure, FHFA established housing goals for the Enterprises for 2010 and 2011 in a final rule published on September 14, 2010.4 FHFA established housing goals levels for the Enterprises for 2012 through 2014 in a final rule published on November 13, 2012.5 In a final rule published on September 3, 2015, FHFA announced the housing goals for the Enterprises for 2015 through 2017, including a new small multifamily low-income housing subgoal.6

    3 Housing and Economic Recovery Act of 2008, Public Law 110-289, 122 Stat. 2654 (July 30, 2008).

    4See 75 FR 55892.

    5See 77 FR 67535.

    6See 80 FR 53392.

    Single-family goals. The single-family goals defined under the Safety and Soundness Act include separate categories for home purchase mortgages for low-income families, very low-income families, and families that reside in low-income areas. Performance on the single-family home purchase goals is measured as the percentage of the total home purchase mortgages purchased by an Enterprise each year that qualify for each goal or subgoal. There is also a separate goal for refinancing mortgages for low-income families, and performance on the refinancing goal is determined in a similar way.

    Under the Safety and Soundness Act, the single-family housing goals are limited to mortgages on owner-occupied housing with one to four units total. The single-family goals cover conventional, conforming mortgages, defined as mortgages that are not insured or guaranteed by the Federal Housing Administration (FHA) or another government agency and with principal balances that do not exceed the loan limits for Enterprise mortgages.

    Two-part approach. The performance of the Enterprises on the housing goals is evaluated using a two-part approach, which compares the goal-qualifying share of the Enterprise's mortgage purchases to two separate measures: A benchmark level and a market level. FHFA considered alternatives to this method in the 2015-2017 housing goals rulemaking and determined that the two-part approach continued to be the most appropriate method for evaluating performance on the single-family goals. FHFA is proposing to continue that approach in this rule.

    In order to meet a single-family housing goal or subgoal, the percentage of mortgage purchases by an Enterprise that meet each goal or subgoal must exceed either the benchmark level or the market level for that year. The benchmark level is set prospectively by rulemaking based on various factors, including FHFA's forecast of the goal-qualifying share of the overall market. The market level is determined retrospectively each year, based on the actual goal-qualifying share of the overall market as measured by FHFA based on Home Mortgage Disclosure Act (HMDA) data for that year. The overall mortgage market that FHFA uses for both the prospective market forecasts and the retrospective market measurement consists of all single-family owner-occupied conventional conforming mortgages that would be eligible for purchase by either Enterprise. It includes loans actually purchased by the Enterprises as well as comparable loans held in a lender's portfolio. It also includes comparable loans that are part of a private label security (PLS), although very few such securities have been issued for conventional conforming mortgages since 2008.

    While both the benchmark and the retrospective market measure are designed to measure the current year's mortgage originations, the performance of the Enterprises on the housing goals includes all Enterprise purchases in that year, regardless of the year in which the loan was originated. This provides housing goals credit when the Enterprises acquire qualified seasoned loans. (Seasoned loans are loans that were originated in prior years and acquired by the Enterprise in the current year.) The Enterprises' acquisition of seasoned loans provides an important source of liquidity for this market segment.

    Recent changes to the HMDA regulations will result in the HMDA data covering a greater portion of the single-family mortgage market.7 The changes will also provide more detailed information about the loans included in the HMDA data. The changes to the HMDA regulations generally take effect at the start of 2018, so the new, more detailed information will not be available until after the 2018 performance year.

    7See Home Mortgage Disclosure Act final rule, 80 FR 66128 (Oct. 28, 2015).

    For example, the Enterprise housing goals currently count all loans purchased by an Enterprise with original principal balances that are within the conforming loan limits. The conforming loan limits are different for single-family properties depending on the number of units in the property. However, the definition of the retrospective market excludes all loans with original principal balances above the conforming loan limits for single unit properties because the current HMDA data do not identify the number of units for each loan. Starting with the new HMDA data reported, it will be possible to identify the number of units for each loan. This may allow FHFA to revise the definition of the retrospective market to exclude only those loans above the conforming loan limits applicable to the size of the property, instead of excluding all loans above the conforming loan limit applicable to a single unit property.

    FHFA has considered the possible impact that certain changes to the HMDA regulations may have on the Enterprise housing goals. However, at this time the impact that such changes might have on the retrospective measure of the market is uncertain. FHFA is not proposing to make any changes to the Enterprise housing goals in anticipation of the upcoming changes to the HMDA data. FHFA will assess the impact of the changes and, if necessary, may propose changes to the housing goals regulation at a later date.

    Multifamily goals. The multifamily goals defined under the Safety and Soundness Act include separate categories for mortgages on multifamily properties (properties with five or more units) with rental units affordable to low-income families and on multifamily properties with rental units affordable to very low-income families, as well as a small multifamily low-income subgoal for properties with 5-50 units. The multifamily goals established by FHFA in 2010, 2012, and 2015 evaluated the performance of the Enterprises based on numeric targets, not percentages, for the number of affordable units in properties backed by mortgages purchased by an Enterprise. FHFA has not established a retrospective market level measure for the multifamily goals and subgoals, due in part to a lack of comprehensive data about the multifamily market such as that provided by HMDA for single-family mortgages. As a result, FHFA currently measures Enterprise multifamily goals performance against the benchmark levels only. The expanded HMDA fields that will be available for the 2018 performance year are expected to include information on the number of units for each multifamily loan and should be helpful in evaluating performance for this market segment.

    B. Adjusting the Housing Goals

    Under the housing goals regulation first established by FHFA in 2010, as well as under this proposed rule, FHFA may reduce the benchmark levels for any of the single-family or multifamily housing goals in a particular year without going through notice and comment rulemaking based on a determination by FHFA that (1) market and economic conditions or the financial condition of the Enterprise require a reduction, or (2) “efforts to meet the goal or subgoal would result in the constraint of liquidity, over-investment in certain market segments, or other consequences contrary to the intent of the Safety and Soundness Act or the purposes of the Charter Acts.” 8 The proposal also takes into account the possibility that achievement of a particular housing goal may or may not have been feasible for the Enterprise. If FHFA determines that a housing goal was not feasible for the Enterprise to achieve, then the regulation provides for no further enforcement of that housing goal for that year.9

    8 12 CFR 1282.14(d).

    9 12 CFR 1282.21(a).

    If, after publication of a final rule establishing the housing goals for 2018 through 2020, FHFA determines that any of the single-family or multifamily housing goals should be adjusted in light of market conditions, to ensure the safety and soundness of the Enterprises, or for any other reason, FHFA will take steps as necessary and appropriate to adjust that goal. Such steps could include adjusting the benchmark levels through the processes in the existing regulation or establishing revised housing goal levels through notice and comment rulemaking.

    C. Housing Goals Under Conservatorship

    On September 6, 2008, FHFA placed each Enterprise into conservatorship. Although the Enterprises remain in conservatorship at this time, they continue to have the mission of supporting a stable and liquid national market for residential mortgage financing. FHFA has continued to establish annual housing goals for the Enterprises and to assess their performance under the housing goals each year during conservatorship.

    III. Summary of Proposed Rule A. Benchmark Levels for the Single-Family Housing Goals

    This proposed rule would establish the benchmark levels for the single-family housing goals and subgoal for 2018-2020 as follows:

    Goal Criteria Current benchmark level for 2015-2017 Proposed benchmark level for 2018-2020 Low-Income Home Purchase Goal Home purchase mortgages on single-family, owner-occupied properties with borrowers with incomes no greater than 80 percent of area median income 24 percent 24 percent. Very Low-Income Home Purchase Goal Home purchase mortgages on single-family, owner-occupied properties with borrowers with incomes no greater than 50 percent of area median income 6 percent 6 percent. Low-Income Areas Home Purchase Subgoal Home purchase mortgages on single-family, owner-occupied properties with:
  • • Borrowers in census tracts with tract median income of no greater than 80 percent of area median income; or
  • 14 percent 15 percent.
    • Borrowers with income no greater than 100 percent of area median income in census tracts where (i) tract income is less than 100 percent of area median income, and (ii) minorities comprise at least 30 percent of the tract population Low-Income Refinancing Goal Refinancing mortgages on single-family, owner-occupied properties with borrowers with incomes no greater than 80 percent of area median income 21 percent 21 percent.
    B. Multifamily Housing Goal Levels

    The proposed rule would establish the levels for the multifamily goal and subgoals for 2018-2020 as follows:

    Goal Criteria Current goal level for 2017 Proposed goal level for 2018-2020 Low-Income Goal Units affordable to families with incomes no greater than 80 percent of area median income in multifamily rental properties with mortgages purchased by an Enterprise 300,000 units 315,000 units. Very Low-Income Subgoal Units affordable to families with incomes no greater than 50 percent of area median income in multifamily rental properties with mortgages purchased by an Enterprise 60,000 units 60,000 units. Low-Income Small Multifamily Subgoal Units affordable to families with incomes no greater than 80 percent of area median income in small multifamily rental properties (5 to 50 units) with mortgages purchased by an Enterprise 10,000 units 10,000 units. C. Other Proposed Changes

    The proposed rule would make changes and clarifications to the existing rules, including minor technical changes to some regulatory definitions. The proposed rule also would revise the requirements applicable to the housing plan an Enterprise may be required to submit based on a failure to achieve one or more of the housing goals.

    IV. Single-Family Housing Goals

    This proposed rule sets out FHFA's views about benchmark levels for the single-family housing goals from 2018-2020. In making this proposal, FHFA has considered the required statutory factors described below. FHFA's analysis and goal setting process includes developing market forecast models for each of the single-family housing goals, as well as considering a number of other variables that impact affordable homeownership. Many of these variables indicate that low-income and very low-income households are facing, and will continue to face, difficulties in achieving homeownership or in refinancing an existing mortgage. These factors, such as rising property values and stagnant household incomes, also impact the Enterprises' ability to meet their mission and facilitate affordable homeownership for low-income and very low-income households. Nevertheless, FHFA expects and encourages the Enterprises to work toward meeting their housing goal requirements in a safe and sound manner. This may include steps the Enterprises take to fulfill FHFA's access to credit expectations expressed in the most recent Conservatorship Scorecard, which requires the Enterprises to undertake a number of research and related efforts including the development of pilots and initiatives.10

    10 See 2017 Scorecard for Fannie Mae, Freddie Mac, and Common Securitization Solutions, December 2016, available at https://www.fhfa.gov/AboutUs/Reports/ReportDocuments/2017-Scorecard-for-Fannie-Mae-Freddie-Mac-and-CSS.pdf.

    A. Setting the Single-Family Housing Goal Levels FHFA Process for Setting the Single-Family Benchmark Levels

    Section 1332(e)(2) of the Safety and Soundness Act requires FHFA to consider the following seven factors in setting the single-family housing goals:

    1. National housing needs;

    2. Economic, housing, and demographic conditions, including expected market developments;

    3. The performance and effort of the Enterprises toward achieving the housing goals in previous years;

    4. The ability of the Enterprises to lead the industry in making mortgage credit available;

    5. Such other reliable mortgage data as may be available;

    6. The size of the purchase money conventional mortgage market, or refinance conventional mortgage market, as applicable, serving each of the types of families described, relative to the size of the overall purchase money mortgage market or the overall refinance mortgage market, respectively; and

    7. The need to maintain the sound financial condition of the Enterprises.11

    11 12 U.S.C. 4562(e)(2).

    FHFA has considered each of these seven statutory factors in setting the proposed benchmark levels for each of the single-family housing goals and subgoal.

    Recognizing that some of the factors required by statute to be considered can be readily captured using reliable data series while others cannot, FHFA implemented the following approach: FHFA's statistical market models considered factors that are captured through well-known and established data series and these are then used to generate a point forecast for each goal as well as a confidence interval for the point forecast. FHFA then considered the remaining statutory factors, as well as other relevant policy factors, in selecting the specific point forecast within the confidence interval as the proposed benchmark level. FHFA's market forecast models incorporate four of the seven statutory factors: National housing needs; economic, housing, and demographic conditions; other reliable mortgage data; and the size of the purchase money conventional mortgage market or refinance conventional mortgage market for each single-family housing goal. The market forecast models generate a point estimate, as well as a confidence interval. FHFA then considered the remaining three statutory factors (historical performance and effort of the Enterprises toward achieving the housing goal; ability of the Enterprises to lead the industry in making mortgage credit available; and need to maintain the sound financial condition of the Enterprises), as well as other relevant policy factors in selecting the specific point forecast within the confidence interval as the proposed benchmark level for the goal period.

    Market forecast models. The purpose of FHFA's market forecast models is to forecast the market share of the goal-qualifying mortgage originations in the market for the 2018-2020 period. The models are intended to generate reliable forecasts rather than to test various economic hypotheses about the housing market or to explain the relationship between variables. Following standard practice among forecasters and economists at other federal agencies, FHFA estimated a reduced-form equation for each of the housing goals and fit an Autoregressive Integrated Moving Average (or ARIMA) model to each goal share. The models look at the statistical relationship between (a) the historical market share for each single-family housing goal or subgoal, as calculated from monthly HMDA data, and (b) the historical values for various factors that may influence the market shares, e.g., interest rates, inflation, house prices, home sales, the unemployment rate, and other factors. The models then project the future value of the affordable market share using forecast values of the model inputs. Separate models were developed for each of the single-family housing goals and subgoals.

    FHFA has employed similar models in past housing goals rulemakings to generate market forecasts. The models were developed using monthly series generated from HMDA and other data sources, and the resulting monthly forecasts were then averaged into an annual forecast for each of the three years in the goal period. The models rely on 12 years of HMDA data, from 2004 to 2015, the latest year for which HMDA data are available. Additional discussion of the market forecast models can be found in a research paper, available at http://www.fhfa.gov/PolicyProgramsResearch/Research/. 12

    12 Details on FHFA's single-family market models will be available in the technical paper “The Size of the Affordable Mortgage Market: 2018-2020 Enterprise Single-Family Housing Goals.”

    In the final rule establishing the housing goals for 2015-2017, FHFA stated that it would engage directly with commenters to obtain detailed feedback on FHFA's econometric models for the housing goals. Throughout 2016, FHFA met with industry modeling experts about potential improvements to the econometric models. Considering input received, FHFA has revised the market forecast models to include better specifications and new variables for all goal-qualifying shares, while still following and adhering to generally accepted practices and standards adopted by economists, including those at other federal agencies. During the model development process, FHFA grouped factors that are expected by housing market economists to have an impact on the market share of affordable housing into seven broad categories. For each category of variables, many variables were tested but only retained when they exhibited predictive power. The new set of models includes new driver variables that reflect factors that impact the affordable housing market—for example, household debt service ratio, labor force participation rate, and underwriting standards.

    As is the case with any forecasting model, the accuracy of the forecast will vary depending on the accuracy of the inputs to the model and the length of the forecast period. FHFA has attempted to minimize the first variable by using third party forecasts published by Moody's and other accredited mortgage market forecasters. The second variable is harder to address. The proposed rule relies on the most up-to-date data available as of December 2016, and uses forecasted input values for 2017 to produce the forecasts for 2018-2020. The confidence intervals for the benchmark levels become wider as the forecast period lengthens. In other words, it becomes more likely that the actual market levels will be different from the forecasts the farther into the future the forecasts attempt to make predictions. Predicting four years out is not the usual practice in forecasting. A number of industry forecasters, including Fannie Mae, Freddie Mac, and the Mortgage Bankers Association (MBA), do not publish forecasts beyond two years because accuracy of forecasts decreases substantially beyond a two year period.

    Market outlook. There are many factors that impact the affordable housing market as a whole, and changes to any one of them may significantly impact the ability of the Enterprises to meet the goals. In developing our market models, FHFA used Moody's forecasts, where available, as the source for macroeconomic variables.13 In cases where Moody's forecasts were not available (for example, the share of government-guaranteed home purchases and the share of government-guaranteed refinances), FHFA generated and tested its own forecasts.14 Elements that impact the models and the determination of benchmark levels are discussed below.

    13 The macroeconomic outlook described here is based on Moody's and other forecasts as of September 2016.

    14 This refers to the mortgages insured/guaranteed by government agencies such as the FHA, Department of Veterans Affairs (VA), and the Rural Housing Service (RHS).

    Interest rates are arguably one of the most important variables in determining the trajectory of the mortgage market. The Federal Reserve launched its interest rate normalization process in December 2015 with a 0.25-percentage point increase. At the July 2016 meeting of the Federal Open Market Committee (FOMC), policymakers indicated their commitment to a low federal funds rate for the time being, signaling a pause in the interest rate normalization path. However, there is broad consensus among economists that the Federal Reserve will resume rate hikes if the economy performs as expected. Based on Moody's January 2017 forecast, mortgage interest rates—in particular the 30-year fixed rate, which is closely tied to the federal funds rate and the 10-year Treasury note yield—are projected to rise gradually from the current historic low of 3.6 percent in 2016 to 5.5 percent by 2020.

    The unemployment rate has steadily fallen over the last few years and according to Moody's is expected to remain at 4.7 percent over the next four years, given expected growth of the economy at the modest range of 1.5 to 2.9 percent per year (January 2017 forecast). Moody's also forecasts a modest increase in per capita disposable nominal income growth—from $43,100 in 2016 to $50,300 in 2020. Moody's estimates that the inflation rate will remain flat at 2.0 percent throughout the same period, although this also depends on Federal Reserve policy.

    Industry analysts generally expect the overall housing market to continue its recovery, although the growth of house prices may slow down, assuming continued increases in interest rates. According to Moody's forecast (as of January 2017) based on FHFA's purchase-only House Price Index (HPI), house prices are expected to increase at the annual rates of 3.9, 1.8, and 2.0 percent in 2018, 2019, and 2020, respectively.

    The expected increase in mortgage interest rates and house prices will likely impact the ability of low- and very low-income households to purchase homes. Housing affordability, as measured by Moody's forecast of the National Association of Realtors' Housing Affordability Index, is projected to decline from an index value of 162.2 in 2016 to 152.5 in 2020. Low interest rates coupled with rising house prices usually create incentives for homeowners to refinance, and the refinance share of overall mortgage originations increased from 39.9 percent in 2014 to 50 percent in 2016. However, assuming that interest rates rise in the near future, the refinance rate is expected to fall below 21.4 percent by 2019, according to the Moody's forecast.

    Additional Factors Reflecting Affordability Challenges in the Single-Family Market

    While FHFA's models can address and forecast many of the statutory factors that can make affordability for single-family homeownership more challenging for low-income and very low-income households, including increasing interest rates and rising property values, some factors are not captured in the models. FHFA, therefore, considers additional factors when selecting the benchmark point within the model-generated confidence interval for each of the single-family housing goals. Some of these factors may affect a subset of the market rather than the market as a whole. Some of these additional factors include an uneven economic recovery, stagnant wages even where unemployment is decreasing, demographic trends, and the Enterprises' share of the mortgage market. Variability in these factors can also have substantial impacts on the ability of the Enterprises to meet housing goals. Consequently, as discussed further below, FHFA will carefully monitor these factors and consider the potential impact of market shifts or larger trends on the ability of the Enterprises to achieve the housing goals.

    Throughout 2016, the economy and the housing market continued to recover from the financial crisis, but the recovery has been uneven across the country. In some areas, economic growth, job gains, and demand are outpacing housing supply, sparking rapidly rising property values, while other areas of the country have not regained pre-crisis home values and are not projected to do so in the near future.

    Trends in factors such as area median income (AMI) point to an uneven recovery. FHFA uses census-tract level AMIs published by the U.S. Department of Housing and Urban Development (HUD) to determine affordability for the Enterprise single-family and multifamily mortgage acquisitions. AMI is a measure of median family income derived from the Census Bureau's American Community Survey (ACS). Since the 1990s, AMIs have been used widely by HUD, state housing finance agencies, the Federal Deposit Insurance Corporation (FDIC), the U.S. Department of Treasury, and local governments across the nation to determine eligibility for various affordable housing and public assistance programs. The HUD-published AMIs are considered the standard benchmark in the affordable housing industry. HUD changed the methodology for determining AMIs in 2015 because of changes in the Census Bureau's data collection methodology and changes in the reporting schedules of the ACS data.

    AMI shifts reflect changes in borrower income levels at the census tract level. In general, a decrease in an area's AMI represents a decline in housing affordability in the area because the households will have relatively less income with which to purchase a home where property values have either remained the same or increased during the same time period.15 This can make it more challenging for the Enterprises to meet the housing goals. Conversely, increases in AMIs would make it easier for the Enterprises to meet the housing goals. Overall, while there are annual fluctuations in AMI, the trends over a longer period (for instance, over four years) indicate that the economy is recovering, albeit in an uneven manner. For instance, from 2014 to 2016, over 80 percent of census tracts experienced an AMI increase. Over the four-year period from 2012 to 2016, AMI increased in about 51 percent of census tracts. This unevenness of the economic recovery is particularly evident geographically. For instance, the census tracts that experienced more than a 10 percent decline in AMIs in 2016 are concentrated in the southern and midwestern regions of the country.

    15 The supply of single-family homes at the more affordable end of the market also impacts a low-income or very low-income household's ability to purchase a home. See The State of the Nation's Housing 2017, Joint Center on Housing Studies, June 2017.

    In addition to the uneven recovery reflected in changing AMI levels, many households have experienced stagnant wages or limited wage growth even though unemployment levels have decreased significantly since the peak of the financial crisis. Data released by the U.S. Census Bureau last year for the most recent year available reflected that while median household income increased by 5.2 percent in 2015, the first annual increase in median household income since 2007, median wages remained 1.6 percent lower than the median in 2007, the year before the most recent recession, and 2.4 percent lower than the median household income peak that occurred in 1999.16 Constrained wages, in addition to rising interest rates and increasing property values, could make it difficult for many low-income and very low-income households to achieve homeownership.

    16 See Income and Poverty in the United States: 2015, United States Census Bureau, September 2016 https://www.census.gov/content/dam/Census/library/publications/2016/demo/p60-256.pdf.

    Demographic changes, such as the housing patterns of millennials or the growth of minority households, also reflect challenges in the affordable homeownership market. The homeownership rate among millennials is lower than other demographic groups, but household formation will likely increase as this group ages. However, many millennials will face multiple challenges, including difficulty finding affordable homes to buy and building enough wealth for a down payment and closing costs, particularly in light of student loan and other debt burdens. In addition, another continuing demographic trend is the growth of minority households, which is projected to be over 70 percent of net household growth through 2025.17 In light of the fact that the median net worth of minority households has been historically low, building the necessary wealth to meet down payment and closing costs will likely also be a challenge for many of these new households. FHFA is committed to identifying new market conditions and challenges and working with the Enterprises to identify solutions to help meet these challenges. The effectiveness of these solutions, however, cannot be accounted for in a model.

    17 Daniel McCue, Christopher Herbert, Working Paper: Updated Household Projections, 2015-2035: Methodology and Results, Harvard Joint Center for Housing Studies, December 2016.

    Another factor that can affect the Enterprises' ability to support affordable homeownership for low-income and very low-income households is the Enterprises' overall share of the mortgage market. The Enterprises' share of the market is continually subject to fluctuation. During the mortgage market bubble, the Enterprises' share of the market dropped to about 46 percent in the last quarter of 2005. The other significant low point occurred in 2008, when the Enterprises' acquisitions accounted for less than 45 percent of the mortgage market. Since then, the Enterprises' share has risen overall but declined slightly in recent years, accounting for about 52 percent of the market in 2015. As shown in Graph 1, over the same time period, the total government share of the mortgage market (including FHA, VA, and RHS) has been expanding. In 2015, the total government share accounted for 28 percent of overall mortgage originations, up from 24 percent in 2014. This is likely an impact of the FHA mortgage insurance premium reduction announced in January 2015. As seen in Graph 1, the increase in government share came from decreases in the other two segments.

    EP07JY17.016

    Both Enterprises' charter acts require that all mortgages the Enterprises acquire have mortgage insurance (or one of the other forms of credit enhancement specified in the charter acts) if the loan-to-value (LTV) ratio for the loan at acquisition is greater than 80 percent. Private mortgage insurance rates are dependent on characteristics of the mortgage such as loan term, type of mortgage (purchase, type of refinance), LTV ratio, and credit score of the borrower. Lenders may also be able to negotiate and obtain lower private mortgage insurance directly from the mortgage insurer. Therefore, for certain market segments, the choice between government mortgage insurance or private mortgage insurance depends on the net impact of these factors.

    In recent years private mortgage insurance rates have increased relative to government mortgage insurance rates, but the increase has not been uniform across the credit score and LTV spectrum. Changes in the mortgage insurance market can impact the cost of mortgage insurance and, consequently, may influence whether the mortgage is originated with private mortgage insurance or with FHA insurance. For example, FHA decreased its rates for mortgage insurance from 1.35 percent to 0.85 percent in January 2015. If FHA decreased or increased its mortgage insurance premiums, it would be reasonable to expect further shifts in the market that would not be uniform across the credit score and LTV spectrum. Reductions in the FHA insurance premium are likely to have two impacts on the conforming segment of the market: (1) The substitution effect—some borrowers will switch from private mortgage insurance to FHA insurance due to the lower premium rate; and (2) the expanded homeownership effect—new borrowers, especially those with lower credit scores seeking higher LTV loans, will enter the mortgage market because they are now able to meet the debt-to-income threshold due to the lower monthly mortgage payment. Analysis conducted by Federal Reserve Board staff indicates that both effects existed after the last FHA reduction.18 Increases in FHA premiums would likely result in reverse shifts.

    18 Bhutta, Neil and Ringo, Daniel (2016). “Changing FHA Mortgage Insurance Premiums and the Effects on Lending,” FEDS Notes. Washington: Board of Governors of the Federal Reserve System, September 29, 2016, http://dx.doi.org/10.17016/2380-7172.1843.

    As discussed above, multiple factors impact the Enterprises' ability to meet their mission and support affordable homeownership through the housing finance market. Nevertheless, FHFA expects the Enterprises to continue efforts in a safe and sound manner to support affordable homeownership under the single-family housing goals categories.

    B. Proposed Single-Family Benchmark Levels 1. Low-Income Home Purchase Goal

    The low-income home purchase goal is based on the percentage of all single-family, owner-occupied home purchase mortgages purchased by an Enterprise that are for low-income families, defined as families with incomes less than or equal to 80 percent of AMI. The proposed rule would set the annual low-income home purchase housing goal benchmark level for 2018-2020 at 24 percent, the same as the current 2015-2017 benchmark level. FHFA believes that, despite the various challenges to affordability highlighted above, the Enterprises will be able to take steps to maintain or increase their performance on this goal.

    Table 1—Enterprise Low-Income Home Purchase Goal Year Historical performance 2013 2014 2015 2016 Projected performance 2017 2018 2019 2020 Actual Market 24.0% 22.8% 23.6% Benchmark 23% 23% 24% 24% 24% Current Market Forecast 23.9% +/−2.5% 24.9% +/−4.3% 25.5% +/−5.6% 24.0% +/−6.6% 23.0% +/−7.4% Fannie Mae Performance: Low-Income Home Purchase Mortgages 193,712 177,846 188,891 221,249 Total Home Purchase Mortgages 814,137 757,870 802,432 964,847 Low-Income % of Home Purchase Mortgages 23.8% 23.5% 23.5% 22.9% Freddie Mac Performance: Low-Income Home Purchase Mortgages 93,478 108,948 129,455 153,435 Total Home Purchase Mortgages 429,158 519,731 579,340 644,991 Low-Income % of Home Purchase Mortgages 21.8% 21.0% 22.3% 23.8%

    As shown in Table 1, performance at both Enterprises has fallen short of the market in the low-income purchase goal almost every year since 2013 (with the exception of Fannie Mae in 2014), although the Enterprises have sometimes missed the market look-back goal only by one- or two-tenths of a percentage point. Performance at both Enterprises fell short of both the benchmark and the market level in 2015. The past performance of the Enterprises indicates that it has been difficult for the Enterprises to consistently lead this market segment in making credit available.

    From 2013 to 2014, the low-income home purchase market decreased from 24.0 percent to 22.8 percent. In 2015, the actual market rebounded to 23.6 percent. FHFA's current model forecasts that the market for this goal will increase slightly to 23.9 percent in 2016 and then to 24.9 percent in 2017. (Actual market levels for 2016 will not be available until HMDA data are published in September 2017.) Although the Enterprises have been challenged in meeting the percentage single-family housing goal levels in recent years, FHFA notes that each Enterprise has increased the number of single-family home purchase loans made to low-income households. Fannie Mae's eligible single-family loan purchases increased from 193,712 loans in 2013 to 221,249 in 2016. Freddie Mac's eligible single-family loan purchases increased from 93,478 in 2013 to 153,435 in 2016.

    From 2018 to 2020, the proposed goals period, the current forecast peaks at 25.5 percent in 2018, before decreasing to 24.0 percent in 2019 and 23.0 percent in 2020. The average of these projections is 24.1 percent. This forecast is based on the latest data available and will be updated before the release of the final housing goals rule. The confidence intervals for the 2018-2020 goal period are wide, but they will narrow before the final rule is published.

    FHFA is proposing a benchmark level for the low-income home purchase housing goal that is close to the market forecast, to encourage the Enterprises to continue to find ways to support lower income borrowers while not compromising safe and sound lending standards. FHFA notes that the proposed benchmark is close to the average of its market forecast for this goal. FHFA recognizes that there may be challenges to meeting this goal, including uneven growth in AMI and the relative affordability of private mortgage insurance, that may be beyond the control of the Enterprises and impact their ability to achieve these goals. FHFA will continue to monitor the Enterprises, both as regulator and as conservator, and if FHFA determines in later years that the benchmark level for the low-income home purchase housing goal is no longer feasible for the Enterprises to achieve in light of market conditions or for any other reason, FHFA can take appropriate steps to adjust the benchmark level.

    2. Very Low-Income Home Purchase Goal

    The very low-income home purchase goal is based on the percentage of all single-family, owner-occupied home purchase mortgages purchased by an Enterprise that are for very low-income families, defined as families with incomes less than or equal to 50 percent of the area median income. The proposed rule would set the annual very low-income home purchase housing goal benchmark level for 2018 through 2020 at 6 percent, also unchanged from the current 2015 to 2017 benchmark level.

    Table 2—Very Low-Income Home Purchase Goal Year Historical performance 2013 2014 2015 2016 Projected performance 2017 2018 2019 2020 Actual Market 6.3% 5.7% 5.8% Benchmark 7% 7% 6% 6% 6% Current Market Forecast 5.9% +/−0.8% 6.4% +/−1.4% 6.7% +/−1.8% 6.3% +/−2.1% 6.2% +/−2.4% Fannie Mae Performance: Very Low-Income Home Purchase Mortgages 48,810 42,872 45,022 49,852 Total Home Purchase Mortgages 814,137 757,870 802,432 964,847 Very Low-Income % of Home Purchase Mortgages 6.0% 5.7% 5.6% 5.2% Freddie Mac Performance: Very Low-Income Home Purchase Mortgages 23,705 25,232 31,146 36,838 Total Home Purchase Mortgages 429,158 519,731 579,340 644,991 Very Low-Income % of Home Purchase Mortgages 5.5% 4.9% 5.4% 5.7%

    Since 2013, the market for very low-income home purchase loans has also been declining, as reflected in HMDA data, although there was a slight uptick in 2015. FHFA has gradually lowered the benchmark for this goal from 8 percent in 2010 to 6 percent in 2015. Despite this reduction, the performance of both Enterprises has fallen below the benchmark and the market levels in each year since 2013. In addition, both Enterprises are projected to fall below the 6 percent benchmark level in 2016.

    FHFA market analysis reflects a relatively flat trend for this segment, at 5.7 percent in 2014 and 5.8 percent in 2015. FHFA's current model forecasted the market to increase slightly to 5.9 percent in 2016 and then to 6.4 percent in 2017. For the 2018-2020 goal period, FHFA's forecast indicates an increase to 6.7 percent in 2018, followed by declines to 6.3 percent and 6.2 percent in 2019 and 2020, respectively. As noted earlier, the confidence intervals widen as the forecast period lengthens, and will reduce somewhat as FHFA incorporates more information before publishing the final rule.

    Similar to the low-income home purchase goal, FHFA is proposing a benchmark level that is near the market forecast to encourage the Enterprises to continue their efforts to promote safe and sustainable lending to very low-income families. As noted in the low-income purchase goal discussion, FHFA believes that there are significant challenges to housing affordability that may be beyond the control of the Enterprises that could make the proposed benchmark a challenge for the Enterprises. As each Enterprise has been struggling to meet the current benchmark and market levels, the proposed benchmark will continue to encourage the Enterprise to safely and soundly innovate in this area. FHFA, as regulator and as conservator, will continue to monitor the Enterprises' performance, and if FHFA determines in later years that the benchmark level for the very low-income areas home purchase housing goal is no longer feasible for the Enterprises to achieve in light of market conditions or for any other reason, FHFA may take appropriate steps to adjust the benchmark level.

    3. Low-Income Areas Home Purchase Subgoal

    Background. The low-income areas home purchase subgoal is based on the percentage of all single-family, owner-occupied home purchase mortgages purchased by an Enterprise that are either: (1) For families in low-income areas, defined to include census tracts with median income less than or equal to 80 percent of AMI; or (2) for families with incomes less than or equal to AMI who reside in minority census tracts (defined as census tracts with a minority population of at least 30 percent and a tract median income of less than 100 percent of AMI). Borrowers could qualify under either or both conditions. As noted in Table 3, mortgages satisfying condition (1) above (borrowers in low-income areas) are almost typically double the share of mortgages satisfying condition (2) (moderate-income borrowers in minority census tracts). For example, in 2015, 12.2 percent of mortgages met only condition (1), 7.6 percent met only condition (2), and 4.6 percent of mortgages met both conditions.

    Table 3—Composition of Low-Income Areas Home Purchase Subgoal Based on HMDA Data Year Low-income area goal
  • %
  • All low-income areas
  • %
  • Low-income census tracts that are not high minority areas
  • %
  • High minority areas that are also low-
  • income census tracts
  • %
  • High minority areas that are not low-
  • income census tracts
  • %
  • All high
  • minority areas
  • %
  • (A)
  • Grand Total
  • (B)
  • LI
  • (C)
  • LI, not HM
  • (D)
  • HM and LI
  • (E)
  • HM, not LI
  • (F)
  • HM
  • Distribution of HMDA Borrowers By Census Tract Location 2004 16.8 13.3 8.1 5.3 3.5 8.7 2005 15.3 12.5 8.3 4.2 2.8 7.0 2006 15.8 13.1 8.9 4.3 2.7 6.9 2007 16.2 13.3 8.5 4.8 3.0 7.7 2008 14.3 11.6 7.4 4.2 2.7 6.9 2009 13.1 10.0 5.9 4.1 3.0 7.2 2010 12.1 9.2 5.6 3.6 2.9 6.5 2011 11.4 8.8 5.5 3.3 2.6 5.9 2012 13.5 10.3 6.0 4.3 3.2 7.5 2013 14.1 10.9 6.6 4.3 3.1 7.4 2014 15.0 12.0 7.5 4.6 3.0 7.5 2015 15.1 12.2 7.6 4.6 2.9 7.5 Enterprises' Performance: 2010 11.6 8.7 5.2 3.5 2.9 6.4 2011 10.7 8.1 5.1 3.1 2.6 5.7 2012 12.6 9.3 5.4 3.9 3.3 7.2 2013 13.4 10.2 6.2 4.0 3.2 7.2 2014 14.7 11.6 7.0 4.5 3.2 7.7 2015 15.1 12.1 7.4 4.6 3.0 7.7 Source: FHFA's tabulation of Home Mortgage Disclosure Act (HMDA) and Enterprises' data. Conventional conforming single-family owner-occupied 1st lien non-HOEPA originations.

