Federal Register Vol. 82, No.230,

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 to supersede AD 2014-08-01, Amendment 39-17825 (79 FR 23900, April 29, 2014) (“AD 2014-08-01”). AD 2014-08-01 applied to all Airbus Model A318, A319, A320, and A321 series airplanes. The NPRM published in the Federal Register on May 19, 2017 (82 FR 22918).

The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Union, has issued EASA AD 2016-0113, dated June 15, 2016 (referred to after this as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for all Airbus Model A318, A319, A320, and A321 series airplanes. The MCAI states:

You may examine the MCAI in the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0476.

We gave the public the opportunity to participate in developing this AD. The following presents the comments received on the NPRM and the FAA's response to each comment. United Airlines and the Air Line Pilots Association, International supported the NPRM.

Delta Airlines (DAL) requested that additional identification steps be required in the NPRM to ensure that the affected parts are correctly identified. DAL stated that figure 1 to paragraphs (g) and (h) of the proposed AD contains part numbers for affected interconnecting struts. DAL commented that a review of its records from inspections conducted during compliance with AD 2014-08-01 determined that other part numbers were possible. DAL stated that it has had at least one instance of a part with the part number D5757032200000A.

DAL stated that figure 2 to paragraphs (i)(2), (k), and (l) of the proposed AD adds the provision that additional alphanumeric characters may exist. DAL commented that while the NPRM removes some of the ambiguity that existed in AD 2014-08-01, a review of Airbus's Aircraft Illustrated Parts Catalog (AIPC) does not show any parts with a “letter” suffix. DAL provided a photo that showed that the part number appears to “wrap” (to the next line) on the part. DAL stated that this “wrapping” condition has led to confusion in identifying the parts.

DAL stated that per the Airbus AIPC Front Matter, the 13th, 14th, and 15th characters are controlled in specific ways. DAL also stated that the 13th and 14th characters are expected to be “00” and are used to fill out 12-digit base numbers on the part installed during production. DAL stated that the 15th character is a paint code designator and found the use of a paint code designator unusual on a part that is not viewable or expected to be painted to match an air carrier paint scheme. DAL commented that it believes the AD should be updated to show 00A, 00B, or the list of true possibilities, and the XXX allowance creates a significant number of possible part numbers that DAL must identify as prohibited.

We agree to clarify the requirement to identify affected parts. Regarding the characters in the part number, identifying the last three characters are not required to identify a discrepant part; only the first twelve base numbers are required. Therefore, we do not agree to revise this AD to include a complete list of all possible combinations of these characters.

We acknowledge the commenter's concern about the “wrapping” condition for part identification. However, in the photo provided by the commenter only the last three characters are “wrapped.” As stated previously, the last three characters are not required to identify a discrepant part.

Figure 3 to paragraph (k)(1) of this AD has been reformatted to clarify affected manufacturer serial numbers.

We have determined that a review of maintenance records is acceptable for complying with the actions specified in paragraphs (i)(1) and (i)(2) of this AD, provided the part number of the installed interconnecting struts and the part number and the serial number of the associated target and proximity sensor can be conclusively determined from that review. We have revised paragraph (i) of this AD accordingly.

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

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

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

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

Airbus has issued Service Bulletin A320-27-1206, Revision 02, dated November 2, 2015. The service information describes procedures for an inspection to determine the part number of the installed interconnecting struts and the part number and serial number of the associated target and proximity sensors, and procedures for replacement and re-identification of the interconnecting struts. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

We estimate that this AD affects 1,032 airplanes of U.S. registry.

We estimate the following costs to comply with this AD:

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

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

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

This AD is issued in accordance with authority delegated by the Executive Director, Aircraft Certification Service, as authorized by FAA Order 8000.51C. In accordance with that order, issuance of ADs is normally a function of the Compliance and Airworthiness Division, but during this transition period, the Executive Director has delegated the authority to issue ADs applicable to transport category airplanes to the Director of the System Oversight Division.

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

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

1. Is not a “significant regulatory action” under Executive Order 12866;

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

3. Will not affect intrastate aviation in Alaska; and

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

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

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 to supersede AD 2016-20-11, Amendment 39-18677 (81 FR 85837, November 29, 2016) (“AD 2016-20-11”). AD 2016-20-11 applied to certain Airbus Model A300-600 series airplanes; and Airbus Model A310 series airplanes. The NPRM published in the Federal Register on July 27, 2017 (82 FR 34891). The NPRM was prompted by a determination that reinforcement of the aft cargo door sill beam area is necessary to address the unsafe condition, which constitutes terminating action for the repetitive inspections. The NPRM proposed to continue to require repetitive inspections of the external area of the aft cargo door sill beam for cracking, repetitive inspections for fatigue cracking of the cargo door sill beam, lock fitting, and torsion box plate, and repair if necessary. The NPRM also proposed to require reinforcement of the aft cargo door sill beam area. We are issuing this AD to prevent fatigue cracking of the cargo door sill beam, lock fitting, and torsion box plate, which could result in the loss of the door locking function and subsequently, loss of the cargo door in flight and rapid decompression.

The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Union, has issued EASA AD 2017-0048, dated March 15, 2017; corrected April 20, 2017 (referred to after this as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for certain Airbus Model A300-600 series airplanes; and Airbus Model A310 series airplanes. The MCAI states:

You may examine the MCAI in the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0708.

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

FedEx requested that the terminating modification in paragraph (n) of the proposed AD be made an optional action. FedEx stated that they have inspected their airplanes as required by AD 2016-20-11 and have not found any cracks during HFEC inspections. FedEx noted that they have inspected airplanes having accumulated anywhere from 12,000 total flight cycles to 40,000 total flight cycles. FedEx suggested that the modification would be necessary on less than 1 percent of inspected airplanes over the next 10 years. FedEx claimed that the modification is an unproven change that has not been subjected to full scale fatigue testing. For these reasons, FedEx argued that inspections alone will maintain safe airworthiness for the affected airplanes.

We disagree with the commenter's request. EASA, as the State of Design Authority for Airbus products, has determined an unsafe conditions exists after conducting a risk analysis taking into consideration in-service data for the worldwide fleet. We agree with EASA's risk assessment and their decision to mitigate the risk by mandating the modification in this AD. FedEx has not provided sufficient data to support their request to allow inspections in lieu of the modification. We have not changed this AD in this regard.

FedEx requested that we update the labor costs for the modification in the proposed AD. FedEx stated that their labor costs for the modification will be an additional $10,000 per airplane. FedEx further noted that the modification would extend their service checks, resulting in additional out-of-service time for their airplanes and additional expenses.

We partially agree with the commenter's request. The number of work-hours to complete the modification depends on the airplane's configuration. In the NPRM, we used the 40 work-hours estimate for the configuration that requires less time to modify. We have updated this final rule to reflect work-hour costs of up to 68 hours (the estimated work-hours for the other configuration) for the required modification.

Regarding the additional costs related to extended service checks, we do not consider it appropriate to attribute the costs associated with aircraft “downtime” to the AD. Normally, compliance with the AD will not necessitate any additional downtime beyond that of a regularly scheduled maintenance hold. Even if additional downtime is necessary for some airplanes in some cases, we do not have sufficient information to evaluate the number of airplanes that may be affected or the amount of additional downtime that may be required. Therefore, we are unable to provide an estimate for these variable costs. We have made no further change to this final rule regarding this issue.

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

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

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

Airbus has issued Service Bulletin A300-53-6181, Revision 01, dated July 2, 2015; and Service Bulletin A310-53-2141, Revision 01, dated July 2, 2015. This service information describes procedures for reinforcing the aft cargo door sill beam area. These documents are distinct since they apply to different airplane models.

Airbus has also issued Service Bulletin A300-53-6179, dated December 12, 2014; and Service Bulletin A310-53-2139, dated December 12, 2014. This service information describes procedures for repetitive HFEC inspections of the cargo door sill beam, lock fitting, and torsion box plate. These documents are distinct since they apply to different airplane models.

Airbus has also issued Alert Operators Transmission AOT A53W005-14, Revision 01, dated April 29, 2014, which describes procedures for doing an ultrasonic inspection or detailed inspection of the aft cargo door sill beam external area for cracking.

This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

We estimate that this AD affects 75 airplanes of U.S. registry.

We estimate the following costs to comply with this AD:

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

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

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

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

This AD is issued in accordance with authority delegated by the Executive Director, Aircraft Certification Service, as authorized by FAA Order 8000.51C. In accordance with that order, issuance of ADs is normally a function of the Compliance and Airworthiness Division, but during this transition period, the Executive Director has delegated the authority to issue ADs applicable to transport category airplanes to the Director of the System Oversight Division.

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

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

1. Is not a “significant regulatory action” under Executive Order 12866;

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

3. Will not affect intrastate aviation in Alaska; and

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

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

The SCSEP, authorized by title V of the Older Americans Act (OAA), is the only Federally sponsored employment and training program targeted specifically to low-income older individuals who want to enter or re-enter the workforce. Participants must be 55 years of age or older, with incomes no more than 125 percent of the Federal poverty level. The program offers participants training at community service employment assignments in public and non-profit organizations and agencies so that they can gain on-the-job experience. The dual goals of the program are to promote useful opportunities in community service activities and also to move SCSEP participants into unsubsidized employment, where appropriate, so that they can achieve economic self-sufficiency.

The OAA, Public Law 114-144 (Apr. 19, 2016), amended the statutory provisions authorizing SCSEP and requires the Department to implement the amendments to the SCSEP performance measures by December 31, 2017. See OAA sec. 513(d)(4) (42 U.S.C. 3056k(d)(4), as amended by 2016 OAA sec. 6(d)(4) 1 ). The purpose of this IFR is to fulfill that statutory requirement.

The OAA requires the Secretary to “implement the core measures of performance not later than December 31, 2017.” OAA sec. 513(d)(4), 42 U.S.C. 3056k(d)(4). Accordingly, this IFR includes both the definitions of the measures (as required by OAA sec. 513(b)(2)) and the processes used to implement these measures in the conduct of the SCSEP grants. These processes include how the Department and grantees initially determine and then adjust expected levels of performance for the grants, and how the Department determines whether a grantee fails, meets, or exceeds the levels of performance. This IFR updates the current processes so that they reflect the changes required by the OAA.

The Administrative Procedure Act (APA) authorizes agencies to issue a rule without notice and comment upon a showing of good cause. 5 U.S.C. 553(b)(B). The APA's good cause exception to public participation applies upon a finding that those procedures are “impracticable, unnecessary, or contrary to the public interest.” 5 U.S.C. 553(b)(B). According to the legislative history of the APA, “unnecessary” means unnecessary so far as the public is concerned, as would be the case if a minor or merely technical amendment in which the public is not particularly interested were involved.” Senate Report No. 752 at p. 200, 79th Cong. 1st Sess. (1945). As explained by the U.S. Court of Appeals for the D.C. Circuit, “when regulations merely restate the statute they implement, notice-and-comment procedures are unnecessary.” Gray Panthers Advocacy Cmm. v. Sullivan, 936 F.2d 1284, 1291 (D.C. Cir. 1991). The Department has determined that there is good cause to find that a pre-publication comment period is unnecessary. The revisions set forth herein to the existing regulations at 20 CFR part 641 codify statutory changes requiring little to no agency discretion or are technical amendments updating terminology or outdated references to WIA, which WIOA superseded. For this reason, the Department's implementation of this rule as an IFR, with provision for post-promulgation public comment, is in accordance with sec. 553(b) of the APA.

Grantees may submit comments on the IFR until January 30, 2018, and the Department will consider them prior to issuing the rule finalizing this IFR. The Department plans to make any additional changes to the SCSEP regulations not related to the performance measures through a notice-and-comment rulemaking process.

The OAA requires the Department to establish and implement the new SCSEP performance measures after consultation with stakeholders. OAA sec. 513(b)(2). The Department satisfied these statutory requirements when it solicited public input on the definitions and implementation of the statutory performance measures in April and May of 2017. On May 8, 2017, the Department sent an email to 4,529 stakeholders, inviting them to register for the consultation. The invitees included 2,491 American Job Center managers, 523 SCSEP grantee and sub-grantee managers, 55 governors, 300 State workforce administrators, and 1,220 State Development Board chairs and directors. Those who registered received a reminder email on May 15, 2017.

Stakeholders were also informed that they could submit written comments after the consultation.

In response to this outreach effort, 394 individuals registered for the consultation from these stakeholder groups: Workforce development boards and American Job Centers; local, State, and Federal government; nonprofit organizations; direct providers of employment services; labor organizations; educational organizations; economic development organizations; and others. Of the 394 registered participants, 273 attended the consultation on May 16, 2017. At the start of the consultation, participants identified these affiliations: SCSEP grantees or sub-grantees (70 percent); WIOA partner, One-Stop operator, or American Job Center affiliate (18 percent); national or local aging agency (4 percent); SCSEP host agency (1 percent); Administration for Community Living (1 percent); and other (6 percent).

During the consultation, 100 written comments were received via the chat function. Some attendees submitted multiple comments. After the consultation, three grantees each submitted multiple comments in writing. Thirty of the comments are not relevant to the subject of the consultation or this IFR. Most of these comments were directed at the mechanics of the online webinar through which the consultation was conducted, announced participants' arrivals or departures from the webinar, or were in other ways non-substantive. A few substantive comments are not relevant to this IFR in that they do not relate to the performance measures or other changes required by the OAA amendments. The program office will review these substantive comments to inform its continued operation of the program and its future technical assistance.

Fifteen comments addressed SCSEP's overall relationship with WIOA. As set forth above, increased coordination with WIOA is one of the main purposes of the OAA amendments. However, except for the adoption of some of the WIOA core measures, the programmatic coordination with WIOA is not the subject of this IFR.

Three questions asked specifically about the relationship between the SCSEP performance measures and WIOA: Whether WIOA will adopt measures of community service similar to the SCSEP measures, whether the SCSEP measures will be incorporated into the Participant Individual Record Layout (PIRL, the WIOA performance reporting system), and whether SCSEP performance will be factored into the statewide WIOA performance. The changes in this IFR to the SCSEP performance measurement system reflect in large part an alignment of the SCSEP performance measures with the three employment outcome indicators mandated for WIOA core programs under WIOA sec. 116(b)(2)(A)(i)(I)-(III). In addition to these three WIOA employment outcome indicators of performance, SCSEP has three measures related to participation in the program: Service level, hours of community service, and service to the most-in-need. These three measures are unique to SCSEP and are retained unchanged by the current OAA amendments. Although WIOA has several similar measures, these SCSEP measures are not directly applicable to WIOA. In addition, the WIOA primary indicators of performance include effectiveness in serving employers; the corresponding measure for SCSEP under the OAA, as discussed below at § 641.720, is not directly parallel because it includes participants and host agencies, as well as employers. All the SCSEP measures will be incorporated into the PIRL, along with other aspects of SCSEP performance. However, although the 2016 OAA amendments require SCSEP to adopt several of WIOA's primary indicators of performance, SCSEP is independent of WIOA, and SCSEP performance is not included in the WIOA State program or indicator scores.

Two other general comments were received during the consultation:

• One comment asked whether the Department will still require all grantees to use the SCSEP Performance and Results Quarterly Performance System (SPARQ). The Department is exploring a new case management system that may replace SPARQ in whole or in part. Grantees must continue using SPARQ until the Department informs them that a new system is available.

• One grantee questioned whether the new performance measures apply to both State and national grantees. Like the current measures, the new measures apply to all grantees.

Finally, another comment from a stakeholder requested that the Department provide grantees as much notice of the new measures as possible so grantees have time to program their internal computer systems. The Department is sensitive to the importance of providing ample notice to the grantees and of minimizing the burden of implementing the new regulations. With the publication of this IFR and the first required reporting of the new measures starting on July 1, 2018, grantees will have ample time to make the minimal changes required by the new measures. The Department will provide technical assistance and guidance as soon as possible in order to provide additional support to grantees in their implementation efforts.

The Department carefully considered all comments received as we developed this IFR. In the following section of the preamble entitled “Section-by-Section Discussion of Interim Final Rule,” the Department summarizes and discusses the input received from stakeholders.

The 2016 OAA changes to the SCSEP performance measurement system reflect in large part an alignment of the SCSEP performance measures with those mandated for WIOA core programs under WIOA sec. 116(b)(2)(A)(i). The WIOA performance measures were implemented in a joint final rule issued by the Departments of Labor and Education on August 19, 2016 (81 FR 55792) (Joint WIOA Final Rule), after notice and comment rulemaking, and are codified in 20 CFR part 677. This IFR revises 20 CFR part 641, subpart G (Performance Accountability) to codify the revised SCSEP performance measures in the 2016 OAA sec. 513, which in large part aligns the SCSEP performance measures with the WIOA performance measures. In addition, this rule makes technical amendments to other subparts of part 641 to reflect 2016 OAA amendments that aligned the SCSEP program statutory language with WIOA, such as updating outdated terminology and outdated references to WIA, which WIOA superseded.

Coordination between the SCSEP and the WIOA programs continues to be an important objective of the OAA. SCSEP is a required partner in the workforce development system (per WIOA sec. 121(b)(1)(B)(v)), and SCSEP is required to coordinate with the WIOA One-Stop delivery system (OAA sec. 511, 42 U.S.C. 3056i), such as by accepting each other's assessments and Individual Employment Plans (OAA sec. 502(b)(3), 42 U.S.C. 3056(b)(3)). The underlying notion of the One-Stop delivery system is the coordination of programs, services, and governance structures, so that the customer has access to a seamless system of workforce development services. Although there are many similarities to the system established under WIA, there are also significant changes under WIOA that are intended to make substantial improvements to the public workforce delivery system. The Joint WIOA Final Rule requires partners to collaborate to support a seamless customer-focused service delivery network; requiring that programs and providers co-locate, coordinate, and integrate activities and information, so that the system as a whole is cohesive and accessible for individuals and employers alike.

The Department remains committed to a system-wide continuous improvement approach grounded upon proven quality principles and practices. Although many of the SCSEP regulations remain unchanged from the 2010 SCSEP Final Rule (75 FR 53786), this IFR codifies the 2016 OAA revisions to the program that align senior employment services with the workforce development system under WIOA. In particular, this rule aligns the SCSEP performance measures related to employment and earnings with the performance measures established by WIOA to enhance consistency and coordination between the programs and ensure effective services for older Americans. The changes implemented by the rule are discussed in more detail in Section II.

In this section, we discuss the changes made to the regulations as required by the 2016 OAA.

In addition to the changes made to part 641, subpart G (Performance Accountability) codifying the 2016 OAA statutory revisions as described more fully below, this IFR makes non-substantive technical amendments throughout all of part 641 to reflect the 2016 OAA amendments and to align the SCSEP program language with WIOA, such as updating outdated terminology and outdated references to WIA, which WIOA superseded. The IFR revises § 641.140 by removing definitions that are no longer operational as a result of the 2016 OAA amendments and WIOA, revising definitions consistent with updates to governing law, and adding definitions to address new terminology as a result of statutory amendments.

In particular, the IFR removes the definition of “additional measures” because the 2016 OAA removed them from the SCSEP performance requirements. The IFR also removes the definition of “volunteer work” because the 2016 OAA removed the term from the SCSEP performance measures. Also, as part of aligning SCSEP with WIOA, the IFR removes the definition for “Local Workforce Investment Area” and adds “Local Workforce Development Area.”

The IFR updates the definition of “core measures” (which the 2016 OAA changed from “core indicators”) to refer to the new measures of performance laid out in amended OAA sec. 513(b)(1) and implemented by this rule. To align with WIOA, the IFR changes the terms “core services” and “intensive services” to “career services,” and updates the definitions of “Workforce Innovation and Opportunity Act (WIOA)” and “Workforce Innovation and Opportunity Act regulations” (changed from “Workforce Investment Act (WIA)” and “Workforce Investment Act regulations,” respectively). This update clearly establishes that the term “Workforce Innovation and Opportunity Act regulations” includes all WIOA and Wagner-Peyser Act regulations, including the regulations implementing WIOA sec. 188. Similarly, to align the text of the SCSEP definitions with the terms used in WIOA, the IFR revises the definitions of “Local Board,” “One-Stop Center,” “One-Stop delivery system,” and “State Board” to reflect the definitions as they have been updated under WIOA. Additionally, the IFR updates the WIA citations to use WIOA citations in the definitions of “Co-enrollment,” “Most-in-need,” “One-Stop partner,” and “Training Services.” Additionally, the IFR updates the OAA citations in the definitions “Pacific Island and Asian Americans,” “Supportive services,” and “Unemployed” to be consistent with the OAA as amended by the 2016 OAA.

The IFR adds a definition of “community service employment” because that term is used in sec. 513 of the 2016 OAA. To avoid confusion, the definition of “community service employment” is the same as “community service assignment,” so those two terms can be used interchangeably.

This IFR also adds a new § 641.370 to state that for a State that obtains approval of a WIOA Combined State Plan under 20 CFR 676.143, the requirements of WIOA sec. 103 and 20 CFR part 676 will apply in lieu of OAA sec. 503(a) and part 641, subpart C. This implements a provision added by the 2016 OAA to sec. 503 of the OAA, which aligns the requirements of the States submitting SCSEP State Plans with the WIOA State Plan requirements.

Finally, the IFR updates the references to the regulations that implement sec. 188 of WIOA, the nondiscrimination and equal opportunity provisions of WIOA. Those regulations take the place of the WIA sec. 188 regulations. They were finalized in January 2017 and codified in 29 CFR part 38.

Only the substantive subpart G revisions are described in detail in the remainder of this section-by-section discussion.

Throughout this subpart, the Department has revised the term “core indicator(s)” to “core measure(s)” to align the regulation with the 2016 OAA, specifically sec. 513(a), 42 U.S.C. 3056k(a). The amended statute also refers to “indicators.” However, because the statute uses the terms interchangeably, for consistency and to reduce the possibility of confusion, the Department uses only the term “measures” throughout this subpart. Other changes made to the sections of subpart G are described below.

The Department has made several revisions to paragraph (a) to align with the 2016 OAA and the WIOA performance measures. In addition to revising references to “indicators” to “measures” as described above, the Department has removed all reference to “additional indicators” throughout this section. The 2016 OAA removed the additional measures of performance that were not subject to goal-setting and corrective actions, as they were previously established in sec. 513(b)(2) of the 2006 OAA. In order to align with the 2016 OAA, the Department has replaced the first sentence in paragraph (a) that stated “There are currently eight performance measures, of which six are core indicators and two are additional indicators,” with the sentence “There are seven core performance measures.” In addition, the Department has deleted the last sentence that stated “Additional indicators (defined in § 641.710) are not subject to goal-setting and are, therefore, also not subject to corrective action.” Other revisions the Department has made to remove reference to “additional indicators” in other sections are discussed below.

The Department also revised the second sentence of paragraph (a) to remove reference to the requirement that performance level goals for each core measure must be agreed upon by the grantee and the Department “before the start of each program year.” As described in the discussion of revisions in § 641.720 below, grantees and the Department no longer are required to reach agreement on levels of performance prior to each year. Rather, per 2016 OAA sec. 513(a)(2)(C), agreement on levels of performance is now required to be reached every 2 years, prior to each 2-year period of the SCSEP grants (that is, prior to the first program year and the third program year of the grant. The Department replaced the phrase “before the start of each program year” with a reference to § 641.720.

The Department made several changes to paragraph (b), which now reads “Core measures,” to align with the 2016 OAA's amendments to the measures. Many of these changes align SCSEP's performance measures to the performance measures established by WIOA for the title I core programs, as implemented in 20 CFR 677.155. First, the Department made a technical change to paragraph (b) to replace the outdated reference to the 2006 OAA with a reference to the OAA as amended. The Department has not revised the core measure for hours of community service employment implemented in paragraph (b)(1) because the 2016 OAA did not amend this measure.

In paragraph (b)(2), the Department replaced the second core measure “Entry into unsubsidized employment” with the core measure “The percentage of project participants who are in unsubsidized employment during the second quarter after exit from the project.” This core measure is required by OAA sec. 513(b)(1)(B) and aligns with the measure as described in sec. 116(b)(2)(A)(i)(I) of WIOA and implemented in 20 CFR 677.155(a)(1)(i), except that the WIOA statute uses the term “program participants,” rather than “project participants.” The revised performance measure is different from the former SCSEP measure in that the 2016 OAA now clarifies that entry into unsubsidized employment is to be measured during the second quarter after exit. Previously, the 2006 OAA statute did not state when the rate was measured, and the 2006 regulations required it to be measured at the first quarter after exit, which was consistent with the WIA performance measures at that time.

Next, in paragraph (b)(3), the Department replaced the third core measure “Retention in unsubsidized employment for six months” with the core measure “The percentage of project participants who are in unsubsidized employment during the fourth quarter after exit from the project.” This core measure is required by OAA sec. 513(b)(1)(C) and aligns with the measure as described in sec. 116(b)(2)(A)(i)(II) of WIOA and implemented in 20 CFR 677.155(a)(1)(ii). This is a separate and distinct employment measure for the fourth quarter after exit, which measures the employment rate in that quarter. A participant will be counted as a positive outcome for this measure if he or she is employed in the fourth quarter after exit regardless of whether he or she was also employed in the second quarter after exit.

In paragraph (b)(4), the Department replaced the fourth core measure “Earnings,” with the core measure “The median earnings of project participants who are in unsubsidized employment during the second quarter after exit from the project.” This core measure is required by OAA sec. 513(b)(1)(D) and aligns with the measure as described in sec. 116(b)(2)(A)(i)(III) of WIOA and implemented in 20 CFR 677.155(a)(1)(iii). This performance measure gauges median earnings at the same time frame as the above measure gauges the employment rate of participants. The use of a median is a shift from the use of an average under WIA and is consistent with the requirements of WIOA.

The Department added a fifth performance measure in paragraph (b)(5) for “indicators of effectiveness in serving employers, host agencies, and project participants.” This core measure is required by OAA sec. 513(b)(1)(E) and partially aligns with the WIOA measure, “effectiveness in serving employers,” as described in sec. 116(b)(2)(A)(i)(VI) of WIOA and implemented in 20 CFR 677.155(a)(1)(vi). A similar measure for “satisfaction of the participants, employers, and their host agencies with their experiences and the services provided” was included as an additional measure in the 2006 OAA sec. 513(b)(2), which was not subject to goal-setting and corrective actions. (This same measure was also a core measure under the 2000 OAA amendments.) However, the 2016 OAA establishes this as a core measure of performance. This is further discussed below in the preamble text that corresponds to § 641.710(e).

To accommodate the newly added fifth core performance measure, the Department renumbered former paragraphs (b)(5) and (6) as paragraphs (b)(6) and (7), respectively, to contain the sixth and seventh core measures, which remain the same as they were under the 2006 OAA.

As discussed above, the 2016 OAA removed the additional measures of performance that were previously found at sec. 513(b)(2) of the 2006 OAA. Therefore, the Department has deleted former paragraphs (c)(1) through (4), “Additional indicators,” and has renumbered paragraphs (d) and (e) as (c) and (d), respectively. In addition, the Department has replaced the words “indicators of performance and additional indicators of performance” from the renumbered paragraph (c) with the word “measures”, and has replaced the words “indicators of performance and to report information on the additional indicators of performance” from the renumbered paragraph (d) with the word “measures,” to be consistent with the 2016 OAA amendments to these terms as described above.

In addition to the regulatory text changes discussed above, various non-substantive changes have been made for purposes of correcting typographical errors and improving clarity.

The Department revised the core indicator (now “core measure”) definitions contained in this section to align with the revised core measures set forth in § 641.700 of this IFR. As discussed below, the Department deleted the entirety of former paragraph (b) to remove the definitions for the former “additional indicators,” which the 2016 OAA removed. Thus, as an initial change, the Department renumbered paragraphs (a)(1) through (6) to (a) through (g) (to include the definition for an added core measure, as discussed below).

The Department did not revise paragraph (a), renumbered from former paragraph (a)(1), which contains the definition for the first core measure for hours of community service employment as currently implemented.

In paragraph (b), renumbered from former paragraph (a)(2), the Department included a definition for the second performance measure, “percentage of project participants who are in unsubsidized employment during the second quarter after exit from the project.” This performance measure is defined by the following formula: The number of participants who exited during the reporting period who are employed in unsubsidized employment during the second quarter after the exit quarter, divided by the number of participants who exited during the reporting period. This figure will be multiplied by 100 and reported as a percentage. This definition aligns with the definition of the corresponding WIOA performance measure, as explained in Training and Employment Guidance Letter (TEGL) 10-16, Performance Accountability Guidance for Workforce Innovation and Opportunity Act (WIOA) Title I, Title II, Title III and Title IV Core Programs, published December 19, 2016.

In paragraph (c), renumbered from former paragraph (a)(3), the Department included a definition for the third performance measure, “percentage of project participants who are in unsubsidized employment during the fourth quarter after exit from the project.” This performance measure is defined by the following formula: The number of participants who exited during the reporting period who are employed in unsubsidized employment during the fourth quarter after the exit quarter divided by the number of participants who exited during the reporting period, multiplied by 100 so as to be reported as a percentage. This definition aligns with the definition of the corresponding WIOA performance measure, as explained in TEGL 10-16.

In paragraph (d), renumbered from former paragraph (a)(4), the Department included a definition for the fourth performance measure, “median earnings of project participants who are in unsubsidized employment during the second quarter after exit from the project.” This performance measure is defined by the following formula: For all participants who exited and are in unsubsidized employment during the second quarter after the exit quarter: The wage that is at the midpoint (of all the wages) between the highest and lowest wage earned in the second quarter after the exit quarter. This definition aligns with the definition of the corresponding WIOA performance measure, as explained in TEGL 10-16.

Several comments received during the stakeholder consultation described at the beginning of this preamble questioned the adoption of the median as opposed to the mean for the new measure of earnings. One comment suggested that the first year under the new measures be designated as a baseline year since the Department does not have the ability to determine what the impact the change in calculation will have on performance. The use of the median is required by the 2016 OAA and the Department has no discretion in this matter. The Department understands, however, that all three of the new outcome measures use different calculations from the measures currently in effect and that it will take some time to establish a reliable baseline to use in setting goals for these measures. To help determine how performance under the current measures relates to performance under the new measures as set forth in this IFR, the Department will reanalyze prior grantee performance data reported under the existing measures using the calculations required for the new measures as established by this IFR and to create a cross-walk between the two sets of measures. If that proves to be an inadequate basis for setting the Program Year (PY) 2018 grantee goals, the Department will take that into consideration in the goal setting process and will take appropriate action. See discussion of § 641.730 below.

During the consultative process, one stakeholder raised the concern that the new employment outcome measures set forth in this IFR at paragraphs (b), (c), and (d) will be harder for grantees to achieve than the measures that have been in effect and will make the program overall seem less effective than it actually is. The Department addressed this comment in discussion of § 641.740 below.

The Department has added a definition in paragraph (e) for the fifth performance measure, “effectiveness in serving employers, host agencies, and project participants.” While this definition is similar to the definition used for this indicator under the 2006 OAA, when it was an additional indicator, the 2016 OAA revised the definition so that it focuses more specifically on effectiveness rather than satisfaction in general. The Department may revise the definition in paragraph (e) in the future once the Department finalizes the definition of the corresponding WIOA performance measure “effectiveness in serving employers”. For the WIOA core programs, the Department is initially implementing the effectiveness measure in the form of a pilot program. The pilot would allow several approaches (including wage records, the repeated use rate for employers' use of the core programs, and employers served) with the intent of assessing each approach, ultimately to develop a standardized measure.

The Department received fifteen comments during the consultative process addressing this new core measure. Most comments assumed that the use of the current customer satisfaction surveys would continue for all or some of the three SCSEP customer groups, and several comments questioned how the Department would define “effectiveness.”

• Six comments recommended that the administration of the employer survey be changed to include host agencies that hire SCSEP participants into unsubsidized jobs within their organizations. Under the survey administration procedures used for the existing measure, a host agency receives only a host agency survey (rather than an employer survey) even if the agency subsequently hires a participant assigned to it and thus becomes that individual's employer.

• One comment stated that effectiveness is different from satisfaction and suggested that the survey questions would need to change to encompass customers' assessment of effectiveness. Another comment recommended that field staff review and comment on any revised or new survey questions.

• One comment recommended that the surveys be distributed electronically and be available for distribution in hard copy as needed.

• Three comments recommended that SCSEP use the WIOA approach to piloting new measures of effectiveness in serving employers. One of these comments further suggested the extension of the WIOA pilot approach to host agencies, allowing SCSEP grantees to vote on which measures SCSEP as a whole would pilot, and the retention of the current participant customer satisfaction survey. This comment also recommended training sessions for the grantees on various approaches for determining pilot measures. Another of the three commenters who recommended piloting measures of effectiveness in serving employers recommended that the Department provide grantees with customer relationship management (CRM) software.

The Department appreciates the suggestions about ways to measure effectiveness in serving SCSEP's customers that build and improve on the current method of surveying those customers. Although the new SCSEP measure of effectiveness parallels the language of the WIOA measure, it differs because it also measures the effectiveness in serving participants and host agencies, as well as employers. As the comments appear to acknowledge, the WIOA approach to the measure, which is being piloted until 2019, does not have obvious application to SCSEP's other two customer groups. As a result, for the SCSEP measure, the Department has decided to continue surveying all three customer groups to assess the effectiveness of the services received as an interim measure at least until the WIOA pilot is complete and a WIOA measure is defined in final form. By using the same definition as that of the current customer satisfaction measure during this interim period, the Department will not require SCSEP customers to change their current practices or take on any additional burden. The Department welcomes comments on this measure.

During this interim period, the Department will explore with grantees, and with its three customer groups, options for best measuring the effectiveness of SCSEP's services, including the suggestions made by the commenters. The Department will also explore ways to improve the efficiency of the current customer surveys (including the use of online surveys and changes to the administration of the employer survey) and will examine what, if any, new or revised questions would support an index of effectiveness as an alternative to the current index of satisfaction.

To conform to the changes outlined above, the Department has renumbered former paragraph (a)(5) to (f). The Department also has renumbered former paragraph (a)(6)(i) through (xiii) to (g)(1) through (13). Renumbered paragraphs (f) and (g) correspond to the sixth and seventh SCSEP performance measures, the definitions of which are unchanged.

Several comments regarding paragraph (g), the most-in-need measure, recommended adding ex-offender to the list of barriers to employment included in the statute for determining participants who are most in need of SCSEP services. The Department agrees that ex-offenders have serious and unique barriers to employment, but for purposes of this IFR, the Department will use the list provided in the statute. The Department also notes that ex-offender status is already incorporated into the most-in-need measure because it is a factor that would result in a participant having low employment prospects, one of the factors included in the most-in-need measure. However, as part of its review of the statistical model for the adjustment of grantee goals, the Department will consider whether ex-offender should be considered with the other participant characteristics currently used in the SCSEP model. See discussion of the statistical model in preamble text discussing § 641.720.

Another comment regarding the most-in-need measure stated that the current definition of frail, which is one of the barriers to employment that the statute includes in the most-in-need measure, is incorrect because it could require a grantee to enroll someone who is in a nursing home. This theoretical objection to the definition of frail misunderstands its use in the SCSEP performance system. Frail is not part of the eligibility determination and is not one of the priorities of service required by the OAA. Rather, it is an additional barrier to employment that a participant may develop during enrollment and that potentially entitles a participant to have an extended period of enrollment.

Nineteen comments received during the consultation and additional comments received from three grantees after the consultation were addressed to how the Department would compute or define the performance measures (other than the measure, “Indicators of effectiveness in serving employers, host agencies, and project participants,” which is addressed below). Several comments related to how the exit cohorts would be defined and what the timing rules would be. These questions have been addressed by the definitions provided in this IFR and the discussion in other parts of this preamble. As set forth below, separate guidance will be provided on the technical aspects of the timing and reporting requirements.

The 2016 OAA removed the additional indicators of performance that were previously established in sec. 513(b)(2) of the 2006 OAA. Therefore, the Department has deleted former paragraphs (b)(1) through (3) that contained definitions for the additional indicators.

In addition to the regulatory text changes discussed above, various non-substantive changes have been made to the regulations for purposes of correcting typographical errors and improving clarity.

The Department has made substantial revisions to this section to align with the 2016 OAA, which in large part mirrors the process for establishing the expected performance levels required by WIOA for the title I core programs, as implemented in 20 CFR 677.170.

The revised paragraph (a), which requires agreement between the grantee and the Department for expected levels of performance for the first 2 program years of the grant, mirrors the statutory language in 2016 OAA sec. 513(a)(2)(B) and (C)(i) and aligns with WIOA sec. 116(b)(3)(A)(iv)(I). Specifically, paragraph (a) states that each grantee must reach agreement with the Department on levels of performance for each measure listed in § 641.700 for each of the first 2 program years covered by the grant agreement. In reaching the agreement, the grantee and the Department must take into account the expected levels of performance proposed by the grantee and the factors described in paragraph (c) of this section. This paragraph also states that the levels agreed to will be considered to be the expected levels of performance for the grantee for such program years, and funds may not be awarded under the grant until such agreement is reached. Lastly, this paragraph states that, at the conclusion of negotiations concerning the performance levels with all grantees, the Department will make available for public review the final negotiated expected levels of performance for each grantee, including any comments submitted by the grantee regarding the grantee's satisfaction with the negotiated levels.