    The forecast for this subgoal is obtained by generating separate forecasts for the two sub-populations (the low-income areas component and the high-minority income component). For this proposed rulemaking, FHFA has tested alternate model specifications for this subgoal and determined that aligning the overlapping portion with the low-income area component yields forecast estimates that are more precise (in terms of a narrower confidence interval).19

    19 Details are available in the market model paper, “The Size of the Affordable Mortgage Market: 2018-2020 Enterprise Single-Family Housing Goals,” available at http://www.fhfa.gov/PolicyProgramsResearch/Research/PaperDocuments/Market-Estimates_2018-2020.pdf.

    FHFA sought to understand how the markets in low-income areas and high minority census tracts have evolved in recent years and who was being served by the Enterprises' efforts in these areas. FHFA's analysis found that the mortgage market in both low-income areas and in high-minority census tracts has been moving towards borrowers with higher incomes in recent years. As noted in Table 4, HMDA data show that both the low-income areas and the high-minority areas have increasing shares of borrowers with incomes at or above 100 percent of AMI, although loans to borrowers with incomes over 100 percent of AMI do not qualify for the minority areas component of the goal. For instance, the share of loans made to borrowers with incomes less than 50 percent of AMI and residing in low-income areas decreased from 17.8 percent in 2010 to 14.1 percent in 2015, after peaking at 19 percent in 2012. Over the same period, the share of loans made to borrowers with incomes greater than 100 percent of AMI and residing in these low-income census tracts increased from 38.8 percent in 2010 to 42.1 percent in 2015, after dipping to 36.5 percent in 2012. Thus, borrowers with higher incomes have made up an increasing share of the mortgage market in the low-income areas. A similar trend exists among borrowers residing in high minority census tracts. While borrowers with incomes greater than 100 percent of AMI represented 42.5 percent of borrowers in these census tracts in 2010, the share increased to 49.2 percent in 2015.

    Table 4—Borrower Income Relative to AMI for Low-Income Areas Subgoal [HMDA] 2010
  • (%)
  • 2011
  • (%)
  • 2012
  • (%)
  • 2013
  • (%)
  • 2014
  • (%)
  • 2015
  • (%)
  • Borrowers Residing in Low-Income Census Tracts: Borrower Income ≤ 50% AMI 17.8 17.7 19.0 15.4 14.1 14.1 Borrower Income > 50% and ≤ 60% AMI 9.6 9.0 10.5 9.8 9.3 9.3 Borrower Income > 60% and ≤ 80% AMI 18.4 17.6 18.8 18.6 18.6 18.6 Borrower Income > 80% and ≤ 100% AMI 14.3 13.9 13.9 14.7 14.9 14.9 Borrower Income > 100% and ≤ 120% AMI 10.1 10.0 10.0 10.8 11.3 11.3 Borrower Income > 120% AMI 28.7 30.5 26.5 29.3 30.9 30.8 Income Missing 1.0 1.4 1.3 1.3 0.9 1.0 Total 100.0 100.0 100.0 100.0 100.0 100.0 Borrowers Residing in High-Minority Census Tracts: Borrower Income ≤ 50% AMI 14.9 15.0 14.6 11.3 10.1 10.3 Borrower Income > 50% and ≤ 60% AMI 9.0 8.7 9.1 8.1 7.6 7.6 Borrower Income > 60% and ≤ 80% AMI 18.0 17.7 17.7 16.9 16.8 17.0 Borrower Income > 80% and ≤ 100% AMI 14.6 14.3 14.1 14.7 14.8 14.9 Borrower Income > 100% and ≤ 120% AMI 10.9 10.6 11.0 11.7 12.0 12.2 Borrower Income > 120% AMI 31.6 32.4 32.3 36.0 37.8 37.0 Income Missing 1.0 1.3 1.3 1.4 0.9 1.0 Total 100.0 100.0 100.0 100.0 100.0 100.0 Definitions: Low-income census tracts = Census tracts with median income ≤ 80% Area Median Income (AMI). High-minority census tracts = Census tracts where (i) tract median income ≤ 100% Area Median Income (AMI); and (ii) minorities comprise at least 30 percent of the tract population. Source: FHFA's tabulation of HMDA data.

    The presence of higher income borrowers in lower income and higher minority areas may be a sign of economic diversity in those areas and may be related to the possibility of improved economic indicators for the community, but there is nevertheless some concern that such a trend could displace lower income households in these areas. Change in the mix of renters to owner-occupied households often precedes and accompanies these trends. FHFA is aware that this particular subgoal may encourage the Enterprises to focus on purchasing loans for higher income households in low-income and high-minority areas, and FHFA is also aware of concerns about the impact of rising housing costs on existing households in lower-income or higher-minority areas. FHFA welcomes input on all aspects of the low-income areas goal and subgoal, and in particular how best to satisfy the policy objectives of the various components of the goal and subgoal.

    Table 5 shows similar trends in Enterprise acquisitions of mortgages in low-income areas and high-minority areas. In 2015, 42.5 percent of Enterprise acquisitions were of loans made to borrowers with incomes greater than or equal to 100 percent of the AMI, up from 40.7 percent in 2010. Also in 2015, 48.3 percent of Enterprise acquisitions in high-minority census tracts were acquisitions of loans made to borrowers with incomes greater than or equal to 100 percent of AMI, up from 45.4 percent in 2010.

    Table 5—Borrower Income Relative to AMI for Low-Income Areas Subgoal [Enterprise loans only] 2010
  • (%)
  • 2011
  • (%)
  • 2012
  • (%)
  • 2013
  • (%)
  • 2014
  • (%)
  • 2015
  • (%)
  • Borrowers Residing in Low-Income Census Tracts: Borrower Income ≤ 50% AMI 16.7 16.3 18.2 14.5 13.4 13.4 Borrower Income > 50% and ≤ 60% AMI 9.2 8.8 10.0 9.6 9.4 9.4 Borrower Income > 60% and ≤ 80% AMI 18.4 17.5 18.6 18.6 19.0 19.1 Borrower Income > 80% and
  • ≤ 100% AMI
  • 14.8 14.4 14.6 15.3 15.5 15.6
    Borrower Income > 100% and ≤ 120% AMI 10.8 10.9 10.8 11.5 11.7 11.8 Borrower Income > 120% AMI 29.9 32.0 27.7 30.5 31.0 30.7 Income Missing 0.2 0.0 0.0 0.0 0.0 0.0 Total 100.0 100.0 100.0 100.0 100.0 100.0 Borrowers Residing in High-Minority Census Tracts: Borrower Income ≤ 50% AMI 13.3 12.9 15.2 11.5 10.3 10.3 Borrower Income > 50% and ≤ 60% AMI 8.4 8.0 9.0 8.3 8.0 7.9 Borrower Income > 60% and ≤ 80% AMI 17.7 16.9 18.0 17.7 17.7 17.7 Borrower Income > 80% and ≤ 100% AMI 15.1 14.7 14.9 15.5 15.7 15.9 Borrower Income > 100% and ≤ 120% AMI 11.6 11.4 11.5 12.4 12.6 12.8 Borrower Income > 120% AMI 33.8 36.2 31.3 34.6 35.7 35.5 Income Missing 0.2 0.1 0.0 0.0 0.0 0.0 Total 100.0 100.0 100.0 100.0 100.0 100.0 Definitions: Low-income census tracts = Census tracts with median income ≤ 80% Area Median Income (AMI). High-minority census tracts = Census tracts where (i) tract median income ≤ 100% Area Median Income (AMI); and (ii) minorities comprise at least 30 percent of the tract population. Source: FHFA's tabulation of Enterprises' data.

    Proposed rule. The proposed rule would raise the annual low-income areas home purchase subgoal benchmark level for 2018 through 2020 to 15 percent from the 14 percent level set for the current goal period (2015-2017).

    Table 6—Low-Income Areas Home Purchase Subgoal Year Historical performance 2013 2014 2015 2016 Projected performance 2017 2018 2019 2020 Actual Market 14.2% 15.2% 15.2% Benchmark 11% 11% 14% 14% 14% Current Market Forecast 14.7% +/− 1.2% 15.6% +/− 2.0% 15.8% +/− 2.6% 16.1% +/− 3.1% 15.7% +/− 3.5% Fannie Mae Performance: Low-Income Area Home Purchase Mortgages 86,430 91,691 99,723 n/a High-Minority Area Home Purchase Mortgages 27,425 25,650 25,349 n/a Subgoal-Qualifying Total Home Purchase Mortgages 113,855 117,341 125,072 156,441 Total Home Purchase Mortgages 814,137 757,870 802,432 964,847 Low-Income Area % of Home Purchase Mortgages 14.0% 15.5% 15.6% 16.2% Freddie Mac Performance: Low-Income Area Home Purchase Mortgages 40,444 55,987 67,172 n/a High-Minority Area Home Purchase Mortgages 12,177 14,808 16,601 n/a Subgoal-Qualifying Total Home Purchase Mortgages 52,621 70,795 83,773 100,608 Total Home Purchase Mortgages 429,158 519,731 579,340 644,991 Low-Income Area % of Home Purchase Mortgages 12.3% 13.6% 14.5% 15.6%

    Both Enterprises have met this subgoal every year since 2013, regularly exceeding both the market and the benchmark levels. Fannie Mae's performance exceeded both the market and the benchmark in 2014 and 2015, although its performance was lower than that of the market in 2013. From 2013 through 2015, Freddie Mac's performance exceeded the benchmark but was below the market level. FHFA's forecast indicates that the market will increase slightly in the coming years, reaching a maximum level of 16.1 in 2019.

    FHFA is proposing only a modest increase in the benchmark level that reflects the recent performance levels of the Enterprises while FHFA continues to evaluate whether the measure meets policy objectives. FHFA, as regulator and as conservator, will continue to monitor the Enterprises' performance, and if FHFA determines in later years that the benchmark level for the low-income areas home purchase housing subgoal is no longer feasible for the Enterprises to achieve in light of market conditions or for other reasons, FHFA may take appropriate steps to adjust the benchmark level.

    4. Low-Income Areas Home Purchase Goal

    The low-income areas home purchase goal covers the same categories as the low-income areas home purchase subgoal, but it also includes moderate income families in designated disaster areas. As a result, the low-income areas home purchase goal is based on the percentage of all single-family, owner-occupied home purchase mortgages purchased by an Enterprise that are: (1) For families in low-income areas, defined to include census tracts with median income less than or equal to 80 percent of AMI; (2) for families with incomes less than or equal to AMI who reside in minority census tracts (defined as census tracts with a minority population of at least 30 percent and a tract median income of less than 100 percent of AMI); or (3) for families with incomes less than or equal to 100 percent of AMI who reside in designated disaster areas.

    The low-income areas goal benchmark level is established by a two-step process. The first step is setting the benchmark level for the low-income areas subgoal, as established by this proposed rule. The second step is establishing an additional increment for mortgages to families located in federally-declared disaster areas with incomes less than or equal to AMI.20 Each year, FHFA sets the disaster area increment separately from this rule and notifies the Enterprises by letter of the benchmark level for that year. The proposed rule would set the annual low-income areas home purchase goal benchmark level for 2018 through 2020 at the subgoal benchmark level of 15 percent plus a disaster areas increment that FHFA will set separately each year.

    20 Disaster declarations are listed on the Federal Emergency Management Agency (FEMA) Web site at https://www.fema.gov/disasters.

    Table 7—Low-Income Areas Home Purchase Goal Year Historical performance 2010 2011 2012 2013 2014 2015 2016 Actual Market 24.0% 22.0% 23.2% 22.1% 22.1% 19.8% n/a Benchmark 24% 24% 20% 21% 18% 19% 17% Fannie Mae Performance: Subgoal-Qualifying Home Purchase Mortgages 59,281 54,285 83,202 113,855 117,341 125,072 156,441 Disaster Areas Home Purchase Mortgages 56,076 50,209 58,085 62,314 54,548 38,885 38,545 Goal-Qualifying Total Home Purchase Mortgages 115,357 104,494 141,287 176,169 171,889 163,957 194,986 Total Home Purchase Mortgages 479,200 467,066 633,627 814,137 757,870 802,432 964,847 Goal Performance 24.1% 22.4% 22.3% 21.6% 22.7% 20.4% 20.2% Freddie Mac Performance: Subgoal-Qualifying Home Purchase Mortgages 32,089 23,902 32,750 52,621 70,795 83,773 100,608 Disaster Areas Home Purchase Mortgages 38,898 26,232 26,486 33,123 33,923 26,411 27,709 Goal-Qualifying Total Home Purchase Mortgages 70,987 50,134 59,236 85,744 104,718 110,184 128,317 Total Home Purchase Mortgages 307,555 260,796 288,007 429,158 519,731 579,340 644,991 Goal Performance 23.1% 19.2% 20.6% 20.0% 20.1% 19.0% 19.9% 5. Low-Income Refinancing Goal

    The low-income refinancing goal is based on the percentage of all single-family, owner-occupied refinance mortgages purchased by an Enterprise that are for low-income families, defined as families with incomes less than or equal to 80 percent of AMI. The proposed rule would set the annual low-income refinancing housing goal benchmark level for 2018 through 2020 at 21 percent. While this proposed benchmark level is unchanged from the current 2015 to 2017 benchmark level, FHFA believes that this level will nevertheless be challenging for the Enterprises given the current level of interest rates (which are at historic low levels) and the likelihood of interest rate hikes. Because of the significant impacts interest rate changes have on this market, Enterprise and market performance on this goal are particularly susceptible to fluctuation. Moderation in the setting of this goal is also supported by the fact that many borrowers have already refinanced during the recent extended period of historically low interest rates.

    Table 8—Low-Income Refinancing Goal Year Historical performance 2013 2014 2015 2016 Projected performance 2017 2018 2019 2020 Actual Market 24.3% 25.0% 22.5% Benchmark 20% 20% 21% 21% 21% Current Market Forecast 21.1% +/− 2.9% 23.4% +/− 4.9% 24.3% +/− 6.2% 25.5% +/− 7.3% 24.8% +/− 8.3% Fannie Mae Performance: Low-Income Refinance Mortgages 519,753 215,826 227,817 247,663 Total Refinance Mortgages 2,170,063 831,218 1,038,663 1,268,648 Low-Income % of Refinance Mortgages 24.0% 26.0% 21.9% 19.5% Low-Income HAMP Modification Mortgages 11,858 6,503 3,563 n/a Total HAMP Modification Mortgages 16,478 9,288 6,595 n/a Low-Income % of HAMP Modification Mortgages 72.0% 70.0% 54.0% n/a Low-Income Refinance & HAMP Modification Mortgages 531,611 222,329 231,380 n/a Total Refinance & HAMP Modification Mortgages 2,186,541 840,506 1,045,258 n/a Low-Income % of Refinance & HAMP Modification Mortgages 24.3% 26.5% 22.1% n/a Freddie Mac Performance: Low-Income Refinance Mortgages 306,205 131,921 179,530 174,664 Total Refinance Mortgages 1,309,435 514,936 795,936 830,824 Low-Income % of Refinance Mortgages 23.4% 25.6% 22.6% 21.0% Low-Income HAMP Modification Mortgages 14,757 6,795 3,064 n/a Total HAMP Modification Mortgages 21,599 10,335 4,433 n/a Low-Income % of HAMP Modification Mortgages 68.3% 65.7% 69.1% n/a Low-Income Refinance & HAMP Modification Mortgages 320,962 138,716 182,594 n/a Total Refinance & HAMP Modification Mortgages 1,331,034 525,271 800,369 n/a Low-Income % of Refinance & HAMP Modification Mortgages 24.1% 26.4% 22.8% n/a

    Both Enterprises have met this goal since 2013. The performance of the Enterprises on this goal has historically been very close to actual market levels. In 2014, when the market figure was at its highest point, both Enterprises met the goal and exceeded the market. In 2015, Freddie Mac exceeded the market and the benchmark level, and Fannie Mae exceeded the benchmark level.

    The low-income share of the refinance market as measured by HMDA data has changed dramatically in recent years, increasing from 20.2 percent in 2010 to a peak of 25.0 percent in 2014. FHFA's model for this goal forecasts that this market will decrease in 2016, with a sharp rise in 2017-2019, followed by slight moderation in 2020. However, the confidence intervals around the forecasts are very wide, reflecting the uncertainty about interest rates. Recent macroeconomic forecasts have predicted interest rate hikes that have not materialized.

    Since 2010 the low-income refinancing housing goal has included modifications under the Home Affordable Modification Program (HAMP).21 HAMP modifications, however, are not included in the data used to calculate the market levels. Including HAMP modifications in the Enterprise performance numbers increases the measured performance of the Enterprises on the low-income refinancing housing goal because lower income borrowers make up a greater proportion of the borrowers receiving HAMP modifications than the low-income share of the overall refinancing mortgage market. However, HAMP modifications have been declining over time, and the program stopped taking applications at the end of 2016.22 The expiration of the HAMP program may make it slightly more difficult for the Enterprises to meet the low-income refinancing goal.

    21 The goal has included permanent HAMP modifications to low-income borrowers in the numerator and all HAMP permanent modifications in the denominator.

    22 The HAMP program expired at the end of 2016. There will be some HAMP modifications that will count toward the Enterprise housing goals in 2017 as applications that were initiated before the end of the program are converted to permanent modifications.

    FHFA, as regulator and conservator, will continue to monitor the Enterprises and if FHFA determines in later years that the benchmark level for the low-income refinancing housing goal needs to be revised, FHFA may take appropriate steps to adjust the benchmark level.

    V. Multifamily Housing Goals

    This proposed rule also sets out FHFA's views about benchmark levels for the multifamily housing goals from 2018-2020. FHFA has considered the required statutory factors described below. Despite the strength of the multifamily mortgage market, data indicates a continued supply gap of units affordable to lower-income households. However, FHFA expects and encourages the Enterprises to fully support affordable multifamily housing, in part by fulfilling the multifamily housing goals in a safe and sound manner.

    A. Factors Considered in Setting the Proposed Multifamily Housing Goal Levels

    In setting the proposed benchmark levels for the multifamily housing goals, FHFA has considered the statutory factors outlined in Section 1333(a)(4) of the Safety and Soundness Act. These factors include:

    1. National multifamily mortgage credit needs and the ability of the Enterprises to provide additional liquidity and stability for the multifamily mortgage market;

    2. The performance and effort of the Enterprises in making mortgage credit available for multifamily housing in previous years;

    3. The size of the multifamily mortgage market for housing affordable to low-income and very low-income families, including the size of the multifamily markets for housing of a smaller or limited size;

    4. The ability of the Enterprises to lead the market in making multifamily mortgage credit available, especially for multifamily housing affordable to low-income and very low-income families;

    5. The availability of public subsidies; and

    6. The need to maintain the sound financial condition of the Enterprises.23

    23 12 U.S.C. 4563(a)(4).

    Unlike the single-family housing goals, performance on the multifamily housing goals is measured solely against a benchmark level, without any retrospective market measure. The absence of a retrospective market measure for the multifamily housing goals results, in part, from the lack of comprehensive data about the multifamily mortgage market. Unlike the single-family market, for which HMDA provides a reasonably comprehensive dataset about single-family mortgage originations each year, the multifamily market (including the affordable multifamily market segment) has no comparable source. Consequently, it can be difficult to correlate different datasets that usually rely on different reporting formats. For example, some data are available by dollar volume while other data are available by unit production.24

    24 CFPB is planning to collect and release additional data fields (including the number of units for each multifamily loan that is reported) beginning in 2018 that likely will be useful in creating a retrospective market measure for the multifamily market.

    Another difference between the single-family and multifamily goals is that there are separate single-family housing goals for home purchase and refinancing mortgages, while the multifamily goals include all Enterprise multifamily mortgage purchases, regardless of the purpose of the loan. In addition, unlike the single-family housing goals, the multifamily housing goals are measured based on the total volume of affordable multifamily mortgage purchases rather than on a percentage of multifamily mortgage purchases. The use of total volumes, which FHFA measures by the number of eligible units, rather than percentages of each Enterprises' overall multifamily purchases, requires that FHFA take into account the expected size of the overall multifamily mortgage market and the affordable share of the market, as well as the expected volume of the Enterprises' overall multifamily purchases and the affordable share of those purchases.

    The lack of comprehensive data for the multifamily mortgage market is even more acute with respect to the segments of the market that are targeted to low-income families, defined as families with incomes at or below 80 percent of AMI, and very low-income families, defined as families with incomes at or below 50 percent of AMI. As required by the Safety and Soundness Act, FHFA determines affordability of multifamily units based on a unit's rent and utility expenses not exceeding 30 percent of the area median income standard for low- and very low-income families.25 While much of the analysis that follows discusses trends in the overall multifamily mortgage market, FHFA recognizes that these general trends may not apply to the same extent to all segments of the multifamily market. Notwithstanding these challenges, FHFA has considered each of the required statutory factors (a number of which are related) as discussed below.

    25 12 U.S.C. 4563(c).

    Multifamily mortgage market. FHFA's consideration of the multifamily mortgage market addresses the size of and competition within the multifamily mortgage market, as well as the subset of the multifamily market affordable to low-income and very low-income families. In 2015, the multifamily mortgage origination market experienced remarkable growth—year-over-year origination volume grew 28 percent over the prior year to nearly $250 billion, fueled largely by a recovery in multifamily construction. The overall market grew modestly in 2016. Forecasts from various industry experts indicate that overall multifamily growth in mortgage market volumes and mortgage originations are expected to increase only modestly in 2017, both for refinancing activity and for financing new multifamily units, and remain level in 2018.

    According to the National Multifamily Housing Council's tabulation of American Community Survey microdata, in 2015 about 43 percent of renter households (18.7 million households) lived in multifamily properties, defined as structures with five or more rental units.26 More generally, the population of renters continued to grow from 35 million in 2005 to 44 million in 2015, an increase of about one quarter.27 This growth led to an increase in demand for rental units that has only partially been met by expansions in supply. Vacancy rates hit a 30-year low in 2016, and are especially low in lower-priced segments of the market, while climbing in the high-end segment of many markets.28 As a result of these factors, rents continued to rise nationally and outpaced inflation in 2016.29

    26 Accessed on 9/22/2016 at http://www.nmhc.org/Content.aspx?id=4708#Type_of_Structure.

    27 “America's Rental Housing: Expanding Options for Diverse and Growing Demand” Joint Center on Housing Studies of Harvard University, December 2015.

    28 “State of the Nation's Housing 2017,” Joint Center on Housing Studies of Harvard University, June 2017.

    29Id.

    Affordability in the multifamily market. There are several factors that make it difficult to accurately forecast the affordable share of the multifamily mortgage market. First, the portion of the overall multifamily mortgage market that provides housing units affordable to low-income and very low-income families varies from year to year. Second, competition between purchasers of mortgages within the multifamily market overall may differ from the competition within the affordable multifamily market segment. Finally, the volume for the affordable multifamily market segment will depend on the availability of affordable housing subsidies.

    Using the measure under which affordable rent and utilities do not exceed 30 percent of AMI, affordability for families living in rental units has decreased for many households in recent years. The Joint Center for Housing Studies (JCHS) 2016 State of the Nation's Housing Report notes some concerning trends in the supply of affordable multifamily units. For example, the report found that the majority of growth in the multifamily housing stock has been the result of new construction. Moreover, most of the new construction consists of apartments with fewer bedrooms and has been concentrated in urban areas with higher median rents. In the same report, JCHS also noted, “the steep rent for new units reflect rising land and development costs, which push multifamily construction to the high end of the market.” 30

    30 “The State of the Nation's Housing 2016,” Joint Center for Housing Studies of Harvard University, June 2016, available at http://www.jchs.harvard.edu/sites/jchs.harvard.edu/files/jchs_2016_state_of_the_nations_housing_lowres.pdf.

    JCHS has also noted the significant prevalence of cost-burdened renters. In 2015, nearly half of all tenants paid more than 30 percent of household income for rental housing, especially in high-cost urban markets where most renters reside and where Fannie Mae and Freddie Mac have focused their multifamily lending. Among lower-income households, cost burdens are especially severe.31 In addition, a recent study showed that the median incomes of renter households have experienced slight declines in some large metropolitan areas in recent years, leading to increased cost burdens for these households.32

    31 “State of the Nation's Housing 2017,” Joint Center on Housing Studies of Harvard University, June 2017.

    32 “Renting in America's Largest Metropolitan Areas,” NYU Furman Center, March 2016.

    One source of growth in the stock of lower-rent apartments is “filtering,” a process by which existing units become more affordable as they age. However, in recent years, this downward filtering of rental units has occurred at a slow pace in most markets. Coupled with the permanent loss of affordable units, as these units fall into disrepair or units are demolished to create new higher-rent or higher-valued ownership units, this trend has severely limited the supply of lower rent units. As a result, there is an acute shortfall of affordable units for extremely low-income renters (earning up to 30 percent of AMI) and very low-income renters (earning up to 50 percent of AMI). This supply gap is especially wide in certain metropolitan areas in the southern and western United States.33

    33 “The Gap: The Affordable Housing Gap Analysis 2017,” National Low Income Housing Coalition, March 2017.

    The combination of the supply gap in affordable units which resulted in significant increases in rental rates, and the prevalence of cost-burdened renters resulting from largely flat real incomes has led to an erosion of affordability with fewer units qualifying for the housing goals.34 This challenge of affordability is also reflected in the falling share of low-income multifamily units financed by loans purchased by the Enterprises. While 77 percent of the multifamily units financed by Fannie Mae in 2011 were low-income, that ratio dropped steadily in the intervening years to 64 percent in 2016. At Freddie Mac, the low-income share also peaked in 2011 and 2012 at 79 percent, and decreased gradually to 68 percent in 2016. For the very low-income goal, the share at Fannie Mae peaked in 2012 at 22 percent before falling to 12 percent in 2016, and at Freddie Mac the share peaked at 17 percent in 2013 before falling to 12 percent in 2016.

    34 “State of the Nation's Housing 2017,” Joint Center on Housing Studies of Harvard University, June 2017.

    Small multifamily properties with 5 to 50 units are also an important source of affordable rental housing and represent approximately one-third of the affordable rental market. Because they have different operating and ownership characteristics than larger properties, small multifamily properties often have different financing needs. For example, small multifamily properties are more likely to be owned by an individual or small investor and less likely to be managed by a third party property management firm.35 Likewise, the affordability of small multifamily units means they generate less revenue per unit than larger properties. These factors can make financing more difficult to obtain for small multifamily property owners. While the volume of Enterprise-supported loans on small multifamily properties has been inconsistent in recent years, each Enterprise continues to refine its approach to serving this market.

    35 “2012 Rental Housing Finance Survey,” U.S. Census Bureau and U.S. Department of Housing and Urban Development, Tables 2b, 2c, 2d and 3.

    Availability of public subsidies. Multifamily housing assistance is primarily available in two forms—demand-side subsidies that either assist low-income tenants directly (e.g., Section 8 vouchers) or provide project-based rental assistance (Section 8 contracts), and supply-side subsidies that support the creation and preservation of affordable housing (e.g., public housing and Low-Income Housing Tax Credit (LIHTC)). The availability of public subsidies impacts the overall affordable multifamily housing market, and changes to historic programs could significantly impact the ability of the Enterprises to meet the goals.

    Financing for affordable multifamily buildings—particularly those affordable to very low-income families—often uses an array of state and federal supply-side housing subsidies, such as LIHTC, tax-exempt bonds, project-based rental assistance, or soft subordinate financing.36 In recent years, competition for affordable housing subsidy has been intense and investor interest in tax credit equity projects of all types and in all markets has been strong, especially in markets in which bank investors are seeking to meet Community Reinvestment Act (CRA) goals. By contrast, in recent months, the subsidy provided by the LIHTC program has been volatile and much more uncertain, as policymakers consider a broader range of potential tax reform legislation that could adversely impact the LIHTC program.

    36 LIHTC is a supply-side subsidy created under the Tax Reform Act of 1986 and is the main source of new affordable housing construction in the United States today. Tax credits are used for the acquisition, rehabilitation, and/or new construction of rental housing for low-income households. LIHTC has facilitated the creation or rehabilitation of approximately 2.4 million affordable units since inception in 1986.

    Subject to the continuing availability of these subsidies, there should continue to be opportunities in the multifamily market to provide permanent financing for properties with LIHTC during the 2018-2020 period. There should also be opportunities for market participants, including the Enterprises, to purchase mortgages that finance the preservation of existing affordable housing units (especially for restructurings of older properties that reach the end of their initial 15-year LIHTC compliance periods and for refinancing properties with expiring Section 8 rental assistance contracts).

    In recent years, demand-side public subsidies and the availability of public housing have not kept pace with the growing number of low-income and very low-income households in need of federal housing assistance. As a result, the number of renter households with “worst case needs” has grown to 8.19 million, an increase of one-third since 2005.37

    37 “Preview of 2015 Worst Case Housing Needs,” U.S. Department of Housing and Urban Development, January 2017. Renters with worse case needs have very low incomes, lack housing assistance, and have either severe rent burdens or severely inadequate housing (or both).

    Role of the Enterprises. In setting the proposed multifamily housing goals, FHFA has considered the ability of the Enterprises to lead the market in making multifamily mortgage credit available. The share of the overall multifamily market purchased by the Enterprises increased in the years immediately following the financial crisis but has declined more recently in response to growing private sector participation. The Enterprise share of the multifamily origination market was approximately 70 percent of the market in 2008 and 2009 compared to 38 percent in 2015.38 The total share is expected to remain at around the 2015 level in 2016, 2017, and 2018 in light of the Scorecard cap imposed by FHFA in its role as conservator (discussed below).

    38 Urban Institute, “The GSEs' Shrinking Role in the Multifamily Market,” April 2015.

    Despite the Enterprises' reduced market share in the overall multifamily market, FHFA expects the Enterprises to continue to demonstrate leadership in multifamily affordable housing by providing liquidity and supporting housing for tenants at different income levels in various geographic markets and in various market segments.

    Conservatorship limits on multifamily mortgage purchases (Conservatorship Scorecard cap). As conservator of the Enterprises, FHFA has established a yearly cap in the Conservatorship Scorecard that limits the amount of conventional (market-rate) multifamily loans that each Enterprise can purchase. The multifamily lending cap is intended to further FHFA's conservatorship goal: maintaining the presence of the Enterprises as a backstop for the multifamily finance market, while not impeding the participation of private capital. This target for the Enterprise share of the multifamily origination market reflect what is generally considered by the industry as an appropriate market share for the Enterprises during normal market conditions. The cap prevents the Enterprises from crowding out other capital sources and restrains the rapid growth of the Enterprises' multifamily businesses that started in 2011.39

    39 MBA, 2015 Annual Report on Multifamily Lending, October 2016.

    In 2015, FHFA established a cap of $30 billion on new conventional multifamily loan purchases for each Enterprise in response to increased participation in the market from private sector capital. In 2016, the cap was initially set at $30 billion, raised in May 2016 to $35 billion, and further increased to $36.5 billion in August, in response to growth of the overall multifamily origination market throughout the year. These increases maintained the Enterprises' current market share at about 40 percent. FHFA has announced that for 2017, the cap will remain at $36.5 billion.

    FHFA reviews the market size estimates quarterly, using current market data provided by Fannie Mae, Freddie Mac, the MBA, and the National Multifamily Housing Council. If FHFA determines that the actual market size is greater than was projected, the agency will consider an approximate increase to the capped (conventional market-rate) category of the Conservatorship Scorecard for each Enterprise. In light of the need for market participants to plan sales of mortgages during long origination processes, if FHFA determines that the actual market size is smaller than projected, there will be no reduction to the capped volume for the current year from the amount initially established under the Conservatorship Scorecard.

    In order to encourage affordable lending activities, FHFA excludes many types of loans in underserved markets from the Conservatorship Scorecard cap on conventional loans. The Conservatorship Scorecard has no volume targets in the market segments excluded from the cap. There is significant overlap between the types of multifamily mortgages that are excluded from the Conservatorship Scorecard cap and the multifamily mortgages that contribute to the performance of the Enterprises under the affordable housing goals. The 2017 Conservatorship Scorecard excludes either the entirety of the loan amount or a pro rata share of the loan on the following categories: (1) Targeted affordable housing; (2) small multifamily properties; (3) blanket loans on manufactured housing communities; (4) blanket loans on senior housing and assisted living communities; (5) loans in rural areas; (6) loans to finance energy or water efficiency improvements; and (7) market rate affordable units in standard (60 percent AMI), high cost (80 percent AMI), and very high cost (100 percent AMI) markets. By excluding the underserved market categories from the cap, the Conservatorship Scorecard continues to encourage the Enterprises to support affordable housing in their purchases of multifamily mortgages.40

    40 For more information on the Conservatorship Scorecard, see https://www.fhfa.gov/AboutUs/Reports/ReportDocuments/2017-Scorecard-for-Fannie-Mae-Freddie-Mac-and-CSS.pdf.

    B. Proposed Multifamily Housing Goal Benchmark Levels

    In setting the proposed multifamily housing goals, FHFA encourages the Enterprises to provide liquidity and to support various multifamily finance market segments while doing so in a safe and sound manner. The Enterprises have served as a stabilizing force in the multifamily market in the years since the financial crisis. During the conservatorship period, the Enterprise portfolios of loans on multifamily affordable housing properties have experienced low levels of delinquency and default, similar to the performance of Enterprise loans on market rate properties. In light of this performance, the Enterprises should be able to sustain or increase their volume of purchases of loans on affordable multifamily housing properties without adversely impacting the Enterprises' safety and soundness or negatively affecting the performance of their total loan portfolios.

    FHFA continues to monitor the activities of the Enterprises, both in FHFA's capacity as regulator and as conservator. If necessary, FHFA will make appropriate changes in the multifamily housing goals to ensure the Enterprises' continued safety and soundness.

    The proposed rule establishes benchmark levels for the multifamily housing goals for the Enterprises. Before finalizing the benchmark levels for the low-income and very low-income multifamily goals in the final rule, FHFA will review any additional data that become available about the multifamily performance of the Enterprises in 2016, updated projections of the size of the multifamily market and affordable market share, and any public comments received on the proposed multifamily housing goals.

    1. Multifamily Low-Income Housing Goal

    The multifamily low-income housing goal is based on the total number of rental units in multifamily properties financed by mortgages purchased by the Enterprises that are affordable to low-income families, defined as families with incomes less than or equal to 80 percent of AMI.