The Department considers PY 2016 and PY 2017 to be the first 2 program years under the current SCSEP grants. For national grantees, these were the first 2 program years following the last grant competition. For State grantees, these were the first 2 program years of the current SCSEP State Plans.

The revised paragraph (b), which requires agreement for expected levels of performance for the third and fourth program years of the grant mirrors the statutory language provided in 2016 OAA sec. 513(a)(2)(B) and (C)(ii) and in alignment with WIOA sec. 116(b)(3)(A)(iv)(II). As explained above, the Department considers PY 2018 and PY 2019 to be the third and fourth program years of the current SCSEP grant agreements. Specifically, paragraph (b) states that each grantee must reach agreement with the Department, prior to the third program year covered by the grant agreement, on levels of performance for each measure listed in § 641.700, for each of the third and fourth program years of the grant. This paragraph states that, in reaching the agreement, the grantee and the Department must take into account the expected levels proposed by the grantee and the factors described in paragraph (c) of this section. This paragraph also states that the levels agreed to will be considered to be the expected levels of performance for the grantee for those program years. Lastly, like the requirement in paragraph (a), this paragraph states that, at the conclusion of negotiations concerning the performance levels with all grantees, the Department will make available for public review the final negotiated expected levels of performance for each grantee, including any comments submitted by the grantee regarding the grantee's satisfaction with the negotiated levels.

The Department has added a new paragraph (c), “Factors,” to require that the negotiated levels of performance must be based on the three factors listed in paragraphs (c)(1) through (3), as required by 2016 OAA sec. 513(a)(2)(D) and in alignment with WIOA sec. 116(b)(3)(A)(v). Paragraph (c)(1) states that the negotiated levels must take into account how a grantee's levels of performance compare with the expected levels of performance established for other grantees. See OAA sec. 513(a)(2)(D)(i) and WIOA sec. 116(b)(3)(A)(v)(I). Paragraph (c)(2) states that the negotiated levels must be adjusted using an objective statistical model based on the model established by the Department of Labor with the Department of Education in accordance with WIOA sec. 116(b)(3)(A)(viii) and implemented in § 677.170(c). See 29 U.S.C. 3141(b)(3)(A)(viii), OAA sec. 513(a)(2)(D)(ii), and WIOA sec. 116(b)(3)(A)(v)(II). The objective statistical adjustment model will account for actual economic conditions and characteristics of participants, including the factors required by WIOA sec. 116(b)(3)(A)(v)(II). Paragraph (c)(3) states that the negotiated levels must take into account the extent to which the levels involved promote continuous improvement in performance accountability on the core measures and ensure optimal return on the investment of Federal funds. See OAA sec. 513(a)(2)(D)(iii) and WIOA sec. 116(b)(3)(A)(v)(III).

In paragraph (d), the Department revises the adjustment requirements contained in former paragraph (b). The Department has replaced the adjustment factors specified in former (b)(1) through (3) with the requirement that the Department will, in accordance with the objective statistical model developed pursuant to paragraph (c)(2), adjust the expected levels of performance for a program year for grantees to reflect the actual economic conditions and characteristics of participants in the corresponding projects during such program year. These revisions align with OAA sec. 513(a)(2)(E).

For consistency with the 2016 OAA, the IFR removes the language in paragraphs (a)(1) through (3) of § 641.720 that describes the negotiation process in detail. However, the negotiation process that the Department intends to use under these new performance measures is similar to the current process, and includes similar opportunities for input from the grantees:

• In the spring of 2018, the Department will analyze grantees' baseline performance and issue proposed goals for the next 2 program years, PY 2018 and PY 2019, based on the new adjustment factors.

• If a grantee disagrees with those goals, it may propose its own goals and may request to negotiate.

• Prior to the negotiation, the grantee must provide the Department with the data on which the grantee's proposed goals are based.

• The grantee and Department must reach agreement before funds for the coming 2 program years can be approved; the agreed upon goals will be the expected levels of performance upon which the annual evaluation of grantee performance will be based. If the grantee and the Department fail to reach agreement, no funds may be released.

• At the conclusion of the negotiation, the grantee may submit comments regarding the grantee's satisfaction with the negotiated levels of performance, which the Department will publish, along with the expected levels of performance.

• At the time of the annual evaluation of grantee performance, the expected levels of performance will be adjusted a second time using the latest available adjustment data. The evaluation will be based on the newly adjusted levels of performance. See preamble discussion of § 641.740.

• The same process will be followed for subsequent 2-year periods.

In addition to the regulatory text changes discussed above, various non-substantive changes have been made for purposes of correcting typographical errors and improving clarity.

Eight comments addressed the negotiation process. Several comments raised questions about the use of a statistical model based on WIOA to adjust grantee goals, and one, noting that SCSEP already uses such a model, questioned what changes the Department anticipates. This comment is correct that SCSEP has long used a statistical model to adjust grantee goals. The model considers environmental factors like rates of unemployment and poverty and takes account of participant characteristics that may make some participants harder to serve than others. This model is similar to the model employed by WIA and the model recently adopted by WIOA. The Department will re-examine this model to determine if additional aspects of the WIOA model should be incorporated into the SCSEP model or if other changes are appropriate. (One comment suggested accounting for the percentage of participants who reside in rural areas.) The Department will provide the model to grantees prior to the first negotiations under the new performance measures, as requested by one of the comments.

One comment suggested that all grantees operating within a State should have the same goals because conditions within the State are essentially the same for all grantees. The statute requires that in negotiating goals, the parties consider both the expected levels of performance for other grantees and the promotion of continuous improvement. Both factors require consideration of the circumstances of each grantee. Furthermore, the only grantees operating within a State, in addition to the State grantee, are national grantees. National grantees only have goals at the overall grantee level, not at the State level. In addition, the adjustments that are made to grantee goals are based, to the greatest extent practicable, on factors that prevail in the specific service area of each grantee. Because very few grantees serve an entire State uniformly, SCSEP uses data at a county level to customize the adjustments for all grantees, both State and national.

Nine comments received during the consultation and additional comments received from three grantees after the consultation addressed the implementation of the new measures. Most of these questioned when the new measures would be effective and what the effect would be of collecting data for the new employment outcome measures and the old outcome measures since they will overlap for the first 4 quarters that the new measures are effective. The new measures being implemented by this IFR by promulgation on December 1, 2017 will become effective 30 days after publication. By effective, the Department means that they will be used during the second half of PY 2017, to negotiate the goals for PYs 2018 and 2019. Performance under the PY 2018 goals will begin to be reported starting July 1, 2018. The SCSEP Quarterly Progress Report (QPR) for PY 2017, will be based on the current measures, and the QPRs for PY 2018, will be based on the measures established in this IFR.

SCSEP participants who exit during PY 2017, when goals based on the current measures are still in effect, will have their performance reported under the old measures for PY 2017. For this same cohort of exiters, reporting for the core employment outcome measures would also take place throughout PY 2018, under the new measures set forth in this IFR and would be reflected in the grantees' PY 2018 QPRs. For example, a participant who exits in Quarter 3 of PY 2017, will be included in the previous entered employment measure for Quarter 4 of PY 2017; this participant will also be reported in the IFR's new measure of employment in the second quarter after exit in Quarter 1 of PY 2018. Since the underlying data required for the new measures that will be reported in PY 2018 are the same data required for the existing measures, grantees will have to follow different timing rules for the collection of data in PY 2018, but they will not be required to collect any new or additional data beyond the data they would have reported under the old measures. The Department will provide technical assistance and guidance on the new timing and reporting requirements.

A related comment asked is when reporting on the current SCSEP additional measures would cease. As with the existing core measures, the grantees will collect data for the additional measures not carried forward in this IFR throughout PY 2017, and the final QPR for PY 2017 will be the last report of the additional measures.

Many comments urged the Department to obtain the access to unemployment insurance (UI) wage records for SCSEP in order to ease the burden of case management follow-up for purposes of collecting performance data. One comment recommended that the Department allow those grantees that were able to access wage records locally do so even if other grantees could not have access and had to continue using case management follow-up. Another comment recommended that if the Department is unable to secure access to wage records, the Department should adopt less stringent standards for case management follow-up.

The Department understands that case management follow-up is a costly and not always effective means of obtaining performance data. The Department is investigating access to UI wage records for all SCSEP grantees, but until such access occurs, all grantees must continue using case management follow-up. Using different methods of data collection would compromise the consistency of the performance measures and would potentially provide an unfair advantage to those grantees with access to wage records. In the meantime, the Department will review the standards for case management follow-up as set forth in various guidance materials, will confer with grantees about the changes in procedures desired, and will issue revised guidance if appropriate.

Many comments questioned whether the current exclusions from exit for purposes of the employment outcome measures will be continued, and several recommended that they be continued. As part of its adoption of the WIA common measures in PY 2007, SCSEP has been following the WIA exclusions. With the 2016 OAA's adoption of the measures consistent with the WIOA primary indicators of performance, SCSEP will examine the revised WIOA exclusions and will issue revised guidance as appropriate.

The Department has made several changes in this section to update the Department's transition assistance plans to correspond with the 2016 OAA. First, as a non-substantive change, the Department has deleted the designation of paragraph (a) and its title “General transition provision” because the Department has deleted paragraph (b), as discussed below. This section now includes only two sentences.

The first sentence as revised by this IFR now states that, as soon as practicable after the IFR becomes effective, the Department will determine whether a SCSEP grantee's performance under the measures in effect prior to the effective date of this IFR would have met the expected levels of performance for PY 2018. The second sentence as revised by this IFR now states that if the Department determines that a grantee would have failed to meet those expected levels of performance, then the Department will provide technical assistance to help the grantee to eventually meet the expected levels of performance under the measures in § 641.700, as those measures are revised by this IFR.

The Department will only make the above determination for the three new employment outcome measures, defined in § 641.710(b) through (d) of this IFR, since no transition is required for the remaining four core measures (three are unchanged, and for the fourth, the “indicators of effectiveness in serving employers, host agencies, and participants,” the Department will use the same customer satisfaction measure that was used before the IFR). In making the determination, the Department intends to examine all relevant data, as feasible, in order to provide a cross-walk between the existing measures and the measures implemented in this IFR and to develop a new baseline from which to begin the development of goals for PY 2018 and PY 2019. The Department will provide the analysis to all grantees as soon as it is complete.

As noted above, this IFR removes paragraph (b) from § 641.730, which provided that PY 2007 would be treated as a baseline year for the most-in-need indicator so that grantees and the Department may collect sufficient data to set a meaningful goal for the measure for PY 2008. Since this provision included dates that have already passed, and the Department has documented information on this measure, this provision is no longer required and has been deleted from this section.

With the exception of the technical changes noted below, the Department has not made any changes to this section.

In paragraph (a), the Department has deleted the reference to national grantees because the evaluation process applies identically to both national grantees and State grantees. The Department has also added a reference to § 641.720(d) when referring to the adjustments to the grantee goals.

In paragraph (b)(1)(iii) regarding recompetition for national grantees, the Department has deleted the parenthetical “(beginning with Program Year 2007),” after “any national grantee that has failed to meet the expected levels of performance for 4 consecutive years” to align with the 2016 OAA, which removed this phrase from OAA sec. 513(d)(2)(B)(iii). Due to this deletion, the “4 consecutive years” may include years under the measures in effect prior to this IFR with years under the new measures implemented by this IFR.

In paragraph (b)(2)(iii) regarding competition for State grantees, the Department has deleted the parenthetical “(beginning with Program Year 2007),” after “if the Department determines that the State fails to meet the expected levels of performance for 3 consecutive Program Years” to align with the 2016 OAA, which removed this phrase from OAA sec. 513(d)(3)(B)(iii). Similar to the deletion in paragraph (b)(1)(iii), due to this deletion, the “3 consecutive years” may include years under the measures in effect prior to this IFR with years under the new measures implemented by this IFR.

In paragraph (c) regarding evaluation, the Department has revised this paragraph to state that, for purposes of evaluation, the core measures of performance will be compared to the expected levels of performance established under § 641.720 (including any adjustments to such levels made in accordance with § 641.720(d)). The Department has deleted the former provision that the core measures also would be compared to “the actual performance of each grantee with respect to the levels achieved for each of the additional indicators of performance.” As discussed above, the Department has removed all references to “additional indicators” throughout part 641 to align with the 2016 OAA, which removed reference to additional indicators of performance not subject to goal-setting and corrective actions that were previously established in sec. 513(b)(2) of the 2006 OAA. This paragraph now states, “The Department will annually evaluate, publish and make available for public review, information on the actual performance of each grantee with respect to the levels achieved for each of the core measures of performance, compared to the expected levels of performance established under § 641.720 (including any adjustments to such levels made in accordance with § 641.720(d)).”

One commenter questioned the impact of the new requirement to negotiate performance goals 2 years at a time on the assessment of grantee performance. Although the Department and the grantees will now negotiate performance goals for 2 years at a time, the Department will continue to assess whether grantees have met their expected level of performance at the end of each program year based on whether grantees have met their goals for that completed program year.

Two comments noted that SCSEP goals are already hard to meet because older workers are harder to place than other job seekers. SCSEP has been using the WIA common employment outcome measures since July 1, 2007; the replacement of those measures with the WIOA core employment measures is not intended to change the basic approach of the negotiation process or to negate the focus on serving low-income seniors. In general, SCSEP has consistently met or exceeded its performance goals under the current measures, and the Department does not envision that the new measures will change that level of performance.

The Department has updated the reference to the OAA to reflect the 2016 OAA reauthorization amendments.

The Regulatory Flexibility Act (RFA), 5 U.S.C. chapter 6, requires the Department to evaluate the economic impact of this rule with regard to small entities. The RFA defines small entities to include small businesses, small organizations including not-for-profit organizations, and small governmental jurisdictions. The Department must determine whether the rule imposes a significant economic impact on a substantial number of such small entities.

There are 75 SCSEP grantees; 50 of these are States and are not small entities as defined by the RFA. Six grantees are governmental jurisdictions other than States (four grantees are territories such as Guam, one grantee is Washington, DC, and another grantee is Puerto Rico). Governmental jurisdictions must have a population of less than 50,000 to qualify as a small entity for RFA purposes and the population of these 6 SCSEP grantees each exceeds 50,000. The remaining 19 grantees are non-profit organizations, which includes some large national non-profit organizations.

The Department has determined that this Interim Final Rule will impose no additional burden on small entities affected. Since the alignment with WIOA involved only definitions, the grantees are not required to collect any additional information that may cause a burden increase. In addition, all costs are covered by the SCSEP program funds provided to grantees.

The Departments certifies that this Interim Final Rule does not impose a significant economic impact on a substantial number of small entities.

Under Executive Order 12866, the Office of Management and Budget's (OMB's) Office of Information and Regulatory Affairs determines whether a regulatory action is significant and, therefore, subject to the requirements of the Executive Order and review by OMB. 58 FR 51735. Section 3(f) of Executive Order 12866 defines a “significant regulatory action” as an action that is likely to result in a rule that: (1) Has an annual effect on the economy of $100 million or more, or adversely affects in a material way a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local or tribal governments or communities (also referred to as economically significant); (2) creates serious inconsistency or otherwise interferes with an action taken or planned by another agency; (3) materially alters the budgetary impacts of entitlement grants, user fees, or loan programs, or the rights and obligations of recipients thereof; or (4) raises novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the Executive Order. Id. OMB has determined that this interim final rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866.

This rule is not an EO 13771 regulatory action because this rule is not significant under EO 12866.

Executive Order 13563 directs agencies to propose or adopt a regulation only upon a reasoned determination that its benefits justify its costs; it is tailored to impose the least burden on society, consistent with achieving the regulatory objectives; and in choosing among alternative regulatory approaches, the agency has selected those approaches that maximize net benefits. Executive Order 13563 recognizes that some benefits are difficult to quantify and provides that, where appropriate and permitted by law, agencies may consider and discuss qualitatively values that are difficult or impossible to quantify, including equity, human dignity, fairness, and distributive impacts.

OMB declined review of this IFR because it is not a significant regulatory action. As previously noted, the alignment with WIOA involved only definitions, and grantees are not required to collect any additional information that may cause a burden increase.

The purposes of the Paperwork Reduction Act of 1995 (PRA), 44 U.S.C. 3501 et seq., include minimizing the paperwork burden on affected entities. The PRA requires certain actions before an agency can adopt or revise the collection of information, including publishing a summary of the collection of information and a brief description of the need for and proposed use of the information.

As part of its continuing effort to reduce paperwork and respondent burden, the Department conducts a preclearance consultation program to provide the public and Federal agencies with an opportunity to comment on proposed and continuing collections of information in accordance with the PRA. See 44 U.S.C. 3506(c)(2)(A). This activity helps to ensure that the public understands the Department's collection instructions, respondents can provide the requested data in the desired format, reporting burden (time and financial resources) is minimized, collection instruments are clearly understood, and the Department can properly assess the impact of collection requirements on respondents.

A Federal agency may not conduct or sponsor a collection of information unless it is approved by OMB under the PRA and displays a currently valid OMB control number. The public is also not required to respond to a collection of information unless it displays a currently valid OMB control number. In addition, notwithstanding any other provisions of law, no person will be subject to penalty for failing to comply with a collection of information if the collection of information does not display a currently valid OMB control number (44 U.S.C. 3512).

As part of its effort to streamline program performance reporting, the Department revised the Workforce Innovation and Opportunity Act (WIOA) Performance Accountability, Information and Reporting System (OMB Control Number 1205-0521) information collection by adding the performance information collection requirements for SCSEP. The Department notes that the SCSEP information collection will retain its current approval (under OMB Control Number 1205-0040) for data elements not contained in the revised WIOA Performance Accountability, Information and Reporting System.

The Department provided opportunities for the public to comment on the information collection through notices in the Federal Register that provided comment periods on the associated forms and instructions. This comment period provided at least 60 days for comments to be submitted to the agency. The ICRs was then submitted for OMB approval, and the Department published notices in the Federal Register that invited comments to be sent to OMB for a period lasting at least 30 days. The Department will publish a Federal Register Notice shortly to incorporate the information collection provisions of this Interim Final Rule.

The information collection is summarized as follows.

Agency: DOL-ETA.

Title of Collection: ETA Workforce Innovation and Opportunity Act Performance Accountability, Information, and Reporting System.

Type of Review: Revision.

OMB Control Number: 1205-0521.

Affected Public: State, Local, and Tribal Governments; Individuals or Households; and Private Sector—businesses or other for-profits and not-for-profit institutions.

Obligation to Respond: Required to Obtain or Retain Benefits.

Estimated Total Annual Respondents: 17,532,542.

Estimated Total Annual Responses: 35,064,970.

Estimated Total Annual Burden Hours: 8,938,029.

Regulations sections: § 684.420, § 684.610, § 684.700, § 684.800, § 685.210, § 685.400, § 688.420, § 688.610. 641.700, § 641.710, § 641.720, § 641.730, § 641.740, § 641.750.

For purposes of the Unfunded Mandates Reform Act of 1995, this rule does not include any Federal mandate that may result in increased expenditures by State, local, and tribal governments in the aggregate of more than $100 million, or increased expenditures by the private sector of more than $100 million.

The Department has reviewed this rule in accordance with Executive Order 13132 regarding federalism and has determined that it does not have “federalism implications.” The rule does not “have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.” This Interim Final Rule defines and implements performance measures for the SCSEP and while States are SCSEP grantees, this rule merely makes changes to data collection processes that are ongoing. Requiring State grantees to implement these changes does not constitute a “substantial direct effect” on the States, nor will it alter the relationship or responsibilities between the Federal and State governments.

Executive Order 13045 concerns the protection of children from environmental health risks and safety risks. This rule defines and details the performance measures use by the SCSEP, a program for older Americans, and has no impact on safety or health risks to children.

Executive Order 13175 addresses the unique relationship between the Federal Government and Indian tribal governments. The order requires Federal agencies to take certain actions when regulations have “tribal implications.” Required actions include consulting with Tribal Governments prior to promulgating a regulation with tribal implications and preparing a tribal impact statement. The order defines regulations as having “tribal implications” when they have substantial direct effects on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

The Department has reviewed this Interim Final Rule and concludes that it does not have tribal implications. While some tribes may be recipients of national SCSEP grantees, this rule will not have a substantial direct effect on those tribes because, as outlined in the Regulatory Flexibility Act section of the preamble above, there are only small cost increases associated with implementing this regulation. This regulation does not affect the relationship between the Federal Government and the tribes, nor does it affect the distribution of power and responsibilities between the Federal Government and Tribal Governments. Accordingly, we conclude that this rule does not have tribal implications for the purposes of Executive Order 13175.

The Department has reviewed this rule in accordance with the requirements of the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321 et seq.), the regulations of the Council on Environmental Quality (40 CFR part 1500), and the Department's NEPA procedures (29 CFR part 11). The rule will not have a significant impact on the quality of the human environment and, thus, the Department has not prepared an environmental assessment or an environmental impact statement.

Section 654 of the Treasury and General Government Appropriations Act, enacted as part of the Omnibus Consolidated and Emergency Supplemental Appropriations Act of 1999 (Pub. L. 105-277, 112 Stat. 2681), requires the Department to assess the impact of this rule on family well-being. A rule that is determined to have a negative effect on families must be supported with an adequate rationale.

The Department has assessed this rule and determines that it will not have a negative effect on families. Indeed, we believe the SCSEP strengthens families by providing job training and support services to low-income older Americans so that they can obtain fruitful employment and enjoy increased economic self-sufficiency.

The Privacy Act of 1974, 5 U.S.C. 552a, provides safeguards to individuals concerning their personal information that the Government collects. The Act requires certain actions by an agency that collects information on individuals when that information contains personally identifiable information such as SSNs or names. Because SCSEP participant records are maintained by SSN, the Act applies here.

A key concern is for the protection of participant SSNs. Grantees must collect the SSN in order to properly pay participants for their community service work in host agencies. When participant files are sent to the Department for aggregation, the transmittal is protected by secure encryption. When participant files are retrieved within the internet-based SCSEP data management system of SPARQ, only the last four digits of the SSN are displayed. Any information that is shared or made public is aggregated by grantee and does not reveal personal information on specific individuals.

The Department works diligently to ensure the highest level of security whenever personally identifiable information is stored or transmitted. All contractors that have access to individually identifying information are required to provide assurances that they will respect and protect the confidentiality of the data. ETA's Office of Performance and Technology has been an active participant in the development and approval of data security measures—especially as they apply to SPARQ.

In addition to the above, a Privacy Act Statement is provided to grantees for distribution to all participants. The grantees were advised of the requirement in ETA's Older Worker Bulletin OWB-04-06. Participants receive this information when they meet with a case worker or intake counselor. When the programs are monitored, implementation of this term is included in the review.

This rule is not subject to Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights, because it does not involve implementation of a policy with takings implications.

This regulation has been drafted and reviewed in accordance with Executive Order 12988, Civil Justice Reform, and will not unduly burden the Federal court system. The regulation has been written so as to minimize litigation and provide a clear legal standard for affected conduct, and has been reviewed carefully to eliminate drafting errors and ambiguities.

This rule is not subject to Executive Order 13211, because it will not have a significant adverse effect on the supply, distribution, or use of energy.

The Department drafted this Interim Final Rule in plain language.

For the reasons discussed in the preamble, the Department of Labor amends 20 CFR part 641 as follows:

The City of Chesapeake, owner and operator of the S168/Great Bridge bridge that carries SR 168/Battlefield Boulevard South over the Atlantic Intracoastal Waterway (AICW), Albemarle and Chesapeake Canal, mile 12.0, at Chesapeake, VA, has requested a temporary deviation from the current operating regulations to ensure the safety of the increased volumes of spectators that will be participating in the Annual Chesapeake Rotary Christmas Parade on Saturday, December 2, 2017. This bridge is a double bascule drawbridge, with a vertical clearance of 8 feet above mean high water in the closed position and unlimited vertical clearance in the open position.

The current operating regulation is set out in 33 CFR 117.997(g). Under this temporary deviation, the bridge will be maintained in the closed-to-navigation position from 4 p.m. to 6 p.m. and from 8 p.m. to 10 p.m. on Saturday, December 2, 2017.

The AICW, Albemarle and Chesapeake Canal, is used by a variety of vessels including U.S. government vessels, small commercial vessels, recreational vessels and tug and barge traffic. The Coast Guard has carefully coordinated the restrictions with waterway users in publishing this temporary deviation.

Vessels able to pass through the bridge in the closed-to-navigation position may do so at anytime. The bridge will be able to open for emergencies and there is no immediate alternative route for vessels unable to pass through the bridge in the closed position. The Coast Guard will also inform the users of the waterway through our Local and Broadcast Notices to Mariners of the change in operating schedule for the bridge so that vessel operators can arrange their transits to minimize any impact caused by the temporary deviation.

In accordance with 33 CFR 117.35(e), the drawbridge must return to its regular operating schedule immediately at the end of the effective period of this temporary deviation. This deviation from the operating regulations is authorized under 33 CFR 117.35.

Purpose: As noted above, this final rule incorporates classification changes adopted by the Nice Agreement that will become effective on January 1, 2018. This rule benefits the public by providing notice regarding these changes.

Summary of Major Provisions: The USPTO is revising § 6.1 in part 6 of title 37 of the Code of Federal Regulations to incorporate classification changes and modifications that will become effective January 1, 2018, as listed in the International Classification of Goods and Services for the Purposes of the Registration of Marks (11th ed., 2018) (Nice Classification), published by WIPO.

The Nice Agreement is a multilateral treaty, administered by WIPO, which establishes the international classification of goods and services for the purposes of registering trademarks and service marks. As of September 1, 1973, this international classification system is the controlling system used by the United States, and it applies to all applications filed on or after September 1, 1973, and their resulting registrations, for all statutory purposes. See 37 CFR 2.85(a). Every signatory to the Nice Agreement must utilize the international classification system.

Each state party to the Nice Agreement is represented in the Committee of Experts of the Nice Union (Committee of Experts), which meets annually to vote on proposed changes to the Nice Classification. Any state that is a party to the Nice Agreement may submit proposals for consideration by the other members in accordance with agreed-upon rules of procedure. Proposals are currently submitted on an annual basis to an electronic forum on the WIPO Web site, commented upon, modified, and compiled by WIPO for further discussion and voting at the annual Committee of Experts meeting.

In 2013, the Committee of Experts began annual revisions to the Nice Classification. The annual revisions, which are published electronically and enter into force on January 1 each year, are referred to as versions and identified by edition number and year of the effective date (e.g., “Nice Classification, 10th edition, version 2013” or “NCL 10-2013”). Each annual version includes all changes adopted by the Committee of Experts since the adoption of the previous version. The changes consist of the addition of new goods and services to, and deletion of goods and services from, the Alphabetical List, and any modifications to the wording in the Alphabetical List, the class headings, and the explanatory notes that do not involve the transfer of goods or services from one class to another. New editions of the Nice Classification continue to be published electronically and include all changes adopted annually since the previous version, as well as goods or services transferred from one class to another or new classes that are created.

The annual revisions contained in this final rule consist of modifications to the class headings that have been incorporated into the Nice Agreement by the Committee of Experts. Under the Nice Classification, there are 34 classes of goods and 11 classes of services, each with a class heading. Class headings generally indicate the fields to which goods and services belong. Specifically, this rule adds new, or deletes existing, goods and services from 10 class headings. The changes to the class headings further define the types of goods and/or services appropriate to the class. As a signatory to the Nice Agreement, the United States adopts these revisions pursuant to Article 1.

Costs and Benefits: This rulemaking is not economically significant under Executive Order 12866 (Sept. 30, 1993).

The USPTO is revising § 6.1 as follows:

In Class 1, the wording “Chemicals used in industry, science and photography” is amended to “Chemicals for use in industry, science and photography.” “Manures;” is deleted where it appears as a separate clause. The wording “fire extinguishing compositions” is amended to “fire extinguishing and fire prevention compositions.” “Chemical substances for preserving foodstuffs;” is deleted. The wording “tanning substances” is amended to “substances for tanning animal skins and hides.” The wording “adhesives used in industry” is amended to “adhesives for use in industry;” and “putties and other paste fillers; compost, manures, fertilizers; biological preparations for use in industry and science” is added thereafter.

In Class 2, a comma is inserted after “colorants,” the term “dyes” is added, and the wording and punctuation “inks for printing, marking and engraving;” is added thereafter. “Mordants;” is deleted.

“Non-medicated cosmetics and toiletry preparations; non-medicated dentifrices; perfumery, essential oils;” is added to the beginning of Class 3, and the capital letter in “Bleaching” is changed to lower case. A semi-colon is deleted after “abrasive preparations” and the wording “non-medicated soaps; perfumery, essential oils, non-medicated cosmetics, non-medicated hair lotions; non-medicated dentifrices” is also deleted from the end of Class 3.

In Class 4, a comma is inserted after “greases” and the term “wax” is added thereafter. The wording and parentheses “(including motor spirit)” is deleted.

In Class 7, “Machines and machine tools” is amended to “Machines, machine tools, power-operated tools.” A comma is added after “engines” and the parentheses around “except for land vehicles” are deleted. A comma is also inserted after “transmission components” and the parentheses around “except for land vehicles” are also deleted. The wording “agricultural implements other than hand-operated” is amended to “agricultural implements, other than hand-operated hand tools.”

In Class 8, “Hand tools and implements (hand-operated)” is amended to “Hand tools and implements, hand-operated.” The wording “side arms” is amended to “side arms, except firearms.”

In Class 16, “artists' and drawing materials” is amended to “drawing materials and materials for artists.”

In Class 21, the wording “cookware and tableware, except forks, knives and spoons;” is added.

In Class 29, “edible oils and fats” is amended to “oils and fats for food.”

In Class 30, “(frozen water)” is added after the word “ice.”

A. Administrative Procedure Act: The changes in this rulemaking involve rules of agency practice and procedure, and/or interpretive rules. See Perez v. Mortg. Bankers Ass'n, 135 S. Ct. 1199, 1204 (2015) (Interpretive rules “advise the public of the agency's construction of the statutes and rules which it administers.” (citation and internal quotation marks omitted)); Nat'l Org. of Veterans' Advocates v. Sec'y of Veterans Affairs, 260 F.3d 1365, 1375 (Fed. Cir. 2001) (Rule that clarifies interpretation of a statute is interpretive.); Bachow Commc'ns Inc. v. FCC, 237 F.3d 683, 690 (D.C. Cir. 2001) (Rules governing an application process are procedural under the Administrative Procedure Act.); Inova Alexandria Hosp. v. Shalala, 244 F.3d 342, 350 (4th Cir. 2001) (Rules for handling appeals were procedural where they did not change the substantive standard for reviewing claims.).

Accordingly, prior notice and opportunity for public comment for the changes in this rulemaking are not required pursuant to 5 U.S.C. 553(b) or (c), or any other law. See Perez, 135 S. Ct. at 1206 (Notice-and-comment procedures are required neither when an agency “issue[s] an initial interpretive rule” nor “when it amends or repeals that interpretive rule.”); Cooper Techs. Co. v. Dudas, 536 F.3d 1330, 1336-37 (Fed. Cir. 2008) (stating that 5 U.S.C. 553, and thus 35 U.S.C. 2(b)(2)(B), does not require notice and comment rulemaking for “interpretative rules, general statements of policy, or rules of agency organization, procedure, or practice” (quoting 5 U.S.C. 553(b)(A))).

B. Regulatory Flexibility Act: As prior notice and an opportunity for public comment are not required pursuant to 5 U.S.C. 553 or any other law, neither a Regulatory Flexibility Act analysis, nor a certification under the Regulatory Flexibility Act (5 U.S.C. 601, et seq.), is required. See 5 U.S.C. 603.

C. Executive Order 12866 (Regulatory Planning and Review): This rulemaking has been determined to be not significant for purposes of Executive Order 12866.

D. Executive Order 13563 (Improving Regulation and Regulatory Review): The Office has complied with Executive Order 13563. Specifically, the Office has, to the extent feasible and applicable: (1) Made a reasoned determination that the benefits justify the costs of the rule; (2) tailored the rule to impose the least burden on society consistent with obtaining the regulatory objectives; (3) selected a regulatory approach that maximizes net benefits; (4) specified performance objectives; (5) identified and assessed available alternatives; (6) involved the public in an open exchange of information and perspectives among experts in relevant disciplines, affected stakeholders in the private sector and the public as a whole, and provided on-line access to the rulemaking docket; (7) attempted to promote coordination, simplification, and harmonization across government agencies and identified goals designed to promote innovation; (8) considered approaches that reduce burdens and maintain flexibility and freedom of choice for the public; and (9) ensured the objectivity of scientific and technological information and processes.

E. Executive Order 13771 (Reducing Regulation and Controlling Regulatory Costs): This rule is not an Executive Order 13771 regulatory action because this rule is not significant under Executive Order 12866.

F. Executive Order 13132 (Federalism): This rulemaking does not contain policies with federalism implications sufficient to warrant preparation of a Federalism Assessment under Executive Order 13132 (Aug. 4, 1999).

G. Executive Order 13175 (Tribal Consultation): This rulemaking will not: (1) Have substantial direct effects on one or more Indian tribes; (2) impose substantial direct compliance costs on Indian tribal governments; or (3) preempt tribal law. Therefore, a tribal summary impact statement is not required under Executive Order 13175 (Nov. 6, 2000).

H. Executive Order 13211 (Energy Effects): This rulemaking is not a significant energy action under Executive Order 13211 because this rulemaking is not likely to have a significant adverse effect on the supply, distribution, or use of energy. Therefore, a Statement of Energy Effects is not required under Executive Order 13211 (May 18, 2001).

I. Executive Order 12988 (Civil Justice Reform): This rulemaking meets applicable standards to minimize litigation, eliminate ambiguity, and reduce burden as set forth in sections 3(a) and 3(b)(2) of Executive Order 12988 (Feb. 5, 1996).

J. Executive Order 13045 (Protection of Children): This rulemaking does not concern an environmental risk to health or safety that may disproportionately affect children under Executive Order 13045 (Apr. 21, 1997).

K. Executive Order 12630 (Taking of Private Property): This rulemaking will not affect a taking of private property or otherwise have taking implications under Executive Order 12630 (Mar. 15, 1988).

L. Congressional Review Act: Under the Congressional Review Act provisions of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 801 et seq.), prior to issuing any final rule, the USPTO will submit a report containing the final rule and other required information to the United States Senate, the United States House of Representatives, and the Comptroller General of the Government Accountability Office. The changes in this notice are not expected to result in an annual effect on the economy of 100 million dollars or more, a major increase in costs or prices, or significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of United States-based enterprises to compete with foreign-based enterprises in domestic and export markets. Therefore, this notice is not expected to result in a “major rule” as defined in 5 U.S.C. 804(2).

M. Unfunded Mandates Reform Act of 1995: The changes set forth in this notice do not involve a Federal intergovernmental mandate that will result in the expenditure by State, local, and tribal governments, in the aggregate, of 100 million dollars (as adjusted) or more in any one year, or a Federal private sector mandate that will result in the expenditure by the private sector of 100 million dollars (as adjusted) or more in any one year, and will not significantly or uniquely affect small governments. Therefore, no actions are necessary under the provisions of the Unfunded Mandates Reform Act of 1995. See 2 U.S.C. 1501 et seq.

N. National Environmental Policy Act: This rulemaking will not have any effect on the quality of the environment and is thus categorically excluded from review under the National Environmental Policy Act of 1969. See 42 U.S.C. 4321 et seq.

O. National Technology Transfer and Advancement Act: The requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) are not applicable because this rulemaking does not contain provisions that involve the use of technical standards.

P. Paperwork Reduction Act: This final rule does not involve information collection requirements which are subject to review by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.).

For the reasons given in the preamble and under the authority contained in 15 U.S.C. 1112, 1123 and 35 U.S.C. 2, as amended, the USPTO is amending part 6 of title 37 as follows:

As detailed in a June 12, 2017 interim rule,1 the U.S. Copyright Office memorialized its special procedures for examining secure tests. As detailed in a November 13, 2017 interim rule,2 the Office established a new group registration option for secure test questions. The Office is extending the December 11, 2017 deadline for the submission of written comments to allow greater time for public comment following implementation of the November 13, 2017 interim rule.

EPA Region 1 is publishing this direct final Notice of Deletion of the Hatheway & Patterson Superfund Site (Site), from the National Priorities List (NPL). The NPL constitutes Appendix B of 40 CFR part 300, which is the National Oil and Hazardous Substances Pollution Contingency Plan (NCP), which EPA promulgated pursuant to section 105 of the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) of 1980, as amended. EPA maintains the NPL as the list of sites that appear to present a significant risk to public health, welfare, or the environment. Sites on the NPL may be the subject of remedial actions financed by the Hazardous Substance Superfund (Fund). As described in 300.425(e)(3) of the NCP, sites deleted from the NPL remain eligible for Fund-financed remedial actions if future conditions warrant such actions.