    Table 9—Multifamily Low-Income Housing Goal Year Historical performance 2012 2013 2014 2015 2016 Fannie Mae Goal 285,000 265,000 250,000 300,000 300,000 Freddie Mac Goal 225,000 215,000 200,000 300,000 300,000 Fannie Mae Performance: Low-Income Multifamily Units 375,924 326,597 260,124 307,510 351,235 Total Multifamily Units 501,256 430,751 372,089 468,798 551,666 Low-Income % Total 75.0% 75.8% 69.9% 65.6% 63.7% Freddie Mac Performance: Low-Income Multifamily Units 298,529 254,628 273,807 379,043 407,340 Total Multifamily Units 377,522 341,921 366,377 514,275 597,033 Low-Income % of Total Units 79.1% 74.5% 74.7% 73.7% 68.2%

    From 2012 through 2016, both Enterprises exceeded their low-income multifamily goals. Prior to 2015, Fannie Mae had higher goals than Freddie Mac. For the 2015-2017 goal period, FHFA set the same goal level for both Enterprises for the first time, reflecting parity between Freddie Mac and Fannie Mae multifamily market share in terms of unit counts.

    In 2016, the goal for each Enterprise was 300,000 units. Fannie Mae purchased mortgages financing 351,235 low-income units, and Freddie Mac purchased mortgages financing 407,340 low-income units. While total volumes have increased, the share of low-income units financed at each Enterprise has been declining from peak levels in 2012.

    As noted above, the forecast for the multifamily originations market increases slightly and then levels off after 2017. The Conservatorship Scorecard cap for each Enterprise was raised from an initial $30 billion cap to $36.5 billion in August 2016 in response to growth of the multifamily origination market throughout the year. This change allowed the Enterprises to pursue purchases of a greater volume of multifamily originations and support the overall market and may seem to support an increase in the proposed goal levels for both Enterprises. However, the gap between the supply of low-income and very low-income units and the needs of low-income households, as described in the affordability discussion above, is expected to continue in the next goal period. Moreover, the forecast for the multifamily originations market for 2017 and 2018 is relatively flat, and securing housing subsidies will likely continue to be challenging. These trends suggest moderation in any increase in the proposed goal levels. Therefore, balancing these considerations, the proposed rule sets the annual low-income multifamily housing goal for each Enterprise at 315,000 units in each year from 2018 through 2020, a modest increase from the 300,000 unit goal for each Enterprise in 2015-2017.

    2. Multifamily Very Low-Income Housing Subgoal

    The multifamily very low-income housing subgoal includes units affordable to very low-income families, defined as families with incomes no greater than 50 percent of AMI.

    Table 10—Multifamily Very Low-Income Subgoal Year Historical performance 2012 2013 2014 2015 2016 Fannie Mae Goal 80,000 70,000 60,000 60,000 60,000 Freddie Mac Goal 59,000 50,000 40,000 60,000 60,000 Fannie Mae Performance: Very Low-Income Multifamily Units 108,878 78,071 60,542 69,078 65,445 Total Multifamily Units 501,256 430,751 372,089 468,798 551,666 Very Low-Income % of Total Units 21.7% 18.1% 16.3% 14.7% 11.9% Freddie Mac Performance: Very Low-Income Multifamily Units 60,084 56,752 48,689 76,935 73,032 Total Home Purchase Mortgages 377,522 341,921 366,377 514,275 597,033 Very Low-Income % of Total Units 15.9% 16.6% 13.3% 15.0% 12.2%

    From 2012 through 2016, both Enterprises met and exceeded their very low-income multifamily goals. In 2016, the goal for each Enterprise was 60,000 units. Fannie Mae purchased mortgages financing 65,445 very low-income units, while Freddie Mac purchased mortgages financing 73,032 very low-income units. Similar to the low-income multifamily goal, the share of very low-income units financed at each Enterprise has been declining in recent years.

    The market for very low-income multifamily housing faces even larger challenges than the market for low-income multifamily housing, given the need for lower rents—often requiring deeper subsidies—to make units affordable to these households. These factors suggest moderation in the setting of the very low-income multifamily subgoal for the Enterprises. Therefore, the proposed rule maintains the annual very low-income multifamily subgoal for each Enterprise at 60,000 units each year from 2018 through 2020.

    3. Small Multifamily Low-Income Housing Subgoal

    A small multifamily property is defined as a property with 5 to 50 units. The small multifamily low-income housing subgoal is based on the total number of units in small multifamily properties financed by mortgages purchased by the Enterprises that are affordable to low-income families, defined as families with incomes less than or equal to 80 percent of AMI.

    Table 11—Small Multifamily Low-Income Subgoal Year Historical performance 2012 2013 2014 2015 2016 Small Low-Income Multifamily Goal 6,000 8,000 Fannie Mae Performance: Small Low-Income Multifamily Units 16,801 13,827 6,732 6,731 9,310 Total Small Multifamily Units 26,479 21,764 11,880 11,198 15,230 Low-Income % of Total Small Multifamily Units 63.5% 63.5% 56.7% 60.1% 61.1% Freddie Mac Performance: Small Low-Income Multifamily Units 829 1,128 2,076 12,802 22,101 Total Small Multifamily Units 2,194 2,375 4,659 21,246 33,984 Low-Income % of Total Small Multifamily Units 37.8% 47.5% 44.6% 60.3% 65.0%

    This was a new subgoal created in the 2015-2017 goal period. The goal was set at 6,000 units in 2015, 8,000 units in 2016, and 10,000 units in 2017. In 2016, both Enterprises exceeded the goal of 8,000 units. Fannie Mae purchased mortgages financing 9,310 units, and Freddie Mac purchased mortgages financing 22,101 units.

    The proposed rule would set the annual small multifamily subgoal for each Enterprise at 10,000 units for each year from 2018 through 2020, the same as the 2017 goal. The Enterprises continue to innovate in their approaches to serving this market. FHFA is still monitoring the trends in this market segment as well as Enterprise performance for this new subgoal, and will consider all input in preparation of the final rule. However, FHFA is proposing to maintain the same benchmark level for 2018 through 2020 as the 2017 benchmark level for both Enterprises. Maintaining the current goal should continue to encourage the Enterprises' participation in this market and ensure the Enterprises have the expertise necessary to serve this market should private sources of financing become unable or unwilling to lend on small multifamily properties.

    VI. Section-by-Section Analysis of Other Proposed Changes

    The proposed rule would also revise other provisions of the housing goals regulation, as discussed below.

    A. Changes to Definitions—Proposed § 1282.1

    The proposed rule includes changes to definitions used in the current housing goals regulation. The proposed rule would revise the definitions of “median income,” “metropolitan area,” and “non-metropolitan area” and would remove the definition of “AHS.”

    1. Definition of “Median Income”

    The current regulation defines “median income” as the unadjusted median family income for an area as most recently determined by HUD. While this definition accurately identifies the source that FHFA uses to determine median incomes each year, the definition does not reflect the longstanding practice FHFA has followed in providing the Enterprises with the median incomes that the Enterprises must use each year. The proposed rule would revise the definition to be clear that the Enterprises are required to use the median incomes provided by FHFA each year in determining affordability for purposes of the housing goals.

    The proposed rule would also make two additional technical changes to the definition of “median income.” First, the proposed rule would add a reference to “non-metropolitan areas” in the definition because FHFA determines median incomes for both metropolitan areas and non-metropolitan areas each year. Second, the proposed rule would remove the word “family” in one place so that the term “median income” is used consistently throughout the regulation.

    The revised definition would read: “Median income means, with respect to an area, the unadjusted median family income for the area as determined by FHFA. FHFA will provide the Enterprises annually with information specifying how the median family income estimates for metropolitan and non-metropolitan areas are to be applied for purposes of determining median income.”

    2. Definitions of “Metropolitan Area” and “Non-Metropolitan Area”

    The proposed rule would revise the definitions of “metropolitan area” and “non-metropolitan area” to be consistent with each other and to reflect the proposed changes to the definition of “median income” discussed above.

    The current regulation defines both “metropolitan area” and “non-metropolitan area” based on the areas for which HUD defines median family incomes. The definition of “metropolitan area” refers to median family incomes “determined by HUD,” while the definition of “non-metropolitan area” refers to median family incomes “published annually by HUD.”

    To be consistent with the proposed changes to the definition of “median income,” the proposed rule would revise the definition of “metropolitan area” by replacing the phrase “for which median family income estimates are determined by HUD” with the phrase “for which median incomes are determined by FHFA.” For the same reason, the proposed rule would revise the definition of “non-metropolitan area” by replacing the phrase “for which median family income estimates are published annually by HUD” with the phrase “for which median incomes are determined by FHFA.”

    3. Definition of “AHS” (American Housing Survey)

    The proposed rule would remove the definition of “AHS” from § 1282.1 because the term is no longer used in the Enterprise housing goals regulation.

    Prior to the 2015 amendments to the Enterprise housing goals regulation, the term “AHS” was used to specify the data source from which FHFA derives the utility allowances used to determine the total rent for a rental unit which, in turn, is used to determine the affordability of the unit when actual utility costs are not available. The 2015 amendments consolidated and simplified the definitions applicable to determining the total rent and eliminated the reference to AHS in the part of the definition related to utility allowances, providing FHFA with flexibility in how it determines the nationwide utility allowances. The current nationwide average utility allowances are still fixed numbers based on AHS data, but the regulation does not require FHFA to rely solely on AHS data to determine those utility allowances. The term “AHS” is not used anywhere else in the regulation, so the proposed rule would remove the definition from § 1282.1.

    B. Data Source for Estimating Affordability of Multifamily Rental Units—Proposed § 1282.15(e)(2)

    The proposed rule would revise § 1282.15(e)(2) to update the data source used by FHFA to estimate affordability where actual information about rental units in a multifamily property is not available.

    Section 1282.15(e) permits the Enterprises to use estimated affordability information to determine the affordability of multifamily rental units for up to 5 percent of the total multifamily rental units in properties securing mortgages purchased by the Enterprise each year when actual information about the units is not available. The estimations are based on the affordable percentage of all rental units in the census tract in which the property for which the Enterprise is estimating affordability is located.

    The current regulation provides that the affordable percentage of all rental units in the census tract will be determined by FHFA based on the most recent decennial census. However, the 2000 decennial census was the last decennial census that collected this information. The U.S. Census Bureau now collects this information through the ACS. Since 2011, FHFA has used the most recent data available from the ACS to determine the affordable percentage of rental units in a census tract for purposes of estimating affordability. The proposed rule would revise § 1282.15(e)(2) to reflect this change. To take into account possible future changes in how rental affordability data is collected, the revised sentence would not refer specifically to data derived from the ACS. Section 1282.15(e)(2) would be revised to replace the phrase “as determined by FHFA based on the most recent decennial census” with the phrase “as determined by FHFA.”

    C. Determination of Median Income for Certain Census Tracts—Proposed § 1282.15(g)(2)

    The proposed rule would revise § 1282.15(g) to remove paragraph (g)(2), an obsolete provision describing the method that the Enterprises were required to use to determine the median income for a census tract where the census tract was split between two areas with different median incomes.

    Current § 1282.15(g)(2) requires the Enterprises to use the method prescribed by the Federal Financial Institutions Examination Council to determine the median income for certain census tracts that were split between two areas with different median incomes. This provision was put in place by the 1995 final rule published by HUD to establish the Enterprise housing goals under the Safety and Soundness Act.41

    41See 60 FR 61846 (Dec. 1, 1995).

    As discussed above regarding the definition of “median income,” the process of determining median incomes has changed over the years, so that the Enterprises are now required to use median incomes provided by FHFA each year when determining affordability for purposes of the housing goals. Because FHFA provides median incomes for every location in the United States, it is no longer necessary for the regulation to set forth a process for the Enterprises to use when it is not certain what the applicable median income would be for a particular location. Consequently, the proposed rule would remove § 1282.15(g)(2) from the regulation.

    D. Housing Plan Timing—Proposed § 1282.21(b)(3)

    The proposed rule would revise § 1282.21(b)(3) to provide the Director with discretion to determine the appropriate period of time that an Enterprise may be subject to a housing plan to address a failure to meet a housing goal.

    Section 1336 of the Safety and Soundness Act provides for the enforcement of the Enterprise housing goals. If FHFA determines that an Enterprise has failed to meet a housing goal and that achievement of the goal was feasible, FHFA may require the Enterprise to submit a housing plan describing the actions it will take “to achieve the goal for the next calendar year.” 42 The Safety and Soundness Act has similar provisions for requiring a housing plan if FHFA determines, during the year in question, that there is a substantial probability that an Enterprise will fail to meet a housing goal and that achievement of the goal is feasible. In such cases, the housing plan would describe the actions the Enterprise will take “to make such improvements and changes in its operations as are reasonable in the remainder of such year.” The current regulation generally mirrors the statutory language on the requirements for a housing plan, except that the regulation makes clear that the housing plan must also “[a]ddress any additional matters relevant to the plan as required, in writing, by the Director.” 43

    42See 12 U.S.C. 4566(c)(2).

    43See 12 CFR 1282.21(b).

    FHFA required an Enterprise to submit a housing plan for the first time in late 2015 in response to Freddie Mac's failure to achieve the single-family low-income and very low-income home purchase goals in 2014. FHFA required Freddie Mac to submit a housing plan setting out the steps Freddie Mac would take in 2016 and 2017 to achieve the two goals that it failed to achieve in 2013 and 2014. The requirement for the plan to address actions taken in both 2016 and 2017 was based on FHFA's authority under § 1282.21(b) to require a housing plan to address any additional matters required by the Director and was intended to address an issue of timing.

    FHFA's final determination on Freddie Mac's performance on the housing goals for 2014 was issued on December 17, 2015. As described in more detail below, that timing was driven by procedural steps required by the Safety and Soundness Act and FHFA's own regulation. If FHFA interpreted narrowly the statutory and regulatory provisions stating that the housing plan should address the steps the Enterprise would take in the following year, the housing plan itself would become irrelevant because the year it would cover would have ended before the housing plan was even submitted to FHFA.

    The extended time required to reach a final determination housing goals performance will occur every year as a result of the procedural steps required by the Safety and Soundness Act. Under those procedures, if FHFA determines that an Enterprise has failed to achieve a housing goal in a particular year, FHFA is first required to issue a preliminary determination that generally provides at least 30 days for the Enterprise to respond. FHFA must then consider any information submitted by the Enterprise before making a final determination on whether the Enterprise failed to meet the goal and whether achievement of the goal was feasible. If FHFA determines that the Enterprise should be required to submit a housing plan, the statute provides for up to 45 days for the Enterprise to submit its housing plan.44 FHFA must then evaluate the housing plan, generally within 30 days. The time necessary for FHFA's review and determination at each step of this procedural process is generally four to six months.

    44See 12 U.S.C. 4566(c)(3).

    These procedural steps cannot begin until FHFA has the information necessary to make a determination on whether the Enterprise has met the housing goals. The Enterprises are required to submit their official performance numbers to FHFA within 75 days after the end of the year, usually March 15 of the following year. Therefore, the earliest that FHFA would be able to approve a housing plan from an Enterprise would be mid-July of the year following the performance year. For the single-family housing goals, this time period is extended even further because the HMDA data necessary to determine if an Enterprise met the retrospective market measurement portion of the single-family housing goals are not available until September of the year following the performance year.

    Based on (1) FHFA's experience in overseeing the housing goals, in particular the experience in requiring Freddie Mac to submit a housing plan based on its failure to achieve certain housing goals in 2014, (2) the inherent conflict in the timeframes set out in the Safety and Soundness Act, and (3) the importance of ensuring that any housing plans are focused on sustainable improvements in Enterprise goals performance, FHFA is proposing to amend § 1282.21(b)(3) to state explicitly that a housing plan that is required based on an Enterprise's failure to achieve a housing goal will be required to address a time period determined by the Director. If FHFA requires an Enterprise to submit a housing plan, FHFA will notify the Enterprise of the applicable time period in FHFA's final determination on the performance of the Enterprise for a particular year.

    VII. Paperwork Reduction Act

    The proposed rule would not contain any information collection requirement that would require the approval of the Office of Management and Budget (OMB) under the Paperwork Reduction Act (44 U.S.C. 3501 et seq.). Therefore, FHFA has not submitted any information to OMB for review.

    VIII. Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires that a regulation that has a significant economic impact on a substantial number of small entities, small businesses, or small organizations must include an initial regulatory flexibility analysis describing the regulation's impact on small entities. Such an analysis need not be undertaken if the agency has certified that the regulation will not have a significant economic impact on a substantial number of small entities. 5 U.S.C. 605(b). FHFA has considered the impact of the proposed rule under the Regulatory Flexibility Act. The General Counsel of FHFA certifies that the proposed rule, if adopted as a final rule, is not likely to have a significant economic impact on a substantial number of small entities because the regulation applies to Fannie Mae and Freddie Mac, which are not small entities for purposes of the Regulatory Flexibility Act.

    List of Subjects in 12 CFR Part 1282

    Mortgages, Reporting and recordkeeping requirements.

    Authority and Issuance

    For the reasons stated in the preamble, under the authority of 12 U.S.C. 4511, 4513 and 4526, FHFA proposes to amend part 1282 of Title 12 of the Code of Federal Regulations as follows:

    CHAPTER XII—FEDERAL HOUSING FINANCE AGENCY SUBCHAPTER E—HOUSING GOALS AND MISSION PART 1282—ENTERPRISE HOUSING GOALS AND MISSION 1. The authority citation for part 1282 continues to read as follows: Authority:

    12 U.S.C. 4501, 4502, 4511, 4513, 4526, 4561-4566.

    § 1282.1 [Amended]
    2. Amend § 1282.1 by revising the definitions of “AHS”, “Median income,” “Metropolitan area,” and “Non-metropolitan area” to read as follows:
    § 1282.1 Definitions.

    Median income means, with respect to an area, the unadjusted median family income for the area as determined by FHFA. FHFA will provide the Enterprises annually with information specifying how the median family income estimates for metropolitan and non-metropolitan areas are to be applied for purposes of determining median income.

    Metropolitan area means a metropolitan statistical area (MSA), or a portion of such an area, including Metropolitan Divisions, for which median incomes are determined by FHFA.

    Non-metropolitan area means a county, or a portion of a county, including those counties that comprise Micropolitan Statistical Areas, located outside any metropolitan area, for which median incomes are determined by FHFA.

    3. Revise § 1282.12 to read as follows:
    § 1282.12 Single-family housing goals.

    (a) Single-family housing goals. An Enterprise shall be in compliance with a single-family housing goal if its performance under the housing goal meets or exceeds either:

    (1) The share of the market that qualifies for the goal; or

    (2) The benchmark level for the goal.

    (b) Size of market. The size of the market for each goal shall be established annually by FHFA based on data reported pursuant to the Home Mortgage Disclosure Act for a given year. Unless otherwise adjusted by FHFA, the size of the market shall be determined based on the following criteria:

    (1) Only owner-occupied, conventional loans shall be considered;

    (2) Purchase money mortgages and refinancing mortgages shall only be counted for the applicable goal or goals;

    (3) All mortgages flagged as HOEPA loans or subordinate lien loans shall be excluded;

    (4) All mortgages with original principal balances above the conforming loan limits for single unit properties for the year being evaluated (rounded to the nearest $1,000) shall be excluded;

    (5) All mortgages with rate spreads of 150 basis points or more above the applicable average prime offer rate as reported in the Home Mortgage Disclosure Act data shall be excluded; and

    (6) All mortgages that are missing information necessary to determine appropriate counting under the housing goals shall be excluded.

    (c) Low-income families housing goal. The percentage share of each Enterprise's total purchases of purchase money mortgages on owner-occupied single-family housing that consists of mortgages for low-income families shall meet or exceed either:

    (1) The share of such mortgages in the market as defined in paragraph (b) of this section in each year; or

    (2) The benchmark level, which for 2018, 2019 and 2020 shall be 24 percent of the total number of purchase money mortgages purchased by that Enterprise in each year that finance owner-occupied single-family properties.

    (d) Very low-income families housing goal. The percentage share of each Enterprise's total purchases of purchase money mortgages on owner-occupied single-family housing that consists of mortgages for very low-income families shall meet or exceed either:

    (1) The share of such mortgages in the market as defined in paragraph (b) of this section in each year; or

    (2) The benchmark level, which for 2018, 2019 and 2020 shall be 6 percent of the total number of purchase money mortgages purchased by that Enterprise in each year that finance owner-occupied single-family properties.

    (e) Low-income areas housing goal. The percentage share of each Enterprise's total purchases of purchase money mortgages on owner-occupied single-family housing that consists of mortgages for families in low-income areas shall meet or exceed either:

    (1) The share of such mortgages in the market as defined in paragraph (b) of this section in each year; or

    (2) A benchmark level which shall be set annually by FHFA notice based on the benchmark level for the low-income areas housing subgoal, plus an adjustment factor reflecting the additional incremental share of mortgages for moderate-income families in designated disaster areas in the most recent year for which such data is available.

    (f) Low-income areas housing subgoal. The percentage share of each Enterprise's total purchases of purchase money mortgages on owner-occupied single-family housing that consists of mortgages for families in low-income census tracts or for moderate-income families in minority census tracts shall meet or exceed either:

    (1) The share of such mortgages in the market as defined in paragraph (b) of this section in each year; or

    (2) The benchmark level, which for 2018, 2019 and 2020 shall be 15 percent of the total number of purchase money mortgages purchased by that Enterprise in each year that finance owner-occupied single-family properties.

    (g) Refinancing housing goal. The percentage share of each Enterprise's total purchases of refinancing mortgages on owner-occupied single-family housing that consists of refinancing mortgages for low-income families shall meet or exceed either:

    (1) The share of such mortgages in the market as defined in paragraph (b) of this section in each year; or

    (2) The benchmark level, which for 2018, 2019 and 2020 shall be 21 percent of the total number of refinancing mortgages purchased by that Enterprise in each year that finance owner-occupied single-family properties.

    4. Revise § 1282.13 to read as follows:
    § 1282.13 Multifamily special affordable housing goal and subgoals.

    (a) Multifamily housing goal and subgoals. An Enterprise shall be in compliance with a multifamily housing goal or subgoal if its performance under the housing goal or subgoal meets or exceeds the benchmark level for the goal or subgoal, respectively.

    (b) Multifamily low-income housing goal. The benchmark level for each Enterprise's purchases of mortgages on multifamily residential housing affordable to low-income families shall be at least 315,000 dwelling units affordable to low-income families in multifamily residential housing financed by mortgages purchased by the Enterprise in each year for 2018, 2019, and 2020.

    (c) Multifamily very low-income housing subgoal. The benchmark level for each Enterprise's purchases of mortgages on multifamily residential housing affordable to very low-income families shall be at least 60,000 dwelling units affordable to very low-income families in multifamily residential housing financed by mortgages purchased by the Enterprise in each year for 2018, 2019, and 2020.

    (d) Small multifamily low-income housing subgoal. The benchmark level for each Enterprise's purchases of mortgages on small multifamily properties affordable to low-income families shall be at least 10,000 dwelling units affordable to low-income families in small multifamily properties financed by mortgages purchased by the Enterprise in each year for 2018, 2019, and 2020.

    § 1282.15 [Amended]
    5. Amend § 1282.15 as follows: a. In paragraph (e)(2) remove the phrase “based on the most recent decennial census”; and b. Revise paragraph (g).

    The revision reads as follows:

    § 1282.15 General counting requirements.

    (g) Application of median income. For purposes of determining an area's median income under §§ 1282.17 through 1282.19 and the definitions in § 1282.1, the area is:

    (1) The metropolitan area, if the property which is the subject of the mortgage is in a metropolitan area; and

    (2) In all other areas, the county in which the property is located, except that where the State non-metropolitan median income is higher than the county's median income, the area is the State non-metropolitan area.

    6. Amend § 1282.21 by revising paragraph (b)(3), to read as follows:
    § 1282.21 Housing plans.

    (b) * * *

    (3) Describe the specific actions that the Enterprise will take in a time period determined by the Director to improve the Enterprise's performance under the housing goal; and

    Dated: June 28, 2017. Melvin L. Watt, Director, Federal Housing Finance Agency.
    [FR Doc. 2017-14286 Filed 7-6-17; 8:45 am] BILLING CODE 8070-01-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2017-0667; Directorate Identifier 2016-SW-053-AD] RIN 2120-AA64 Airworthiness Directives; Bell Helicopter Textron Canada Limited (Bell) Helicopters AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed rulemaking (NPRM).

    SUMMARY:

    We propose to adopt a new airworthiness directive (AD) for Bell Model 407 helicopters. This proposed AD would require repetitive inspections of the tail rotor (TR) driveshaft segment assemblies and a torque check of the TR adapter retention nuts. This proposed AD is prompted by a report of an in-flight failure of the TR drive system. The proposed actions are intended to detect and correct an unsafe condition on these products.

    DATES:

    We must receive comments on this proposed AD by September 5, 2017.

    ADDRESSES:

    You may send comments by any of the following methods:

    Federal eRulemaking Docket: Go to http://www.regulations.gov. Follow the online instructions for sending your comments electronically.

    Fax: 202-493-2251.

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

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

    Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0667; or in person at the Docket Operations Office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the Transport Canada AD, the economic evaluation, any comments received, and other information. The street address for the Docket Operations Office (telephone 800-647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

    For service information identified in this proposed rule, contact Bell Helicopter Textron Canada Limited, 12,800 Rue de l'Avenir, Mirabel, Quebec J7J1R4; telephone (450) 437-2862 or (800) 363-8023; fax (450) 433-0272; or at http://www.bellcustomer.com/files/. You may review the referenced service information at the FAA, Office of the Regional Counsel, Southwest Region, 10101 Hillwood Pkwy., Room 6N-321, Fort Worth, TX 76177.

    FOR FURTHER INFORMATION CONTACT:

    David Hatfield, Aviation Safety Engineer, Safety Management Group, Rotorcraft Directorate, FAA, 10101 Hillwood Pkwy., Fort Worth, TX 76177; telephone (817) 222-5110; email [email protected]

    SUPPLEMENTARY INFORMATION:

    Comments Invited

    We invite you to participate in this rulemaking by submitting written comments, data, or views. We also invite comments relating to the economic, environmental, energy, or federalism impacts that might result from adopting the proposals in this document. The most helpful comments reference a specific portion of the proposal, explain the reason for any recommended change, and include supporting data. To ensure the docket does not contain duplicate comments, commenters should send only one copy of written comments, or if comments are filed electronically, commenters should submit only one time.

    We will file in the docket all comments that we receive, as well as a report summarizing each substantive public contact with FAA personnel concerning this proposed rulemaking. Before acting on this proposal, we will consider all comments we receive on or before the closing date for comments. We will consider comments filed after the comment period has closed if it is possible to do so without incurring expense or delay. We may change this proposal in light of the comments we receive.

    Discussion

    Transport Canada, which is the aviation authority for Canada, has issued Canadian AD No. CF-2016-21, dated July 7, 2016 (AD CF-2016-21), to correct an unsafe condition for Bell Model 407 helicopters. Transport Canada advises that a Model 407 helicopter experienced in-flight failure of the TR drive system, which resulted in loss of directional control. The helicopter landed safely with substantial damage to the TR segmented shaft and adapter splines, coupling, and hanger bearings. According to Transport Canada, the splines connecting the adapter part number (P/N) 406-040-328-105 to the shaft assembly P/N 407-040-330-107 were “severely worn and no longer capable of performing their function.” The investigation further revealed other Model 407 helicopters with the same axial and radial play or looseness of some splined connections. AD CF-2016-21 states that these parts should be clamped together with threaded fasteners with no detectable looseness. Transport Canada advises that undetected looseness at the splined connection could result in wear of the parts and eventual loss of directional control of the helicopter.

    For these reasons, AD CF-2016-21 requires a repetitive inspection of the TR driveshaft assemblies for play and a one-time torque verification of the TR adapter retention nuts.

    FAA's Determination

    These helicopters have been approved by the aviation authority of Canada and are approved for operation in the United States. Pursuant to our bilateral agreement with Canada, Transport Canada, its technical representative, has notified us of the unsafe condition described in its AD. We are proposing this AD because we evaluated all known relevant information and determined that an unsafe condition is likely to exist or develop on other products of the same type design.

    Related Service Information Under 1 CFR Part 51

    We reviewed Bell Alert Service Bulletin (ASB) 407-16-113, dated February 12, 2016 (ASB 407-16-113), which specifies procedures for inspecting the TR driveshaft assemblies for noticeable rotational or axial play between each adapter and TR driveshaft. ASB 407-16-113 also specifies procedures for performing a torque check of each TR adapter retention nut on the four TR driveshaft segments.

    This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

    Proposed AD Requirements

    This proposed AD would require inspecting each TR driveshaft segment assembly for rotational and axial play between the adapter and the TR driveshaft and determining the installation torque of each adapter retention nut. For helicopters with 4,000 or more hours time-in-service (TIS), the driveshaft assembly inspection would be required within 50 hours TIS. For helicopters with less than 4,000 hours TIS, the driveshaft assembly inspection would be required within 100 hours TIS. Thereafter, these inspections would be required at intervals not to exceed 330 hours TIS. The torque verification of the adapter retention nuts would be a one-time inspection.

    • If there is play or looseness in the TR driveshaft, the proposed AD would require correcting the discrepant splined fitting before further flight.

    • The proposed AD would also require replacing the adapter retention nut anytime the adapter is re-assembled.

    Costs of Compliance

    We estimate that this proposed AD would affect 667 helicopters of U.S. Registry. We estimate that operators may incur the following costs in order to comply with this proposed AD. At an average labor rate of $85 per hour, inspecting the TR driveshaft segments and adapters for play would require about 1 work-hour, for a cost per helicopter of $85, and a total cost of $56,695 to the U.S. fleet per inspection cycle. Determining the torque of the four adapter retention nuts would require about 3 work-hours for a cost per helicopter of $255 and a total cost of $170,085 to the U.S. fleet.

    If required, repairing a worn driveshaft adapter would require about 3 work-hours, and required parts would cost about $1,259, for a cost per helicopter of $1,514.

    Replacing an adapter retention nut would require about 1 work-hour, and required parts cost are negligible, for a cost of $85 per helicopter and $56,695 for the U.S. fleet per inspection cycle.

    Authority for This Rulemaking

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

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

    Regulatory Findings

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

    For the reasons discussed, I certify this proposed regulation:

    1. Is not a “significant regulatory action” under Executive Order 12866;

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

    3. Will not affect intrastate aviation in Alaska to the extent that it justifies making a regulatory distinction; and

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

    We prepared an economic evaluation of the estimated costs to comply with this proposed AD and placed it in the AD docket.

    List of Subjects in 14 CFR Part 39

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

    The Proposed Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD): Bell Helicopter Textron Canada Limited (Bell): Docket No. FAA-2017-0667; Directorate Identifier 2016-SW-053-AD. (a) Applicability

    This AD applies to Bell Model 407 helicopters, certificated in any category.

    (b) Unsafe Condition

    This AD defines the unsafe condition as a loose tail rotor (TR) driveshaft splined connection, which if not corrected could result in wear in the splines, failure of the TR drive system, and subsequent loss of directional control of the helicopter.

    (c) Comments Due Date

    We must receive comments by September 5, 2017.

    (d) Compliance

    You are responsible for performing each action required by this AD within the specified compliance time unless it has already been accomplished prior to that time.

    (e) Required Actions

    For helicopters with less than 4,000 hours time-in-service (TIS), within 100 hours TIS, and for helicopters with 4,000 or more hours TIS, within 50 hours TIS:

    (1) Inspect each TR driveshaft segment assembly for rotational and axial play between the adapter and the TR driveshaft at the four positions depicted in Figure 1 of Bell Alert Service Bulletin (ASB) 407-16-113, dated February 12, 2016 (ASB 407-16-113). If there is any axial or rotational play, remove the adapter from the TR driveshaft segment assembly and inspect the adapter, washers, and TR driveshaft for damage. Replace the adapter retention nut and apply a torque of 30 to 50 inch-pounds (5.7 to 7.9 Nm). Replace any part with damage or repair the part if the damage is within the maximum repair damage limitations.

    (2) Determine the torque of each TR adapter retention nut at each of the four segment assembly positions depicted in Figure 1 of Bell ASB 407-16-113. If the torque is less than 30 inch-pounds (5.7 Nm), remove the adapter from the TR driveshaft segment assembly and inspect the adapter, washers, and TR driveshaft for damage. Replace the adapter retention nut and apply a torque of 30 to 50 inch-pounds (5.7 to 7.9 Nm). Replace any part with damage or repair the part if the damage is within the maximum repair damage limitations.

    (3) Repeat the actions specified in paragraph (e)(1) of this AD at intervals not to exceed 330 hours TIS.

    (f) Special Flight Permits

    Special flight permits are prohibited.

    (g) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Safety Management Group, FAA, may approve AMOCs for this AD. Send your proposal to: David Hatfield, Aviation Safety Engineer, Safety Management Group, Rotorcraft Directorate, FAA, 10101 Hillwood Pkwy., Fort Worth, TX 76177; telephone (817) 222-5110; email [email protected]

    (2) For operations conducted under a 14 CFR part 119 operating certificate or under 14 CFR part 91, subpart K, we suggest that you notify your principal inspector, or lacking a principal inspector, the manager of the local flight standards district office or certificate holding district office before operating any aircraft complying with this AD through an AMOC.

    (h) Additional Information

    The subject of this AD is addressed in Transport Canada AD No. CF-2016-21, dated July 7, 2016. You may view the Transport Canada AD on the Internet at http://www.regulations.gov in the AD Docket.

    (i) Subject

    Joint Aircraft Service Component (JASC) Code: 6510 Tail Rotor Drive Shaft.

    Issued in Fort Worth, Texas, on June 27, 2017. Scott A. Horn, Acting Manager, Rotorcraft Directorate, Aircraft Certification Service.
    [FR Doc. 2017-14231 Filed 7-6-17; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF THE TREASURY Financial Crimes Enforcement Network 31 CFR Part 1010 RIN 1506-AB38 Proposal of Special Measure Against Bank of Dandong as a Financial Institution of Primary Money Laundering Concern AGENCY:

    Financial Crimes Enforcement Network (FinCEN), Treasury.

    ACTION:

    Notice of proposed rulemaking.

    SUMMARY:

    FinCEN is issuing a notice of proposed rulemaking (NPRM), pursuant to section 311 of the USA PATRIOT Act, to prohibit the opening or maintaining of a correspondent account in the United States for, or on behalf of, Bank of Dandong.

    DATES:

    Written comments on the notice of proposed rulemaking must be submitted on or before September 5, 2017.

    ADDRESSES:

    You may submit comments, identified by 1506-AB38, by any of the following methods:

    Federal E-rulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments. Include Docket Number FinCEN-2017-0010 and RIN 1506-AB38 in the submission.

    Mail: The Financial Crimes Enforcement Network, P.O. Box 39, Vienna, VA 22183. Include RIN 1506-AB38 in the body of the text. Please submit comments by one method only.

    • Comments submitted in response to this NPRM will become a matter of public record. Therefore, you should submit only information that you wish to make publicly available.

    Inspection of comments: FinCEN uses the electronic, Internet-accessible dockets at Regulations.gov as its complete docket; all hard copies of materials that should be in the docket, including public comments, are electronically scanned and placed there. Federal Register notices published by FinCEN are searchable by docket number, RIN, or document title, among other things, and the docket number, RIN, and title may be found at the beginning of such notices. In general, FinCEN will make all comments publicly available by posting them on http://www.regulations.gov.

    FOR FUTHER INFORMATION CONTACT:

    The FinCEN Resource Center at (800) 949-2732.