Section II of this document explains the criteria for deleting sites from the NPL. Section III discusses procedures that EPA is using for this action. Section IV discusses the Hatheway & Patterson Superfund Site and demonstrates how it meets the deletion criteria. Section V discusses EPA's action to delete the Site from the NPL unless adverse comments are received during the public comment period.

The NCP establishes the criteria that EPA uses to delete sites from the NPL. In accordance with 40 CFR 300.425(e), sites may be deleted from the NPL where no further response is appropriate. In making such a determination pursuant to 40 CFR 300.425(e), EPA will consider, in consultation with the state, whether any of the following criteria have been met:

i. Responsible parties or other persons have implemented all appropriate response actions required;

ii. All appropriate Fund-financed response under CERCLA has been implemented, and no further response action by responsible parties is appropriate; or

iii. The remedial investigation has shown that the release poses no significant threat to public health or the environment and, therefore, the taking of remedial measures is not appropriate.

Pursuant to CERCLA section 121(c) and the NCP, EPA conducts five-year reviews to ensure the continued protectiveness of remedial actions where hazardous substances, pollutants, or contaminants remain at a site above levels that allow for unlimited use and unrestricted exposure. EPA conducts such five-year reviews even if a site is deleted from the NPL. EPA may initiate further action to ensure continued protectiveness at a deleted site if new information becomes available that indicates it is appropriate. Whenever there is a significant release from a site deleted from the NPL, the deleted site may be restored to the NPL without application of the hazard ranking system.

The following procedures apply to deletion of the Site:

(1) EPA consulted with the Commonwealth of Massachusetts (the “state”) prior to developing this direct final Notice of Deletion and the Notice of Intent to Delete co-published today in the “Proposed Rules” section of the Federal Register.

(2) EPA has provided the state 30 working days for review of this notice and the parallel Notice of Intent to Delete prior to their publication today, and the state, through the Massachusetts Department of Environmental Protection (MassDEP), has concurred on the deletion of the Site from the NPL.

(3) Concurrently with the publication of this direct final Notice of Deletion, a notice of the availability of the parallel Notice of Intent to Delete is being published in a major local newspaper, The Sun Chronicle, Attleboro, MA. The newspaper notice announces the 30-day public comment period concerning the Notice of Intent to Delete the Site from the NPL.

(4) The EPA placed copies of documents supporting the proposed deletion in the deletion docket and made these items available for public inspection and copying at the Site information repository identified above.

(5) If adverse comments are received within the 30-day public comment period on this deletion action, EPA will publish a timely notice of withdrawal of this direct final Notice of Deletion before its effective date and will prepare a response to comments and continue with the deletion process on the basis of the Notice of Intent to Delete and the comments already received.

Deletion of a site from the NPL does not itself create, alter, or revoke any individual's rights or obligations. Deletion of a site from the NPL does not in any way alter EPA's right to take enforcement actions, as appropriate. The NPL is designed primarily for informational purposes and to assist EPA management. Section 300.425(e)(3) of the NCP states that the deletion of a site from the NPL does not preclude eligibility for future response actions, should future conditions warrant such actions.

The following information provides EPA's rationale for deleting the Site from the NPL:

The Hatheway and Patterson Superfund Site (Site), known by EPA Site Identification Number: MAD001060805, is located in the towns of Mansfield and Foxborough, Massachusetts. Approximately 36 acres of the Site are located in the Town of Mansfield, which is zoned for commercial/industrial use. The remaining 1.77 acres are located in the Town of Foxborough, also zoned for commercial use. The Site is bisected by the Rumford River, which runs north to south, and by a railroad right-of-way, which runs east to west.

Prior to the 1950's, the property was reportedly used for various activities, including railroad operations, coal storage, bulk chemical transfer, and storage of electric/utility poles and railroad ties. Beginning in 1952, wood treatment operations by Hatheway & Patterson Co., Inc. (Hatheway & Patterson) began. Operations at the Site included the preservation of wood sheeting, planking, timber, piling, poles and other wood products and included the use of pentachlorophenol (PCP), creosote, fluoro-chrome-arsenate-phenol (FCAP) salts, chromated copper-arsenate (CCA) salts, and fire retardants, including DriconTM (boric acid and anhydrous sodium tetraborate). Contamination was initially discovered in 1972, when a tar seep (approximately 62 feet long and 6 inches thick) was discovered on the banks of the Rumford River on the southern portion of the property.

Following the initial discovery of contamination, Hatheway & Patterson took steps to control the “oily seepage” from 1973 to 1991. Hatheway & Patterson filed for bankruptcy in 1993, leading to a removal action by EPA in 1993-1995 to address the imminent hazard posed by abandoned chemicals and waste at the Site. The Site was placed on the National Priorities List (NPL) by publication in the Federal Register on September 5, 2002, 67 FR 56757.

The Remedial Investigation and Feasibility Study were completed in 2005. As part of the investigation, soil, surface water, groundwater, sediments and fish tissue were evaluated. The primary contaminants identified at the Site were arsenic, dioxin, polycyclic aromatic hydrocarbons (PAHs), pentachlorophenol (PCP) and other semi-volatile organic compounds (SVOCs). Light Non-Aqueous Phase Liquid (LNAPL) hot spot areas/isolated pockets of free product and LNAPL-saturated subsurface soils were also detected throughout the Site.

The baseline human health risk assessment concluded that exposure to surface and subsurface soil was associated with an unacceptable human health risk outside EPA's acceptable risk range under current and future exposure scenarios. On-site overburden and bedrock groundwater was also associated with an unacceptable human health risk. The baseline ecological risk assessment concluded that there was not a substantial risk from exposure to site-related contaminants. The FS evaluated alternatives with various combinations of soil treatment technologies, excavation, off-site disposal of contaminants, consolidation of contaminated soil and sediments under a cap and institutional controls.

In September 2005, EPA issued a Record of Decision (ROD) that set forth the Selected Remedy at the Hatheway and Patterson Superfund Site to address current and future risks due to direct contact and incidental ingestion of soil and risks to future users of groundwater. The Remedial Action Objectives (RAOs) for the Site outlined in the ROD were as follows:

The Selected Remedy included: Demolition of buildings in and near Hatheway & Patterson's former manufacturing area; excavation and on-site consolidation of soils contaminated with arsenic and pentachlorophenol under a low-permeability cover, after being stabilized with cement to achieve leachability criteria; disposal of soil contaminated with dioxin and free product LNAPL at a licensed off-site facility; institutional controls to prohibit the use of Site groundwater and restrict land uses in a manner that ensures the protectiveness of the remedy as described in the ROD; long term monitoring of groundwater, surface water, sediment, as well as fish tissue analysis of specimens caught in the Rumford River; and Five-Year Reviews of the remedy.

Modifications to the remedy were documented in the 2011 Explanation of Significant Differences (ESD). Based on a zoning change for the Foxborough parcel from residential use to “Limited Industrial” use, and intended reuse of the parcel as a parking lot, EPA and MassDEP determined that the Foxborough parcel should be remediated to a Reasonably Anticipated Future Use of commercial/open space. Therefore, the cleanup level for arsenic was changed for this parcel, and it was then used as a consolidation area for soils contaminated with arsenic and covered with asphalt in order to facilitate the use of the parcel as a parking lot. The ESD also documented that PCP and arsenic-contaminated soils in the Mansfield portion of the Site were disposed at an off-site facility rather than consolidated on-site as described in the ROD. In addition, the ESD clarified the extent of institutional controls to be placed on the Site properties.

Through an Interagency Agreement with EPA Region 1, the U.S. Army Corps of Engineers New England District (USACE) performed the Selected Remedy. Remedial construction activities commenced in September 2009 and were substantially completed in September 2010. A total of 34,000 tons of soil was removed from the Northern Mansfield Property and the Foxborough Property and 9,500 tons of soil was removed from the eastern portion of the Southern Mansfield Property for off-site disposal to a RCRA subtitle C hazardous waste landfill, Envirosafe of Oregon, Ohio. Approximately 5,000 tons of soil exceeding arsenic cleanup levels were consolidated in the “Capped Consolidation Area” on the Foxborough Property under a multi-layer low-permeability barrier (i.e., the asphalt cover). A small portion of land along the western boundary of the Foxborough Property, approximately 30 feet wide, was left unpaved. All portions of the Foxborough Property that are not part of the Capped Consolidation Area are referred to as the “Unpaved Area”. The Unpaved Area of the Foxborough Property was cleaned-up to the same level that was being used in the rest of the Site in Mansfield that was zoned open space/commercial.

The properties owned by the towns of Mansfield and Foxborough have institutional controls in the form of Notice of Activity and Uses Limitations (NAULs), to prevent uncontrolled access to the remaining contamination. Institutional controls were also placed on the railroad right-of way, owned by the Massachusetts Department of Transportation, in the form of signage to prevent the potential exposure to any future utility workers. The property owners are required comply with the institutional controls for the Site; this will be verified during the Five-Year Reviews.

The source control remedy at the Site was performed in accordance with EPA-approved plans and specifications. No additional EPA construction is anticipated at the Site. The source control remedial cleanup levels (listed below) were set in the ROD based on commercial/open-space reuse:

During the remedial action, if contaminants of concern (COCs) were detected above the clean-up criteria listed above, excavation continued horizontally and vertically until either: (1) Post-excavation confirmatory samples met the clean-up criteria; (2) planned excavation limits along County Street and the railroad right of way were met, or (3) for vertical excavation, the water table was reached.

Post-excavation confirmatory sampling was performed in conjunction with excavation activities from the bottom of excavation and “clean” perimeter embankment and tested for the COCs. Generally, as excavation was completed in a grid cell area, confirmatory soil samples were collected from the bottom and sidewalls of the excavation. Bottom samples were comprised of a five-point composite sample collected from the center and four corners of the excavation cell. Sidewall samples were collected from the sidewalls of excavations when grids were adjacent to the Site perimeter. If excavation sidewalls were greater than three feet in depth, an additional sample was collected below this interval to the bottom of the excavation. All samples collected and analytical results are summarized in the Remedial Action Completion Report, dated August 2011.

Institutional controls in the form of enforceable Notices of Activity and Use Limitations (NAULs) were recorded with the deed on properties associated with the Site, as listed below:

The NAUL on each property specifies the current allowable and prohibited uses of the property, and establishes limits and conditions on the future uses of contaminated portions of the property. The restrictions are different for each property, but generally restrict the use of groundwater and subsurface soils where contamination remains on the site. The NAUL provides information about the risks remaining at the Site for current and future owners and interest holders. The NAULs require that the site owner submit annual reports to EPA and MassDEP regarding the status of the ICs. EPA will also assess site conditions and interview town officials as part of the Five Year Review process to confirm that only the permitted uses have taken place on the restricted properties. Should there be violations of the restrictions contained in the NAUL, the state has the authority to take an enforcement action against any property owner.

In addition to NAULs, institutional controls in the form of signage were used along the railroad right-of-way that intersects the Site stating to contact the property owner before soils are disturbed. The signage along the railroad right-of-way will be inspected periodically at a minimum every five years as part of EPA's Five Year Review process and/or during regular operation and maintenance activities conducted by the state.

The ROD required long-term monitoring of groundwater, surface water, fish tissue and sediment, and operation and maintenance of the low-permeability cover. As a result of changes to the remedy documented in the ESD, the Hatheway and Patterson Operation and Maintenance Manual, dated August 2017 requires semi-annual monitoring of groundwater following the first five-year review, and sampling of sediment and surface water at least once every five years following the second five-year review. The 2017 Operation and maintenance (O&M) Manual also provides an explanation for eliminating the fish tissue sampling requirement which is primarily due to the lack of fish in the Rumford River.

The ROD contains performance standards for on-site groundwater and for groundwater at the boundary of the Site. If monitoring indicates exceedances of the on-site groundwater performance standards, further evaluation of the impacts to surface water and sediments is needed. If monitoring indicates exceedances of the Site boundary groundwater performance standards, the ROD requires an evaluation of whether off-site receptors are at risk. MassDEP is the lead agency performing the O&M, including the groundwater, surface water and sediment monitoring for the Site.

Five-year reviews are required at the Site because hazardous substances will remain at the Site above concentration levels that would allow for unrestricted use and unrestricted exposure after the completion of all remedial actions. Pursuant to CERCLA Section 121(c), NCP Section 300.400(f)(4)(ii) and as provided in OSWER Directive 9355.7-03B-P, June 2001, Comprehensive Five-Year Review Guidance, EPA must conduct statutory five-year reviews at the Site. The purpose of these reviews is to evaluate whether the selected remedy remains protective of human health and the environment. These five-year reviews are required no less often than each five years after the initiation of the remedial action. EPA may terminate these reviews when no hazardous substances, pollutants, or contaminants remain at the Site above levels that allow for unrestricted use and unlimited exposure.

The first five-year review was conducted in 2014, and found that the remedy at the Hatheway & Patterson Superfund Site currently protects human health and the environment. Several issues were raised in the 2014 Five-Year Review and resolved as discussed below.

Institutional Controls: At the time of the 2014 Five-Year Review, institutional controls were not in place. Between 2015 and 2017, all institutional controls for the Site were implemented.

Sediment Sampling: An issue was noted with the sediment sampling locations. To address the issue additional sediment sampling was performed and the results showed contaminants concentrations in sediment at the Site remain protective of human health and the environment.

Fish Tissue and Surface Water Sampling: Fish tissue and surface water sampling were not performed as required by the ROD. To address this issue, the 2017 O&M Manual was written to reflect site conditions (a lack of fish in the Rumford River) and to require sediment and surface water monitoring at a minimum in conjunction with the five-year reviews.

Groundwater: Two issues related to groundwater were raised in the 2014 Five-Year review. First, to determine whether a detection of a contaminant of concern at an off-site well was site actual and persistent; and second, to evaluate whether the active irrigation wells outside the compliance boundary have impacted groundwater flow directions. To address the first issue, additional sampling was performed at the off-site well which showed the contaminant was below state groundwater standards and was likely not site-related. To address the second issue, EPA compiled a technical memorandum documenting that the irrigations wells are not impacting groundwater flowpaths near the Site. Also, periodic groundwater monitoring will continue to confirm that off-site wells are not impacted.

The 2014 Five-Year Review found that the remedy at the Hatheway & Patterson Superfund Site protects human health and the environment because remediation of the soil (soil removal and on-site consolidation) has been completed to cleanup levels that are considered protective for the anticipated future use of the property, and there is no current use of on-site groundwater which is classified as non-potable. Institutional controls have been created and recorded to restrict inappropriate land uses (including use of groundwater) and protect the consolidation area cover. Operation and maintenance activities have been initiated and will ensure that the consolidation area and associated components of the remedy (e.g., groundwater monitoring wells) remain in good condition. In addition, monitoring of groundwater will continue to assess the protectiveness of the remedy.

Throughout the Site's history, EPA has kept the community and other interested parties apprised of Site activities through informational meetings, fact sheets, press releases, and public meetings. A Community Relations Plan was established before remedial actions were performed at the Site to address issues of community concern and community relation activities conducted by EPA. Activities included providing information concerning the progress of remedial activities to interested citizens and allowing those individuals or groups an opportunity to provide comments as EPA conducts remedial activities at the Site. EPA also issued press releases announcing the start and conclusion of the five-year review and will continue to do so.

Remedial Design and Remedial Action (RD/RA) activities at the Site were consistent with the ROD and EPA RD/RA Statements of Work provided to USACE. RA plans for all phases of construction included a Quality Assurance Project Plan (QAPP) dated October 2009 and QAPP Revision 1, dated March 2010. The QAPP incorporated all EPA and state quality assurance and quality control procedures and protocols (where necessary). All procedures and protocols were followed for soil, sediment, water, and air sampling during the RA. EPA analytical methods were used for all validation and monitoring samples during all RA activities. EPA has determined that the analytical results are accurate to the degree needed to assure satisfactory execution of the RA, and are consistent with the ROD and the RD/RA plans and specifications. All Institutional Controls are in place and currently EPA expects that no further Superfund response is needed to protect human health and the environment, except future Five Year Reviews.

Operation and maintenance (O&M) activities were agreed upon by EPA and the state following construction of the remedy. The operation and maintenance activities are documented in the 2017 O&M Manual. The state preforms O&M at the Site and will follow state quality assurance/quality control plans associated with the 2017 O&M plan.

This Site meets all the site completion requirements as specified in OSWER Directive 9320.2-09-A-P, Close Out Procedures for National Priorities List Sites. All cleanup actions specified in the ROD and ESD have been implemented. Confirmatory ground-water monitoring and institutional controls provide further assurance that the Site no longer poses any threats to human health or the environment. The only remaining activity to be performed is O&M that the state has guaranteed. Five year reviews and monitoring will also be conducted at the Site. A bibliography of all reports relevant to the completion of this Site under the Superfund program is in the administrative record for this deletion.

The EPA, with concurrence of the Commonwealth of Massachusetts through the Department of Environmental Protection, has determined that all appropriate response actions under CERCLA, other than operation and maintenance, monitoring, and five-year reviews have been completed. Therefore, EPA is deleting the Site from the NPL.

Because EPA considers this action to be noncontroversial and routine, EPA is taking it without prior publication. This action will be effective January 30, 2018 unless EPA receives adverse comments by January 2, 2018. If adverse comments are received within the 30-day public comment period, EPA will publish a timely withdrawal of this direct final notice of deletion before the effective date of the deletion, and it will not take effect. EPA will prepare a response to comments and continue with the deletion process on the basis of the notice of intent to delete and the comments already received. There will be no additional opportunity to comment.

For the reasons set out in this document, 40 CFR part 300 is amended as follows:

Background

Section 3508 of the NDAA 2013 authorized the extension of the Maritime Security Program through fiscal year 2025. Under section 3508, the Secretary of Transportation, acting through the Maritime Administrator, is authorized to offer to extend the existing 60 MSP Operating Agreements through fiscal year 2025. Section 3508 authorized a new payment schedule of increasing MSP Operating Agreement payments through fiscal year 2025. These payment amounts were subsequently updated by the CAA 2016 and the NDAA 2016. Section 3508 of the NDAA 2013 also provided a new procedure for awarding MSP Operating Agreements, including a new priority system for the award of operating agreements. Under the new priority, award will be first based on vessel type as determined by military requirements and then based on the citizenship status of the applicant. Section 3508 revised the procedure for the transfer of MSP Operating Agreements by eliminating the requirement to first offer an MSP Operating Agreement to a U.S. Citizen under 46 U.S.C. 50501. In addition, Section 3508 eliminated the procedure for early termination of MSP Operating Agreements based on the availability of replacement vessels. Section 3508 also eliminated the eligibility of Lighter Aboard Ship (LASH) vessels to participate in the MSP Fleet as a stand-alone category of vessel. The rule eliminates the Maintenance and Repair Pilot Program, which has sunset and was not extended by the NDAA 2013. The rule also updates MARAD's address for the purposes of submitting required reports and vouchers.