    SUPPLEMENTARY INFORMATION: I. Statutory Provisions

    On October 26, 2001, the President signed into law the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56 (the USA PATRIOT Act). Title III of the USA PATRIOT Act amends the anti-money laundering (AML) provisions of the Bank Secrecy Act (BSA), codified at 12 U.S.C. 1829b, 12 U.S.C. 1951-1959, and 31 U.S.C. 5311-5314, 5316-5332, to promote the prevention, detection, and prosecution of international money laundering and the financing of terrorism. Regulations implementing the BSA appear at 31 CFR chapter X. The authority of the Secretary of the Treasury (the Secretary) to administer the BSA and its implementing regulations has been delegated to FinCEN.

    Section 311 of the USA PATRIOT Act (section 311), codified at 31 U.S.C. 5318A, grants FinCEN the authority, upon finding that reasonable grounds exist for concluding that a jurisdiction outside of the United States, one or more financial institutions operating outside of the United States, one or more classes of transactions within or involving a jurisdiction outside of the United States, or one or more types of accounts is of primary money laundering concern, to require domestic financial institutions and domestic financial agencies to take certain “special measures.” The five special measures enumerated in section 311 are prophylactic safeguards that defend the U.S. financial system from money laundering and terrorist financing. FinCEN may impose one or more of these special measures in order to protect the U.S. financial system from these threats. Special measures one through four, codified at 31 U.S.C. 5318A(b)(1)-(b)(4), impose additional recordkeeping, information collection, and reporting requirements on covered U.S. financial institutions. The fifth special measure, codified at 31 U.S.C. 5318A(b)(5), allows FinCEN to prohibit, or impose conditions on, the opening or maintaining in the United States of correspondent or payable-through accounts for, or on behalf of, a foreign banking institution, if such correspondent account or payable-through account involves the foreign financial institution found to be of primary money laundering concern.

    Before making a finding that reasonable grounds exist for concluding that a financial institution is of primary money laundering concern, the Secretary is required to consult with both the Secretary of State and the Attorney General.1 The Secretary shall also consider such information as the Secretary determines to be relevant, including the following potentially relevant factors:

    1 31 U.S.C. 5318A(c)(1).

    • The extent to which such a financial institution is used to facilitate or promote money laundering in or through the jurisdiction, including any money laundering activity by organized criminal groups, international terrorists, or entities involved in the proliferation of weapons of mass destruction (WMD) or missiles;

    • the extent to which such a financial institution is used for legitimate business purposes in the jurisdiction; and

    • the extent to which such action is sufficient to ensure that the purposes of section 311 are fulfilled, and to guard against international money laundering and other financial crimes.2

    2 31 U.S.C. 5318A(c)(2)(B).

    Upon finding that a financial institution is of primary money laundering concern, the Secretary may require covered financial institutions to take one or more special measures. In selecting which special measure(s) to take, the Secretary “shall consult with the Chairman of the Board of Governors of the Federal Reserve System, any other appropriate Federal banking agency (as defined in Section 3 of the Federal Deposit Insurance Act), the Secretary of State, the Securities and Exchange Commission, the Commodity Futures Trading Commission, the National Credit Union Administration Board, and in the sole discretion of the Secretary, such other agencies and interested parties as the Secretary [of the Treasury] may find appropriate.” 3 In imposing the fifth special measure, the Secretary must do so “in consultation with the Secretary of State, the Attorney General, and the Chairman of the Board of Governors of the Federal Reserve System.” 4

    3 31 U.S.C. 5318A(a)(4)(A).

    4 31 U.S.C. 5318A(b)(5).

    In addition, in selecting which special measure(s) to take, the Secretary shall consider the following factors:

    • Whether similar action has been or is being taken by other nations or multilateral groups;

    • whether the imposition of any particular special measure would create a significant competitive disadvantage, including any undue cost or burden associated with compliance, for financial institutions organized or licensed in the United States;

    • the extent to which the action or the timing of the action would have a significant adverse systemic impact on the international payment, clearance, and settlement system, or on legitimate business activities involving the particular jurisdiction, institution, class of transactions, or type of account; and

    • the effect of the action on United States national security and foreign policy.5

    5 31 U.S.C. 5318A(a)(4)(B).

    II. Summary of Notice of Proposed Rulemaking

    This NPRM sets forth 1. FinCEN's finding that Bank of Dandong, a commercial bank located in Dandong, China, is a financial institution of primary money laundering concern pursuant to Section 311, and 2. FinCEN's proposal of a prohibition under the fifth special measure on the opening or maintaining in the United States of a correspondent account for, or on behalf of, Bank of Dandong. As described more fully below, FinCEN finds that Bank of Dandong is a financial institution of primary money laundering concern because it serves as a conduit for North Korea to access the U.S. and international financial systems, including by facilitating millions of dollars of transactions for companies involved in North Korea's WMD and ballistic missile programs. Having made such a finding and having performed the requisite consultations set forth in the statute, FinCEN proposes a prohibition on covered U.S. financial institutions from opening or maintaining a correspondent account in the United States for, or on behalf of, Bank of Dandong.

    III. Background on North Korea Sanctions Evasion and Bank of Dandong 1. North Korea's Evasion of Sanctions

    North Korea continues to advance its nuclear and ballistic missile programs despite international censure and U.S. and international sanctions. In response to North Korea's continued actions to proliferate WMDs, the United Nations Security Council (UNSC) has issued a number of United Nations Security Council resolutions (UNSCRs), including 1718 (2006), 1874 (2009), 2087 (2013), 2094 (2013), 2270 (2016), and 2321 (2016), that restrict North Korea's financial and operational activities related to its nuclear and ballistic missile programs. Additionally, the President of the United States has issued Executive Orders 13466, 13551, 13570, 13687, and 13722 to impose economic sanctions on North Korea pursuant to the International Emergency Economic Powers Act,6 and the U.S. Department of the Treasury has designated North Korean persons for asset freezes pursuant to other Executive Orders, such as Executive Order 13382, which targets WMD proliferators worldwide.

    6 Title II of Public Law 95-223, 91 Stat. 1626 (October 28, 1977).

    According to the February 2016 annual report by the UN Panel of Experts, established pursuant to UNSCR 1874, although international sanctions have served to significantly isolate North Korean banks from the international financial system, the North Korean government continues to access the international financial system to support its WMD and conventional weapons programs through its use of aliases, agents, foreign individuals in multiple jurisdictions, and a long-standing network of front companies and embassy personnel that support illicit activities through banking, bulk cash, and trade.7

    7 United Nations Security Council, Report of the Panel of Experts established pursuant to resolution 1874 (2009). February 24, 2016. S/2016/157, available at http://www.un.org/ga/search/view_doc.asp?symbol=S/2016/157.

    According to that report, transactions for front companies for North Korea have been processed through correspondent bank accounts in the United States and Europe. Further, the enhanced vigilance required under the relevant UNSCRs is frustrated by the fact that North Korea-linked companies are often registered by third-country nationals who also use indirect payment methods and circuitous transactions disassociated from the movement of goods or services to conceal their activity.

    Additionally, according to the February 2017 annual report produced by the same body, despite expanded financial sanctions adopted by the Security Council in UNSCRs 2270 and 2321, North Korea has continued to access the international financial system to support its activities.8 Financial networks of North Korea have adapted to these sanctions, using evasive methods to maintain access to formal banking channels and bulk cash transfers to facilitate prohibited activities. According to the report, one way that North Korean financial institutions and networks access the international banking system is through trading companies, including designated entities, that are linked to North Korea. These trading companies open bank accounts that perform the same financial services as banks, such as maintaining funds on deposit and providing indirect correspondent bank account services.

    8 United Nations Security Council, Report of the Panel of Experts established pursuant to resolution 1874 (2009). February 27, 2017. S/2017/150, available at http://www.un.org/ga/search/view_doc.asp?symbol=S/2017/150.

    To further protect the United States from North Korea's illicit financial activity, FinCEN has issued three advisories since 2005 detailing its concerns surrounding the deceptive financial practices used by North Korea and North Korean entities and calling on U.S. financial institutions to take appropriate risk mitigation measures. Moreover, on November 9, 2016, FinCEN finalized a rule under section 311 prohibiting the opening or maintaining of correspondent accounts in the United States by covered financial institutions for, or on behalf of, North Korean banks.9 The final rule also requires U.S. financial institutions to apply additional due diligence measures in order to prevent North Korean financial institutions from gaining improper indirect access to U.S. correspondent accounts. The notice of finding associated with the final rule highlighted North Korea's use of state-controlled financial institutions and front companies to conduct international financial transactions that, among other things, support the proliferation of its WMD and conventional weapons programs.10 As explained below, Bank of Dandong facilitates such activity through the U.S. financial system.

    9 81 FR 78715 (November 9, 2016).

    10 81 FR 35441 (June 2, 2016).

    2. Bank of Dandong

    Established in 1997, Bank of Dandong is a small commercial bank located in Dandong, China that offers domestic and international financial services to both individuals and businesses. According to commercial database research, Bank of Dandong is ranked as the 148th-largest financial institution out of a total of 196 financial institutions in China's banking sector. As discussed further below, FinCEN is concerned that Bank of Dandong serves as a financial conduit between North Korea and the U.S. and international financial systems in violation of U.S. and UN sanctions.

    IV. Finding Bank of Dandong To Be a Financial Institution of Primary Money Laundering Concern

    Based on information available to the agency, including both public and non-public reporting, and after performing the requisite interagency consultations and considering each of the factors discussed below, FinCEN finds that reasonable grounds exist for concluding that Bank of Dandong is a financial institution of primary money laundering concern.

    1. The Extent to Which Bank of Dandong Has Been Used To Facilitate or Promote Money Laundering, Including by Entities Involved in the Proliferation of Weapons of Mass Destruction or Missiles

    Bank of Dandong serves as a gateway for North Korea to access the U.S. and international financial systems despite U.S. and UN sanctions. Increasing U.S. and international sanctions on North Korea have caused most banks worldwide to sever their ties with North Korean banks, impeding North Korea's ability to gain direct access to the global financial system. As a result, North Korea uses front companies and banks outside North Korea to conduct financial transactions, including transactions in support of its WMD and conventional weapons programs. For example, as of mid-February 2016, North Korea was using bank accounts under false names and conducting financial transactions through banks located in China, Hong Kong, and various southeast Asian countries. The primary bank in China was Bank of Dandong.

    In early 2016, accounts at Bank of Dandong were used to facilitate millions of dollars of transactions on behalf of companies involved in the procurement of ballistic missile technology. Bank of Dandong also facilitates financial activity for North Korean entities designated by the United States and listed by the United Nations for WMD proliferation, as well as for front companies acting on their behalf.

    In particular, Bank of Dandong has facilitated financial activity for Korea Kwangson Banking Corporation (KKBC), a North Korean bank designated by the United States and listed by the United Nations for providing financial services in support of North Korean WMD proliferators. As of May 2012, KKBC had a representative embedded at Bank of Dandong. Moreover, Bank of Dandong maintained a direct correspondent banking relationship with KKBC since approximately 2013, when another Chinese bank ended a similar correspondent relationship. As of early 2016, KKBC maintained multiple bank accounts with Bank of Dandong.

    Bank of Dandong has also facilitated financial activity for the Korea Mining Development Trading Corporation (KOMID), a U.S.- and UN-designated entity. As of early 2016, a front company for KOMID maintained multiple bank accounts with Bank of Dandong. The President subjected KOMID to an asset blocking by listing it in the Annex of Executive Order 13382 in 2005, and the United States designated KOMID pursuant to Executive Order 13687 in January 2015 for being North Korea's primary arms dealer and its main exporter of goods and equipment related to ballistic missiles and conventional weapons.

    FinCEN is concerned that Bank of Dandong uses the U.S. financial system to facilitate financial activity for KKBC and KOMID, as well as other entities connected to North Korea's WMD and ballistic missile programs. Based on FinCEN's analysis of financial transactional data provided to FinCEN by U.S. financial institutions pursuant to the BSA as well as other information available to the agency, FinCEN assesses that at least 17 percent of Bank of Dandong customer transactions conducted through the bank's U.S. correspondent accounts from May 2012 to May 2015 were conducted by companies that have transacted with, or on behalf of, U.S.- and UN-sanctioned North Korean entities, including designated North Korean financial institutions and WMD proliferators. In addition, U.S. banks have identified a substantial amount of suspicious activity processed by Bank of Dandong, including: 1. Transactions that have no apparent economic, lawful, or business purpose and may be tied to sanctions evasion; 2. transactions that have a possible North Korean nexus and include activity between unidentified companies and individuals and behavior indicative of shell company activity; and 3. transactions that include transfers from offshore accounts with apparent shell companies that are domiciled in financial secrecy jurisdictions and banking in another country.

    FinCEN is also concerned that, until recently, an entity designated by the United States for its ties to North Korea's WMD proliferation maintained an ownership stake in Bank of Dandong. Specifically, this entity, Dandong Hongxiang Industrial Development Co. Ltd. (DHID), maintained a minority ownership interest in Bank of Dandong until December 2016. The United States designated DHID in 2016 for acting for, or on behalf of, KKBC, the U.S.- and UN-designated North Korean bank with which Bank of Dandong maintained a direct relationship since approximately 2013. FinCEN believes that DHID's ownership stake in Bank of Dandong allowed DHID to access the U.S. financial system through the bank. Based on FinCEN's analysis of financial transactional data provided to FinCEN by U.S. financial institutions pursuant to the BSA, Bank of Dandong processed approximately $56 million through U.S. banks for DHID between October 2012 and December 2014. Even though DHID may no longer maintain an ownership stake in Bank of Dandong, FinCEN is concerned that the close relationship between the two entities helped establish Bank of Dandong as a prime conduit for North Korean activity.

    Moreover, FinCEN believes that illicit financial activity involving North Korea continues to infiltrate the U.S. and international financial systems through Bank of Dandong.

    2. The Extent to Which Bank of Dandong Is Used for Legitimate Business Purposes

    According to commercial database research, Bank of Dandong is ranked as the 148th-largest financial institution out of a total of 196 financial institutions in China's banking sector. Based on FinCEN's analysis of financial transactional data provided to FinCEN by U.S. financial institutions pursuant to the BSA, Bank of Dandong processed over $2.5 billion in U.S. dollar transactions between May 2012 and May 2015 through its U.S. correspondent accounts, including at least $786 million in customer transactions for businesses and individuals (the remaining transactions comprised bank-to-bank transactions). This $786 million in financial activity consisted largely of letters of credit satisfaction, invoice payments, currency exchange activity, and transfers between individuals, which could be indicative of legitimate business activity. Nonetheless, FinCEN assesses that the $786 million in financial activity includes transactions conducted by companies that have transacted with, or on behalf of, U.S.- and UN-sanctioned North Korean entities. FinCEN is concerned that the existence of relationships between designated North Korean entities and Bank of Dandong suggests that the bank likely processes more transactions for North Korean-related front companies than what FinCEN is currently able to identify. Consequently, the exposure of U.S. financial institutions to North Korea's illicit financial activity via Bank of Dandong outweighs concerns for any legitimate business activity at the bank.

    Moreover, Bank of Dandong maintains euro, Japanese yen, Hong Kong dollar, pound sterling, and Australian dollar correspondent accounts that would not be affected by this action. A prohibition under the fifth special measure would not prevent Bank of Dandong from conducting legitimate business activities in other foreign currencies so long as such activity does not involve a correspondent account maintained in the United States. Bank of Dandong would, therefore, still have other avenues through which it could provide services.

    3. The Extent to Which This Action is Sufficient To Guard Against International Money Laundering and Other Financial Crimes

    A prohibition under the fifth special measure would sufficiently guard against international money laundering and other financial crimes related to Bank of Dandong by restricting the ability of Bank of Dandong to access the U.S. financial system to process transactions for entities connected to the proliferation of WMDs and ballistic missiles. Given the national security threat posed by such activity, FinCEN views this action as necessary to prevent Bank of Dandong from continuing to access the U.S. financial system.

    V. Proposed Prohibition on Covered Financial Institutions From Opening or Maintaining Correspondent Accounts in the United States for Bank of Dandong

    After performing the requisite interagency consultations, considering the relevant factors, and making a finding that Bank of Dandong is a financial institution of primary money laundering concern, FinCEN proposes a prohibition under the fifth special measure. A prohibition under the fifth special measure is the most effective and practical measure to safeguard the U.S. financial system from the illicit finance risks posed by Bank of Dandong.

    1. Factors Considered in Proposing a Prohibition Under the Fifth Special Measure

    Below is a discussion of the relevant factors FinCEN considered in proposing a prohibition under the fifth special measure with respect to Bank of Dandong.

    A. Whether Similar Action Has Been or Will Be Taken by Other Nations or Multilateral Groups Against Bank of Dandong

    FinCEN is not aware of any other nation or multilateral group that has taken or is taking similar action regarding Bank of Dandong. The international community has, however, taken a series of steps to address the illicit financial threats emanating from North Korea, for which Bank of Dandong serves as a conduit. Between 2006 and 2016, the UNSC adopted multiple resolutions that generally restrict North Korea's financial activities related to its nuclear and missile programs and conventional arms sales. In March 2016, the UNSC unanimously adopted UNSCR 2270, which contains provisions that generally require nations to: 1. Prohibit North Korean banks from opening branches in their territory or engaging in certain correspondent relationships with these banks; 2. terminate existing representative offices or subsidiaries, branches, and correspondent accounts with North Korean financial institutions; and 3. prohibit their financial institutions from opening new representative offices or subsidiaries, branches, or bank accounts in North Korea. Additionally, UNSCR 2321, unanimously adopted by the UNSC in November 2016, requires nations to close existing representative offices or subsidiaries, branches, or bank accounts in North Korea within 90 days and expel individuals working on behalf of, or at the direction of, a North Korean bank or financial institution.

    Similarly, the Financial Action Task Force (FATF) has emphasized its concerns regarding the threat posed by North Korea's illicit activities related to the proliferation of WMDs and related financing. Reiterating the UNSCR requirements, the FATF called upon its members and urged all jurisdictions to take the necessary measures to close existing branches, subsidiaries, and representative offices of North Korean banks within their territories and terminate correspondent relationships with North Korean banks, where required by relevant UNSC Resolutions.

    Despite these measures, North Korea continues to use the U.S. and international financial systems through front companies and other surreptitious means. It is necessary to protect the U.S. financial system, directly and indirectly, from banks like Bank of Dandong that facilitate such access. Moreover, given the interconnectedness of the global financial system, the potential for Bank of Dandong to access the U.S. financial system indirectly, including through the use of nested correspondent accounts, exposes the U.S. financial system to the risks associated with conducting transactions with entities operating for, or on behalf of, North Korea.

    B. Whether the Imposition of the Fifth Special Measure Would Create a Significant Competitive Disadvantage, Including any Undue Cost or Burden Associated With Compliance, for Financial Institutions Organized or Licensed in the United States

    A prohibition under the fifth special measure would not cause a significant competitive disadvantage or place an undue cost or burden on U.S. financial institutions. Pursuant to sanctions administered by OFAC, U.S. financial institutions are currently subject to a range of prohibitions related to financial activity involving North Korea. Accordingly, a prohibition on covered financial institutions from opening or maintaining correspondent accounts for, or on behalf of, a bank that facilitates North Korean financial activity would not create any competitive disadvantage for U.S. financial institutions.

    Similarly, the proposed due diligence obligations would not create any undue costs or burden on U.S. financial institutions. U.S. financial institutions already generally have systems in place to screen transactions in order to identify and report suspicious activity and comply with the sanctions programs administered by OFAC. Institutions can modify these systems to detect transactions involving Bank of Dandong. While there may be some additional burden in conducting due diligence on foreign correspondent account holders and notifying them of the prohibition (as described below), any such burden will likely be minimal, and certainly not undue, given the national security threat posed by Bank of Dandong's facilitation of activity for front companies associated with North Korea, some of which are involved in activities that support the proliferation of WMD or missiles.

    C. The Extent to Which the Proposed Action or Timing of the Action Will Have a Significant Adverse Systemic Impact on the International Payment, Clearance, and Settlement System, or on Legitimate Business Activities of Bank of Dandong

    Bank of Dandong is a relatively small financial institution in China's banking sector, is not a major participant in the international payment system, and is not relied upon by the international banking community for clearance or settlement services. Therefore, a prohibition under the fifth special measure with respect to Bank of Dandong will not have an adverse systemic impact on the international payment, clearance, and settlement system.

    FinCEN also considered the extent to which this action could have an impact on the legitimate business activities of Bank of Dandong and has concluded that the need to protect the U.S. financial system from banks that facilitate North Korea's illicit financial activity strongly outweighs any such impact. Financial transactional data provided to FinCEN by U.S. financial institutions pursuant to the BSA indicates that Bank of Dandong's financial activity conducted through its U.S. correspondent accounts has consisted largely of letters of credit satisfaction, invoice payments, currency exchange activity, and transfers between individuals, which could be indicative of legitimate business activity. Nonetheless, FinCEN assesses that this financial activity also includes transactions conducted by companies that have transacted with, or on behalf of, entities that threaten the national security of the United States.

    As stated above, Bank of Dandong maintains euro, Japanese yen, Hong Kong dollar, pound sterling, and Australian dollar correspondent accounts. A prohibition under the fifth special measure would not prevent Bank of Dandong from conducting legitimate business activities in other foreign currencies so long as such activity does not involve a correspondent account maintained in the United States. Bank of Dandong would, therefore, still have other avenues through which it could provide legitimate services.

    D. The Effect of the Proposed Action on United States National Security and Foreign Policy

    Excluding from the U.S. financial system foreign banks that serve as conduits for significant money laundering activity, for the financing of WMDs or their delivery systems, and for other financial crimes enhances national security by making it more difficult for proliferators and money launderers to access the U.S. financial system. As Bank of Dandong has been used to facilitate financial activity related to North Korean entities designated by the United States and United Nations for WMD proliferation, the proposed rule, if finalized, would serve as an additional measure to prevent North Korea from accessing the U.S. financial system and would both support and uphold U.S. national security and foreign policy goals. A prohibition under the fifth special measure would also complement the U.S. Government's worldwide efforts to expose and disrupt international money laundering.

    2. Consideration of Alternative Special Measures

    Under Section 311, special measures one through four enable FinCEN to impose additional recordkeeping, information collection, and information reporting requirements on covered financial institutions. The fifth special measure enables FinCEN to impose conditions as an alternative to a prohibition on the opening or maintaining of correspondent accounts. FinCEN considered these alternatives to a prohibition under the fifth special measure, but believes that a prohibition under the fifth special measure would most effectively safeguard the U.S. financial system from the illicit finance risks posed by Bank of Dandong.

    North Korea is subject to numerous U.S. and UN sanctions, and it has also been consistently identified by the Financial Action Task Force for its anti-money laundering deficiencies. Further, FinCEN has issued three advisories since 2005 detailing its concerns surrounding the deceptive financial practices used by North Korea and North Korean entities and calling on U.S. financial institutions to take appropriate risk mitigation measures.

    Despite these measures, North Korea continues to access the international financial system to support its WMD and conventional weapons programs through its use of aliases, agents, foreign individuals in multiple jurisdictions, and a long-standing network of front companies. Given Bank of Dandong's apparent disregard for numerous international calls to prevent North Korean illicit financial activity, FinCEN does not believe that any condition, additional recordkeeping requirement, or reporting requirement would be an effective measure to safeguard the U.S. financial system. Such measures would not prevent Bank of Dandong from accessing, directly or indirectly, the correspondent accounts of U.S. financial institutions, thus leaving the U.S. financial system vulnerable to processing illicit transfers that pose a national security risk. In addition, no recordkeeping requirement or conditions on correspondent accounts would be sufficient to guard against the risks posed by a bank that processes transactions that are designed to obscure their involvement with North Korea, and are ultimately for the benefit of sanctioned entities. Therefore, a prohibition under the fifth special measure is the only special measure that can adequately protect the U.S. financial system from the illicit finance risks posed by Bank of Dandong.

    VI. Section-by-Section Analysis for the Proposal of a Prohibition Under the Fifth Special Measure 1010.660(a)—Definitions 1. Bank of Dandong

    The proposed rule defines “Bank of Dandong” to mean all subsidiaries, branches, offices, and agents of Bank of Dandong Co., Ltd. operating in any jurisdiction.

    2. Correspondent Account

    The proposed rule defines “Correspondent account” to have the same meaning as the definition contained in 31 CFR 1010.605(c)(1)(ii). In the case of a U.S. depository institution, this broad definition includes most types of banking relationships between a U.S. depository institution and a foreign bank that are established to provide regular services, dealings, and other financial transactions, including a demand deposit, savings deposit, or other transaction or asset account, and a credit account or other extension of credit. FinCEN is using the same definition of “account” for purposes of this proposed rule as was established for depository institutions in the final rule implementing the provisions of Section 312 of the USA PATRIOT Act requiring enhanced due diligence for correspondent accounts maintained for certain foreign banks.11 Under this definition, “payable through accounts” are a type of correspondent account.

    11See 31 CFR 1010.605(c)(2)(i).

    In the case of securities broker-dealers, futures commission merchants, introducing brokers-commodities, and investment companies that are open-end companies (“mutual funds”), FinCEN is also using the same definition of “account” for purposes of this proposed rule as was established for these entities in the final rule implementing the provisions of Section 312 of the USA PATRIOT Act requiring enhanced due diligence for correspondent accounts maintained for certain foreign banks.12

    12See 31 CFR 1010.605(c)(2)(ii)-(iv).

    3. Covered Financial Institution

    The proposed rule defines “covered financial institution” with the same definition used in the final rule implementing the provisions of Section 312 of the USA PATRIOT Act, which in general includes the following:

    • An insured bank (as defined in section 3(h) of the Federal Deposit Insurance Act (12 U.S.C. 1813(h)));

    • a commercial bank;

    • an agency or branch of a foreign bank in the United States;

    • a Federally insured credit union;

    • a savings association;

    • a corporation acting under section 25A of the Federal Reserve Act (12 U.S.C. 611);

    • a trust bank or trust company;

    • a broker or dealer in securities;

    • a futures commission merchant or an introducing broker-commodities; and

    • a mutual fund.

    4. Foreign Banking Institution

    The proposed rule defines “foreign banking institution” to mean a bank organized under foreign law, or an agency, branch, or office located outside the United States of a bank. The term does not include an agent, agency, branch, or office within the United States of a bank organized under foreign law. This is consistent with the definition of “foreign bank” under 31 CFR 1010.100(u).

    5. Subsidiary

    The proposed rule defines “subsidiary” to mean a company of which more than 50 percent of the voting stock or analogous equity interest is owned by another company.

    1010.660(b)—Prohibition on Accounts and Due Diligence Requirements for Covered Financial Institutions 1. Prohibition on Opening or Maintaining Correspondent Accounts

    Section 1010.660(b)(1) and (2) of this proposed rule would prohibit covered financial institutions from opening or maintaining in the United States a correspondent account for, or on behalf of, Bank of Dandong. It would also require covered financial institutions to take reasonable steps to not process a transaction for the correspondent account of a foreign banking institution in the United States if such a transaction involves Bank of Dandong. Such reasonable steps are described in 1010.660(b)(3), which sets forth the special due diligence requirements a covered financial institution would be required to take when it knows or has reason to believe that a transaction involves Bank of Dandong.

    2. Special Due Diligence for Correspondent Accounts

    As a corollary to the prohibition set forth in section 1010.660(b)(1) and (2), section 1010.660(b)(3) of the proposed rule would require covered financial institutions to apply special due diligence to all of their foreign correspondent accounts that is reasonably designed to guard against such accounts being used to process transactions involving Bank of Dandong. As part of that special due diligence, covered financial institutions would be required to notify those foreign correspondent account holders that the covered financial institutions know or have reason to believe provide services to Bank of Dandong that such correspondents may not provide Bank of Dandong with access to the correspondent account maintained at the covered financial institution. A covered financial institution may satisfy this notification requirement using the following notice:

    Notice: Pursuant to U.S. regulations issued under Section 311 of the USA PATRIOT Act, see 31 CFR 1010.660, we are prohibited from opening or maintaining in the United States a correspondent account for, or on behalf of, Bank of Dandong. The regulations also require us to notify you that you may not provide Bank of Dandong, including any of its subsidiaries, branches, offices, or agents with access to the correspondent account you hold at our financial institution. If we become aware that the correspondent account you hold at our financial institution has processed any transactions involving Bank of Dandong, including any of its subsidiaries, branches, offices, or agents, we will be required to take appropriate steps to prevent such access, including terminating your account.

    The purpose of the notice requirement is to aid cooperation with correspondent account holders in preventing transactions involving Bank of Dandong from accessing the U.S. financial system. FinCEN does not require or expect a covered financial institution to obtain a certification from any of its correspondent account holders that access will not be provided to comply with this notice requirement.

    Methods of compliance with the notice requirement could include, for example, transmitting a notice by mail, fax, or email. The notice should be transmitted whenever a covered financial institution knows or has reason to believe that a foreign correspondent account holder provides services to Bank of Dandong.

    Special due diligence also includes implementing risk-based procedures designed to identify any use of correspondent accounts to process transactions involving Bank of Dandong. A covered financial institution would be expected to apply an appropriate screening mechanism to identify a funds transfer order that on its face listed Bank of Dandong as the financial institution of the originator or beneficiary, or otherwise referenced Bank of Dandong in a manner detectable under the financial institution's normal screening mechanisms. An appropriate screening mechanism could be the mechanisms used by a covered financial institution to comply with various legal requirements, such as the commercially available software programs used to comply with the economic sanctions programs administered by OFAC.

    3. Recordkeeping and Reporting

    Section 1010.660(b)(4) of the proposed rule would clarify that the proposed rule does not impose any reporting requirement upon any covered financial institution that is not otherwise required by applicable law or regulation. A covered financial institution must, however, document its compliance with the notification requirement described above.

    VII. Request for Comments

    FinCEN invites comments on all aspects of the proposal to impose a prohibition under the fifth special measure with respect to Bank of Dandong and specifically invites comments on the following matters:

    1. FinCEN's proposal of a prohibition under the fifth special measure under 31 U.S.C. 5318A(b), as opposed to special measures one through four or imposing conditions under the fifth special measure;

    2. The form and scope of the notice to certain correspondent account holders that would be required under the rule; and

    3. The appropriate scope of the due diligence requirements in this proposed rule.

    VIII. Regulatory Flexibility Act

    When an agency issues a rulemaking proposal, the Regulatory Flexibility Act (RFA) requires the agency to “prepare and make available for public comment an initial regulatory flexibility analysis” that will “describe the impact of the proposed rule on small entities.” (5 U.S.C. 603(a)). Section 605 of the RFA allows an agency to certify a rule, in lieu of preparing an analysis, if the proposed rulemaking is not expected to have a significant economic impact on a substantial number of small entities.

    1. Proposal To Prohibit Covered Financial Institutions From Opening or Maintaining Correspondent Accounts With Certain Foreign Banks Under the Fifth Special Measure A. Estimate of the Number of Small Entities to Whom the Proposed Fifth Special Measure Will Apply

    For purposes of the RFA, both banks and credit unions are considered small entities if they have less than $550,000,000 in assets.13 Of the estimated 6,192 banks, 80 percent have less than $550,000,000 in assets and are considered small entities.14 Of the estimated 6,021 credit unions, 92.5 percent have less than $550,000,000 in assets.15

    13Table of Small Business Size Standards Matched to North American Industry Classification System Codes, Small Business Administration Size Standards (SBA Feb. 26, 2016) [hereinafter “SBA Size Standards”]. (https://www.sba.gov/sites/default/files/files/Size_Standards_Table.pdf).

    14 Federal Deposit Insurance Corporation, Find an Institution, http://www2.fdic.gov/idasp/main.asp; select Size or Performance: Total Assets, type Equal or less than $: “550000” and select Find.

    15 National Credit Union Administration, Credit Union Data, http://webapps.ncua.gov/customquery/; select Search Fields: Total Assets, select Operator: Less than or equal to, type Field Values: “550000000” and select Go.

    Broker-dealers are defined in 31 CFR 1010.100(h) as those broker-dealers required to register with the Securities and Exchange Commission (SEC). For the purposes of the RFA, FinCEN relies on the SEC's definition of small business as previously submitted to the Small Business Administration (SBA). The SEC has defined the term small entity to mean a broker or dealer that: 1. Had total capital (net worth plus subordinated liabilities) of less than $500,000 on the date in the prior fiscal year as of which its audited financial statements were prepared pursuant to Rule 17a-5(d) or, if not required to file such statements, a broker or dealer that had total capital (net worth plus subordinated debt) of less than $500,000 on the last business day of the preceding fiscal year (or in the time that it has been in business if shorter); and 2. is not affiliated with any person (other than a natural person) that is not a small business or small organization as defined in this release.16 Based on SEC estimates, 17 percent of broker-dealers are classified as small entities for purposes of the RFA.17

    16 17 CFR 240.0-10(c).

    17 76 FR 37572, 37602 (June 27, 2011) (the SEC estimates 871 small broker-dealers of the 5,063 total registered broker-dealers).

    Futures commission merchants (FCMs) are defined in 31 CFR 1010.100(x) as those FCMs that are registered or required to be registered as a FCM with the Commodity Futures Trading Commission (CFTC) under the Commodity Exchange Act (CEA), except persons who register pursuant to section 4f(a)(2) of the CEA, 7 U.S.C. 6f(a)(2). Because FinCEN and the CFTC regulate substantially the same population, for the purposes of the RFA, FinCEN relies on the CFTC's definition of small business as previously submitted to the SBA. In the CFTC's “Policy Statement and Establishment of Definitions of `Small Entities' for Purposes of the Regulatory Flexibility Act,” the CFTC concluded that registered FCMs should not be considered to be small entities for purposes of the RFA.18 The CFTC's determination in this regard was based, in part, upon the obligation of registered FCMs to meet the capital requirements established by the CFTC.

    18 47 FR 18618, 18619 (Apr. 30, 1982).

    For purposes of the RFA, an introducing broker-commodities dealer is considered small if it has less than $38,500,000 in gross receipts annually.19 Based on information provided by the National Futures Association (NFA), 95 percent of introducing brokers-commodities dealers have less than $38.5 million in adjusted net capital and are considered to be small entities.

    19 SBA, Size Standards to Define Small Business Concerns, 13 CFR 121.201 (2016), at 28.

    Mutual funds are defined in 31 CFR 1010.100(gg) as those investment companies that are open-end investment companies that are registered or are required to register with the SEC. For the purposes of the RFA, FinCEN relies on the SEC's definition of small business as previously submitted to the SBA. The SEC has defined the term “small entity” under the Investment Company Act to mean “an investment company that, together with other investment companies in the same group of related investment companies, has net assets of $50 million or less as of the end of its most recent fiscal year.” 20 Based on SEC estimates, seven percent of mutual funds are classified as “small entities” for purposes of the RFA under this definition.21

    20 17 CFR 270.0-10.

    21 78 FR 23637, 23658 (April 19, 2013).

    As noted above, 80 percent of banks, 92.5 percent of credit unions, 17 percent of broker-dealers, 95 percent of introducing broker-commodities dealers, no FCMs, and seven percent of mutual funds are small entities.

    B. Description of the Projected Reporting and Recordkeeping Requirements of a Prohibition Under the Fifth Special Measure

    The proposed prohibition under the fifth special measure could require covered financial institutions to provide a notification intended to aid cooperation from foreign correspondent account holders in preventing transactions involving Bank of Dandong from being processed by the U.S. financial system. FinCEN estimates that the burden on institutions providing this notice is one hour.

    Covered financial institutions would also be required to take reasonable measures to detect use of their correspondent accounts to process transactions involving Bank of Dandong. All U.S. persons, including U.S. financial institutions, currently must comply with OFAC sanctions, and U.S. financial institutions have suspicious activity reporting requirements. The systems that U.S. financial institutions have in place to comply with these requirements can easily be modified to adapt to this proposed rule. Thus, the special due diligence that would be required under the proposed rule—i.e., preventing the processing of transactions involving Bank of Dandong and the transmittal of notice to certain correspondent account holders—would not impose a significant additional economic burden upon small U.S. financial institutions.

    2. Certification

    For these reasons, FinCEN certifies that the proposals contained in this rulemaking would not have a significant impact on a substantial number of small businesses.

    FinCEN invites comments from members of the public who believe there would be a significant economic impact on small entities from the imposition of a prohibition under the fifth special measure regarding Bank of Dandong.

    IX. Paperwork Reduction Act

    The collection of information contained in this proposed rule is being submitted to the Office of Management and Budget for review 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 Desk Officer for the Department of the Treasury, Office of Information and Regulatory Affairs, Office of Management and Budget, Paperwork Reduction Project (1506), Washington, DC 20503 (or by email to [email protected]) with a copy to FinCEN by mail or email at the addresses previously specified. Comments should be submitted by one method only. Comments on the collection of information should be received by September 5, 2017. In accordance with the requirements of the Paperwork Reduction Act and its implementing regulations, 5 CFR 1320, the following information concerning the collection of information as required by 31 CFR 1010.660 is presented to assist those persons wishing to comment on the information collection.

    The notification requirement in section 1010.660(b)(3)(i)(A) is intended to aid cooperation from correspondent account holders in denying Bank of Dandong access to the U.S. financial system. The information required to be maintained by that section would be used by federal agencies and certain self-regulatory organizations to verify compliance by covered financial institutions with the provisions of 31 CFR 1010.660. The collection of information would be mandatory.

    Description of Affected Financial Institutions: Banks, broker-dealers in securities, futures commission merchants and introducing brokers-commodities, money services businesses, and mutual funds.

    Estimated Number of Affected Financial Institutions: 5,000.

    Estimated Average Annual Burden in Hours Per Affected Financial Institution: The estimated average burden associated with the collection of information in this proposed rule is one hour per affected financial institution.

    Estimated Total Annual Burden: 5,000 hours.

    FinCEN specifically invites comments on: 1. Whether the proposed collection of information is necessary for the proper performance of the mission of FinCEN, including whether the information would have practical utility; 2. the accuracy of FinCEN's estimate of the burden of the proposed collection of information; 3. ways to enhance the quality, utility, and clarity of the information required to be maintained; 4. ways to minimize the burden of the required collection of information, including through the use of automated collection techniques or other forms of information technology; and 5. estimates of capital or start-up costs and costs of operation, maintenance, and purchase of services to report the 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 valid OMB control number.

    X. Executive Order 12866

    Executive Orders 12866 and 13563 direct agencies to assess 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. It has been determined that the proposed rule is not a “significant regulatory action” for purposes of Executive Order 12866.

    List of Subjects in 31 CFR Part 1010

    Administrative practice and procedure, Banks and banking, Brokers, Counter-money laundering, Counter-terrorism, Foreign banking.

    Authority and Issuance

    For the reasons set forth in the preamble, part 1010, chapter X of title 31 of the Code of Federal Regulations, is proposed to be amended as follows:

    PART 1010—GENERAL PROVISIONS 1. The authority citation for part 1010 continues to read as follows: Authority:

    12 U.S.C. 1829b and 1951-1959; 31 U.S.C. 5311-5314, 5316-5332; Title III, sec. 314 Pub. L. 107-56, 115 Stat. 307; sec. 701 Pub. L. 114-74, 129 Stat. 599.

    2. Add § 1010.660 to read as follows:
    § 1010.660 Special measures against Bank of Dandong.

    (a) Definitions. For purposes of this section:

    (1) Bank of Dandong means all subsidiaries, branches, offices, and agents of Bank of Dandong Co., Ltd. operating in any jurisdiction.

    (2) Correspondent account has the same meaning as provided in § 1010.605(c)(1)(ii).

    (3) Covered financial institution has the same meaning as provided in § 1010.605(e)(1).

    (4) Foreign banking institution means a bank organized under foreign law, or an agency, branch, or office located outside the United States of a bank. The term does not include an agent, agency, branch, or office within the United States of a bank organized under foreign law.

    (5) Subsidiary means a company of which more than 50 percent of the voting stock or analogous equity interest is owned by another company.

    (b) Prohibition on accounts and due diligence requirements for covered financial institutions—(1) Opening or maintaining correspondent accounts for Bank of Dandong. A covered financial institution shall not open or maintain in the United States a correspondent account for, or on behalf of, Bank of Dandong.

    (2) Prohibition on use of correspondent accounts involving Bank of Dandong. A covered financial institution shall take reasonable steps to not process a transaction for the correspondent account of a foreign banking institution in the United States if such a transaction involves Bank of Dandong.

    (3) Special due diligence of correspondent accounts to prohibit use.

    (i) A covered financial institution shall apply special due diligence to its foreign correspondent accounts that is reasonably designed to guard against their use to process transactions involving Bank of Dandong. At a minimum, that special due diligence must include:

    (A) Notifying those foreign correspondent account holders that the covered financial institution knows or has reason to believe provide services to Bank of Dandong that such correspondents may not provide Bank of Dandong with access to the correspondent account maintained at the covered financial institution; and

    (B) Taking reasonable steps to identify any use of its foreign correspondent accounts by Bank of Dandong, to the extent that such use can be determined from transactional records maintained in the covered financial institution's normal course of business.

    (ii) A covered financial institution shall take a risk-based approach when deciding what, if any, other due diligence measures it reasonably must adopt to guard against the use of its foreign correspondent accounts to process transactions involving Bank of Dandong.

    (iii) A covered financial institution that knows or has reason to believe that a foreign bank's correspondent account has been or is being used to process transactions involving Bank of Dandong shall take all appropriate steps to further investigate and prevent such access, including the notification of its correspondent account holder under paragraph (b)(3)(i)(A) of this section and, where necessary, termination of the correspondent account.

    (4) Recordkeeping and reporting.

    (i) A covered financial institution is required to document its compliance with the notice requirement set forth in this section.

    (ii) Nothing in this section shall require a covered financial institution to report any information not otherwise required to be reported by law or regulation.

    Dated: June 29, 2017. Jamal El-Hindi, Acting Director, Financial Crimes Enforcement Network.
    [FR Doc. 2017-14026 Filed 7-6-17; 8:45 am] BILLING CODE 4810-02-P
    DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Chapter I 46 CFR Chapters I and III 49 CFR Chapter IV [Docket No. USCG-2017-0480] Evaluation of Existing Coast Guard Regulations, Guidance Documents, Interpretative Documents, and Collections of Information AGENCY:

    Coast Guard, DHS.

    ACTION:

    Request for comments; extension of comment period.

    SUMMARY:

    We are extending the comment period on the subject request for comments that we published June 8, 2017. We are extending the deadline by 2 months because interested persons indicated they needed more time to respond. The comment period is now open through September 11, 2017.

    DATES:

    Your comments and related material in response to our request for comments published June 8, 2017 (82 FR 26632) must now be received on or before September 11, 2017.

    ADDRESSES:

    You may submit comments identified by docket number USCG-2017-0480 using the Federal eRulemaking Portal at http://www.regulations.gov. See the “Public Participation and Request for Comments” portion of the SUPPLEMENTARY INFORMATION section for further instructions on submitting comments.

    FOR FURTHER INFORMATION CONTACT:

    For information about this document call or email Mr. Adam Sydnor, Coast Guard; telephone 202-372-1490, email [email protected]

    SUPPLEMENTARY INFORMATION:

    The Coast Guard is extending the comment period on the request for comments entitled “Evaluation of Existing Coast Guard Regulations, Guidance Documents, Interpretative Documents, and Collections of Information” that we published in the Federal Register on June 8, 2017 (82 FR 26632). We are extending the comment period by 2 months to allow interested persons more time to comment. You may now submit comments through September 11, 2017.

    In our June 8, 2017 request for comments, which is available via www.regulations.gov in docket USCG-2017-0480, we requested your comments on Coast Guard regulations, guidance documents, and interpretative documents that you believe should be repealed, replaced, or modified. Also, we welcome your comments on our approved collections of information, regardless of whether the collection is associated with a regulation. We took this action in response to Executive Orders 13771, Reducing Regulation and Controlling Regulatory Costs; 13777, Enforcing the Regulatory Reform Agenda; and 13783, Promoting Energy Independence and Economic Growth. We plan to use your comments to assist us in our work with the Department of Homeland Security's Regulatory Reform Task Force.

    Your comments should help us with our ongoing task of identifying and alleviating unnecessary regulatory burdens. After assessing responses to our June 8 request for comments, we may issue a similar request for comments next year.

    Public Participation and Request for Comments

    If you submit a comment, please include the docket number for the notice requesting comments (USCG-2017-0480), indicate the specific regulation, guidance document, interpretative document, or collection of information you are commenting on, and provide a reason for each suggestion or recommendation. Please make your comments as specific as possible, and include any supporting data or other information, such as cost information, you may have. Also, if you are commenting on a regulation, please provide a Federal Register (FR) or Code of Federal Regulations (CFR) citation when referencing a specific regulation, and provide specific suggestions regarding repeal, replacement or modification.

    We encourage you to submit comments through the Federal eRulemaking Portal at http://www.regulations.gov. If your material cannot be submitted using http://www.regulations.gov, contact the person in the FOR FURTHER INFORMATION CONTACT section of this document for alternate instructions. Copies of Executive Orders 13771, 13777, and 13783, the June 8, 2017 request for comments, and all public comments are available in our online docket at http://www.regulations.gov.

    We accept anonymous comments. All comments received will be posted without change to http://www.regulations.gov and will include any personal information you have provided. For more about privacy and the docket, visit http://www.regulations.gov/privacyNotice.

    Although the Coast Guard will not respond to individual comments, we value your comments and will give careful consideration to them.

    Dated: June 30, 2017. J.G. Lantz, Senior Accountable Regulatory Official, Director of Commercial Regulations and Standards.
    [FR Doc. 2017-14254 Filed 7-6-17; 8:45 am] BILLING CODE 9110-04-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R05-OAR-2017-0081; FRL-9964-50-Region 5] Air Plan Approval; Wisconsin; Site-Specific Sulfur Dioxide Requirements for USG Interiors, LLC AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Proposed rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is proposing to approve under the Clean Air Act a State Implementation Plan (SIP) revision submitted by Wisconsin on January 31, 2017, and supplemented on March 20, 2017. This SIP submittal consists of Wisconsin Administrative Order AM-16-01, which imposes a requirement for a taller cupola exhaust stack, a sulfur dioxide (SO2) emission limit in conjunction with a minimum cupola stack flue gas flow rate, and associated requirements on the mineral wool production process at the USG Interiors LLC facility located in Walworth, Wisconsin (USG-Walworth). Wisconsin submitted this SIP revision to enable the area near USG-Walworth to qualify for being designated “attainment” of the 2010 primary SO2 National Ambient Air Quality Standards, a matter that will be addressed in a separate future rulemaking. EPA is approving AM-16-01 into the Wisconsin SIP, which makes the AM-16-01 requirements federally enforceable.

    DATES:

    Comments must be received on or before August 7, 2017.

    ADDRESSES:

    Submit your comments, identified by Docket ID No. EPA-R05-OAR-2017-0081 at http://www.regulations.gov, or via email to [email protected] For comments submitted at Regulations.gov, follow the online instructions for submitting comments. Once submitted, comments cannot be edited or removed from Regulations.gov. For either manner of submission, EPA may publish any comment received to its public docket. Do not submit electronically any information you consider to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. Multimedia submissions (audio, video, etc.) must be accompanied by a written comment. The written comment is considered the official comment and should include discussion of all points you wish to make. EPA will generally not consider comments or comment contents located outside of the primary submission (i.e. on the web, cloud, or other file sharing system). For additional submission methods, please contact the person identified in the FOR FURTHER INFORMATION CONTACT section. For the full EPA public comment policy, information about CBI or multimedia submissions, and general guidance on making effective comments, please visit http://www2.epa.gov/dockets/commenting-epa-dockets.

    FOR FURTHER INFORMATION CONTACT:

    Jenny Liljegren, Physical Scientist, Attainment Planning and Maintenance Section, Air Programs Branch (AR-18J), Environmental Protection Agency, Region 5, 77 West Jackson Boulevard, Chicago, Illinois 60604, (312) 886-6832, [email protected]

    SUPPLEMENTARY INFORMATION:

    In the Final Rules section of this Federal Register, EPA is approving the State's SIP submittal as a direct final rule without prior proposal because the Agency views this as a noncontroversial submittal and anticipates no adverse comments. A detailed rationale for the approval is set forth in the direct final rule. If no adverse comments are received in response to this rule, no further activity is contemplated. If EPA receives adverse comments, the direct final rule will be withdrawn and all public comments received will be addressed in a subsequent final rule based on this proposed rule. EPA will not institute a second comment period. Any parties interested in commenting on this action should do so at this time. Please note that if EPA receives adverse comment on an amendment, paragraph, or section of this rule and if that provision may be severed from the remainder of the rule, EPA may adopt as final those provisions of the rule that are not the subject of an adverse comment. For additional information, see the direct final rule which is located in the Rules section of this Federal Register.

    Dated: June 20, 2017. Robert A. Kaplan, Acting Regional Administrator, Region 5.
    [FR Doc. 2017-14213 Filed 7-6-17; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R03-OAR-2016-0561; FRL-9964-57-Region 3] Approval and Promulgation of Air Quality Implementation Plans; Pennsylvania; Volatile Organic Compound Reasonably Available Control Technology for 1997 Ozone Standard AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Proposed rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) proposes to approve the state implementation plan (SIP) revision submitted by the Commonwealth of Pennsylvania. This SIP revision pertains to the requirements for reasonably available control technology (RACT) controls for certain sources of volatile organic compounds (VOCs) under the 1997 ozone national ambient air quality standard (NAAQS). This SIP revision includes Pennsylvania's certification that previously adopted RACT controls in Pennsylvania's SIP that were approved by EPA under the 1-hour ozone NAAQS are based on the currently available technically and economically feasible controls, and that they continue to represent RACT for the 1997 ozone NAAQS and a negative declaration that certain categories of sources do not exist in Pennsylvania. This SIP revision does not address Pennsylvania's May 2016 VOC and nitrogen oxides (NOX) RACT rule, “Additional RACT Requirements for Major Sources of NOX and VOCs,” also known as RACT II. EPA will take separate action on RACT II. In the Final Rules section of this Federal Register, EPA is approving the State's SIP submittal as a direct final rule without prior proposal because the Agency views this as a noncontroversial submittal and anticipates no adverse comments. A detailed rationale for the approval is set forth in the direct final rule. If no adverse comments are received in response to this action, no further activity is contemplated. If EPA receives adverse comments, the direct final rule will be withdrawn and all public comments received will be addressed in a subsequent final rule based on this proposed rule. EPA will not institute a second comment period. Any parties interested in commenting on this action should do so at this time.

    DATES:

    Comments must be received in writing by August 7, 2017.

    ADDRESSES:

    Submit your comments, identified by Docket ID No. EPA-R03-OAR-2016-0561 at http://www.regulations.gov, or via email to [email protected] For comments submitted at Regulations.gov, follow the online instructions for submitting comments. Once submitted, comments cannot be edited or removed from Regulations.gov. For either manner of submission, the EPA may publish any comment received to its public docket. Do not submit electronically any information you consider to be confidential business information (CBI) or other information whose disclosure is restricted by statute. Multimedia submissions (audio, video, etc.) must be accompanied by a written comment. The written comment is considered the official comment and should include discussion of all points you wish to make. EPA will generally not consider comments or comment contents located outside of the primary submission (i.e. on the web, cloud, or other file sharing system). For additional submission methods, please contact the person identified in the For Further Information Contact section. For the full EPA public comment policy, information about CBI or multimedia submissions, and general guidance on making effective comments, please visit http://www2.epa.gov/dockets/commenting-epa-dockets.

    FOR FURTHER INFORMATION CONTACT:

    Maria A. Pino, (215) 814-2181, or by email at [email protected]

    SUPPLEMENTARY INFORMATION:

    For further information, please see the information provided in the direct final action, with the same title, that is located in the “Rules and Regulations” section of this Federal Register publication.

    Dated: June 22, 2017. Cecil Rodrigues, Acting Regional Administrator, Region III.
    [FR Doc. 2017-14205 Filed 7-6-17; 8:45 am] BILLING CODE 6560-50-P
    82 129 Friday, July 7, 2017 Notices AGENCY FOR INTERNATIONAL DEVELOPMENT Notice of July 19, 2017 Advisory Committee on Voluntary Foreign Aid Meeting AGENCY:

    United States Agency for International Development.

    ACTION:

    Notice of meeting.

    SUMMARY:

    Pursuant to the Federal Advisory Committee Act, notice is hereby given of a meeting of the Advisory Committee on Voluntary Foreign Aid (ACVFA).

    Date: Wednesday, July 19, 2017. Time: 2:00-4:00 p.m. Location: Horizon Ballroom, The Ronald Reagan Building, 1300 Pennsylvania Ave. NW., Washington, DC 20004. Purpose

    The Advisory Committee on Voluntary Foreign Aid (ACVFA) brings together USAID and private voluntary organization officials, representatives from universities, international nongovernment organizations, U.S. businesses, and government, multilateral, and private organizations to foster understanding, communication, and cooperation in the area of foreign aid.

    Agenda

    USAID leadership will make opening remarks, followed by a panel discussion to explore possible approaches to reforming U.S. foreign assistance. The full meeting agenda will be forthcoming on the ACVFA Web site at http://www.usaid.gov/who-we-are/organization/advisory-committee.

    Stakeholders

    The meeting is free and open to the public. Persons wishing to attend should register online at http://www.usaid.gov/who-we-are/organization/advisory-committee.

    FOR FURTHER INFORMATION CONTACT:

    Jessica Klein, [email protected].

    Jessica Klein, Acting Executive Director, U.S. Agency for International Development.
    [FR Doc. 2017-14288 Filed 7-6-17; 8:45 am] BILLING CODE P
    DEPARTMENT OF AGRICULTURE Animal and Plant Health Inspection Service [Docket No. APHIS-2014-0056] Availability of a Final Environmental Assessment and Finding of No Significant Impact for the Field Release of Genetically Engineered Diamondback Moths AGENCY:

    Animal and Plant Health Inspection Service, USDA.

    ACTION:

    Notice of availability.

    SUMMARY:

    We are advising the public that the Animal and Plant Health Inspection Service (APHIS) has prepared a final environmental assessment and finding of no significant impact and will issue a permit for the field release of diamondback moths that have been genetically engineered for repressible female lethality, also known as female autocide. Based on its finding of no significant impact, APHIS has determined that an environmental impact statement need not be prepared.

    FOR FURTHER INFORMATION CONTACT:

    Ms. Chessa Huff-Woodard, Esq., Policy, Program and International Collaboration Chief, Biotechnology Regulatory Services, APHIS, 4700 River Road, Unit 147, Riverdale, MD 20737-1236; (301) 851-3943, email: [email protected]

    SUPPLEMENTARY INFORMATION:

    On April 19, 2017, we published in the Federal Register (82 FR 18416-18417, Docket No. APHIS-2014-0056) a notice 1 in which we announced the availability, for public review and comment, of an environmental assessment (EA) that examined the potential environmental impacts associated with the proposed field release of diamondback moths that have been genetically engineered for repressible female lethality, also known as female autocide.

    1 To view the notice, environmental assessment, finding of no significant impact, and the comments we received, go to https://www.regulations.gov/docket?D=APHIS-2014-0056.

    We solicited comments on the EA for 30 days ending May 19, 2017. We received 670 comments by that date. Written responses to the comments we received on the EA can be found in the finding of no significant impact (FONSI).

    In this document, we are advising the public of our finding of no significant impact regarding the field release of genetically engineered diamondback moths into the continental United States. The finding, which is based on the EA, reflects our determination that release of the genetically engineered diamondback moths will not have a significant impact on the quality of the human environment. Concurrent with this announcement, APHIS will issue a permit for the field release of the genetically engineered diamondback moth.

    The EA and FONSI may be viewed on the Regulations.gov Web site (see footnote 1). Copies of the EA and FONSI are also available for public inspection at USDA, Room 1141, South Building, 14th Street and Independence Avenue SW., Washington, DC, between 8 a.m. and 4:30 p.m., Monday through Friday, except holidays. Persons wishing to inspect copies are requested to call ahead on (202) 799-7039 to facilitate entry into the reading room. In addition, copies may be obtained by calling or writing to the individual listed under FOR FURTHER INFORMATION CONTACT.

    The EA and FONSI have been prepared in accordance with: (1) The National Environmental Policy Act of 1969 (NEPA), as amended (42 U.S.C. 4321 et seq.); (2) regulations of the Council on Environmental Quality for implementing the procedural provisions of NEPA (40 CFR parts 1500-1508); (3) USDA regulations implementing NEPA (7 CFR part 1b); and (4) APHIS' NEPA Implementing Procedures (7 CFR part 372).

    Done in Washington, DC, this 30th day of June 2017. Jere L. Dick, Acting Administrator, Animal and Plant Health Inspection Service.
    [FR Doc. 2017-14345 Filed 7-6-17; 8:45 am] BILLING CODE 3410-34-P
    DEPARTMENT OF AGRICULTURE Food Safety and Inspection Service [Docket No. FSIS-2017-0020] Availability of FSIS Guidance for Importing Meat, Poultry, and Egg Products Into the United States AGENCY:

    Food Safety and Inspection Service, USDA.

    ACTION:

    Notice of availability and request for comments.

    SUMMARY:

    The Food Safety and Inspection Service (FSIS) is announcing the availability of and requesting comment on guidance for importing meat, poultry, and egg products into the United States. This guidance is intended to help U.S. importers, customs brokers, official import inspection establishments, egg products plants, and other interested parties understand and comply with FSIS import requirements.

    DATES:

    Submit comments on or before September 5, 2017.

    ADDRESSES:

    A downloadable version of the guidance is available to view and print at http://www.fsis.usda.gov/Regulations_&_Policies/Compliance_Guides_Index/index.asp. No hard copies of the compliance guideline have been published.

    FSIS invites interested persons to submit comments on issues discussed and outlined in this notice. Only comments addressing the scope of this notice will be considered.

    Comments may be submitted by one of the following methods:

    Federal eRulemaking Portal: This Web site provides the ability to type short comments directly into the comment field on this Web page or attach a file for lengthier comments. Go to http://www.regulations.gov/. Follow the on-line instructions at that site for submitting comments.

    Mail, CD-ROMs: Send to Docket Clerk, U.S. Department of Agriculture, Food Safety and Inspection Service, Patriots Plaza 3, 1400 Independence Avenue SW., Mailstop 3782, Room 8-163B, Washington, DC 20250-3700.

    Hand- or courier-delivered submittals: Deliver to Patriots Plaza 3, 355 E. Street SW., Room 8-163A, Washington, DC 20250-3700.

    Instructions: All items submitted by mail or electronic mail must include the Agency name and docket number FSIS-2017-0020. Comments received in response to this docket will be made available for public inspection and posted without change, including any personal information, to http://www.regulations.gov.

    Docket: For access to background documents or to comments received, go to the FSIS Docket Room at Patriots Plaza 3, 355 E. Street SW., Room 164-A, Washington, DC 20250-3700 between 8:00 a.m. and 4:30 p.m., Monday through Friday.

    FOR FURTHER INFORMATION CONTACT:

    Roberta Wagner, Assistant Administrator, Office of Policy and Program Development; Telephone: (202) 205-0495, or by Fax: (202) 720-2025.

    SUPPLEMENTARY INFORMATION: Background

    The U.S. Department of Agriculture's (USDA) Food Safety and Inspection Service (FSIS) is the public health regulatory agency responsible for ensuring that domestic and imported meat, poultry, and egg products are safe, wholesome, and correctly labeled and packaged. FSIS inspects imported meat, poultry, and egg products under the authority of the Federal Meat Inspection Act (FMIA) (21 U.S.C. 601 et seq.) and the Poultry Products Inspection Act (PPIA) (21 U.S.C. 451 et seq.), and the Egg Products Inspection Act (EPIA) (15 U.S.C. 1031 et seq.). Imported meat, poultry, and egg products must originate from eligible countries and from establishments or plants that are certified to export to the United States (21 U.S.C. 620, 466 and 1046). A country becomes eligible following an equivalence determination process completed by FSIS in coordination with the country's central competent authority (CCA). Foreign establishments or plants become eligible when the CCA certifies to FSIS that the establishments or plants meet requirements that are equivalent to FSIS requirements. All imported shipments of meat, poultry, and egg products must be presented to FSIS for inspection, with certain exceptions, as detailed in the guidance (e.g., meat, poultry, or dried egg products shipment that does not exceed 50 pounds, for personal consumption only). This guidance summarizes existing requirements and best practices for complying with those requirements. FSIS encourages interested parties (e.g., U.S. importers, brokers, official import inspection establishments, and egg products plants) to follow this guidance. This guidance represents current FSIS thinking, and FSIS will update it as necessary to reflect comments received and any additional information that becomes available. FSIS is seeking comments on this guidance as part of its efforts to continuously assess and improve the effectiveness of policy documents.

    USDA Nondiscrimination Statement

    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 http://www.ocio.usda.gov/sites/default/files/docs/2012/Complain_combined_6_8_12.pdf, or write a letter signed by you or your authorized representative.

    Send your completed complaint form or letter to USDA by mail, fax, or email:

    Mail: U.S. Department of Agriculture, Director, Office of Adjudication, 1400 Independence Avenue SW., Washington, DC 20250-9410.

    Fax: (202) 690-7442.

    Email: [email protected] 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).

    Additional Public Notification

    FSIS will announce this notice online through the FSIS Web page located at http://www.fsis.usda.gov/federal-register.

    FSIS will also make copies of this Federal Register publication available through the FSIS Constituent Update, which is used to provide information regarding FSIS policies, procedures, regulations, Federal Register notices, FSIS public meetings, and other types of information that could affect or would be of interest to constituents and stakeholders. The Update is communicated via Listserv, a free electronic mail subscription service for industry, trade groups, consumer interest groups, health professionals, and other individuals who have asked to be included. The Update is also available on the FSIS Web page. In addition, FSIS offers an electronic mail subscription service which provides automatic and customized access to selected food safety news and information. This service is available at http://www.fsis.usda.gov/subscribe. 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.

    Done at Washington, DC, on: July 3, 2017. Alfred V. Almanza, Administrator.
    [FR Doc. 2017-14287 Filed 7-6-17; 8:45 am] BILLING CODE 3410-DM-P
    DEPARTMENT OF AGRICULTURE Grain Inspection, Packers and Stockyards Administration United States Standards for Lentils AGENCY:

    Grain Inspection, Packers and Stockyards Administration, USDA.

    ACTION:

    Final Notice.

    SUMMARY:

    This action is being taken under the authority of the Agricultural Marketing Act of 1946, as amended, (AMA). The Department of Agriculture's (USDA) Grain Inspection, Packers and Stockyards Administration (GIPSA) is revising the United States Standards for Lentils to establish an additional grading factor, definition, grade requirements, and visual reference images for “wrinkled lentils,” and establish a special grade, definition, special grade requirements, designation, and visual reference images for “green lentils.” GIPSA believes these revisions will improve the application of standards and facilitate the marketing of lentils.

    DATES:

    Effective Date: August 1, 2017.

    FOR FURTHER INFORMATION CONTACT:

    Beverly A. Whalen at USDA, GIPSA, FGIS, 10383 N. Ambassador Drive, Kansas City, Missouri 64153; Telephone (816) 659-8410; Fax Number (816) 872-1258; email [email protected]

    SUPPLEMENTARY INFORMATION:

    Section 203(c) of the AMA (7 U.S.C. § 1622(c)), directs and authorizes the Secretary of Agriculture “To develop and improve standards of quality, condition, quantity, grade, and packaging and recommend and demonstrate such standards in order to encourage uniformity and consistency in commercial practices.” GIPSA is committed to carrying out this authority in a manner that facilitates the marketing of agricultural commodities.

    Under the AMA, GIPSA establishes and maintains standards for graded commodities including rice, whole dry peas, split peas, feed peas, lentils, and beans. The AMA standards are voluntary and widely used in private contracts, government procurement, marketing communication, and/or consumer information. The standards serve as a common trading language to define commodity quality in the domestic and global marketplace.

    Background

    GIPSA engages in regular outreach with stakeholders to ensure commodity standards maintain relevance with the modern market. Lentil industry stakeholders include the USA Dry Pea and Lentil Council (USADPLC), a national organization of producers, processors, and exporters of U.S. dry peas, lentils, and chickpeas; the U.S. Dry Pea and Lentil Trade Association (USPLTA), a national association representing processors, traders, handlers and merchandisers, and transporters in the pea, lentil and chickpea industry; and, other handlers and merchandisers.

    The United States Standards for Lentils are available on GIPSA's public Web site at: https://www.gipsa.usda.gov/fgis/standards/lentils.pdf. USADPLC and USPLTA reviewed the United States Standards for Lentils, which were last revised in 2008. The review resulted in those stakeholders jointly recommending that GIPSA revise the standards based on changing market trends. Specifically, these groups asked GIPSA to (1) establish a new grading factor of “wrinkled lentils,” and (2) establish a new special grade of “green lentils.”

    GIPSA provides official inspection procedures for lentils in the Pea and Lentil Handbook, which is available on GIPSA's public Web site at: http://www.gipsa.usda.gov/Publications/fgis/handbooks/pealentil_insphb.html.

    Establishment of Grading Factor “Wrinkled Lentils”

    USADPLC and USPLTA reported on a trend of an increasing percentage of fully developed lentils that possess a wrinkled seed coat. These lentils do not meet the definition for immature lentils. Under the current United States Standards for Lentils, these lentils would grade U.S. #1; however, the wrinkled appearance is considered undesirable. The stakeholders jointly recommended that GIPSA establish a new grade determining factor “wrinkled lentil,” and also recommended factor limits for grades No's. 1, 2, and 3. GIPSA and the stakeholders worked collaboratively to develop a visual reference image that best reflects the “wrinkled lentil” condition. Additionally, stakeholders endorsed the following definition: Wrinkled lentils are sound lentils that are substantially wrinkled on at least 50 percent of one side.

    Establishment of Special Grade “Green Lentils”

    The USPLTA Grades Committee members recommended that GIPSA establish a special grade, “green lentils.” Lentil stakeholders concurred on the need for a special grade to distinguish a desirable aesthetic feature. GIPSA and the stakeholders worked collaboratively to develop a visual reference image that best reflects the “green lentils” condition. Additionally, stakeholders endorsed the following definition: Green lentils are clear seeded (non-mottled) and possess a natural, uniformly green color.

    Comment Review

    GIPSA published a Notice in the Federal Register on May 15, 2017 (82 FR 22305), inviting interested parties to comment on the proposed revisions to the United States Standards for Lentils. Two comments were received from industry associations, supporting the proposed revisions. No adverse comments were received. Accordingly, the lentil standards are being revised as proposed in the May 15, 2017, notice. GIPSA believes that these revisions will facilitate use of the standards and better reflect current marketing practices. The revisions to the standards become effective August 1, 2017, and the Pea and Lentil Handbook will be revised to incorporate the revisions to the standards.

    Final Action

    GIPSA is revising the lentil standards to (1) establish a new grading factor, definition, factor limits, and visual reference image for wrinkled lentils; and (2) establish a special grade, definition, designation, and visual reference image for green lentils. Accordingly, the following sections of the United States Standards for Lentils under the AMA are amended: Section 601, Definitions, is amended to include the following definition: Wrinkled lentils are sound lentils that are substantially wrinkled on at least 50% of one side. Section 607, Grades and grade requirements for dockage-free lentils, is amended as follows:

    607 Grades and Grade Requirements for Dockage-Free Lentils Grading factors Grades U.S. Nos. 1 2 3 Defective Lentils Total 1 2.0 3.5 5.0 Weevil-Damaged Lentils 0.3 0.8 0.8 Heat-Damaged Lentils 0.2 0.5 1.0 Foreign Material Total 2 0.2 0.5 0.5 Stones 0.1 0.2 0.2 Skinned Lentils 4.0 7.0 10.0 Wrinkled Lentils 3 5.0 10.0 >10.0 Contrasting Lentils 4 2.0 4.0 <4.0 Inconspicuous Admixture 0.5 0.8 1.0 Minimum Requirements for Color Good Fair Poor U.S. Sample grade are lentils that: (a) Do not meet the requirements for the grades U.S. Nos. 1, 2, or 3; or (b) Contain more than 14.0 percent moisture, live weevils, or other live insects, metal fragments, broken glass, or a commercially objectionable odor; or (c) Are materially weathered, heating, or distinctly low quality. 1 Defective lentils total is weevil-damaged, heat-damaged, damaged, and split lentils combined. 2 Foreign material total includes stones. 3 Lentils with more than 10.0 percent wrinkled lentils shall grade no higher than U.S. No. 3. 4 Lentils with more than 4.0 percent contrasting lentils shall grade no higher than U.S. No. 3.

    Section 609, Special grades and requirements, is amended to include the following definition:

    Green lentils are clear seeded (non-mottled) lentils possessing a natural, uniformly green color.

    Authority:

    7 U.S.C. 1621-1627.

    Randall D. Jones, Acting Administrator, Grain Inspection, Packers and Stockyards Administration.
    [FR Doc. 2017-14308 Filed 7-6-17; 8:45 am] BILLING CODE 3410-KD-P
    DEPARTMENT OF AGRICULTURE Grain Inspection, Packers and Stockyards Administration United States Standards for Beans AGENCY:

    Grain Inspection, Packers and Stockyards Administration, USDA.

    ACTION:

    Final notice.

    SUMMARY:

    This action is being taken under the authority of the Agricultural Marketing Act of 1946, as amended, (AMA). The Department of Agriculture's (USDA) Grain Inspection, Packers and Stockyards Administration (GIPSA) is revising the United States Standards for Beans to (1) establish a class and grade requirement chart for “chickpea,” also known as “garbanzo bean,” and (2) establish a new grade determining factor, definition, factor limits, and visual reference image for “contrasting chickpeas.” GIPSA believes these revisions will help facilitate the marketing of chickpeas and improve the application of the standards.

    DATES:

    Effective Date: August 1, 2017.