Executive Orders 12866 (Regulatory Planning and Review), 13563 (Improving Regulation and Regulatory Review) and DOT Regulatory Policies and Procedures. Under E.O. 12866 (58 FR 51735, October 4, 1993), supplemented by E.O. 13563 (76 FR 3821, January 18, 2011) and DOT policies and procedures, MARAD must determine whether a regulatory action is “significant” and, therefore, subject to Office of Management and Budget (OMB) review and the requirements of the E.O.s. The Orders define “significant regulatory action” as one likely to result in a rule that may: (1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal government or communities; (2) create a serious inconsistency or otherwise interfere with an action taken or planned by another Agency; (3) materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; and (4) raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the E.O.s.

A determination has been made that this rulemaking is not considered a significant regulatory action under section 3(f) of Executive Order 12866. This rulemaking will not result in an annual effect on the economy of $100 million or more. It is also not considered a major rule for purposes of Congressional review under Public Law 104-121. This rulemaking is also not significant under the Regulatory Policies and Procedures of the Department of Transportation (44 FR 11034, February 26, 1979). The costs and overall economic impact of this rulemaking do not require further analysis because the rulemaking will create no additional costs or new substantive burdens to participants in or applicants to the existing program as it addresses only new processing procedures.

This rule is not an E.O. 13771 regulatory action because this rule is not significant under E.O. 12866.

This rulemaking was analyzed in accordance with the principles and criteria contained in Executive Order 13132 (“Federalism”), and it has been determined that it does not have sufficient Federalism implications to warrant the preparation of a Federalism summary impact statement. The revisions to the regulations, among other things, make changes to vessel eligibility for participation in the MSP, authorize the extension of current MSP Operating Agreements, amend the procedures for the award of new MSP Operating Agreements, update the MSP Operating Agreement payments and schedule of payments, and eliminate the Maintenance and Repair Pilot Program. This rulemaking has no substantial effect on the States, or on the current Federal-State relationship, or on the current distribution of power and responsibilities among the various local officials. Nothing in this document preempts any State law or regulation. Therefore, MARAD did not consult with State and local officials because it was not necessary.

The Regulatory Flexibility Act of 1980 requires MARAD to assess whether this rulemaking would have a significant economic impact on a substantial number of small entities and to minimize any adverse impact. MARAD certifies that this rulemaking will not have a significant economic impact on a substantial number of small entities because MSP participants (13 in total) and applicants (11 in the most recent solicitation for applications) do not constitute a substantial number of small entities.

MARAD has determined that this rulemaking will not significantly affect energy supply, distribution, or use. Therefore, no Statement of Energy Effects is required.

This rulemaking will not effect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This rulemaking does not contain standards-related activities that create unnecessary obstacles to the foreign commerce of the United States.

Section 522(a)(5) of the Transportation, Treasury, Independent Agencies, and General Government Appropriations Act, 2005 (Pub. L. 108-447, div. H, 118 Stat. 2809 at 3268) requires the Department of Transportation and certain other Federal agencies to conduct a privacy impact assessment of each proposed rule that will affect the privacy of individuals. Claims submitted under this rule will be treated the same as all legal claims received by MARAD. The processing and treatment of any claim within the scope of this rulemaking by MARAD shall comply with all legal, regulatory and policy requirements regarding privacy.

The Unfunded Mandates Reform Act of 1995 requires Agencies to evaluate whether an Agency action would result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $156 million or more (as adjusted for inflation) in any 1 year, and if so, to take steps to minimize these unfunded mandates. This rulemaking will not impose unfunded mandates under the Unfunded Mandates Reform Act of 1995. It will not result in costs of $156 million or more to either State, local, or tribal governments, in the aggregate, or to the private sector, and is the least burdensome alternative that achieves the objectives of the rule.

A regulation identifier number (RIN) is assigned to each regulatory action listed in the Unified Agenda of Federal Regulations. The Regulatory Information Service Center publishes the Unified Agenda in April and October of each year. The RIN contained in the heading of this document can be used to cross-reference this action with the Unified Agenda.

Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501 et seq.), Federal agencies must obtain approval from OMB for each collection of information they conduct, sponsor, or require through regulations. This rulemaking updates the regulations due to amendments to the Maritime Security Act. This rulemaking contains no new or amended information collection or recordkeeping requirements that have been approved or require approval by OMB.

In response to the agency's Federal Register document published on August 5, 2015 (80 FR 46527) seeking public comment on its proposed revisions to 46 CFR part 296, a total of five separate comment submissions were made by or on behalf of the following entities: APL Marine Services, Ltd. and its affiliated companies (“APL”), American Roll-on Roll-off Carrier Group Inc. (“ARC Group”), Schuyler Line Navigation Company, LLC, Liberty Global Logistics LLC, and the Transportation Trades Department, AFL-CIO (“TTD”). The agency responds below to all comments.

One commenter noted that 46 CFR 296.30(h)(2) of the existing regulations was omitted from the proposed rulemaking and should be retained in a final rule. We agree. The NDAA 2013 did not eliminate the provision permitting an owner or operator of an MSP vessel to transfer and register such a vessel under an acceptable foreign registry in the event sufficient funds are not appropriated for any fiscal year by the 60th day of that fiscal year. The text of 46 CFR 296.30(h)(2) is retained in the final rule.

The commenter also noted that the definition of Foreign Commerce unduly omitted certain services that were not affected by the NDAA 2013. We agree. While excluding from the definition of Foreign Commerce certain bulk carrying services, the NDAA 2013 did not otherwise substantively change the definition of Foreign Commerce. The proposed definition unnecessarily eliminated currently MSP-eligible services. Therefore, these existing services are retained in the final rule. The commenter also recommended amending 46 CFR 296.31(d)(2), to make that section more consistent with the text of 46 U.S.C. 53105(a) and the regulatory definition of Foreign Commerce of 46 CFR 296.2. We agree that 46 CFR 296.31(d)(2), as currently drafted, is inconsistent with 46 U.S.C. 53105(a) with its use of “foreign trade,” an undefined term, instead of “foreign commerce” and thus may invite confusion. Accordingly, we are amending 46 CFR 296.31(d)(2) by replacing “foreign trade” with “foreign commerce” and retaining reference to the registry endorsement requirement.

Three commenters recommended increasing annual payments under the MSP. Two recommended an annual payment of $5 million per vessel starting in fiscal year 2017. MSP payment amounts are established by statute. MARAD cannot adjust annual payment amounts without a corresponding legislative authorization. Nevertheless, the increased payments authorized by the NDAA 2016 and CAA 2016 are included in the final rule.

Two commenters critiqued MARAD's administration of the MSP and made recommendations that would require significant amendments to our regulations. These recommendations are beyond the scope of the current rulemaking implementing the NDAA 2013, but will be considered in the event of a future rulemaking.

For the reasons set out in the preamble, the Maritime Administration amends 46 CFR part 296 as follows:

Background

Section 602(a) of the CGAA added two new exceptions to the restrictions on the eligibility of vessels over 165 feet in registered length to be documented with fishery endorsements found at 46 U.S.C. 12113(d): (1) Replaced or rebuilt vessels and (2) fish tender vessels. The CGAA also eliminated the 15-day application deadline for vessels whose fishery endorsements had become invalid. Exemptions from the large fishing industry vessel restrictions are found in our regulations at 46 CFR 356.47.

In addition, section 601(b)(2) of the CGAA repealed section 203(g) of the AFA, which exempted particular vessels from the ownership requirements of 46 U.S.C. 12113. These exempt vessels are currently listed in our regulations at 46 CFR 356.51.

Section 307 of the CGMTA (“Section 307”) added further restrictions on large vessels under 46 U.S.C. 12113(d) by limiting those vessels from participating in the non-AFA trawl catcher processor subsector.

Accordingly, MARAD is updating its regulations under 46 CFR part 356 to reflect these amendments to the AFA and 46 U.S.C. 12113.

In addition to updating our regulations under 46 CFR part 356, MARAD is revising its Large Vessel Certificate to reflect the amendments to 46 U.S.C. 12113. Owners of fishing industry vessels 165 feet or greater in registered length are required to submit a Large Vessel Certificate to MARAD on an annual basis under 46 CFR 356.47(e). The revisions to the form include provisions for the replacement and fish tender vessels as well as a provision that an AFA sector vessel is neither participating in nor eligible to participate in the non-AFA trawl catcher-processor sector.

Finally, MARAD is amending 46 CFR 356.47(a) to update the statutory citation to the current code sections.

Executive Orders 12866 (Regulatory Planning and Review), 13563 (Improving Regulation and Regulatory Review) and DOT Regulatory Policies and Procedures. Under E.O. 12866 (58 FR 51735, October 4, 1993), supplemented by E.O. 13563 (76 FR 3821, January 18, 2011) and DOT policies and procedures, MARAD must determine whether a regulatory action is “significant,” and, therefore, subject to OMB review and the requirements of the E.O. The Order defines “significant regulatory action” as one likely to result in a rule that may: (1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal government or communities. (2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another Agency. (3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof. (4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the E.O.

MARAD has determined that this final rule is not a significant regulatory action under section 3(f) of Executive Order 12866 and, therefore, it was not reviewed by the Office of Management and Budget. This rulemaking will not result in an annual effect on the economy of $100 million or more. It is also not considered a major rule for purposes of Congressional review under Public Law 104-121. This rulemaking is also not significant under the Regulatory Policies and Procedures of the Department of Transportation (44 FR 11034, February 26, 1979). The costs and overall economic impact of this rulemaking do not require further analysis.

This rule is not an E.O. 13771 regulatory action because this rule is not significant under E.O. 12866.

We analyzed this rulemaking in accordance with the principles and criteria contained in Executive Order 13132 (“Federalism”) and have determined that it does not have sufficient Federalism implications to warrant the preparation of a Federalism summary impact statement. This rulemaking has no substantial effect on the States, on the current Federal-State relationship, or on the current distribution of power and responsibilities among the various local officials. Nothing in this document preempts any State law or regulation. Therefore, MARAD did not consult with State and local officials because it was not necessary.

MARAD does not believe that this rulemaking will significantly or uniquely affect the communities of Indian tribal governments when analyzed under the principles and criteria contained in Executive Order 13175 (Consultation and Coordination with Indian Tribal Governments). Therefore, the funding and consultation requirements of this Executive Order do not apply.

The regulations implementing Executive Order 12372 regarding intergovernmental consultation on Federal programs and activities do not apply to this rulemaking.

The Regulatory Flexibility Act of 1980 requires MARAD to assess whether this rulemaking would have a significant economic impact on a substantial number of small entities and to minimize any adverse impact. MARAD certifies that this rulemaking will not have a significant economic impact on a substantial number of small entities.

We have analyzed this rulemaking for purposes of compliance with the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) and have concluded that under the categorical exclusions provision in section 4.05 of Maritime Administrative Order (MAO) 600-1, “Procedures for Considering Environmental Impacts,” 50 FR 11606 (March 22, 1985), neither the preparation of an Environmental Assessment, an Environmental Impact Statement, nor a Finding of No Significant Impact for this rulemaking is required. This rulemaking has no environmental impact.

MARAD has determined that this rulemaking will not significantly affect energy supply, distribution, or use. Therefore, no Statement of Energy Effects is required.

Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks, requires agencies issuing “economically significant” rules that involve an environmental health or safety risk that may disproportionately affect children, to include an evaluation of the regulation's environmental health and safety effects on children. As discussed previously, this rulemaking is not economically significant, and will cause no environmental or health risk that disproportionately affects children.

This action meets applicable standards in sections 3(a) and 3(b)(2) of E.O. 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

This rulemaking will not effect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This rulemaking is not expected to contain standards-related activities that create unnecessary obstacles to the foreign commerce of the United States.

Section 522(a)(5) of the Transportation, Treasury, Independent Agencies, and General Government Appropriations Act, 2005 (Pub. L. 108-447, div. H, 118 Stat. 2809 at 3268) requires the Department of Transportation and certain other Federal agencies to conduct a privacy impact assessment of each proposed rule that will affect the privacy of individuals. Claims submitted under this rule will be treated the same as all legal claims received by MARAD. The processing and treatment of any claim within the scope of this rulemaking by MARAD shall comply with all legal, regulatory and policy requirements regarding privacy.

The Unfunded Mandates Reform Act of 1995 requires agencies to evaluate whether an Agency action would result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $141.3 million or more (as adjusted for inflation) in any 1 year, and if so, to take steps to minimize these unfunded mandates. This rulemaking will not impose unfunded mandates under the Unfunded Mandates Reform Act of 1995. It will not result in costs of $141.3 million or more to either State, local, or tribal governments, in the aggregate, or to the private sector, and is the least burdensome alternative that achieves the objectives of the rule.

A regulation identifier number (RIN) is assigned to each regulatory action listed in the Unified Agenda of Federal Regulations. The Regulatory Information Service Center publishes the Unified Agenda in April and October of each year. The RIN contained in the heading of this document can be used to cross-reference this action with the Unified Agenda.

Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501 et seq.), Federal agencies must obtain approval from OMB for each collection of information they conduct, sponsor, or require through regulations. This rulemaking updates the regulations with two new exceptions to the restrictions on the eligibility of vessels over 165 feet in registered length to be documented with fishery endorsements, removes certain exemptions relating to specific vessels, and adds restrictions on large vessels by limiting those vessels from participating in the non-AFA trawl catcher processor subsector. This rulemaking contains no new or amended information collection or recordkeeping requirements that have been approved or require approval by the Office of Management and Budget.

In response to the agency's Federal Register document seeking public comment on its proposed revisions to 46 CFR part 356 published on June 10, 2014 (79 FR 33160), a total of three separate comment submissions were made by or on behalf of the following entities: Groundfish Forum, O'Hara Corporation, and the At-Sea Processors Association. The agency responds below to all comments.

Two commenters suggested that 46 CFR 356.47(b) be revised to clarify that the restrictions imposed by Section 307 apply to all the vessels listed in paragraphs (1) through (20) of section 208(e) of the American Fisheries Act (non-Amendment 80 AFA catcher-processor vessels) regardless of which large vessel exemption the vessel falls under in 46 U.S.C. 12113(d)(2) in order to preserve the statutory distinction between the AFA and Amendment 80 sectors. To accomplish this, one of the commenters recommended adopting the technical advice provided by the National Oceanic and Atmospheric Administration (NOAA) to Congress during its consideration of Section 307. We acknowledge that Section 307 of the CGMTA is intended to codify and maintain the separation of the AFA sector from the non-AFA trawler sector as evidenced by statements of Senators Cantwell, Murkowski, and Begich in the Congressional Record and the text of the statute. 158 Cong. Rec. S7972 (Dec. 12, 2012). We note, however, that NOAA's technical advice that would have edited Section 307 to accomplish this separation was not ultimately adopted by Congress because the non-AFA trawler sector restrictions on AFA sector vessels were only inserted in the regional fishery management council provision and the replacement vessel exemptions to the large vessel prohibition of 46 U.S.C. 12113(d) (sections 12113(d)(2)(B) and (C), respectively). In light of the fact that the statutory amendments of Section 307 are sufficiently complete as to be self-executing, MARAD finds that the best way to implement the restrictions on AFA sector vessels consistent with the statutory language of Section 307 and Congressional intent is to insert the restrictions in our regulations as they appear in the statute. Nevertheless, to assure that the sector separation of section 307 is clear, MARAD is revising its Large Vessel Certificate (see below) to require all AFA sector vessels subject to the large vessel restrictions of 46 U.S.C. 12113(d) to certify that they are neither eligible nor participating in the non-AFA trawler sector. In order to be eligible for a fishery endorsement, all large fishing industry vessels subject to 46 U.S.C. 12113(d) must submit a Large Vessel Certificate under MARAD regulation 46 CFR 356.47.

Another commenter noted that the revisions to 46 CFR 356.47(b) omitted subsection (2) providing that a large vessel is still eligible for a fishery endorsement if it is not placed under foreign registry after October 1998. This omission was inadvertent. Neither the CGMTA nor the CGAA repealed this provision. The final rule will contain subsection (2).

For the reasons set out in the preamble, the Maritime Administration amends 46 CFR part 356 as follows:

Background What laws authorize the America's Marine Highway Program?

The Energy Independence and Security Act of 2007 (EISA) authorized the Secretary of Transportation (Secretary) to promulgate regulations to implement the AMHP. The Secretary of Transportation delegated authority to the Maritime Administrator to issue AMHP implementing regulations. On April 9, 2010, MARAD published in the Federal Register final regulations implementing the AMHP (75 FR 18101).

The Secretary, in consultation with the Environmental Protection Agency, submitted a Report to Congress in April 2011that included a description of the benefits of the AMHP and activities conducted under the program. It also included recommendations for further legislative and administrative action that the Secretary considered appropriate.

In December 2012, the Coast Guard and Maritime Transportation Act of 2012 (CGMTA), which built on some of the ideas in the report, was signed into law. The CGMTA expanded the scope of the AMHP by adding the words “or to promote short sea transportation” to the existing purpose of reducing landside congestion. This added language expanded the focus of the AMHP to include efforts that increase utilization or efficiency of short sea transportation on designated Marine Highway Routes.

In November 2015, the National Defense Authorization Act for Fiscal Year 2016 added to the definition of short sea transportation, that is the subject of the AMHP, to include the carriage by a documented vessel of cargo that is: (1) Shipped in discrete units, or packages that are handled individually, palletized; or, (2) unitized for purposes of transportation or freight vehicles carried aboard commuter ferry boats.

As part of our routine systematic review of existing regulations, MARAD is updating its AMHP implementing regulations to conform to statutory changes and streamline the regulations for ease of use. Accordingly, the rule revises in full the AMHP implementing regulations to: (1) Add “promote short sea shipping” as a purpose of the AMHP; (2) re-designate “corridors, connectors, and crossings” as used in the rule as “Routes” for purposes of simplicity; (3) expand and clarify the definition of AMHP-eligible cargo to include discrete units or packages that are handled individually, palletized, or unitized as well as freight vehicles carried aboard commuter ferry boats; (4) add a requirement for the project sponsors to provide updates on project status; (5) expand the eligibility criteria for services and Routes that may participate in AMHP; (6) clarify criteria for Project Designation; and, (7) reorganize the regulations for ease of use.

Congress authorized the AMHP to promote short sea shipping by designating routes, also called Marine Highways, as a way to relieve congestion on America's roads and railways. Marine Highway designations are intended to assist the maritime industry in meeting national freight transportation needs. The AMHP encourages the use of marine transportation to reduce freight and passenger travel delays caused by congestion, reduce greenhouse gas emissions, conserve energy, improve safety, and reduce landside infrastructure maintenance costs.