    FOR FURTHER INFORMATION CONTACT:

    Beverly A. Whalen at USDA, GIPSA, FGIS, 10383 N. Ambassador Drive, Kansas City, Missouri 64153; Telephone (816) 659-8410; Fax Number (816) 872-1258; email [email protected]

    SUPPLEMENTARY INFORMATION:

    Section 203(c) of the AMA (7 U.S.C. 1622(c)), directs and authorizes the Secretary of Agriculture “To develop and improve standards of quality, condition, quantity, grade, and packaging and recommend and demonstrate such standards in order to encourage uniformity and consistency in commercial practices.” GIPSA is committed to carrying out this authority in a manner that facilitates the marketing of agricultural commodities.

    Under the AMA, GIPSA establishes and maintains standards for graded commodities including rice, whole dry peas, split peas, feed peas, lentils, and beans. The AMA standards are voluntary and widely used in private contracts, government procurement, marketing communication, and/or consumer information. The standards serve as a common trading language to define commodity quality in the domestic and global marketplace.

    Background

    GIPSA engages in regular outreach with stakeholders to ensure commodity standards maintain relevance with the modern market. Chickpea industry stakeholders include the USA Dry Pea and Lentil Council (USADPLC), a national organization of producers, processors, and exporters of U.S. dry peas, lentils, and chickpeas; the U.S. Dry Pea and Lentil Trade Association (USPLTA), a national association representing processors, traders, handlers and merchandisers, and transporters in the pea, lentil and chickpea industry; and the US Dry Bean Council (USDBC) representing the U.S. dry bean industry, including growers, shippers, dealers, canners, and local and regional trade associations.

    The United States Standards for Beans are available on GIPSA's public Web site at: http://www.gipsa.usda.gov/fgis/standards/Bean-Standards.pdf. USDPLC and USPLTA reviewed the United States Standards for Beans, which were last revised in 2008. Currently, chickpeas are graded under the Miscellaneous Bean standard. This is confusing to the market because GIPSA issues an “AMA Commodity Inspection Certificate” providing the commonly accepted commercial name, “chickpea” or “garbanzo” as the class on the certificate grade line. Specifically, industry stakeholders asked GIPSA to (1) establish a class and grade requirement chart for “chickpeas,” (2) use the terms “chickpeas” and “garbanzo beans” interchangeably, and (3) establish a new grade determining factor, definition, factor limits, and visual reference image for “contrasting chickpeas.”

    GIPSA provides official inspection procedures for beans in the Bean Handbook, found on GIPSA's public Web site at: https://www.gipsa.usda.gov/fgis/handbook/BeanHB/BeanHandbook_2016-02-23.pdf.

    Establishment of Class “Chickpeas” and Grade Requirements

    The stakeholders jointly recommended that GIPSA establish a new class and grade requirement chart for “chickpea,” and also recommended a new grade determining factor, definition, and factor limits for grades No's 1, 2, and 3 for “contrasting chickpeas.” GIPSA and these stakeholders collaborated to develop a visual reference image that best reflects the “contrasting chickpeas” condition. Additionally, the stakeholders endorsed the following definition: Contrasting chickpeas are chickpeas that differ substantially in shape or color.

    Comment Review

    GIPSA published a Notice in the Federal Register on May 15, 2017 (82 FR 22306), inviting interested parties to comment on the proposed revisions to the U.S. Standards for Beans. One comment was received, which was supportive of proposed revisions. GIPSA did not receive adverse comments. Accordingly, the bean standards are revised as published in this final notice, with a technical correction in the table in new Section 135.

    Section 135 is corrected to remove footnote 3 that appeared in the May 15, 2017, Notice for Comment inviting public comment. The footnote stated “3 Beans with more than 5.0 percent contrasting chickpeas are graded mixed beans.” The footnote was errantly included in the table. Contrasting chickpeas are not counted toward mixed beans, thus the footnote should not have appeared in the table.

    GIPSA believes these revisions will facilitate the use of the standards and better reflect current marketing practices. The revisions to the standards are effective August 1, 2017. The Bean Handbook will be revised to incorporate the revisions to the standards.

    Final Action

    GIPSA is revising the bean standards to (1) establish a class and grade requirement chart for chickpeas, and (2) establish a new grade determining factor, definition, factor limits, and visual reference image for contrasting chickpeas.

    Under Terms Defined:

    Section 102, Classes, is amended to include Chickpeas (Garbanzo Beans).

    A new Section 122 is added. Contrasting chickpeas are chickpeas that differ substantially in shape or color.

    Under Principles Governing Application of the Standards:

    Current Sections 122, 123, and 124 are renumbered to 123, 124, and 125 with no change to the text.

    Under Grades, Grade Requirements, Grade Designations, Special Grades, and Special Grade Requirements:

    Current Sections 125, 126, 127, 128, 129, 130, 131, 132, 133 are renumbered to 126, 127, 128, 129, 130, 131, 132, 133, 134, with no change to the text.

    A new Section 135, Grade and grade requirements for the class Chickpeas (Garbanzo Beans) is added.

    Current Sections 134 and 135 are renumbered to 136 and 137, respectively, with no change to the text.

    135 Grades and Grade Requirements for the Class Chickpea [Garbanzo bean] Grade Percent maximum limits of— Moisture 1 Total defects
  • (total damaged,
  • total foreign
  • material, contrasting classes, & splits)
  • Total
  • damaged
  • Foreign material Total
  • (including stones)
  • Stones Contrasting
  • classes 2
  • Contrasting
  • chickpeas
  • U.S. No. 1 18.0 2.0 2.0 0.5 0.2 0.5 1.0 U.S. No. 2 18.0 4.0 4.0 1.0 0.4 1.0 2.0 U.S. No. 3 18.0 6.0 6.0 1.5 0.6 2.0 5.0 U.S. Substandard are beans that do not meet the requirements for the grades U.S. No. 1 through U.S. No. 3 or U.S. Sample grade. Beans that are not well screened must also be U.S. Substandard, except for beans that meet the requirements for U.S. Sample grade. U.S. Sample grade are beans that are musty, sour, heating, materially weathered, or weevily; have any commercially objectionable odor; contain insect webbing or filth, animal filth, any unknown foreign substance, broken glass, or metal fragments; or are otherwise of distinctly low quality. 1 Beans with more than 18.0 percent moisture are graded high moisture. 2 Beans with more than 2.0 percent contrasting classes are graded mixed beans.
    Authority:

    7 U.S.C. 1621-1627.

    Randall D. Jones, Acting Administrator, Grain Inspection, Packers and Stockyards Administration.
    [FR Doc. 2017-14309 Filed 7-6-17; 8:45 a.m.] BILLING CODE 3410-KD-P
    COMMISSION ON CIVIL RIGHTS Sunshine Act Meeting Notice AGENCY:

    United States Commission on Civil Rights.

    ACTION:

    Notice of Commission Business Meeting.

    DATES:

    Friday, July 14, 2017, at 10:00 a.m. EST.

    ADDRESSES:

    National Place Building, 1331 Pennsylvania Ave. NW., 11th Floor, Suite 1150, Washington, DC 20245 (Entrance on F Street NW).

    FOR FURTHER INFORMATION CONTACT:

    Brian Walch, phone: (202) 376-8371; TTY: (202) 376-8116; [email protected]

    SUPPLEMENTARY INFORMATION:

    This business meeting is open to the public. There will also be a call-in line for individuals who desire to listen to the presentations: (888) 504-7958; Conference ID 790-7062. Hearing-impaired persons who will attend the briefing and require the services of a sign language interpreter should contact Pamela Dunston at (202) 376-8105 or at [email protected] at least three business days before the scheduled date of the meeting.

    Meeting Agenda I. Approval of Agenda II. Business Meeting A. Discussion and Vote on 2018 Business Meeting Dates B. State Advisory Committees • Presentation by Ms. Diane Citrino, Chair of the Ohio Advisory Committee, on its report on Human Trafficking in Ohio • Presentation by Mr. Wendell Blaylock, Chair of the Nevada Advisory Committee, on its Advisory Memorandum on Municipal Fines and Fees in Nevada C. Management and Operations • Staff Director's Report D. Presentation on the Americans with Disabilities Act by Rebecca Cokley, Executive Director, the National Council on Disability III. Adjourn Meeting Dated: July 5, 2017. Brian Walch, Director, Communications and Public Engagement.
    [FR Doc. 2017-14386 Filed 7-5-17; 4:15 pm] BILLING CODE 6335-01-P
    DEPARTMENT OF COMMERCE Census Bureau Submission for OMB Review; Comment Request; Correction

    This is a correction to FR 2017-13778, which should have listed Census as the submitting agency instead of the Department of Commerce. The remainder of the document as published on June 30, 2017 (82 FR 29843) is republished in its entirety below.

    Under 44 U.S.C. 3506(e) and 13 U.S.C. Section 9, the U.S. Census Bureau is seeking comments on revisions to the confidentiality pledge it provides to its respondents under Title 13, United States Code, Section 9. These revisions are required by the passage and implementation of provisions of the Federal Cybersecurity Enhancement Act of 2015 (6 U.S.C. 1501 note), which require the Secretary of Homeland Security to provide Federal civilian agencies' information technology systems with cybersecurity protection for their Internet traffic. More details on this announcement are presented in the SUPPLEMENTARY INFORMATION section below. The previous notice for public comment, titled “Agency Information Collection Activities; Request for Comments; Revision of the Confidentiality Pledge under Title 13 United States Code, Section 9” was published in the Federal Register on December 23, 2016 (Vol. 81, No. 247, pp. 94321-94324), allowing for a 60 day comment period. The Census Bureau received two comments, which are addressed within this notice.

    SUPPLEMENTARY INFORMATION: I. Background

    On December 18, 2015, Congress passed the Federal Cybersecurity Enhancement Act of 2015 (the Act) (6 U.S.C. 1501 note). The Act requires the Department of Homeland Security to deploy for use by other agencies a program with the “capability to detect cybersecurity risks in network traffic transiting or traveling to or from an agency information system.” 1 The Act requires each agency to “apply and continue to utilize the capabilities to all information traveling between an agency information system and any information system other than an agency information system.” 2 The DHS program is known as EINSTEIN, and DHS currently operates version 3A (E3A).

    1 Sec. 230(b)(1)(A) of the Homeland Security Act of 2002 (6 U.S.C. 151(b)(1)(A)), as added by section 223((a)(6) of the Federal Cybersecurity Enhancement Act of 2015.

    2 Section 223(b)(1)(A) (6 U.S.C. 151 note) of the Federal Cybersecurity Enhancement Act of 2015.

    Importantly, the Act provides that DHS may use the information collected through EINSTEIN “only to protect information and information systems from cybersecurity risks.” 3 The Act does not authorize DHS to use information collected through EINSTEIN for any other purposes, including law enforcement purposes.

    3 Section 230(c)(3) of the Homeland Security Act of 2002 (6 U.S.C. 151(c)(3)), as added by section 223(a)(6) of the Federal Cybersecurity Enhancement Act of 2015.

    In response to the passage of the Act, the Census Bureau considered whether it should revise its confidentially pledge. The Census Bureau's Center for Survey Measurement (CSM) joined the interagency Statistical Community of Practice and Engagement (SCOPE) Confidentiality Pledge Revision Subcommittee, which developed and evaluated the revision to the confidentiality pledge language. SCOPE and CSM conducted remote and in-person cognitive testing of the potential revised confidentiality pledge. The Census Bureau based its revised confidentiality pledge on the results of these tests. The revised confidentiality pledge utilizes the language the Census Bureau determined would best communicate the essential information to respondents while not negatively affecting response rates. The following is the revised statistical confidentiality pledge for the Census Bureau's data collections:

    The U.S. Census Bureau is required by law to protect your information. The Census Bureau is not permitted to publicly release your responses in a way that could identify you. Per the Federal Cybersecurity Enhancement Act of 2015, your data are protected from cybersecurity risks through screening of the systems that transmit your data.

    On December 23, 2016, the Census Bureau requested comments on the revised confidentiality pledge. During the public comment period, the Census Bureau received two comments from the Asian Americans Advancing Justice (AAJC) and American-Arab Anti-Discrimination Committee (ADC).

    II. Comments and Responses

    In response to the Census Bureau's revised confidentiality pledge, AAJC and the ADC provided comments and suggestions to the Census Bureau. These comments and suggestions, along with the Census Bureau's responses are below.

    1. The AAJC and the ADC both expressed concerns about the effect of the revised confidentiality pledge on the accuracy of the results of the Census Bureau's survey.

    Response: The Census Bureau is committed to collecting the most complete and accurate data. The Census Bureau takes the collection and protection of respondent information very seriously and has since the first Decennial Census in 1790. As a statistical agency committed to ensuring the collection and publication of accurate data, the Census Bureau continually conducts extensive research and testing to inform census and survey design. This research and testing confirms key technologies, outreach and promotional strategies, data collection methods, and management and response processes to allow the Census Bureau to maximize response rates and ensure the accuracy of the data collected. We also uphold a strong data stewardship culture to ensure that any decisions we make will fulfill our legal and ethical obligations to respect your privacy and protect the confidentiality of your information. The revised confidentiality pledge utilizes language that the Census Bureau determined, after cognitive testing, would not negatively affect response rates, and hence the accuracy of the survey results.

    2. The “ADC has serious concerns on the ability of [DHS] to . . . access . . . people's personal information on the server.”

    Response: E3A does not provide DHS with access to a respondent's personal information. E3A does not currently decrypt respondent information or scan data at rest on Census Bureau information systems. Moreover, the Act limits the use of any information collected, stating that the DHS may use information obtained through activities authorized under this section “only to protect information and information systems from cybersecurity risks.” (6 U.S.C. 151(c)(3)).

    EINSTEIN also provides greater protection for the Census Bureau's information and information systems than would otherwise exist. EINSTEIN enables DHS to detect cyber threat indicators traveling or transiting to or from one agency's information system, and to share those indicators with other agencies, thereby making all agencies' information systems more secure. The necessity of providing DHS limited access to such information—information which DHS can only use for cybersecurity purposes—is not only required by the Federal Cybersecurity Enhancement Act, but has a net positive impact of the security of information respondents provide to the Census Bureau.

    3. The ADC is concerned that “there is a lack of safeguards in place on who has access to information through EINSTEIN.”

    Response: In addition to the safeguards contained in the Act, the Census Bureau works with DHS to protect information DHS may access through EINSTEIN. These additional safeguards cover the collection, retention, use, and disclosure of information. The safeguards also include notification and reporting requirements in the unlikely event that any unauthorized access, use, or dissemination of any Census Bureau information would occur.

    To reiterate, the information at issue is not a respondent's personal information, rather, it is cyber threat information. E3A does not provide DHS with access to a respondent's personal information. E3A does not currently decrypt respondent information or scan data at rest on Census Bureau information systems.

    4. The ADC is concerned that the revised confidentiality pledge “raises flags on improper use of such information.”

    Response: The Act limits DHS's use of information collected pursuant to the Act to the protection of “information and information systems from cybersecurity risks.” To be clear, DHS's use of the information for any other purpose would be unlawful.

    5. The AAJC suggests that the protections contained in Title 13 and the Confidential Information Protection and Statistical Efficiency Act (CIPSEA), both of which limit the use and disclosure of information collected, should control the information at issue.

    Response: Pursuant to the Act, each agency must “apply and continue to utilize the capabilities to all information traveling between an agency information system and any information system other than an agency information system.” Congress authorized that, notwithstanding the protections previously afforded to information by other laws, such as Title 13, for the purpose of protecting agency information systems from cyber attacks, DHS may access information transiting and traveling to or from an agency information system. Census Bureau employees remain subject to the penalties contained in Title 13, including a federal prison sentence of up to five years and a fine of up to $250,000, or both.

    6. The AAJC suggests that either the Census Bureau employees “perform Einstein 3A functions for Census Bureau internet traffic” or that “DHS employees monitoring Census Bureau internet traffic under Einstein 3A take the current Title 13 confidentiality pledge.”

    Response: The Act provides DHS access to network traffic transiting or traveling to or from the Census Bureau's information systems, notwithstanding the protections previously afforded to information by other laws, such as Title 13. The Act also requires each agency to “apply and continue to utilize the capabilities to all information traveling between an agency information system and any information system other than an agency information system.”

    In addition to the safeguards contained in the Act, the Census Bureau works with DHS to safeguard respondent information. These additional safeguards cover the collection, retention, use, and disclosure of information. The safeguards also include notification and reporting requirements that would apply in the unlikely event that any unauthorized access, use, or dissemination of any Census Bureau information would occur.

    III. Data

    Agency: U.S. Census Bureau, Department of Commerce.

    Title: Revision of the Confidentiality Pledge under Title 13 United States Code, Section 9.

    OMB Control Number: 0607-0993.

    Form Number(s): None.

    Affected Public: All survey respondents to Census Bureau data collections.

    Legal Authority: 44 U.S.C. 3506(e) and 13 U.S.C. Section 9.

    This information collection request may be viewed at www.reginfo.gov. Follow the instructions to view Department of Commerce collections currently under review by OMB.

    IV. Request for Comments

    Comments are invited on the necessity and efficacy of the Census Bureau's revised confidentiality pledge above. Comments submitted in response to this notice will become a matter of public record. Comments should be sent within 30 days of publication of this notice to [email protected] or fax to (202) 395-5806.

    Sheleen Dumas, Departmental PRA Lead, Office of the Chief Information Officer.
    [FR Doc. 2017-14110 Filed 7-6-17; 8:45 am] BILLING CODE 3510-07-P
    DEPARTMENT OF COMMERCE Foreign-Trade Zones Board [B-46-2017] Foreign-Trade Zone (FTZ) 106—Oklahoma City, Oklahoma, Notification of Proposed Production Activity, Eastman Kodak Company, (Printing Flexographic Plates), Weatherford, Oklahoma

    Eastman Kodak Company (Eastman Kodak) submitted a notification of proposed production activity to the FTZ Board for its facility in Weatherford, Oklahoma. The notification conforming to the requirements of the regulations of the FTZ Board (15 CFR 400.22) was received on June 21, 2017.

    The request indicates that a separate application for subzone designation for the Eastman Kodak facility under FTZ 106 will be submitted. The facilities will be used to produce printing flexographic plates. Pursuant to 15 CFR 400.14(b), FTZ activity would be limited to the specific foreign-status materials/components and specific finished products described in the submitted notification (as described below) and subsequently authorized by the FTZ Board.

    Production under FTZ procedures could exempt Eastman Kodak from customs duty payments on the foreign-status materials/components used in export production. On its domestic sales, for the foreign-status materials/components noted below, Eastman Kodak would be able to choose the duty rate during customs entry procedures that apply to: Flexographic finished plates; aluminum finished printing plates; thermo imaging layer; direct imaging recording film sheets; and, direct imaging record film rolls (duty rates range from free to 3.7%). Customs duties also could possibly be deferred or reduced on foreign-status production equipment.

    The materials/components sourced from abroad include: Aging inhibitor; stabilizer; photopolymerization initiator; resins for coating; ethanaminium; inhibitor; coating solvent; light stabilizer for coating; 3H-Indolium; photoinitiators; coatings for plates; aluminum finished printing plates; flexographic finished plates; mat film sheets; butadiene polymers; thermoplastic elastomers; plate manufacturing chemicals; intermediates for production of printing plates; co-polymers; monomers; propenoic acid; naphthalenesulfonic acid; urethane acrylate polymers; phonolic resin solutions; foam interleave sheets; aluminum coils of aluminum not alloyed; aluminum coils of aluminum alloys; aluminum coils of a thickness not exceeding 0.15mm: of a thickness exceeding 0.01mm; and, aluminum coils of a thickness exceeding 0.15mm but not exceeding 0.2mm (duty rates range from free to 6.5%).

    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 August 16, 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 www.trade.gov/ftz.

    For further information, contact Christopher Wedderburn at [email protected] or (202) 482-1963.

    Dated: July 3, 2017. Elizabeth Whiteman, Acting Executive Secretary.
    [FR Doc. 2017-14279 Filed 7-6-17; 8:45 am] BILLING CODE 3510-DS-P
    DEPARTMENT OF COMMERCE International Trade Administration [A-583-853] Certain Crystalline Silicon Photovoltaic Products From Taiwan: Final Results of Antidumping Duty Administrative Review; 2014-2016 AGENCY:

    Enforcement and Compliance, International Trade Administration, Department of Commerce.

    SUMMARY:

    On March 7, 2017, the Department of Commerce (the Department) published the preliminary results of the administrative review of the antidumping duty order on certain crystalline silicon photovoltaic products (solar products) from Taiwan. The period of review (POR) is July 31, 2014, through January 31, 2016. Based on our analysis of the comments received, we have made certain changes to the margin calculations with respect to Sino-American Silicon Products Inc. and Solartech Energy Corp., and, therefore, the final results differ from the preliminary results. We made no changes to the preliminary results with respect to Motech Industries, Inc. The final weighted-average dumping margins are listed below in the section “Final Results of Review.”

    DATES:

    Effective July 7, 2017.

    FOR FURTHER INFORMATION CONTACT:

    Magd Zalok or Thomas Martin, AD/CVD Operations, Office IV, Enforcement and Compliance, International Trade Administration, Department of Commerce, 1401 Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-4162 or (202) 482-3936, respectively.

    SUPPLEMENTARY INFORMATION:

    Background

    On March 7, 2017, the Department published the Preliminary Results of this administrative review.1 For the events that occurred since the Preliminary Results, see the Issues and Decision Memorandum.2 These final results cover 12 companies.3 The Department conducted this review in accordance with section 751(a) of the Tariff Act of 1930, as amended (the Act).

    1Certain Crystalline Silicon Photovoltaic Products From Taiwan: Preliminary Results of Antidumping Duty Administrative Review and Partial Rescission of Antidumping Duty Administrative Review; 2014-2016, 82 FR 12802 (March 7, 2017) (Preliminary Results), and accompanying Memorandum, “Decision Memorandum for the Preliminary Results of the 2014-2016 Antidumping Duty Administrative Review of Certain Crystalline Silicon Photovoltaic Products from Taiwan,” dated February 28, 2017 (Preliminary Decision Memorandum).

    2See Memorandum, “Issues and Decision Memorandum for the Final Results of the 2014-2016 Administrative Review of the Antidumping Duty Order on Certain Crystalline Silicon Photovoltaic Products from Taiwan,” dated concurrently with this notice and incorporated herein by reference (Issues and Decision Memorandum).

    3 The Preliminary Results covered 14 companies. See Preliminary Results, 82 FR at 12803. Subsequently, the Department collapsed Sino-American Silicon Products Inc. (SAS) and Solartech Energy Corp. See Preliminary Decision Memorandum at 3-4. In these final results, the Department has determined that SAS should also be collapsed with Sunrise Global Solar Energy. See Issues and Decision Memorandum at Comment 3. Thus, these final results cover two mandatory respondents, and 10 companies not individually examined. See Final Results of Review section below, for a list of all of the companies.

    Scope of the Order

    The merchandise covered by this order is crystalline silicon photovoltaic cells, and modules, laminates and/or panels consisting of crystalline silicon photovoltaic cells, whether or not partially or fully assembled into other products, including building integrated materials. Merchandise covered by this order is currently classified in the Harmonized Tariff Schedule of the United States (HTSUS) under subheadings 8501.61.0000, 8507.20.8030, 8507.20.8040, 8507.20.8060, 8507.20.8090, 8541.40.6020, 8541.40.6030 and 8501.31.8000. These HTSUS subheadings are provided for convenience and customs purposes; the written description of the scope is dispositive.4

    4 For a complete description of the scope of the order, see the Issues and Decision Memorandum.

    Analysis of Comments Received

    All issues raised in the case and rebuttal briefs filed by parties in this review are addressed in the Issues and Decision Memorandum, which is hereby adopted with this notice. A list of the issues which parties raised, and to which we responded in the Issues and Decision Memorandum, can be found in the Appendix to this notice. The Issues and Decision Memorandum is a public document and is on file electronically via Enforcement and Compliance's Antidumping and Countervailing Duty Centralized Electronic Service System (ACCESS). ACCESS is available to registered users at https://access.trade.gov and is available to all parties in the Central Records Unit, room B8024 of the main Department of Commerce building. In addition, a complete version of the Issues and Decision Memorandum can be accessed directly on the Internet at http://enforcement.trade.gov/frn/index.html. The signed Issues and Decision Memorandum and the electronic version of the Issues and Decision Memorandum are identical in content.

    Changes Since the Preliminary Results

    Based on a review of the record and comments received from interested parties regarding our Preliminary Results, and for the reasons explained in the Issues and Decision Memorandum, we made revisions to our preliminary calculations of the weighted-average dumping margins for Sino-American Silicon Products Inc. (SAS) and Solartech Energy Corp. (Solartech) (hereinafter, SAS-Solartech).5 6 For Motech Industries, Inc. (Motech), the Department made no changes to the Preliminary Results.

    5See Issues and Decision Memorandum at comments 4, 7, 10 and 11.

    6See Memorandum to The File Through Robert Bolling, Program Manager, AD/CVD Operations, Office IV, From Magd Zalok, AD/CVD Operations, Office 4: 2014-2016 Antidumping Duty Administrative Review of Certain Crystalline Silicon Photovoltaic Products from Taiwan, Final Results Analysis for the SAS-Solartech Entity (Analysis Memorandum for the Final Results), dated concurrently with this notice.

    Rate for Non-Examined Companies

    The statute and the Department's regulations do not address the establishment of a rate to be applied to companies not selected for examination when the Department limits its examination in an administrative review pursuant to section 777A(c)(2) of the Act. Generally, the Department looks to section 735(c)(5) of the Act, which provides instructions for calculating the all-others rate in a market economy investigation, for guidance when calculating the rate for companies which were not selected for individual review in an administrative review. Under section 735(c)(5)(A) of the Act, the all-others rate is normally “an amount equal to the weighted average of the estimated weighted average dumping margins established for exporters and producers individually investigated, excluding any zero or de minimis margins, and any margins determined entirely {on the basis of facts available}.”

    In this review, we calculated weighted-average dumping margins for SAS-Solartech and Motech that are not zero, de minimis, or determined entirely on the basis of facts available. With two respondents, we normally calculate (A) a weighted-average of the dumping margins calculated for the mandatory respondents; (B) a simple average of the dumping margins calculated for the mandatory respondents; and (C) a weighted-average of the dumping margins calculated for the mandatory respondents using each company's publicly-ranged values for the merchandise under consideration. We compare (B) and (C) to (A) and select the rate closest to (A) as the most appropriate rate for all other companies.7 Accordingly, we have applied a rate of 4.10 percent to the non-selected companies, as set forth in the chart below.8

    7See Ball Bearings and Parts Thereof From France, Germany, Italy, Japan, and the United Kingdom: Final Results of Antidumping Duty Administrative Reviews, Final Results of Changed-Circumstances Review, and Revocation of an Order in Part, 75 FR 53661, 53663 (September 1, 2010).

    8See Memorandum from Thomas Martin to the File, “Calculation of the Rate for Non-Selected Respondents,” dated dated concurrently with this notice.

    Final Results of Review

    The Department determines that the following weighted-average dumping margins exist for the period July 31, 2014, through January 31, 2016:

    Manufacturer/exporter Weighted-
  • average
  • margin
  • (percent)
  • Sino-American Silicon Products Inc./Solartech Energy Corp 3.56 Motech Industries, Inc 4.20 AU Optronics Corporation 4.10 EEPV CORP 4.10 E-TON Solar Tech. Co., Ltd 4.10 Gintech Energy Corporation 4.10 Inventec Energy Corporation 4.10 Inventec Solar Energy Corporation 4.10 Kyocera Mexicana S.A. de C.V 4.10 Sunengine Corporation Ltd 4.10 TSEC Corporation 4.10 Win Win Precision Technology Co., Ltd 4.10
    Disclosure

    The Department intends to disclose the calculations performed for these final results of review within five days of the date of publication of this notice in the Federal Register, in accordance with 19 CFR 351.224(b).

    Assessment

    Pursuant to section 751(a)(2)(C) of the Act and 19 CFR 351.212(b), the Department shall determine, and U.S. Customs and Border Protection (CBP) shall assess, antidumping duties on all appropriate entries of subject merchandise in accordance with the final results of this review. The Department intends to issue assessment instructions to CBP 15 days after the date of publication of the final results of this administrative review in the Federal Register.

    Where the respondent reported reliable entered values, we calculated importer- (or customer-) specific ad valorem rates by aggregating the dumping margins calculated for all U.S. sales to each importer (or customer) and dividing this amount by the total entered value of the sales to each importer (or customer).9 Where the Department calculated a weighted-average dumping margin by dividing the total amount of dumping for reviewed sales to that party by the total sales quantity associated with those transactions, the Department will direct CBP to assess importer- (or customer-) specific assessment rates based on the resulting per-unit rates.10 Where an importer- (or customer-) specific ad valorem or per-unit rate is greater than de minimis (i.e., 0.50 percent), the Department will instruct CBP to collect the appropriate duties at the time of liquidation.11 Where an importer- (or customer-) specific ad valorem or per-unit rate is zero or de minimis, the Department will instruct CBP to liquidate appropriate entries without regard to antidumping duties.12

    9See 19 CFR 351.212(b)(1).

    10Id.

    11Id.

    12See 19 CFR 351.106(c)(2).

    For the companies which were not selected for individual review, we will assign an assessment rate based on the methodology described in the “Rates for Non-Examined Companies” section, above.

    Consistent with the Department's assessment practice, for entries of subject merchandise during the POR produced by SAS-Solartech, Motech, or the non-examined companies for which the producer did not know that its merchandise was destined for the United States, we will instruct CBP to liquidate unreviewed entries at the all-others rate if there is no rate for the intermediate company(ies) involved in the transaction.13

    13 For a full discussion of this practice, see Antidumping and Countervailing Duty Proceedings: Assessment of Antidumping Duties, 68 FR 23954 (May 6, 2003).

    Cash Deposit Requirements

    The following cash deposit requirements will be effective for all shipments of subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date of the final results of this administrative review, as provided for by section 751(a)(2)(C) of the Act: (1) The cash deposit rates for the companies listed in these final results will be equal to the weighted-average dumping margins established in the final results of this review; (2) for merchandise exported by producers or exporters not covered in this review but covered in a prior segment of this proceeding, the cash deposit rate will continue to be the company-specific rate published for the most recently completed segment in which the company was reviewed; (3) if the exporter is not a firm covered in this review or the original less-than-fair-value (LTFV) investigation, but the producer is, the cash deposit rate will be the rate established for the most recently completed segment of this proceeding for the producer of the subject merchandise; and (4) the cash deposit rate for all other producers or exporters will continue to be 19.50 percent,14 the all-others rate established in the LTFV investigation. These cash deposit requirements, when imposed, shall remain in effect until further notice.

    14See Certain Crystalline Silicon Photovoltaic Products: Final Determination of Sales at Less Than Fair Value, 79 FR 76966 (December 23, 2014).

    Notification to Importers

    This notice serves as a final reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this POR. Failure to comply with this requirement could result in the Department's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties.

    Notification to Interested Parties Regarding Administrative Protective Order

    This notice also serves as the only reminder to parties subject to administrative protective order (APO) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3), which continues to govern business proprietary information in this segment of the proceeding. Timely written notification of the return or destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation.

    We are issuing and publishing this notice in accordance with sections 751(a)(1) and 777(i)(1) of the Act and 19 CFR 351.213(h).

    Dated: June 29, 2017. Ronald K. Lorentzen, Acting Assistant Secretary for Enforcement and Compliance. Appendix List of Topics Discussed in the Issues and Decision Memorandum I. Summary II. List of Issues A. SAS-Solartech-Specific Issues Comment 1: Whether Products Shipped to the United States are Third-Country Sales Comment 2: Whether To Exclude Priced Sample Sales Comment 3: Whether To Assign SAS-Solartech's Rate to Sunrise Global Solar Energy Comment 4: Whether To Revise the MFRH/U Fields To Reflect the Collapsed Entity Comment 5: Whether To Revise the Draft Cash Deposit and Assessment Instructions Comment 6: Differential Pricing Comment 7: Cost of Manufacturing for Grade 4 Non-Prime Products Comment 8: Scrap Offset for Two Resold CONNUMs Comment 9: Year-End Adjustment for Items Relating to Profit Comment 10: Loss in Inventory Devaluation Comment 11: Other CPA Adjustment Comment 12: Scrap Offset Comment 13: Rental Expenses Comment 14: Fixed Overhead Costs Comment 15: G&A and Financial Expenses B. Motech-Specific Issues Comment 16: Whether To Apply Partial AFA to Motech's Reported Per-Unit Costs Comment 17: Whether To Deny Motech's Offset for Silver Paste Scrap Comment 18: Whether To Include Fire Losses in Motech's General and Administrative (“G&A”) Expenses Comment 19: Whether To Exclude Motech's Reported “Indirect” U.S. Sales for One Customer III. Background IV. Scope of the Order V. Margin Calculations VI. Discussion of the Issues VII. Recommendation
    [FR Doc. 2017-14281 Filed 7-6-17; 8:45 am] BILLING CODE 3510-DS-P
    DEPARTMENT OF COMMERCE International Trade Administration [A-570-863] Honey From the People's Republic of China: Preliminary Rescission of the New Shipper Review and Preliminary Results of the Administrative Review; 2015-2016 AGENCY:

    Enforcement and Compliance, International Trade Administration, Department of Commerce.

    SUMMARY:

    The Department of Commerce (the Department) aligned the 2015-2016 new shipper review of the antidumping duty order on honey from the People's Republic of China (PRC) with the 2015-2016 administrative review of the same order covering the same period of review (POR), and is therefore conducting the reviews concurrently. The POR for the administrative review and the new shipper review is December 1, 2015, through November 30, 2016. As discussed below, the Department is preliminarily rescinding the new shipper with respect to Jiangsu Runchen Agricultural/Sideline Foodstuff Co., Ltd. (Jiangsu Runchen) and has preliminarily found that Shanghai Sunbeauty Trading Co., Ltd. (Sunbeauty) is not eligible to receive a separate rate.

    DATES:

    Effective July 7, 2017.

    FOR FURTHER INFORMATION CONTACT:

    Carrie Bethea, AD/CVD Operations, Office V, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-1491.

    SUPPLEMENTARY INFORMATION:

    Background

    On December 1, 2016, the Department published a notice of opportunity to request an AR of the antidumping duty order on honey from the PRC for the POR.1 On December 28, 2016, Sunbeauty requested that the Department conduct an administrative review of the sales of subject merchandise exported by Sunbeauty during the POR.2 On January 3, 2017, the American Honey Producers Association and Sioux Honey Producers Association (collectively, the petitioners) requested that the Department conduct an administrative review.3 On February 13, 2017, based on the timely requests for administrative review, the Department initiated an administrative review of two exporters/producers, Shayang Xianghe and Sunbeauty.4 On February 28, 2017, the petitioners withdrew their request for Shayang Xianghe.5 As a result, the Department rescinded the review with respect to Shayang Xianghe.6

    1See Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review, 81 FR 86694 (December 1, 2016).

    2See Letter to the Secretary from Sunbeauty re: Request for Administrative Review; 2015-2016, dated December 28, 2016.

    3See Letter to the Secretary from Petitioners re: Request for Administrative Review; 2015-2016, dated January 3, 2017.

    4See Initiation of Antidumping and Countervailing Duty Administrative Reviews, 82 FR 10457, 10460 (February 13, 2017) (AR Initiation Notice); see also Letter to the Secretary from Petitioners re: Petitioners' Withdrawal of Request for Administrative Review of Jiangsu Runchen Agricultural/Sideline Foodstuff Co., Ltd., dated January 26, 2017.

    5See Letter to the Secretary from Petitioners, re: Petitioners' Withdrawal of Request for 2015/2016 Administrative Review, in Part, dated February 28, 2017.

    6See Honey from the People's Republic of China: Notice of Partial Rescission of Antidumping Duty Administrative Review; 2015-2016, 82 FR 14503 (March 21, 2017).

    On February 3, 2017, in response to a request from Jiangsu Runchen, the Department published notice of initiation of a new shipper review of honey for the period December 1, 2015, to November 30, 2016.7 On February 15, 2017, the Department aligned the new shipper review of honey from the PRC with the concurrent administrative review of honey from the PRC.8

    7See Honey from the People's Republic of China: Initiation of Antidumping Duty New Shipper Review; 2015-2016, 82 FR 9192 (February 3, 2017) (NSR Initiation Notice); see also Letter to the Secretary from Jiangsu Runchen re: Request for New-Shipper Review, dated December 23, 2017.

    8See Memorandum regarding: Alignment of the New Shipper Review of Jiangsu Runchen, dated February 15, 2017.

    The Department sent the new shipper review antidumping duty questionnaire to Jiangsu Runchen on February 3, 2017.9 The Department issued the administrative review antidumping duty questionnaire to Sunbeauty on February 13, 2017.10

    9See Department Letter re: Antidumping Duty New Shipper Review Questionnaire, dated February 3, 2017.

    10See Department Letter re: Antidumping Duty Administrative Review Questionnaire, dated February 13, 2017.

    Scope of the Order

    The products covered by the order are natural honey, artificial honey containing more than 50 percent natural honey by weight, preparations of natural honey containing more than 50 percent natural honey by weight and flavored honey. The subject merchandise includes all grades and colors of honey whether in liquid, creamed, comb, cut comb, or chunk form, and whether packaged for retail or in bulk form.

    The merchandise subject to the order is currently classifiable under subheadings 0409.00.00, 1702.90.90, 2106.90.99, 0409.00.0010, 0409.00.0035, 0409.00.0005, 0409.00.0045, 0409.00.0056, and 0409.00.0065 of the Harmonized Tariff Schedule of the United States (HTSUS). Although the HTSUS subheadings are provided for convenience and customs purposes, the Department's written description of the merchandise under the order is dispositive.

    Also, included in the scope are blends of honey and rice syrup, regardless of the percentage of honey contained in the blend.

    Scope Rulings made between July 1, 2012, and September 30, 2012; Requestor: The American Honey Producers Association and the Sioux Honey Association; blends of honey and rice syrup, regardless of the percentage of honey they contain, are later-developed merchandise that are within the scope of the antidumping duty order; August 21, 2012.

    Methodology

    The Department is conducting these reviews in accordance with sections 751(a)(1), 751(a)(2)(B)(iv), 751(a)(3), 771(i)(1) of the Act, and 19 CFR 351.213 and 351.214. For a full description of the methodology underlying our conclusions, see the Preliminary Decision Memorandum.

    The Preliminary Decision Memorandum is a public document and is on file electronically via Enforcement and Compliance's Antidumping and Countervailing Duty Centralized Electronic Service System (ACCESS). ACCESS is available to registered users at http://access.trade.gov and in the Department's Central Records Unit, room B8024 of the main Department of Commerce building. In addition, a complete version of the Preliminary Decision Memorandum can be accessed directly on the Internet at http://enforcement.trade.gov/frn/. The signed Preliminary Decision Memorandum and the electronic versions of the Preliminary Decision Memorandum are identical in content.

    Preliminary Rescission of New Shipper Review

    For the reasons detailed in the Preliminary Decision Memorandum, the Department preliminarily finds that we cannot determine whether Jiangsu Runchen made bona fide sale(s) to the United States. Consequently, the Department is preliminarily rescinding the new shipper review of Jiangsu Runchen for the period December 1, 2015, through November 30, 2016.

    Preliminary Results of Administrative Review

    In making our findings, because Sunbeauty was unable to provide evidence of a suspended entry of subject merchandise into the United States during the POR and is, thus, ineligible to receive a separate rate, we are preliminarily treating Sunbeauty as part of the PRC-wide entity. For a full description of the methodology underlying our preliminary conclusions, see the Preliminary Decision Memorandum.

    We preliminarily determine that the following antidumping duty margin exists:

    Manufacturer/exporter Margin (dollars per kilogram) PRC-wide entity (including Shanghai Sunbeauty Trading Co., Ltd.) 2.63 Public Comment

    Interested parties may submit written comments by no later than 30 days after the date of publication of this preliminary rescission of the new shipper review and these preliminary results of the administrative review.11 Rebuttals, limited to issues raised in the written comments, may be filed by no later than five days after the written comments are due.12

    11See 19 CFR 351.309(c).

    12See 19 CFR 351.309(d).

    Any interested party may request a hearing within 30 days of publication of this notice.13 Hearing requests should contain the following information: (1) The party's name, address, and telephone number; (2) the number of participants; and (3) a list of the issues to be discussed. Oral presentations will be limited to issues raised in the briefs. If a request for a hearing is made, parties will be notified of the time and date for the hearing to be held at the U.S. Department of Commerce, 1401 Constitution Avenue NW., Washington, DC 20230.14

    13See 19 CFR 351.310(c).

    14See 19 CFR 351.310(d).

    The Department intends to issue the final results of these reviews, which will include the results of its analysis of issues raised in any such comments, within 120 days of publication of these preliminary results, pursuant to section 751(a)(2)(B)(iv) of the Act.

    Assessment Rates

    Upon completion of the final results of this new shipper review, pursuant to 19 CFR 351.212(b), the Department will determine, and the U.S. Customs and Border Protection (CBP) shall assess, antidumping duties on all appropriate entries. If we proceed to a final rescission of the new shipper review, Jiangsu Runchen's entries will be assessed at the rate entered.15 If we do not proceed to a final rescission of the new shipper review, pursuant to 19 CFR 351.212(b)(1), we will calculate importer-specific assessment rates. We will instruct CBP to assess antidumping duties on all appropriate entries covered by this review if any importer-specific assessment rate calculated in the final results of this review is above de minimis.16 The Department intends to issue assessment instructions to CBP 15 days after the publication of the final results of this new shipper review.

    15See 19 CFR 351.106(c)(2).

    16Id.

    Upon issuance of the final results of this administrative review, the Department will determine, and CBP shall assess antidumping duties on all appropriate entries. We will instruct CBP to liquidate entries containing merchandise from the PRC-wide entity at the PRC-wide rate we determine in the final results of the review. If we do not continue to treat Sunbeauty as part of the PRC-wide entity, pursuant to 19 CFR 351.212(b)(1), we will calculate importer-specific assessment rates. We will instruct CBP to assess antidumping duties on all appropriate entries covered by this review if any importer-specific assessment rate calculated in the final results of this review is above de minimis.17 The Department intends to issue assessment instructions to CBP 15 days after the publication of the final results or rescission of this new shipper review and the final results of this administrative review.

    17Id.

    Cash Deposit Requirements

    The following cash deposit requirements will be effective upon publication of the final results of this administrative review for all shipments of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date, as provided for by section 751(a)(2)(C) of the Act: (1) For the exporters listed above, the cash deposit rate will be the rate established in the final results of this review (except, if the rate is zero or de minimis, i.e., less than 0.5 percent, no cash deposit rate will be required for that company); (2) for previously investigated or reviewed PRC and non-PRC exporters not listed above that have separate rates, the cash deposit rate will continue to be the exporter-specific rate published for the most recently completed period; (3) for all PRC exporters of subject merchandise that have not been found to be entitled to a separate rate, the cash deposit rate will be the PRC-wide rate of $2.63 per kilogram; and, (4) for all non-PRC exporters of subject merchandise which have not received their own rate, the cash deposit rate will be the rate applicable to the PRC exporter(s) that supplied that non-PRC exporter. These deposit requirements, when imposed, shall remain in effect until further notice.

    Notification to Importers

    This notice also serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Department's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties.

    This notice also serves as a final reminder to parties subject to administrative protective order (APO) in this administrative review of their responsibility concerning the return or destruction of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3), which continues to govern business proprietary information in this segment of the proceeding. Timely written notification of the return or destruction of APO materials, or conversion to judicial protective order, is hereby requested. Failure to comply with the regulations and terms of an APO is a violation which is subject to sanction.

    The Department is issuing and publishing these results in accordance with sections 751(a)(2)(B) and 777(i)(l) of the Act, and 19 CFR 351.214 and 19 CFR 351.221(b)(4).

    Dated: June 29, 2017. Ronald K. Lorentzen, Acting Assistant Secretary for Enforcement and Compliance.
    [FR Doc. 2017-14277 Filed 7-6-17; 8:45 am] BILLING CODE 3510-DS-P
    DEPARTMENT OF COMMERCE International Trade Administration [A-821-809] Certain Hot-Rolled Flat-Rolled Carbon-Quality Steel Products From the Russian Federation: Final Results of Antidumping Duty Administrative Review; 2014-2015 AGENCY:

    Enforcement and Compliance, International Trade Administration, Department of Commerce.

    SUMMARY:

    On January 5, 2017, the Department of Commerce (the Department) published in the Federal Register the preliminary results of the administrative review of the antidumping duty order on certain hot-rolled flat-rolled carbon-quality steel products from the Russian Federation (Russia). The review covers one producer/exporter of the subject merchandise, Severstal PAO and Severstal Export (collectively, Severstal). The period of review (POR) is December 19, 2014, through November 30, 2015. After our analysis of the comments and information received, these final results do not change from the preliminary results of review. For the final weighted-average dumping margins, see the “Final Results of Review” section below.

    DATES:

    Effective July 7, 2017.

    FOR FURTHER INFORMATION CONTACT:

    John Drury or Madeline Heeren, AD/CVD Operations, Office VI, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-5041 or (202) 482-0195, respectively.

    SUPPLEMENTARY INFORMATION: Background

    On January 5, 2017, the Department published the Preliminary Results. 1 A summary of the events that occurred since the Department published these results, as well as a full discussion of the issues raised by parties for these final results, may be found in the Issues and Decision Memorandum, which is hereby adopted by this notice.2 The Issues and Decision Memorandum is a public document and is on file electronically via Enforcement and Compliance's Antidumping and Countervailing Duty Centralized Electronic Service System (ACCESS). ACCESS is available to registered users at https://access.trade.gov and it is available to all parties in the Central Records Unit, Room B8024 of the main Department of Commerce building. In addition, a complete version of the Issues and Decision Memorandum can be accessed directly at http://enforcement.trade.gov/frn/index.html. The signed and electronic versions of the Issues and Decision Memorandum are identical in content.

    1 The Initiation Notice and Preliminary Results inadvertently referenced the incorrect order title. This Federal Register notice and the decision memorandum accompanying these final results use the original and correct order title, as reflected in the 2014 order. See Initiation of Antidumping and Countervailing Duty Administrative Reviews, 81 FR 6832 (February 9, 2016) (Initiation Notice); see also Certain Hot-Rolled Carbon Steel Flat Products from the Russian Federation: Preliminary Results of Antidumping Duty Administrative Review; 2014-2015, 82 FR 1318 (January 5, 2017) (Preliminary Results); see also, Termination of the Suspension Agreement on Hot-Rolled Flat-Rolled Carbon-Quality Steel Products from the Russian Federation, Rescission of 2013-2014 Administrative Review, and Issuance of Antidumping Duty Order, 79 FR 77455 (December 24, 2014) (AD Order).

    2See Memorandum, “Issues and Decision Memorandum for the Final Results of the Administrative Review of the Antidumping Duty Order on Certain Hot-Rolled Flat-Rolled Carbon-Quality Steel Products from the Russian Federation; 2014-2015,” dated concurrently with this notice (Issues and Decision Memorandum).

    Scope of the Order

    The product covered by this order is certain hot-rolled flat-rolled carbon-quality steel products (hot-rolled steel) from Russia. The full text of the scope of the order is contained in the Issues and Decision Memorandum.

    Analysis of Comments Received

    All issues raised in the case and rebuttal briefs by parties to this administrative review are addressed in the Issues and Decision Memorandum. A list of the issues raised by parties is attached in the Appendix to this notice.

    Adverse Facts Available

    In the Preliminary Results, the Department applied total adverse facts available (AFA) to Severstal and assigned it a rate of 184.56 percent. The Department determined that Severstal significantly impeded the proceeding, failed to provide necessary information, and failed to cooperate by not acting to the best of its ability to comply with requests for information. As discussed in the Issues and Decision Memorandum, we continue to assign Severstal an AFA rate for these final results of review.

    Final Results of the Review

    The final weighted-average dumping margin is as follows:

    Exporter/producer Weighted-
  • average
  • dumping
  • margin
  • (percent)
  • Severstal PAO and Severstal Export (collectively, Severstal) 184.56
    Assessment Rate

    Pursuant to section 751(a)(2)(A) of the Act, and 19 CFR 351.212(b), the Department has determined, and U.S. Customs and Border Protection (CBP) shall assess, antidumping duties on all appropriate entries of subject merchandise in accordance with the final results of this review.3 The Department shall instruct CBP to apply an ad valorem assessment rate of 184.56 percent to all entries of subject merchandise during the POR which were produced and/or exported by Severstal. The Department intends to issue assessment instructions to CBP 15 days after the date of publication of these final results of review.

    3 For assessment purposes, the Department applied the assessment rate calculation method adopted in Antidumping Proceedings: Calculation of the Weighted-Average Dumping Margin and Assessment Rate in Certain Antidumping Proceedings: Final Modification, 77 FR 8101 (February 14, 2012).

    Cash Deposit Requirements

    The following cash deposit requirements will be effective upon publication of this notice for all shipments of subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication of these final results, as provided by section 751(a)(2) of the Act: (1) The cash deposit rate for the respondent noted above will be the rate established in the final results of this administrative review; (2) for merchandise exported by manufacturers or exporters not covered in this administrative review but covered in a prior segment of the proceeding, the cash deposit rate will continue to be the company specific rate published for the most recently completed segment of this proceeding; (3) if the exporter is not a firm covered in this review, a prior review, or the original investigation, but the producer is, the cash deposit rate will be the rate established for the most recently completed segment of this proceeding for the producer of the subject merchandise; and (4) the cash deposit rate for all other producers or exporters will continue to be 184.56 percent, the all-others rate established in the antidumping duty investigation.4 These cash deposit requirements, when imposed, shall remain in effect until further notice.

    4See Notice of Final Determination of Sales at Less Than Fair Value: Hot-Rolled Flat-Rolled Carbon-Quality Steel Products from the Russian Federation, 64 FR 38626 (July 19, 1999).

    Notification to Importers Regarding the Reimbursement of Duties

    This notice also serves as a final reminder to importers of their responsibility under 19 CFR 351.402(f) to file a certificate regarding the reimbursement of antidumping and/or countervailing duties prior to liquidation of the relevant entries during the period of review. Failure to comply with this requirement could result in the Department's presumption that reimbursement of antidumping and/or countervailing duties did occur and the subsequent assessment of doubled antidumping duties.

    Administrative Protective Order

    This notice also serves as a reminder to parties subject to administrative protective orders (APOs) of their responsibility concerning the return or destruction of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3), which continues to govern business proprietary information in this segment of the proceeding. Timely written notification of the return/destruction of APO materials, or conversion to judicial protective order, is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation.

    We are issuing and publishing this notice in accordance with sections 751(a)(1) and 777(i)(1) of the Act and 19 CFR 351.213(h).

    Dated: June 30, 2017. Ronald K. Lorentzen Acting Assistant Secretary for Enforcement and Compliance. Appendix List of Topics Discussed in the Final Issues and Decision Memorandum I. Summary II. List of Issues III. Background IV. Scope of the Order V. Discussion of the Issues 1. Application of Total Adverse Facts Available 2. Rejection of Severstal's April 14, 2016, Extension Request 3. Issuance of a U.S. Customer Questionnaire 4. Release of Business Proprietary Information 5. Selection of AFA Rate VI. Recommendation
    [FR Doc. 2017-14278 Filed 7-6-17; 8:45 am] BILLING CODE 3510-DS-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration RIN 0648-XF502 Fisheries of the South Atlantic; Southeast Data, Assessment, and Review (SEDAR); Public Meeting AGENCY:

    National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

    ACTION:

    Notice of SEDAR Data Best Practices Standing Panel webinar.

    SUMMARY:

    The SEDAR Data Best Practices Panel will develop, review, and evaluate best practice recommendations for SEDAR Data Workshops. See SUPPLEMENTARY INFORMATION.

    DATES:

    The SEDAR Data Best Practices Standing Panel webinar will be held on Thursday, July 27, 2017, from 2 p.m. to 4 p.m. (EST).

    ADDRESSES:

    The meeting will be held via webinar. The webinar is open to members of the public. Those interested in participating should contact Julia Byrd at SEDAR (see FOR FURTHER INFORMATION CONTACT) to request an invitation providing webinar access information. Please request webinar invitations at least 24 hours in advance of each webinar.

    SEDAR address: South Atlantic Fishery Management Council, 4055 Faber Place Drive, Suite 201, N. Charleston, SC 29405. www.sedarweb.org.

    FOR FURTHER INFORMATION CONTACT:

    Julia Byrd, SEDAR Coordinator, 4055 Faber Place Drive, Suite 201, North Charleston, SC 29405; phone: (843) 571-4366; email: [email protected]

    SUPPLEMENTARY INFORMATION:

    The Gulf of Mexico, South Atlantic, and Caribbean Fishery Management Councils, in conjunction with NOAA Fisheries and the Atlantic and Gulf States Marine Fisheries Commissions, have implemented the Southeast Data, Assessment and Review (SEDAR) process, a multi-step method for determining the status of fish stocks in the Southeast Region. SEDAR is a three-step process including: (1) Data Workshop; (2) Assessment Process utilizing a workshop and/or webinars; and (3) Review Workshop. The product of the Data Workshop is a data report which compiles and evaluates potential datasets and recommends which datasets are appropriate for assessment analyses. The product of the Assessment Process is a stock assessment report which describes the fisheries, evaluates the status of the stock, estimates biological benchmarks, projects future population conditions, and recommends research and monitoring needs. The assessment is independently peer reviewed at the Review Workshop. The product of the Review Workshop is a Summary documenting panel opinions regarding the strengths and weaknesses of the stock assessment and input data. Participants for SEDAR Workshops are appointed by the Gulf of Mexico, South Atlantic, and Caribbean Fishery Management Councils and NOAA Fisheries Southeast Regional Office, Highly Migratory Species Management Division, and Southeast Fisheries Science Center. Participants include: Data collectors and database managers; stock assessment scientists, biologists, and researchers; constituency representatives including fishermen, environmentalists, and non-governmental organizations (NGOs); international experts; and staff of Councils, Commissions, and state and federal agencies.

    The SEDAR Data Best Practices Standing Panel is charged with developing, reviewing, and evaluating best practice recommendations for SEDAR Data Workshops. The items of discussion for this webinar are as follows:

    1. Discuss prioritization criteria to select next issues for Panel to address 2. Identify preferred management history template 3. Update on Data Best Practice feedback received to date 4. Prioritize Data Best Practice issues to address next and discuss process that will be used to address these issues 5. Other business

    Although non-emergency issues not contained in this agenda may come before this group for discussion, those issues may not be the subject of formal action during this meeting. Action will be restricted to those issues specifically identified in this notice and any issues arising after publication of this notice that require emergency action under section 305(c) of the Magnuson-Stevens Fishery Conservation and Management Act, provided the public has been notified of the intent to take final action to address the emergency.

    Special Accommodations

    This meeting is accessible to people with disabilities. Requests for auxiliary aids should be directed to the SAFMC office (see ADDRESSES) at least 10 business days prior to the meeting.

    Note:

    The times and sequence specified in this agenda are subject to change.

    Authority:

    16 U.S.C. 1801 et seq.

    Dated: July 3, 2017. Tracey L. Thompson, Acting Deputy Director, Office of Sustainable Fisheries, National Marine Fisheries Service.
    [FR Doc. 2017-14264 Filed 7-6-17; 8:45 am] BILLING CODE 3510-22-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration RIN 0648-XF521 Mid-Atlantic Fishery Management Council (MAFMC); Meeting AGENCY:

    National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

    ACTION:

    Notice; public meeting.

    SUMMARY:

    The Mid-Atlantic Fishery Management Council's (MAFMC) Atlantic Bluefish Monitoring Committee will hold a public meeting.

    DATES:

    The meeting will be held on Monday, July 24, 2017, from 10 a.m. to 12 p.m. For agenda details, see SUPPLEMENTARY INFORMATION.

    ADDRESSES:

    The meeting will be held via webinar with a telephone-only connection option. Details on the proposed agenda, webinar listen-in access, and briefing materials will be posted at the MAFMC's Web site: www.mafmc.org.

    Council address: Mid-Atlantic Fishery Management Council, 800 N. State Street, Suite 201, Dover, DE 19901; telephone: (302) 674-2331 or on their Web site at www.mafmc.org.

    FOR FURTHER INFORMATION CONTACT:

    Christopher M. Moore, Ph.D., Executive Director, Mid-Atlantic Fishery Management Council, telephone: (302) 526-5255.

    SUPPLEMENTARY INFORMATION:

    The purpose of this meeting is for the Monitoring Committee to review, and if necessary, revise the current management measures designed to achieve the recommended Atlantic Bluefish catch and landings limits for 2018.

    Although non-emergency issues not contained in this agenda may come before this group for discussion, those issues may not be the subject of formal action during this meeting. Action will be restricted to those issues specifically identified in this notice and any issues arising after publication of this notice that require emergency action under section 305(c) of the Magnuson-Stevens Fishery Conservation and Management Act, provided the public has been notified of the intent to take final action to address the emergency.

    Special Accommodations

    The meeting is physically accessible to people with disabilities. Requests for sign language interpretation or other auxiliary aid should be directed to M. Jan Saunders, (302) 526-5251, at least 5 days prior to the meeting date.

    Authority:

    16 U.S.C. 1801 et seq.

    Dated: July 3, 2017. Tracey L. Thompson, Acting Deputy Director, Office of Sustainable Fisheries, National Marine Fisheries Service.
    [FR Doc. 2017-14267 Filed 7-6-17; 8:45 am] BILLING CODE 3510-22-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration RIN 0648-XF286 Takes of Marine Mammals Incidental to Specified Activities; Taking Marine Mammals Incidental to Site Characterization Surveys off the Coast of New Jersey AGENCY:

    National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

    ACTION:

    Notice; issuance of an Incidental Harassment Authorization.

    SUMMARY:

    In accordance with the regulations implementing the Marine Mammal Protection Act (MMPA) as amended, notification is hereby given that NMFS has issued an incidental harassment authorization (IHA) to Ocean Wind, LLC (Ocean Wind), to incidentally harass, by Level B harassment only, marine mammals during high-resolution geophysical (HRG) and geotechnical survey investigations associated with marine site characterization activities off the coast of New Jersey in the area of the Commercial Lease of Submerged Lands for Renewable Energy Development on the Outer Continental Shelf (OCS-A 0498) (Lease Area).

    DATES:

    This Authorization is effective from June 8, 2017, through June 7, 2018.

    FOR FURTHER INFORMATION CONTACT:

    Laura McCue, Office of Protected Resources, NMFS, (301) 427-8401. Electronic copies of the applications and supporting documents, as well as a list of the references cited in this document, may be obtained online at: www.nmfs.noaa.gov/pr/permits/incidental/energy_other.htm. In case of problems accessing these documents, please call the contact listed above.

    SUPPLEMENTARY INFORMATION:

    Background

    Sections 101(a)(5)(A) and (D) of the MMPA (16 U.S.C. 1361 et seq.) direct 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 if certain findings are made and either regulations are issued or, if the taking is limited to harassment, a notice of a proposed authorization is provided to the public for review.

    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” 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 MMPA states that the term “take” means to harass, hunt, capture, kill or attempt to harass, hunt, capture, or kill any marine mammal.

    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).

    National Environmental Policy Act

    To comply with the National Environmental Policy Act of 1969 (NEPA; 42 U.S.C. 4321 et seq.) and NOAA Administrative Order (NAO) 216-6A, NMFS must review our proposed action with respect to environmental consequences on the human environment.

    Summary of Request

    NMFS received a request from Ocean Wind for an IHA to take marine mammals incidental to 2017 geophysical survey investigations off the coast of New Jersey in the OCS-A 0498 Lease Area, designated and offered by the U.S. Bureau of Ocean Energy Management (BOEM), to support the development of an offshore wind project. Ocean Wind's request was for harassment only, and NMFS concurs that mortality is not expected to result from this activity; therefore, an IHA is appropriate.

    The planned geophysical survey activities will occur for 42 days beginning in early June 2017, and geotechnical survey activities will take place in September 2017 and last for approximately 12 days. The following specific aspects of the planned activities are likely to result in the take of marine mammals: shallow and medium-penetration sub-bottom profilers (chirper and sparker) used during the HRG survey, and dynamically-positioned (DP) vessel thruster used in support of geotechnical survey activities. Take, by Level B Harassment only, of individuals of five species of marine mammals is anticipated to result from the specified activities. No serious injury or mortality is expected from Ocean Wind's HRG and geotechnical surveys.

    Description of the Specified Activity Overview

    Ocean Wind plans to conduct a geophysical and geotechnical survey off the coast of New Jersey in the Lease Area to support the characterization of the existing seabed and subsurface geological conditions in the Lease Area. This information is necessary to support the siting, design, and deployment of up to two meteorological data collection buoys called floating light and detection ranging buoys (FLIDARs) and up to two metocean and current buoys, as well as to obtain a baseline assessment of seabed/sub-surface soil conditions in the Lease Area to support the siting of the wind farm. Surveys will include the use of the following equipment: multi-beam depth sounder, side-scan sonar, sub-bottom profiler, and cone penetration tests (CPTs). A detailed description of the planned marine site characterization project was provided in the Federal Register notice for the proposed IHA (82 FR 20563; May 3, 2017). Since that time, no changes have been made to the planned activities. Therefore, a detailed description is not provided here. Please refer to that Federal Register notice for the description of the specific activity.

    Dates and Duration

    HRG surveys are anticipated to commence in early June 2017 and will last for approximately 42 days, including estimated weather down time. Geotechnical surveys requiring the use of the DP drill ship will take place in September 2017, at the earliest, and will last for approximately 12 days excluding weather downtime. Equipment is expected run continuously for 24 hours per day.

    Specified Geographic Region

    Ocean Wind's survey activities will occur in the approximately 160,480-acre Lease Area designated and offered by the BOEM, located approximately nine miles (mi) southeast of Atlantic City, New Jersey, at its closest point (see Figure 1 of the IHA application). The Lease Area falls within the New Jersey Wind Energy Area (NJ WEA; Figure 1-1 of the IHA application) with water depths ranging from 15-40 meters (m) (49-131 feet (ft)).

    Detailed Description of Specific Activities HRG Survey Activities

    Marine site characterization surveys will include the following HRG survey activities:

    • Depth sounding (multibeam depth sounder) to determine water depths and general bottom topography;

    • Magnetic intensity measurements for detecting local variations in regional magnetic field from geological strata and potential ferrous objects on and below the bottom;

    • Seafloor imaging (sidescan sonar survey) for seabed sediment classification purposes, to identify natural and man-made acoustic targets resting on the bottom as well as any anomalous features;

    • Shallow penetration sub-bottom profiler (chirper) to map the near surface stratigraphy (top 0-5 meter (m) soils below seabed); and

    • Medium penetration sub-bottom profiler (sparker) to map deeper subsurface stratigraphy as needed (soils down to 75-100 m below seabed).

    Table 1 identifies the representative survey equipment that is being considered in support of the HRG survey activities. The make and model of the listed HRG equipment will vary depending on availability but will be finalized as part of the survey preparations and contract negotiations with the survey contractor. The final selection of the survey equipment will be confirmed prior to the start of the HRG survey program. Only the make and model of the HRG equipment may change, not the types of equipment or the addition of equipment with characteristics that might have effects beyond (i.e., resulting in larger ensonified areas) those considered in this proposed IHA. None of the proposed HRG survey activities will result in the disturbance of bottom habitat in the Lease Area.

    Table 1—Summary of Proposed HRG Survey Equipment HRG equipment Operating
  • frequencies
  • Source
  • level (manufacturer) (dBpeak; dBrms)
  • Source level
  • (bay state wind
  • survey) *
  • (dBpeak; dBrms)
  • Beamwidth (degree) Pulse
  • duration (millisec)
  • Sonardyne Ranger 2 USBL 35-50 kHz 200 dBPeak; n/a 194 dBPeak; 166.10 dBrms 180 1. Klein 3000H Sidescan Sonar 445/900 kHz 245 dBPeak; 242 dBrms n/a; n/a 0.2 0.0025 to 0.4. GeoPulse Sub-bottom Profiler (chirper) 1.5 to 18 kHz 223.5 dBPeak; 208 dBrms 203 dBPeak; 172.45 dBrms 55 0.1 to 22. Geo-Source 600/800 (sparker) 50 to 5000 Hz 222/223 dBPeak; 221/223 dBrms 206/212 dBPeak; 182.10/188.15 dBrms 110 1 to 10. SeaBat 7125 Multibeam Sonar 200/400 kHz 220 dBPeak; 213 dBrms n/a; n/a 2 0.03 to 0.3. * Gardline 2016, 2017.

    The HRG survey activities will be supported by a vessel approximately 98 to 180 feet (ft) in length and capable of maintaining course and a survey speed of approximately 4.5 knots while transiting survey lines. HRG survey activities across the Lease Area will generally be conducted at 900-meter (m) line spacing. Up to two FLIDARs and two wave buoys will be deployed within the Lease Area, and up to three potential locations for FLIDAR deployment will be investigated. At each FLIDAR and wave buoy deployment locations, the survey will be conducted along a tighter 30-m line spacing to meet the BOEM requirements as set out in the July 2015 Guidelines for Providing Geophysical, Geotechnical, and Geohazard Information Pursuant and Archeological and Historic Property Information in 30 CFR part 585.

    The equipment positioning systems use vessel-based underwater acoustic positioning to track equipment (in this case, the sub-bottom profiler) in very shallow to very deep water. Equipment positioning systems will be operational at all times during HRG survey data acquisition (i.e, concurrent with the sub-bottom profiler operation). Sub-bottom profiling systems identify and measure various marine sediment layers that exist below the sediment/water interface. A sound source emits an acoustic signal vertically downwards into the water and a receiver monitors the return signal that has been reflected off the sea floor. Some of the acoustic signal will penetrate the seabed and be reflected when it encounters a boundary between two layers that have different acoustic impedance. The system uses this reflected energy to provide information on sediment layers beneath the sediment-water interface. A shallow penetration sub-bottom profiler will be used to map the near surface stratigraphy of the Lease Area. A Geo-Source 200/800, or similar model, medium-penetration sub-bottom profiler (sparker) will be used to map deeper subsurface stratigraphy in the Lease Area as needed (soils down to 75-100 m below seabed). The sparker is towed from a boom arm off the side of the survey vessel and emits a downward pulse with a duration of 1 to 10 millisecond (ms) at an operating frequency of 50 to 5000 Hertz (Hz).

    Geotechnical Survey Activities

    Marine site characterization surveys will involve the following geotechnical survey activities:

    • Sample boreholes to determine geological and geotechnical characteristics of sediments;

    • Deep CPTs to determine stratigraphy and in-situ conditions of the deep surface sediments; and

    • Shallow CPTs to determine stratigraphy and in-situ conditions of the near surface sediments.

    It is anticipated that the geotechnical surveys will take place no sooner than September 2017. The geotechnical survey program will consist of up to 8 deep sample bore holes and adjacent 8 deep CPTs both to a depth of approximately 130 ft to 200 ft (40 m to 60 m) below the seabed, as well as 30 shallow CPTs, up to 130 ft (40 m) below seabed.

    The investigation activities are anticipated to be conducted from a 250-ft to 350-ft (76 m to 107 m) DP drill ship. DP vessel thruster systems maintain their precise coordinates in waters with automatic controls. These control systems use variable levels of power to counter forces from current and wind. Operations will take place over a 24-hour period to ensure cost, the duration of survey activities, and the period of potential impact on marine species are minimized. Based on 24-hour operations, the estimated duration of the geotechnical survey activities will be approximately 12 days excluding weather downtime. Estimated weather downtime is approximately 10 days.

    Please see the previously referenced Federal Register notice (82 FR 20563; May 3, 2017) for a more detailed description of the specified activity.

    Comments and Responses

    A notice of NMFS' proposal to issue an IHA to Ocean Wind was published in the Federal Register on May 3, 2017 (82 FR 20563). That notice described, in detail, Ocean Wind's activity, the marine mammal species that may be affected by the activity and the anticipated effects on marine mammals. During the 30-day public comment period, NMFS received comments from the Marine Mammal Commission (Commission) and the Center for Regulatory Effectiveness (CRE).

    Comment 1: The Commission recommends that, until the behavior thresholds are updated, NMFS require applicants to use the 120- rather than 160-dB re 1 μPa threshold for acoustic, non-impulsive sources (e.g., chirp-type sub-bottom profilers, echosounders, and other sonars including side-scan and fish-finding).

    Response: NMFS considers sub-bottom profilers to be impulsive sources; therefore, 160 dB threshold will continue to be used. Additionally, BOEM listed sparkers as impulsive sources (BOEM 2016). The 120-dB threshold is typically associated with continuous sources. Continuous sounds are those whose sound pressure level remains above that of the ambient sound, with negligibly small fluctuations in level (NIOSH, 1998; ANSI, 2005). Intermittent sounds are defined as sounds with interrupted levels of low or no sound (NIOSH, 1998). Sub-bottom profiler signals are intermittent sounds. Intermittent sounds can further be defined as either impulsive or non-impulsive. Impulsive sounds have been defined as sounds which are typically transient, brief (<1 sec), broadband, and consist of a high peak pressure with rapid rise time and rapid decay (ANSI, 1986; NIOSH, 1998). Non-impulsive sounds typically have more gradual rise times and longer decays (ANSI, 1995; NIOSH, 1998). Sub-bottom profiler signals have durations that are typically very brief (<1 sec), with temporal characteristics that more closely resemble those of impulsive sounds than non-impulsive sounds. With regard to behavioral thresholds, we consider the temporal and spectral characteristics of sub-bottom profiler signals to more closely resemble those of an impulse sound rather than a continuous sound. The 160-dB threshold is typically associated with impulsive sources. Therefore, the 160-dB threshold (typically associated with impulsive sources) is more appropriate than the 120-dB threshold (typically associated with continuous sources) for estimating takes by behavioral harassment incidental to use of such sources.

    Comment 2: The Commission recommends that NMFS work with the BOEM Office of Renewable Energy to determine the circumstances under which adoption of mutually agreed-upon mitigation measures would avoid the potential for taking marine mammals and the need for an IHA. The Commission further recommends that NMFS use a consistent approach for reducing (or not reducing) the numbers of estimated takes based on the requirement to implement mitigation measures to preclude taking in the respective Level B harassment zones.