Congestion on the U.S. surface transportation system significantly impacts America's economic prosperity and way of life. Overall, the U.S. Department of Transportation (USDOT) estimates that congestion on our roads, bridges, railways, and in ports costs the United States as much as $200 billion a year and projects that cargoes moving through our ports will nearly double over the next 15 years. Most of this additional cargo will ultimately move along our surface transportation corridors, many of which are already at or beyond capacity.

Under Executive Order (E.O.) 12866 (58 FR 51735, October 4, 1993), supplemented by E.O. 13563 (76 FR 3821, January 18, 2011) and USDOT policies and procedures, MARAD must determine whether a regulatory action is “significant,” and therefore subject to the Office of Management and Budget (OMB) review and the requirements of the Order. The Order defines “significant regulatory action” as one likely to result in a rule that may: (1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal government or communities. (2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another Agency. (3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof. (4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the E.O.

MARAD has determined that this rulemaking is not considered a significant regulatory action under section 3(f) of E.O. 12866 and, therefore, it was not reviewed by OMB. This rulemaking will not result in an annual effect on the economy of $100 million or more. It is also not considered a major rule for purposes of Congressional review under Public Law 104-121. This rulemaking is also not significant under the Regulatory Policies and Procedures of the Department of Transportation (44 FR 11034, February 26, 1979). The costs and overall economic impact of this rulemaking do not require further analysis.

This rule is not an E.O. 13771 regulatory action because this rule is not significant under E.O. 12866.

MARAD analyzed this rulemaking in accordance with the principles and criteria contained in E.O. 13132 (“Federalism”) and has determined that it does not have sufficient Federalism implications to warrant the preparation of a Federalism summary impact statement. This rulemaking has no substantial effect on the States, or on the current Federal-State relationship, or on the current distribution of power and responsibilities among the various local officials. Nothing in this document preempts any State law or regulation. Therefore, MARAD was not required to consult with State and local officials.

MARAD does not believe that this rulemaking will significantly or uniquely affect the communities of Indian tribal governments when analyzed under the principles and criteria contained in E.O. 13175 (Consultation and Coordination with Indian Tribal Governments); therefore, the funding and consultation requirements of this Executive Order do not apply.

The regulations implementing E.O. 12372 regarding intergovernmental consultation on Federal programs and activities do not apply to this rulemaking.

The Regulatory Flexibility Act of 1980 requires MARAD to assess whether this rulemaking would have a significant economic impact on a substantial number of small entities and to minimize any adverse impact. MARAD certifies that this rulemaking will not have a significant economic impact on a substantial number of small entities.

MARAD has evaluated this rulemaking under Maritime Administrative Order (MAO) 600-1, “Procedures for Considering Environmental Impacts,” 50 FR 11606 (March 22, 1985), which guides MARAD in complying with the National Environmental Policy Act of 1969, 42 U.S.C. 4321 et seq. MARAD has determined that this rulemaking is not a major action (requiring the preparation of an environmental impact statement or environmental assessment) because it is categorically excluded from detailed environmental review pursuant to section 4.05 of MAO 600-1. Section 4.05 reads, in pertinent part, “[c]ategorical exclusions are Maritime Administration actions or groups of actions that do not have a significant effect on the quality of the human environment, individually or cumulatively. Categorical exclusions do not require preparation of environmental documents. Appendix 1 of this order [MAO-600-1] describes the Maritime Administration's categorical exclusions.” This action falls under Categorical Exclusion #3 because MARAD's revisions to the regulations “do not require a regulatory impact analysis under section 3 of Executive Order 12291 or do not have a potential to cause a significant effect on the environment . . .” MAO 600-1, App.1, pg. 1.

In accordance with section 4.05 and Appendix 2 of MAO 600-1, the Agency has further concluded that no extraordinary circumstances exist with respect to this regulation that might trigger the need for a more detailed environmental review. As a result, MARAD finds that this regulatory revision is not a major Federal action significantly affecting the quality of the human environment.

MARAD has determined that this rulemaking will not significantly affect energy supply, distribution, or use. Therefore, no Statement of Energy Effects is required.

This action meets applicable standards in sections 3(a) and 3(b)(2) of E.O. 12988, Civil Justice Reform, to minimize litigation, eliminates ambiguity, and reduce burden.

This rulemaking will not affect a taking of private property or otherwise have taking implications under E.O. 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This rulemaking is not expected to contain standards-related activities that create unnecessary obstacles to the foreign commerce of the United States.

Section 522(a)(5) of the Transportation, Treasury, Independent Agencies, and General Government Appropriations Act, 2005 (Pub. L. 108-447, div. H, 118 Stat. 2809 at 3268) requires the USDOT and certain other Federal agencies to conduct a privacy impact assessment of each proposed rule that will affect the privacy of individuals. Claims submitted under this rule will be treated the same as all legal claims received by MARAD. The processing and treatment of any claim within the scope of this rulemaking by MARAD shall comply with all legal, regulatory and policy requirements regarding privacy.

The Unfunded Mandates Reform Act of 1995 requires Agencies to evaluate whether an Agency action would result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $141.3 million or more (as adjusted for inflation) in any 1 year, and if so, to take steps to minimize these unfunded mandates. This rulemaking will not impose unfunded mandates under the Unfunded Mandates Reform Act of 1995. It will not result in costs of $141.3 million or more to either State, local, or tribal governments, in the aggregate, or to the private sector, and is the least burdensome alternative that achieves the objectives of the rule.

A regulation identifier number (RIN) is assigned to each regulatory action listed in the Unified Agenda of Federal Regulations. The Regulatory Information Service Center publishes the Unified Agenda in April and October of each year. The RIN number contained in the heading of this document can be used to cross-reference this action with the Unified Agenda.

Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501 et seq.), Federal agencies must obtain approval from OMB for each collection of information they conduct, sponsor, or require through regulations. This rulemaking updates the regulations due to changes made by the CGMTA, the NDAA, and to clarify AMH program procedures. This rulemaking contains no new or amended information collection or recordkeeping requirements that have been approved or require approval by OMB.

In response to the agency's Federal Register document seeking public comment on its proposed revisions to 46 CFR part 393 published on January 11, 2017 (82 FR 3250), we received one comment from the Center for Biological Diversity (CBD). The commenter requests that MARAD analyze the revisions' impacts and the impacts of the AMHP as a whole under NEPA, and consult on impacts of the revisions to species listed under the Endangered Species Act (ESA), 16 U.S.C. 1531 et seq. Specifically, CBD requests that MARAD consider the impacts arising from increased shipping noise and risk of ship strikes to endangered and threatened marine species resulting from increased traffic as a result of the AMHP. CBD also requests that the revisions to the rule require proponents of individual AMH corridors and projects to prepare environmental assessments as a condition for designation. CBD further requests that the revisions to the rule also require MARAD to consult on impacts to ESA-listed species before designation.

Pursuant to the requirements of the CGMTA and NDAA, this rulemaking expands the purpose of the AMHP to promote short sea transportation, updates the definition of short sea transportation, and clarifies AMHP procedures highlighting resources available to program participants. CBD provided no specific comments with respect to the Agency's proposed changes in this rulemaking to conform the AMH implementing regulations to the relevant statutory amendments, and therefore CBD's comments are outside the scope of this rulemaking. Nevertheless, in response to CBD's comments, MARAD states that it complies with all environmental laws in the administration of its programs. All future project proposals under the AMHP will be reviewed in accordance with the requirements contained in NEPA and all applicable environmental laws.

In regard to CBD's request that MARAD analyze the environmental impacts of the revisions to the rule and the AMHP under NEPA and to participate in interagency consultation under the ESA for any impacts the revisions may have upon listed species, MARAD has performed the required environmental review for this rulemaking under NEPA and MAO 600-1 “Procedures for Considering Environmental Impacts.”

In response to the agency's Federal Register document seeking public comment on its proposed revisions to 46 CFR part 393, we received one comment from the American Federation of Labor and Congress of Industrial Organizations (AFL/CIO) Transportation Trades Department (TDD). The comment offered their strong support for the proposed rule citing the need to address congested corridors, reduce shipping costs and improve safety. The commenter credited the AMHP with providing meaningful options for companies utilizing short sea shipping and for promoting job growth in the maritime industry. In addition, TDD noted challenges facing the maritime industry and MARAD in the areas of Title XI loan guarantees and potential double taxation of goods transported using domestic short sea shipping via the Harbor Maintenance Tax. Both of these areas of concern are outside of the scope of the AMH Program.

The Harbor Maintenance Tax (HMT) funds the Harbor Maintenance Trust Fund (HMTF) to fund port and harbor dredging activities by the Corps of Engineers. The HMT and HMTF are not managed by the Department of Transportation. Economic soundness is a key requirement and projects need to have a viable business case or the Maritime Administration cannot approve it. To date, no operators have applied for a Title XI loan guarantee for an AMH Project.

This is a summary of the Commission's Report and Order, FCC 17-132, CC Docket No. 91-281, adopted on October 24, 2017, and released on October 25, 2017. The full text of this document will be available for public inspection and copying via ECFS, and during regular business hours at the FCC Reference Information Center, Portals II, 445 12th Street SW., Room CY-A257, Washington, DC 20554. The full text of this document and any subsequently filed documents in this matter may also be found by searching ECFS at: http://apps.fcc.gov/ecfs/ (insert CC Docket No. 91-281 into the Proceeding block).

The Commission sent a copy of this Report and Order to Congress and the Government Accountability Office pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

This document contains modified information collection requirements. The Commission, as part of its continuing effort to reduce paperwork burdens, will invite the general public to comment on the information collection requirements contained in Report and Order as required by the Paperwork Reduction Act (PRA) of 1995, Public Law 104-13. In addition, the Commission notes that, pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, 44 U.S.C. 3506(c)(4), the Commission previously sought comment on how the Commission might “further reduce the information burden for small business concerns with fewer than 25 employees.”

1. In Report and Order, the Commission helps security and law enforcement personnel obtain quick access to blocked Caller ID information needed to identify and thwart threatening callers. It also amends its rules to allow non-public emergency services to obtain blocked Caller ID information associated with calls requesting assistance.

2. The number of threatening phone calls has increased dramatically in recent years. These calls traumatize communities and result in substantial disruption to schools, religious organizations, and other entities. They also drain public resources by requiring the deployment of police and bomb units. Schools and others receiving threats have suggested that blocked Caller ID information hinders a rapid response. The Commission's action moves away from case-by-case waivers to a streamlined approach that will help protect the safety of threatened parties in a timely way.

3. The Need for an Exemption. The Commission Modifies its Caller ID rules to exempt threatening calls from the Calling Party Number (CPN) privacy rules so that security personnel and law enforcement have quick access to information they need to aid their investigations. The Commission agrees with the vast majority of commenters that the exemption promotes public safety.

4. This new exemption is consistent with the Commission's prior approach in this area. The Commission has previously concluded, for example, that to the extent Caller ID services are used to deliver emergency services, privacy requirements should not apply to delivery of CPN to a public agency's emergency lines, a poison control line, or in conjunction with 911 emergency services. In these instances, the Commission concluded that Caller ID blocking mechanisms could jeopardize emergency services and therefore pose a serious threat to safety. The Commission believes that threatening calls present equally compelling circumstances in which the need to ensure public safety, in accordance with the Commission's fundamental statutory mission, outweighs any CPN privacy interest of the threatening caller.

5. The Commission disagrees with the sole commenter who urges it to not adopt an exemption but instead continue to issue case-by-case waivers, albeit on a streamlined basis. The waiver process, even if streamlined, would not provide equivalent benefits in combatting threatening calls. Investigation of these cases can depend on immediate action to stop a potentially catastrophic event. An exemption would allow for virtually immediate access to blocked Caller ID information upon proper request in threatening situations. The Commission thus agrees with the commenters who point out that threatening calls should be addressed immediately through an exemption in the Commission's rules rather than a case-by-case waiver process.

6. The Commission also disagrees with commenters who urge that carriers should have discretion to decline law enforcement requests to get Caller ID information. CTIA—The Wireless Association claims that a mandate is not necessary, noting both the industry's long and successful track record of cooperation with law enforcement and that the Electronic Communications Privacy Act (ECPA) utilizes a voluntary disclosure provision. While the Commission believes that the industry's record may indeed be laudatory, the Commission concludes that mandatory disclosure is essential to its exemption. The Commission declines to define a “valid request” from law enforcement, as suggested by CenturyLink, because CTIA states carriers have an excellent track record of complying with law enforcement requests under ECPA. The Commission declines at this time to create a new law enforcement request process because the record reveals no evidence that law enforcement requests for this information have been ineffective or unreliable in the past. The record reveals no scenarios where a request for Caller ID by law enforcement, as the Commission describes below, should give carriers reason to question the validity of the emergency. Further, the imminent and grave nature of threatening calls, as defined below, leave little time for the exercise of discretion in whether to disclose information after law enforcement has become involved. As discussed below, the Commission adopts the ECPA standard for disclosure of information. The Commission does not find that standard to be inconsistent with a mandatory disclosure requirement. Carriers that are required to make disclosures in the very specific, narrowly defined scenario covered by the Commission's new exemption will not violate the more flexible ECPA standard by complying with the Commission's requirement. Moreover, the Commission believes that a law enforcement request based on the possibility of death or serious injury can satisfy ECPA's “good faith” standard to justify a carrier's voluntary disclosure of such information.

7. The Commission agrees with AT&T that carriers should not be subject to liability for violation of its Caller ID privacy rules if they disclose blocked Caller ID pursuant to the new exemption. As CTIA notes, “[l]aw enforcement has the experience and the thousands of officers in communities throughout the country who are already positioned to evaluate whether a threat is genuine.” Law enforcement's determination of a threatening call coupled with the mandatory nature of the disclosure removes any justification for placing liability on carriers who comply with a proper request for blocked Caller ID. CTIA suggests that the Commission adopts a provision in its rule § 64.1601(b)'s stating that prohibition on overriding a privacy indicator does not apply when “CPN delivery . . . (iv) Is provided in connection with any lawful request by a law enforcement agency for assistance in an emergency.” Such a provision is unnecessary in light of the Commission's existing rule, § 64.1601(d)(4)(iii), exempting “legally authorized call tracing or trapping procedures specifically requested by a law enforcement agency.” To the extent that AT&T and NTCA—The Rural Broadband Association ask the Commission to somehow exempt carriers from any other legal liability, the Commission declines to do so. The Commission's concern is only with ensuring that its rules do not interfere with the ability of carriers to respond to law enforcement requests as allowed under law.

8. Definition of “Threatening Call.” The Commission defines the term “threatening call,” which triggers the application of the new exemption, as “any call that conveys an emergency involving danger of death or serious physical injury to any person requiring disclosure without delay of information relating to the emergency.” Typically, a call from a person simply reporting a threat, where the facts of the call indicate that the caller wishes to remain anonymous, would not be subject to disclosure because disclosure would not be necessary to prevent death or serious bodily injury. In the event disclosure is necessary to prevent death or serious bodily injury, however, the rule would allow disclosure only to law enforcement. The Commission thinks this is appropriate and permitted by ECPA's emergency exception. The Commission does not wish to deter anonymous tips made to law enforcement. This definition ensures consistency with the emergency-disclosure provision of ECPA, as urged by several commenters, and because it satisfies the Commission's goal of targeting the most threatening calls. NCTA states that the Commission “should define a threatening call under § 64.1600 of its rules as `any call that includes a threat involving danger of death or serious physical injury to any person.' ” The Commission declines to use NCTA's definition because referring to “emergency” rather than to “threat” encompasses more situations where immediate disclosure is necessary to address an emergency. Additionally, its proposed definition is consistent with ECPA. Finally, the Commission includes “disclosure without delay” within the definition to further align its disclosure requirement under circumstances where ECPA allows it.

9. Because carriers are already familiar with the ECPA standard and ECPA covers the imminent nature of the dangers envisioned by the Caller ID NPRM, published at 82 FR 33856, July 21, 2017, and commenters, the Commission tailors its rule to align with the ECPA definition for purposes of this new exemption. The Commission agrees that it makes sense to align its definition of a threatening call with existing federal law to ensure that carriers have consistent legal standards to apply in situations where both the Commission's rules and ECPA apply. The Commission also agrees with commenters that the ECPA definition would sufficiently cover the types of calls it seeks to exempt from the Caller ID blocking rule, without being either over- or under-inclusive, or including terms that could be ambiguous.

10. Law Enforcement Involvement. The Commission finds that, to ensure the exemption is not abused, a request for blocked Caller ID information associated with a threatening call must be made by law enforcement on behalf of the threatened party. The Commission believes that this requirement will, among other things, ensure that such requests concern a bona fide threatening call and will not be a pretext for obtaining blocked Caller ID for other purposes. As CTIA commented, such a requirement will ensure there is no ambiguity regarding the necessary level of law enforcement involvement.

11. The Commission agrees with commenters that law enforcement involvement at this stage of the process is essential to avoid having carriers make a determination on what constitutes a threatening call. AT&T avers that the involvement of law enforcement would help ensure compliance with the ECPA disclosure requirements, and would help prevent overbroad disclosures of blocked caller ID information that may harm the privacy of non-threatening callers. According to AT&T, law enforcement officials are “indisputably better qualified to validate the existence of emergency circumstances than carrier personnel,” and are likely more familiar with the facts giving rise to a requested disclosure. CTIA adds that requiring law enforcement involvement when restricted Caller ID information is requested would deter parties from manipulating the unblocking process. The Commission agrees with commenters that law enforcement personnel are in the best position to determine the existence of a credible threat that necessitates revealing CPN to investigate the threatening call.

12. Likewise, the Commission finds that only law enforcement personnel and, as directed by law enforcement, others directly responsible for the safety and security of the threatened party should receive the otherwise protected Caller ID information in the case of threatening calls. Security personnel may only receive the blocked Caller ID information from the providers as directed by law enforcement because law enforcement will generally be in a better position than providers to determine who qualifies as security personnel. The Commission limits the disclosure of the blocked Caller ID information to prevent abuse, and to protect the privacy interests of parties who may block their Caller ID for valid privacy interests, such as domestic violence victims. By limiting the disclosure to law enforcement or, as directed by law enforcement, to security personnel for purposes of investigating a threat, the Commission seeks to prevent exploitations of the amended rule, such as an abuser tracking down a victim. The Commission defines security personnel as “those individuals directly responsible for maintaining safety of the threatened entity consistent with the nature of the threat.” For example, employees whose duties include security at an institution would qualify as security personnel; by contrast, an employee who merely answered the threatening phone or an individual homeowner would not. Security personnel may include, but are not limited to, corporate and government agency security personnel, and school or university security staff acting within the scope of their duties. In the case of an individual homeowner, law enforcement can take reasonable action to protect the homeowner as it conducts its investigation of a threatening call. The Commission allows disclosure to security personnel as directed by law enforcement to encompass situations where security personnel need access to the blocked Caller ID information for investigative purposes, as in instances when a large institution with its own security force, like a university or government agency, receives a threat.