    Response: NMFS appreciates the Commission's recommendations to streamline our incidental take authorization (ITA) process. NMFS believes that for this project with activities occurring at night and over a long duration, we are not comfortable assuming we can avoid all takes with mitigation measures in place. Ocean Wind's application included conservative monitoring measures, which will help reduce take of marine mammals, but may not completely eliminate the possibility for take.

    In regards to the Commission's recommendation for using a consistent approach to reducing the number of estimated take, they referenced our ITAs involving Cook Inlet beluga whales. First, Ocean Wind's project is not the same situation as in Cook Inlet. In Cook Inlet there is a small resident population of beluga whales, and applicants have proposed shutting down when a certain number of total belugas observed within the Level B zone is reached to help ensure that no more than small numbers (an MMPA requirement) of belugas are taken during their activity. Second, regarding consistency, NMFS generally applies standard minimum mitigation requirements to different activity types. However, if an applicant proposes measures that are more protective than the standard minimum in their application (and NMFS believes that those measures will effect a reduction of impacts beyond the standard minimum measures), it suggests that those measures are practicable for the applicant may be appropriate for NMFS to include them to meet our least practicable adverse impact standard. Though standard minimum measures are helpful and generally used, the overall suite of mitigation measures is determined on a case-by-case basis, is dependent upon multiple factors specific to the activity, environment, and affected species, and may vary some between projects.

    Comment 3: CRE does not oppose NMFS' issuance of the IHA, but they do oppose NMFS' use of the acoustic Guidance in the IHA. Given the Executive Order (EO) 13795, CRE commented that NMFS does not have the authority to use the Guidance until the Commerce Secretary has completed his review and made a decision as to whether to revise or rescind the Guidance. They further recommend that NMFS remove any claim that OMB had approved an Information Collection Request (ICR) for the Guidance, and NMFS should correct information disseminations that suggest or require that the Guidance may be used for any regulatory purpose.

    Response: As described in our May 31, 2017 Federal Register notice (82 FR 24950), NMFS is soliciting public comment on the Guidance in accordance with EO 13795. NMFS will also consult the appropriate Federal agencies to assist the Secretary of Commerce in reviewing the Technical Guidance for consistency with the policy in section 2 of EO 13795. As mandated by the EO, at the conclusion of the review the Secretary of Commerce will make a determination of how to proceed. At that point, NMFS will determine what information will be provided on our information disseminations. EO 13795 does not state that the Guidance cannot be used during the review process; therefore, the Guidance remains applicable during this time. The Guidance explicitly states that ITA applicants are not required to use it and that, if an alternative approach is likely to produce a more accurate estimate of auditory impact for the project being evaluated, the applicant may propose such an alternate approach (NMFS 2016).NMFS is currently in compliance under the Paperwork Reduction Act (PRA) for the ICR.

    Description of Marine Mammals in the Area of the Specified Activity

    There are 35 species of marine mammals that potentially occur in the Northwest Atlantic OCS region (BOEM 2014) (Table 2). The majority of these species are pelagic and/or northern species, or are so rarely sighted that their presence in the Lease Area is unlikely. Five species are considered to have the potential to co-occur with the planned survey activities: fin whale (Balaenoptera physalus), bottlenose dolphin (Tursiops truncatus), short-beaked common dolphin (Delphinus delphis), harbor porpoise (Phocoena phocoena), and harbor seal (Phoca vitulina) (Right Whale Consortium 2016). Table 2 lists all species with expected potential for occurrence in the NE Atlantic OCS and summarizes information related to the population or stock. For status of species, we provide information regarding U.S. regulatory status under the MMPA and ESA. All managed stocks in this region are assessed in NMFS's U.S. 2016 Atlantic SARs and can be found here: http://www.nmfs.noaa.gov/pr/species/. All values presented in Table 2 are the most recent available at the time of publication and are available in the draft 2016 SARs. A detailed description of the of the species likely to be affected by the marine site characterization project, including brief introductions to the species and relevant stocks as well as available information regarding population trends and threats, and information regarding local occurrence, were provided in the Federal Register notice for the proposed IHA (82 FR 20563; May 3, 2017). Since that time, we are not aware of any changes in the status of these species and stocks; therefore, detailed descriptions are not provided here. Please refer to that Federal Register notice for these descriptions. Please also refer to NMFS' Web site (www.nmfs.noaa.gov/pr/species/mammals/) for generalized species accounts.

    Table 2—Marine Mammals Known To Occur in the Waters off the Northwest Atlantic OCS Common name Stock NMFS MMPA and
  • ESA status;
  • strategic
  • (Y/N) 1
  • Stock Abundance
  • (CV,Nmin, most recent abundance survey) 2
  • PBR 3 Occurrence and seasonality in the NW Atlantic OCS
    Toothed whale (Odontoceti) Atlantic white-sided dolphin (Lagenorhynchus acutus) W. North Atlantic -; N 48,819 (0.61; 30,403; n/a) 304 rare. Atlantic spotted dolphin (Stenella frontalis) W. North Atlantic -; N 44,715 (0.43; 31,610; n/a) 316 rare. Bottlenose dolphin (Tursiops truncatus) W. North Atlantic, Offshore -; N 77,532 (0.40; 56,053; 2011) 561 Common year round. Clymene Dolphin (Stenella clymene) W. North Atlantic -; N Unknown (unk; unk; n/a) Undet rare. Pantropical Spotted Dolphin (Stenella attenuata) W. North Atlantic -; N 3,333 (0.91; 1,733; n/a) 17 rare. Risso's dolphin (Grampus griseus) W. North Atlantic -; N 18,250 (0.46; 12,619; n/a) 126 rare. Short-beaked common dolphin (Delphinus delphis) W. North Atlantic -; N 70,184 (0.28; 55,690; 2011) 557 Common year round. Striped dolphin (Stenella coeruleoalba) W. North Atlantic -; N 54,807 (0.3; 42,804; n/a) 428 rare. Spinner Dolphin (Stenella longirostris) W. North Atlantic -; N Unknown (unk; unk; n/a) Undet rare. White-beaked dolphin (Lagenorhynchus albirostris) W. North Atlantic -; N 2,003 (0.94; 1,023; n/a) 10 rare. Harbor porpoise (Phocoena phocoena) Gulf of Maine/Bay of Fundy -; N 79,833 (0.32; 61,415; 2011) 706 Common year round. Killer whale (Orcinus orca) W. North Atlantic -; N Unknown (unk; unk; n/a) Undet rare. False killer whale (Pseudorca crassidens) W. North Atlantic -;Y 442 (1.06; 212; n/a) 2.1 rare. Long-finned pilot whale (Globicephala melas) W. North Atlantic -;Y 5,636 (0.63; 3,464; n/a) 35 rare. Short-finned pilot whale (Globicephala macrorhynchus) W. North Atlantic -;Y 21,515 (0.37; 15,913; n/a) 159 rare. Sperm whale (Physeter macrocephalus) North Atlantic E; Y 2,288 (0.28; 1,815; n/a) 3.6 Year round in continental shelf and slope waters, occur seasonally to forage. Pygmy sperm whale (Kogia breviceps) W. North Atlantic -; N 3,785 b/(0.47; 2,598; n/a) 26 rare. Dwarf sperm whale (Kogia sima) W. North Atlantic -; N 3,785 b/(0.47; 2,598; n/a) 26 rare. Cuvier's beaked whale (Ziphius cavirostris) W. North Atlantic -; N 6,532 (0.32; 5,021; n/a) 50 rare. Blainville's beaked whale (Mesoplodon densirostris) W. North Atlantic -; N 7,092 c/(0.54; 4,632; n/a) 46 rare. Gervais' beaked whale (Mesoplodon europaeus) W. North Atlantic -; N 7,092 c/(0.54; 4,632; n/a) 46 rare. True's beaked whale (Mesoplodon mirus) W. North Atlantic -; N 7,092 c/(0.54; 4,632; n/a) 46 rare. Sowerby's Beaked Whale (Mesoplodon bidens) W. North Atlantic -; N 7,092 c/(0.54; 4,632; n/a) 46 rare. Melon-headed whale (Peponocephala electra) W. North Atlantic -; N Unknown (unk; unk; n/a) Undet rare. Baleen whales (Mysticeti) Minke whale (Balaenoptera acutorostrata) Canadian East Coast -; N 2,591 (0.81; 1,425; n/a) 162 Year round in continental shelf and slope waters, occur seasonally to forage. Blue whale (Balaenoptera musculus) W. North Atlantic E; Y Unknown (unk; 440; n/a) 0.9 Year round in continental shelf and slope waters, occur seasonally to forage. Fin whale (Balaenoptera physalus) W. North Atlantic E; Y 1,618 (0.33; 1,234; n/a) 2.5 Year round in continental shelf and slope waters, occur seasonally to forage. Humpback whale (Megaptera novaeangliae) Gulf of Maine -; N 823 (0; 823; n/a) 2.7 Common year round. North Atlantic right whale (Eubalaena glacialis) W. North Atlantic E; Y 440 (0; 440; n/a) 1 Year round in continental shelf and slope waters, occur seasonally to forage. Sei whale (Balaenoptera borealis) Nova Scotia E; Y 357 (0.52; 236; n/a) 0.5 Year round in continental shelf and slope waters, occur seasonally to forage. Earless seals (Phocidae) Gray seals (Halichoerus grypus) North Atlantic -; N 505,000 (unk; unk; n/a) Undet Unlikely. Harbor seals (Phoca vitulina) W. North Atlantic -; N 75,834 (0.15; 66,884; 2012) 2,006 Common year round. Hooded seals (Cystophora cristata) W. North Atlantic -; N Unknown (unk; unk; n/a) Undet rare. Harp seal (Phoca groenlandica) North Atlantic -; N Unknown (unk; unk; n/a) Undet rare. 1 ESA status: Endangered (E), Threatened (T)/MMPA status: Depleted (D). A dash (-) indicates that the species is not listed under the ESA or designated as depleted under the MMPA. Under the MMPA, a strategic stock is one for which the level of direct human-caused mortality exceeds PBR (see footnote 3) or which is determined to be declining and likely to be listed under the ESA within the foreseeable future. Any species or stock listed under the ESA is automatically designated under the MMPA as depleted and as a strategic stock. 2 CV is coefficient of variation; Nmin is the minimum estimate of stock abundance. In some cases, CV is not applicable. For certain stocks, abundance estimates are actual counts of animals and there is no associated CV. The most recent abundance survey that is reflected in the abundance estimate is presented; there may be more recent surveys that have not yet been incorporated into the estimate. All values presented here are from the draft 2016 Pacific SARs. 3 Potential biological removal, defined by the MMPA as the maximum number of animals, not including natural mortalities, that may be removed from a marine mammal stock while allowing that stock to reach or maintain its optimum sustainable population size (OSP).
    Potential Effects of the Specified Activity on Marine Mammals and Their Habitat

    The effects of underwater noise from HRG and geotechnical activities for the marine site characterization project have the potential to result in behavioral harassment of marine mammals in the vicinity of the action area. The Federal Register notice for the proposed IHA (82 FR 20563; May 3, 2017) included a discussion of the effects of anthropogenic noise on marine mammals, therefore that information is not repeated here. Please refer to the Federal Register notice (82 FR 20563; May 3, 2017) for that information.

    Estimated Take

    This section provides an estimate of the number of incidental takes authorized in this IHA, which informed both NMFS' consideration of whether the number of takes is “small” and the negligible impact determination.

    Harassment is the only type of take expected to result from these activities. 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).

    Authorized takes will be by Level B harassment only, in the form of disruption of behavioral patterns for individual marine mammals resulting from exposure to HRG and geotechnical surveys. Based on the nature of the activity, the short duration of activities, and the small Level A isopleths (less than 3 m for all sources), Level A harassment is neither anticipated nor authorized. The death of a marine mammal is also a type of incidental take. However, as described previously, no mortality is anticipated or authorized for this activity. Below we describe how the take is estimated for this project.

    Project activities that have the potential to harass marine mammals, as defined by the MMPA, include underwater noise from operation of the HRG survey sub-bottom profilers and noise propagation associated with the use of DP thrusters during geotechnical survey activities that require the use of a DP drill ship. NMFS anticipates that impacts to marine mammals will be in the form of behavioral harassment, and no take by injury, serious injury, or mortality is authorized.

    The basis for the take estimate is the number of marine mammals that will be exposed to sound levels in excess of NMFS' Level B harassment criteria for impulsive noise (160 dB re 1 μPa (rms) and continuous noise (120 dB re 1 μPa (rms)), which is generally determined by overlaying the area ensonified above NMFS acoustic thresholds for harassment within a day with the density of marine mammals, and multiplying by the number of days. NMFS' current acoustic thresholds for estimating take are shown in Table 3 below.

    Table 3—NMFS's Acoustic Exposure Criteria Criterion Definition Threshold Level B harassment (underwater) Behavioral disruption 160 dB (impulsive source)/120 dB (continuous source) (rms). Level B harassment (airborne) Behavioral disruption 90 dB (harbor seals)/100 dB (other pinnipeds) (unweighted).

    Modeling took into consideration sound sources using the potential operational parameters, bathymetry, geoacoustic properties of the Lease Area, time of year, and marine mammal hearing ranges. Results from the hydroacoustic modeling and measurements showed that estimated maximum distance to the 160 dB re 1 μPa (rms) MMPA threshold for all water depths for the HRG survey sub-bottom profilers (the HRG survey equipment with the greatest potential for effect on marine mammal) was approximately 75.28 m from the source using practical spreading (Subacoustech 2016), and the estimated maximum critical distance to the 120 dB re 1 μPa (rms) MMPA threshold for all water depths for the drill ship DP thruster was approximately 500 m from the source (Subacoustech 2016). Ocean Wind and NMFS believe that these estimates represent the a conservative scenario and that the actual distances to the Level B harassment threshold may be shorter for HRG equipment, as practical spreading (15logR) was used to estimate the ensonified area here and there are some sound measurements taken in the Northeast that suggest a higher spreading coefficient (which would result in a shorter distance) may be applicable.

    Ocean Wind estimated species densities within the project area in order to estimate the number of marine mammal exposures to sound levels above the 120 dB Level B harassment threshold for continuous noise (i.e., DP thrusters) and the 160 dB Level B harassment threshold for intermittent, impulsive noise (i.e., sub-bottom profiler). Research indicates that marine mammals generally have extremely fine auditory temporal resolution and can detect each signal separately (e.g., Au et al., 1988; Dolphin et al., 1995; Supin and Popov 1995; Mooney et al., 2009b), especially for species with echolocation capabilities. Therefore, it is likely that marine mammals will perceive the acoustic signals associated with the HRG survey equipment as being intermittent rather than continuous, and we base our takes from these sources on exposures to the 160 dB threshold.

    The data used as the basis for estimating cetacean density (“D”) for the Lease Area are sightings per unit effort (SPUE) derived by Duke University (Roberts et al., 2016). For pinnipeds, the only available comprehensive data for seal abundance is the Northeast Navy Operations Area (OPAREA) Density Estimates (DoN 2007). SPUE (or, the relative abundance of species) is derived by using a measure of survey effort and number of individual cetaceans sighted. SPUE allows for comparison between discrete units of time (i.e. seasons) and space within a project area (Shoop and Kenney 1992). The Duke University (Roberts et al., 2016) cetacean density data represent models derived from aggregating line-transect surveys conducted over 23 years by 5 institutions (NMFS Northeast Fisheries Science Center (NEFSC), New Jersey Department of Environmental Protection (NJDEP), NMFS Southeast Fisheries Science Center (SEFSC), University of North Carolina Wilmington (UNCW), Virginia Aquarium & Marine Science Center (VAMSC)), the results of which are freely available online at the Ocean Biogeographic Information System Spatial Ecological Analysis of Megavertebrate Populations (OBIS-SEAMAP) repository. Monthly density values were within the survey area were averaged by season to provide seasonal density estimates. The OPAREA Density Estimates (DoN 2007) used for pinniped densities were based on data collected through NMFS NWFSC aerial surveys conducted between 1998 and 2005.

    The Zone of influence (ZOI) is the extent of the ensonified zone in a given day. The ZOI was calculated using the following equations:

    • Stationary source (e.g. DP thruster): πr2

    • Mobile source (e.g. sparkers): (distance/day * 2r) + πr2

    Where distance is the maximum survey trackline per day (177.6 km) and r is the distance to the 160 dB (for impulsive sources) and 120 dB (for non-impulsive sources) isopleths. The isopleths were calculated using practical spreading.

    Estimated takes were calculated by multiplying the species density (animals per km2) by the appropriate ZOI, multiplied by the number of appropriate days (e.g. 42 for HRG activities or 12 for geotechnical activities) of the specified activity. A detailed description of the acoustic modeling used to calculate zones of influence is provided in Ocean Wind's IHA application (also see the discussion in the Mitigation Measures section below).

    Ocean Wind used a ZOI of 26.757 km2 and a survey period of 42 days, which includes estimated weather downtime, to estimate take from use of the HRG survey equipment during geophysical survey activities. The ZOI is based on the worst case (since it assumes the higher powered GeoSource 800 sparker will be operating all the time) and a maximum survey trackline of 110.4 mi (177.6 km) per day. Based on the planned HRG survey schedule (June 2017), take calculations were based on the summer seasonal species density as derived from Roberts et al. (2016) for cetaceans and seasonal OPAREA density estimates (DoN, 2007) for pinnipeds. The resulting take estimates (rounded to the nearest whole number) are presented in Table 4.

    Table 4—Estimated Level B Harassment Takes for HRG Survey Activities Species Density for summer
  • (No./km²)
  • Calculated take
  • (No.)
  • Requested take
  • authorization
  • (No.)
  • Percentage
  • of stock
  • potentially
  • affected
  • Fin Whale .0008 0.89 *5 0.061 Bottlenose Dolphin .2534 284.7 285 0.385 Short beaked common Dolphin .0282 31.69 32 0.047 Harbor Porpoise .0012 1.34 *4 0.006 * Requested take authorization was increased to account for average group size of fin whales (5) and harbor porpoise (4).

    Ocean Wind used a ZOI of 0.31 m2 (0.79 km2) and a maximum DP thruster use period of 12 days to estimate take from use of the DP thruster during geotechnical survey activities. The ZOI represents the field-verified distance to the 120 dB isopleth for DP thruster use. Based on the planned geotechnical survey schedule (September 2017), take calculations were based on the fall seasonal species density estimates (Roberts et al., 2016; DoN, 2007) (Table 5). The resulting take estimates (rounded to the nearest whole number) based upon these conservative assumptions for bottlenose dolphins and harbor seals are presented in Table 5. These numbers are based on 12 days and represent only 0.001 percent of the stock for each of these 2 species. Take estimates were increased to take into account average group size where needed (fin whale and harbor porpoise).

    Table 5—Estimated Level B Harassment Takes for Geotechnical Survey Activities Species Density for fall
  • (No./100 km²)
  • Calculated take
  • (No.)
  • Requested take
  • authorization
  • (No.)
  • Percentage
  • of stock
  • potentially
  • affected
  • Bottlenose Dolphin 11.44 1.08 *1 0.001 Harbor seal 9.74 0.92 1 0.001 * It is understood that typical pod size for bottlenose dolphins can be 2 to 15 individuals (NOAA 2015b). Given that take for this species has been requested to cover HRG survey activities, in conjunction with mitigation measures, the Applicant has determined that increasing take to account for group size is not necessary.

    Ocean Wind's requested take numbers are provided in Tables 4 and 5 and are also the number of takes NMFS is authorizing. Ocean Wind's calculations do not take into account whether a single animal is harassed multiple times or whether each exposure is a different animal. Therefore, the numbers in Tables 4 and 5 are the maximum number of animals that may be harassed during the HRG and geotechnical surveys (i.e., Ocean Wind assumes that each exposure event is a different animal). These estimates do not account for prescribed mitigation measures that Ocean Wind will implement during the specified activities and the fact that shutdown/powerdown procedures shall be implemented if an animal enters within 200 m of the vessel during HRG activities, and 500 m during geotechnical activities, further reducing the potential for any takes to occur during these activities.

    Ocean Wind used NMFS' Guidance (NMFS 2016) to determine sound exposure thresholds to determine when an activity that produces sound might result in impacts to a marine mammal such that a take by injury, in the form of PTS, might occur. The functional hearing groups and the associated PTS onset acoustic thresholds are indicated in Table 6 below. Ocean Wind used the user spreadsheet to calculate the isopleth for the loudest source (sparker, sub-bottom profiler). The sub-bottom profiler was calculated with the following conditions: Source level at 172.4 rms, vessel velocity of 2.058 m/s, repetition rate of 0.182, pulse duration of 22 ms and a weighting factor adjustment of 10 based on the spectrogram for this equipment (Gardline 2016). Isopleths were less than 3 m for all hearing groups; therefore, no Level A takes were requested. The Geo-Source sparker model used the following parameters: Source level at 188.7 rms Source level, vessel velocity of 2.058 meters per second (m/s), repetition rate of 0.25 seconds, pulse duration of 10 ms and weighting factor adjustment of 3 based on the spectrograms for this equipment. Isopleths were less than 2 m for all hearing groups; therefore, no Level A takes were requested. The DP thruster was defined as non-impulsive static continuous source with an extrapolated source level of 150 dB rms based on far field measurements (Subacoustech 2016), an activity duration of 4 hours and weighting factor adjustment of 2. The transmission loss coefficient of 11.1 was used based on the slope of best fit from field measurements (Subacoustech 2016). Isopleths were less than 1 m for all hearing groups; therefore, no Level A take were requested. No level A take is requested or authorized for any of the sources used during HRG and geotechnical surveys.

    Table 6—Summary of PTS Onset Acoustic Thresholds Hearing group PTS onset acoustic thresholds1
  • (Received level)
  • Impulsive Non-impulsive
    Low-frequency cetaceans Cell 1: Lpk,flat: 219 dB; LE,LF,24h: 183 dB Cell 2: LE,LF,24h: 199 dB. Mid-frequency cetaceans Cell 3: Lpk,flat: 230 dB; LE,MF,24h: 185 dB Cell 4: LE,MF,24h: 198 dB. High-frequency cetaceans Cell 5: Lpk,flat: 202 dB; LE,HF,24h: 155 dB Cell 6: LE,HF,24h: 173 dB. Phocid Pinnipeds (underwaters) Cell 7: Lpk,flat: 218 dB; LE,PW,24h: 185 dB Cell 8: LE,PW,24h: 201 dB. Otariid Pinnipeds (underwater) Cell 9: Lpk,flat: 232 dB; LE,OW,24h: 203 dB Cell 10: LE,OW,24h: 219 dB. 1 NMFS 2016.
    Mitigation Measures

    In order to issue an IHA under section 101(a)(5)(D) of the MMPA, NMFS must set forth the permissible methods of taking pursuant to such activity, and other means of effecting the least practicable impact 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 (latter not applicable for this action). NMFS regulations require applicants for incidental take authorizations to include information about the availability and feasibility (economic and technological) of equipment, methods, and manner of conducting such activity or other means of effecting the least practicable adverse impact upon the affected species or stocks and their habitat (50 CFR 216.104(a)(11)).

    In evaluating how mitigation may or may not be appropriate to ensure the least practicable adverse impact on species or stocks and their habitat, as well as subsistence uses where applicable, we carefully balance two primary factors: (1) The manner in which, and the degree to which, the successful implementation of the measure(s) is expected to reduce impacts to marine mammals, marine mammal species or stocks, and their habitat, which considers the nature of the potential adverse impact being mitigated (likelihood, scope, range), as well as the likelihood that the measure will be effective if implemented; and the likelihood of effective implementation, and; (2) the practicability of the measures for applicant implementation, which may consider such things as cost, impact on operations, and, in the case of a military readiness activity, personnel safety, practicality of implementation, and impact on the effectiveness of the military readiness activity.

    With NMFS' input during the application process, and as per the BOEM Lease, Ocean Wind will implement the following mitigation measures during site characterization surveys utilizing HRG survey equipment and use of the DP thruster. The mitigation measures outlined in this section are based on protocols and procedures that have been successfully implemented and resulted in no observed take of marine mammals for similar offshore projects and previously approved by NMFS (ESS 2013; Dominion 2013 and 2014).

    Marine Mammal Exclusion Zones

    Protected species observers (PSOs) will monitor the following exclusion/monitoring zones for the presence of marine mammals:

    • A 200-m exclusion zone during HRG surveys (this exceeds the estimated Level B harassment isopleth).

    • A 500-m monitoring zone during the use of DP thrusters during geotechnical survey activities (this is equal to the Level B harassment isopleth).

    The 200 m exclusion zone is the default exclusion zone specified in stipulation 4.4.6.1 of the New Jersey OCS-A 0498 Lease Agreement. The 500 m exclusion zone is based on field-verified distances established during similar survey work conducted within the Bay State Wind Lease Area (Subacoustech 2016).

    Visual Monitoring

    Visual monitoring of the established exclusion zone(s) for the HRG and geotechnical surveys will be performed by qualified and NMFS-approved PSOs, the resumes of whom will be provided to NMFS for review and approval prior to the start of survey activities. An observer team comprising a minimum of four NMFS-approved PSOs and two certified Passive Acoustic Monitoring (PAM) operators (PAM operators will not function as PSOs), operating in shifts, will be stationed aboard either the survey vessel or a dedicated PSO-vessel. PSOs and PAM operators will work in shifts such that no one monitor will work more than 4 consecutive hours without a 2-hour break or longer than 12 hours during any 24-hour period. During daylight hours the PSOs will rotate in shifts of one on and three off, while during nighttime operations PSOs will work in pairs. The PAM operators will also be on call as necessary during daytime operations should visual observations become impaired. Each PSO will monitor 360 degrees of the field of vision.

    PSOs will be responsible for visually monitoring and identifying marine mammals approaching or within the established exclusion zone(s) during survey activities. It will be the responsibility of the Lead PSO on duty to communicate the presence of marine mammals as well as to communicate and enforce the action(s) that are necessary to ensure mitigation and monitoring requirements are implemented as appropriate. PAM operators will communicate detected vocalizations to the Lead PSO on duty, who will then be responsible for implementing the necessary mitigation procedures. A mitigation and monitoring communications flow diagram has been included as Appendix A in the IHA application.

    PSOs will be equipped with binoculars and have the ability to estimate distances to marine mammals located in proximity to the vessel and/or exclusion zone using range finders. Reticulated binoculars will also be available to PSOs for use as appropriate based on conditions and visibility to support the siting and monitoring of marine species. Digital single-lens reflex camera equipment will be used to record sightings and verify species identification. During night operations, PAM (see Passive Acoustic Monitoring requirements below) and night-vision equipment in combination with infrared technology will be used (Additional details and specifications are provided in Ocean Wind's application in Appendix B for night-vision devices and Appendix C for infrared video monitoring technology). Position data will be recorded using hand-held or vessel global positioning system (GPS) units for each sighting.

    The PSOs will begin observation of the exclusion zone(s) at least 60 minutes prior to ramp-up of HRG survey equipment. Use of noise-producing equipment will not begin until the exclusion zone is clear of all marine mammals for at least 60 minutes, as per the requirements of the BOEM Lease.

    If a marine mammal is detected approaching or entering the 200-m exclusion zones during the HRG survey, or the 500-m monitoring zone during DP thrusters use, the vessel operator will adhere to the shutdown (during HRG survey) or powerdown (during DP thruster use) procedures described below to minimize noise impacts on the animals.

    At all times, the vessel operator will maintain a separation distance of 500 m from any sighted North Atlantic right whale as stipulated in the Vessel Strike Avoidance procedures described below. These stated requirements will be included in the site-specific training to be provided to the survey team.

    Vessel Strike Avoidance

    The Applicant will ensure that vessel operators and crew maintain a vigilant watch for cetaceans and pinnipeds and slow down or stop their vessels to avoid striking these species. Survey vessel crew members responsible for navigation duties will receive site-specific training on marine mammal and sea turtle sighting/reporting and vessel strike avoidance measures. Vessel strike avoidance measures will include the following, except under extraordinary circumstances when complying with these requirements would put the safety of the vessel or crew at risk:

    • All vessel operators will comply with 10 knot (<18.5 km per hour [km/h]) speed restrictions in any Dynamic Management Area (DMA). In addition, all vessels operating from November 1 through July 31 will operate at speeds of 10 knots (<18.5 km/h) or less.

    • All survey vessels will maintain a separation distance of 500 m or greater from any sighted North Atlantic right whale.

    • If underway, vessels must steer a course away from any sited North Atlantic right whale at 10 knots (<18.5 km/h) or less until the 500 m minimum separation distance has been established. If a North Atlantic right whale is sighted in a vessel's path, or within 100 m to an underway vessel, the underway vessel must reduce speed and shift the engine to neutral. Engines will not be engaged until the North Atlantic right whale has moved outside of the vessel's path and beyond 100 m. If stationary, the vessel must not engage engines until the North Atlantic right whale has moved beyond 100 m.

    • All vessels will maintain a separation distance of 100 m or greater from any sighted non-delphinoid (i.e., mysticetes and sperm whales) cetaceans. If sighted, the vessel underway must reduce speed and shift the engine to neutral and must not engage the engines until the non-delphinoid cetacean has moved outside of the vessel's path and beyond 100 m. If a survey vessel is stationary, the vessel will not engage engines until the non-delphinoid cetacean has moved out of the vessel's path and beyond 100 m.

    • All vessels will maintain a separation distance of 50 m or greater from any sighted delphinoid cetacean. Any vessel underway will remain parallel to a sighted delphinoid cetacean's course whenever possible and avoid excessive speed or abrupt changes in direction. Any vessel underway reduces vessel speed to 10 knots or less when pods (including mother/calf pairs) or large assemblages of delphinoid cetaceans are observed. Vessels may not adjust course and speed until the delphinoid cetaceans have moved beyond 50 m and/or abeam (i.e., moving away and at a right angle to the centerline of the vessel) of the underway vessel.

    • All vessels will maintain a separation distance of 50 m (164 ft) or greater from any sighted pinniped.

    The training program will be provided to NMFS for review and approval prior to the start of surveys. Confirmation of the training and understanding of the requirements will be documented on a training course log sheet. Signing the log sheet will certify that the crew members understand and will comply with the necessary requirements throughout the survey event.

    Seasonal Operating Requirements

    Between watch shifts, members of the monitoring team will consult the NMFS North Atlantic right whale reporting systems for the presence of North Atlantic right whales throughout survey operations. The planned survey activities however, will occur outside of the SMA located off the coasts of Delaware and New Jersey. The planned survey activities will also occur in June/July and September, which is outside of the seasonal mandatory speed restriction period for this SMA (November 1 through April 30).

    Throughout all survey operations, Ocean Wind will monitor the NMFS North Atlantic right whale reporting systems for the establishment of a DMA. If NMFS should establish a DMA in the Lease Area under survey, within 24 hours of the establishment of the DMA Ocean Wind will work with NMFS to shut down and/or alter the survey activities to avoid the DMA.

    Passive Acoustic Monitoring

    As per the BOEM Lease, alternative monitoring technologies (e.g., active or passive acoustic monitoring) are required if a Lessee intends to conduct geophysical surveys at night or when visual observation is otherwise impaired. To support 24-hour HRG survey operations, Ocean Wind will use certified PAM operators with experience reviewing and identifying recorded marine mammal vocalizations, as part of the project monitoring during nighttime operations to provide for optimal acquisition of species detections at night, or as needed during periods when visual observations may be impaired. In addition, PAM systems shall be employed during daylight hours to support system calibration and PSO and PAM team coordination, as well as in support of efforts to evaluate the effectiveness of the various mitigation techniques (i.e., visual observations during day and night, compared to the PAM detections/operations).

    Given the range of species that could occur in the Lease Area, the PAM system will consist of an array of hydrophones with both broadband (sampling mid-range frequencies of 2 kHz to 200 kHz) and at least one low-frequency hydrophone (sampling range frequencies of 75 Hz to 30 kHz). Monitoring of the PAM system will be conducted from a customized processing station aboard the HRG survey vessel. The on-board processing station provides the interface between the PAM system and the operator. The PAM operator(s) will monitor the hydrophone signals in real time both aurally (using headphones) and visually (via the monitor screen displays). Ocean Wind plans to use PAMGuard software for “target motion analysis” to support localization in relation to the identified exclusion zone. PAMGuard is an open source and versatile software/hardware interface to enable flexibility in the configuration of in-sea equipment (number of hydrophones, sensitivities, spacing, and geometry). PAM operators will immediately communicate detections/vocalizations to the Lead PSO on duty who will ensure the implementation of the appropriate mitigation measure (e.g., shutdown) even if visual observations by PSOs have not been made.

    Ramp-Up

    As per the BOEM Lease, a ramp-up procedure will be used for HRG survey equipment capable of adjusting energy levels at the start or re-start of HRG survey activities. A ramp-up procedure will be used at the beginning of HRG survey activities in order to provide additional protection to marine mammals near the Lease Area by allowing them to vacate the area prior to the commencement of survey equipment use. The ramp-up procedure will not be initiated during daytime, night time, or periods of inclement weather if the exclusion zone cannot be adequately monitored by the PSOs using the appropriate visual technology (e.g., reticulated binoculars, night vision equipment) and/or PAM for a 60-minute period. A ramp-up will begin with the power of the smallest acoustic HRG equipment at its lowest practical power output appropriate for the survey. The power will then be gradually turned up and other acoustic sources added such that the source level will increase in steps not exceeding 6 dB per 5-minute period. If marine mammals are detected within the HRG survey exclusion zone prior to or during the ramp-up, activities will be delayed until the animal(s) has moved outside the monitoring zone and no marine mammals are detected for a period of 60 minutes.

    The DP vessel thrusters will be engaged to support the safe operation of the vessel and crew while conducting geotechnical survey activities and require use as necessary. Therefore, there is no opportunity to engage in a ramp-up procedure.

    Shutdown and Powerdown

    HRG Survey—The exclusion zone(s) around the noise-producing activities (HRG survey equipment) will be monitored, as previously described, by PSOs and at night by PAM operators for the presence of marine mammals before, during, and after any noise-producing activity. The vessel operator must comply immediately with any call for shutdown by the Lead PSO. Any disagreement should be discussed only after shutdown.

    As per the BOEM Lease, if a non-delphinoid (i.e., mysticetes and sperm whales) cetacean is detected at or within the established exclusion zone (200-m exclusion zone), an immediate shutdown of the HRG survey equipment is required. Subsequent restart of the electromechanical survey equipment must use the ramp-up procedures described above and may only occur following clearance of the exclusion zone for 60 minutes. These are extremely conservative shutdown zones, as the 200-m exclusion radii exceed the distances to the estimated Level B harassment isopleths (75.28 m).

    As per the BOEM Lease, if a delphinoid cetacean or pinniped is detected at or within the exclusion zone, the HRG survey equipment (including the sub-bottom profiler) must be powered down to the lowest power output that is technically feasible. Subsequent power up of the survey equipment must use the ramp-up procedures described above and may occur after (1) the exclusion zone is clear of a delphinoid cetacean and/or pinniped for 60 minutes or (2) a determination by the PSO after a minimum of 10 minutes of observation that the delphinoid cetacean or pinniped is approaching the vessel or towed equipment at a speed and vector that indicates voluntary approach to bow-ride or chase towed equipment.

    If the HRG sound source (including t