13. The Commission agrees with CTIA's recommendation that “called parties should not be the recipients of information,” and the “use of disclosed CPN should be restricted—by rule—in a manner consistent with prior waivers.” In its reply comments, NTCA asserts that, in times of exigency or in remote or insular areas, Caller ID information should be available to volunteer rescuers and similar non-law enforcement personnel with a safe harbor provision for carriers. The rules the Commission adopts here make Caller ID information available to “security personnel,” as directed by law enforcement, as well as law enforcement, and the Commission's definition of “security personnel” does not necessarily exclude the types of situations NTCA describes. The determination NTCA urges would dependent on the facts of a specific situation, and is, therefore, not appropriate for the general exemption the Commission adopts here. Accordingly, the Commission includes the following conditions in its rule for law enforcement or, as directed by law enforcement, security personnel of the called party investigating the threat: (1) The CPN on incoming restricted calls may not be passed on to the line called; (2) any system used to record CPN must be operated in a secure way, limiting access to designated telecommunications and security personnel, as directed by law enforcement; (3) telecommunications and security personnel, as directed by law enforcement, may access restricted CPN data only when investigating calls involving danger of death or serious physical injury to any person requiring disclosure without delay of information relating to the emergency, and shall document that access as part of the investigative report; (4) carriers transmitting restricted CPN information must take reasonable measures to ensure the security of such communications; (5) CPN information must be destroyed in a secure manner after a reasonable retention period; and, (6) any violation of these conditions must be reported promptly to the Commission. The Commission expects that these boundaries on how the disclosed Caller ID information must be treated will advance public safety efforts while protecting valid privacy interests. The Commission has imposed these conditions on waivers both to ensure that the Caller ID information in question is accessible only to persons with direct involvement in investigating the threatening calls and to ensure that the information is used only for that purpose. The Commission has no indication that these conditions did not properly protect privacy interests in the cases underlying the waivers, and the record does not reveal any reason to doubt their efficacy more generally.

14. Carrier Obligations Under Section 222 of the Act. The Commission finds that the disclosure required by the new exemption the Commission adopts here is consistent with section 222 of the Act. Section 222(a) of the Act states that “[e]very telecommunications carrier has a duty to protect the confidentiality of proprietary information of, and relating to, other telecommunication carriers, equipment manufacturers, and customers, including telecommunication carriers reselling telecommunications services provided by a telecommunications carrier.” The Commission's amended rule requiring carriers to disclose blocked Caller ID information when law enforcement requests it to investigate threatening calls does not contravene carriers' obligations under section 222 of the Act.

15. In addressing the threatening calls recently received by Jewish Community Centers, the Bureau discussed section 222 of the Act in connection with the statutory protection of customer proprietary network information. The Commission agrees with the Bureau's view that section 222(d) of the Act allows for carriers to disclose blocked Caller ID in the case of unlawful activity because section 222(d) of the Act states, “[n]othing in this section prohibits a telecommunications carrier from using, disclosing, or permitting access to customer proprietary network information obtained from its customers, either directly or indirectly through its agents . . . to protect users of those services and other carriers from fraudulent, abusive, or unlawful use of, or subscription to, such services.” As described above, the Commission defines a “threatening call” as “any call that conveys an emergency involving danger of death or serious physical injury to any person requiring disclosure without delay of information relating to the emergency.” By limiting the disclosure of blocked Caller ID to narrowly defined cases of threatening calls that raise the “danger of death or serious physical injury to any person,” the Commission ensures that carriers are within their obligations under section 222 of the Act.

16. On February 28, 2017, Senator Charles E. Schumer submitted a letter to the Commission expressing concern regarding recent bomb threats made via phone against various Jewish Community Centers (JCCs) in New York and across the nation. Senator Schumer noted that the Commission has played a valuable role in ensuring law enforcement and others are not hindered in their access to the caller information of threatening calls and suggested consideration of the grant of a waiver. On March 3, 2017, CGB granted to JCCs, and any carriers that serve JCCs, a temporary, emergency waiver of § 64.1601(b) of the Commission's rules. In so doing, CGB indicated that this temporary waiver would remain in effect until the Commission determined whether the waiver should be made permanent. In addition, CGB sought comment on whether to make this waiver permanent. Comments filed in response support the waiver and note the public interest in promoting efforts to identify and thwart individuals making threatening calls to JCCs. No commenter opposed the waiver.

17. In the Caller ID NPRM, the Commission confirmed that good cause continued to exist to maintain the temporary waiver of § 64.1601(b) of the Commission's rules granted to JCCs and the carriers who serve them for disclosure of CPN associated with threatening calls. The Caller ID NPRM stated that in the event the Commission were to amend its rules to recognize a more general exemption for threatening calls, the JCC waiver would be encompassed within the protections afforded by that exemption. In Report and Order, the Commission recognizes an exemption for threatening calls thereby encompassing the JCC waiver. Accordingly, the JCC waiver is no longer necessary, and is superseded by document FCC 17-32 and terminated as of the effective date of the rule changes adopted herein.

18. The Commission also amends its rules to allow non-public emergency services to receive the CPN of all incoming calls from blocked numbers requesting assistance. The Commission believes amending its rules to allow non-public emergency services access to blocked Caller ID promotes the public interest by ensuring timely provision of emergency services without undermining any countervailing privacy interests.

19. The Commission previously concluded that “[t]o the extent that CPN-based services are used to deliver emergency services, the Commission finds that privacy requirements for CPN-based services should not apply to delivery of the CPN to a public agency's emergency line, a poison control line, or in conjunction with 911 emergency services” and has noted that “in an emergency, a caller is not likely to remember to dial or even know to dial an unblocking code.” Here the Commission takes its previous conclusions a logical step further by amending the rules to allow non-public emergency services to retrieve from carriers the blocked Caller ID of callers seeking assistance. The Commission believes these callers would want an emergency service, whether a public agency or non-public entity, to be able to quickly and easily contact or locate them using their phone number to provide assistance.

20. The Bureau previously waived the Caller ID privacy rule for a private ambulance service, Chevrah Hatzalah Volunteer Ambulance Corps Inc. (Hatzalah). In granting the waiver, the Bureau noted that Hatzalah's automatic dial retrieval system “. . . is disrupted when the incoming call comes from a caller who has requested that his/her number not be revealed to the called party. In this circumstance, Hatzalah states that the inability to automatically identify callers creates several problems that can delay or even prevent the timely provision of emergency care.” In its petition, Hatzalah further argued that allowing it to access blocked Caller ID information “would not frustrate [the] purpose [of the Commission's rule] because the Commission has recognized that a caller's privacy interest should not interfere with the delivery of emergency services.”

21. The Bureau found that the waiver served the public interest “because Hatzalah will be better able to respond to emergency situations by saving the crucial time taken when requesting phone number and location information from the caller.” The Bureau also noted, “. . . people seeking emergency services are often under great stress when they call, which can lead to difficulty in accurately communicating the vital telephone number and location information.” Finally, the Bureau agreed with Hatzalah “that a caller seeking emergency services has an interest in the number becoming known to the emergency provider to speed the provision of emergency services and, therefore, any privacy concerns are minimized in this context.”

22. In the Caller ID NPRM, the Commission sought comment on whether it should extend the proposed exemption to non-public entities that provide emergency services such as private ambulance companies. Hatzalah urges us to amend its rules for the same reasons the Bureau granted it a waiver so that other non-public emergency services will also have access to blocked Caller ID to provide the requested assistance. The Commission agrees that the Hatzalah Order's reasoning should apply more generally and find that allowing non-public emergency services to access blocked Caller ID promotes public safety and does not undermine any countervailing privacy interests associated with revealing CPN. Petition of Chevrah Hatzalah Volunteer Ambulance Corps Inc. for Waiver of Section 1601(b) of the Commission's Rules—Blocked Telephone Numbers, CC Docket No. 91-281, Order, 28 FCC Rcd 1253 (CGB 2013) (order was not published in the Federal Register). In order to facilitate the public safety goals of non-public emergency services, the Commission amends its Caller ID privacy rules to allow such services to obtain blocked Caller ID from carriers.

23. Consistent with the Hatzalah Order, entities providing emergency services must be licensed by a state or municipality to provide such services to qualify for this exemption. Unlike the threatened callers discussed above, non-public emergency services do not have to act in conjunction with law enforcement to obtain blocked Caller ID information from carriers. Involving public emergency services in this scenario would undermine the goal of allowing providers of emergency services to provide quick and effective assistance to individuals seeking such assistance.

24. As required by the Regulatory Flexibility Act of 1980, as amended, (RFA), the Commission incorporated an Initial Regulatory Flexibility Analysis (IRFA) into the Caller ID NPRM. The Commission sought written comment on the proposals in the Caller ID NPRM, including comment on the IRFA. No comments were received on the IRFA.

25. The Report and Order takes an important step to help security and law enforcement personnel responsible for the safety of parties receiving certain threatening calls obtain quick access to the Caller ID information needed to identify and thwart threatening callers. The Report and Order moves away from case-by-case waivers to the streamlined approach necessary to help protect the safety of threatened parties in a timely way. Specifically, Report and Order clears the way for carriers to disclose blocked Caller ID information associated with threatening calls to facilitate the investigation of such threats and amends the Commission's rules to allow non-public emergency services to obtain blocked Caller ID information associated with calls requesting assistance.

26. Caller ID Exemption for Threatening Calls. The Report and Order modifies the Commission's Caller ID rules to exempt threatening calls from the CPN privacy rules, so that security personnel and associated law enforcement have quick access to information they need to aid their investigations. The Report and Order defines the term “threatening call,” which triggers the application of the new exemption, as “any call that conveys an emergency involving danger of death or serious physical injury to any person requiring disclosure without delay of information relating to the emergency.” This definition is consistent with the emergency-disclosure provision of ECPA, and it satisfies the Commission's goal of targeting the most threatening calls.

27. Law Enforcement Involvement. To ensure the exemption is not abused, a request for blocked Caller ID associated with a threatening call must be made by law enforcement on behalf of the threatened party. The Commission believes that this requirement will, among other things, ensure that such requests concern a bona fide threatening call and will not be a pretext for obtaining blocked Caller ID for other purposes.

28. Only Law Enforcement and Security Personnel Receive Blocked Caller ID. Only law enforcement personnel and others responsible for the safety and, as directed by law enforcement, security personnel of the threatened party should receive the otherwise protected Caller ID information in the case of threatening calls. The Report and Order limits the disclosure of the blocked Caller ID information to prevent abuse of the disclosure process, and to protect the privacy interests of parties who may block their Caller ID for valid privacy interests, such as domestic violence victims. The Report and Order defines security personnel as “those individuals directly responsible for maintaining safety of the threatened entity consistent with the nature of the threat.”

29. Conditions on Receipt of Blocked Caller ID Information. The Report and Order includes the following conditions in the Commission's rule for law enforcement or security personnel of the called party investigating the threat: (1) The CPN on incoming restricted calls may not be passed on to the line called; (2) any system used to record CPN must be operated in a secure way, limiting access to designated telecommunications and, as directed by law enforcement, security personnel; (3) telecommunications and, as directed by law enforcement, security personnel may access restricted CPN data only when investigating calls involving danger of death or serious physical injury to any person requiring disclosure without delay of information relating to the emergency, and shall document that access as part of the investigative report; (4) carriers transmitting restricted CPN information must take reasonable measures to ensure the security of such communications; (5) CPN information must be destroyed in a secure manner after a reasonable retention period; and (6) any violation of these conditions must be reported promptly to the Commission.

30. Carrier Obligations Under Section 222 of the Act. The disclosure required by the new exemption adopted in the Report and Order is consistent with section 222 of the Act. Section 222(a) of the Act states that “[e]very telecommunications carrier has a duty to protect the confidentiality of proprietary information of, and relating to, other telecommunication carriers, equipment manufacturers, and customers, including telecommunication carriers reselling telecommunications services provided by a telecommunications carrier.” The Commission's amended rule requiring carriers to disclose blocked Caller ID information when law enforcement requests it does not contravene carriers' obligations under section 222 of the Act.

31. Jewish Community Center Temporary Waiver. The Report and Order recognizes an exemption for threatening calls thereby encompassing the JCC waiver. Accordingly, the JCC waiver is no longer necessary, and is superseded by the Report and Order.

32. Non-Public Emergency Services. The Report and Order also amends the Commission's rules to allow non-public emergency services to receive the CPN of all incoming calls from blocked numbers requesting assistance. Amending the Commission's rules to allow non-public emergency services access to blocked Caller ID promotes the public interest by ensuring timely provision of emergency services without undermining any countervailing privacy interests.

33. Pursuant to the Small Business Jobs Act of 2010, which amended the RFA, the Commission is required to respond to any comments filed by the Chief Counsel for Advocacy of the Small Business Administration (SBA), and to provide a detailed statement of any change made to the proposed rules as a result of those comments. The Chief Counsel did not file any comments in response to the proposed rules in this proceeding.

34. The RFA directs agencies to provide a description of, and where feasible, an estimate of the number of small entities that will be affected by the proposed rules, if adopted. The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. Under the Small Business Act, a “small business concern” is one that: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) meets any additional criteria established by the Small Business Administration. Nationwide, there are a total of approximately 28.8 million small businesses, according to the SBA.

35. Wired Telecommunications Carriers. The U.S. Census Bureau defines this industry as “establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired communications networks. Transmission facilities may be based on a single technology or a combination of technologies. Establishments in this industry use the wired telecommunications network facilities that they operate to provide a variety of services, such as wired telephony services, including VoIP services, wired (cable) audio and video programming distribution, and wired broadband internet services. By exception, establishments providing satellite television distribution services using facilities and infrastructure that they operate are included in this industry.” The SBA has developed a small business size standard for Wired Telecommunications Carriers, which consists of all such companies having 1,500 or fewer employees. Census data for 2012 shows that there were 3,117 firms that operated that year. Of this total, 3,083 operated with fewer than 1,000 employees. Thus, under this size standard, the majority of firms in this industry can be considered small.

36. Local Exchange Carriers (LECs). Neither the Commission nor the SBA has developed a small business size standard specifically for local exchange services. The closest applicable size standard under SBA rules is for the category wired telecommunications carriers. The U.S. Census Bureau defines this industry as “establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired communications networks. Transmission facilities may be based on a single technology or a combination of technologies. Establishments in this industry use the wired telecommunications network facilities that they operate to provide a variety of services, such as wired telephony services, including VoIP services, wired (cable) audio and video programming distribution, and wired broadband internet services. By exception, establishments providing satellite television distribution services using facilities and infrastructure that they operate are included in this industry.” Under that size standard, such a business is small if it has 1,500 or fewer employees. Census data for 2012 show that there were 3,117 firms that operated that year. Of this total, 3,083 operated with fewer than 1,000 employees. Consequently, the Commission estimates that most providers of local exchange service are small businesses.

37. Incumbent Local Exchange Carriers (Incumbent LECs). Neither the Commission nor the SBA has developed a small business size standard specifically for incumbent local exchange services. The closest applicable size standard under SBA rules is for the category wired telecommunications carriers. The U.S. Census Bureau defines this industry as “establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired communications networks. Transmission facilities may be based on a single technology or a combination of technologies. Establishments in this industry use the wired telecommunications network facilities that they operate to provide a variety of services, such as wired telephony services, including VoIP services, wired (cable) audio and video programming distribution, and wired broadband internet services. By exception, establishments providing satellite television distribution services using facilities and infrastructure that they operate are included in this industry.” Under that size standard, such a business is small if it has 1,500 or fewer employees. Census data for 2012 show that there were 3,117 firms that operated that year. Of this total, 3,083 operated with fewer than 1,000 employees. Consequently, the Commission estimates that most providers of incumbent local exchange service are small businesses.

38. Competitive Local Exchange Carriers (Competitive LECs), Competitive Access Providers (CAPs), Shared-Tenant Service Providers, and Other Local Service Providers. Neither the Commission nor the SBA has developed a small business size standard specifically for these service providers. The appropriate size standard under SBA rules is for the category wired telecommunications carriers. The U.S. Census Bureau defines this industry as “establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired communications networks. Transmission facilities may be based on a single technology or a combination of technologies. Establishments in this industry use the wired telecommunications network facilities that they operate to provide a variety of services, such as wired telephony services, including VoIP services, wired (cable) audio and video programming distribution, and wired broadband internet services. By exception, establishments providing satellite television distribution services using facilities and infrastructure that they operate are included in this industry.” Under that size standard, such a business is small if it has 1,500 or fewer employees. Census data for 2012 show that there were 3,117 firms that operated that year. Of this total, 3,083 operated with fewer than 1,000 employees. Consequently, the Commission estimates that most providers of competitive local exchange service, competitive access providers, Shared-Tenant Service Providers, and other local service providers are small entities.

39. The Commission has included small incumbent LECs in this present RFA analysis. As noted above, a “small business” under the RFA is one that, inter alia, meets the pertinent small business size standard (e.g., a telephone communications business having 1,500 or fewer employees), and “is not dominant in its field of operation.” The SBA's Office of Advocacy contends that, for RFA purposes, small incumbent LECs are not dominant in their field of operation because any such dominance is not “national” in scope. The Commission has therefore included small incumbent LECs in this RFA analysis, although it emphasizes that this RFA action has no effect on Commission analyses and determinations in other, non-RFA contexts.

40. Interexchange Carriers. Neither the Commission nor the SBA has developed a small business size standard specifically for providers of interexchange services (IXCs). The appropriate size standard under SBA rules is for the category wired telecommunications carriers. The U.S. Census Bureau defines this industry as “establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired communications networks. Transmission facilities may be based on a single technology or a combination of technologies. Establishments in this industry use the wired telecommunications network facilities that they operate to provide a variety of services, such as wired telephony services, including VoIP services, wired (cable) audio and video programming distribution, and wired broadband internet services. By exception, establishments providing satellite television distribution services using facilities and infrastructure that they operate are included in this industry.” Under that size standard, such a business is small if it has 1,500 or fewer employees. Census data for 2012 show that there were 3,117 firms that operated that year. Of this total, 3,083 operated with fewer than 1,000 employees. Consequently, the Commission estimates that the majority of IXCs are small entities.

41. Other Toll Carriers. Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to other toll carriers. This category includes toll carriers that do not fall within the categories of interexchange carriers, operator service providers, prepaid calling card providers, satellite service carriers, or toll resellers. The closest applicable size standard under SBA rules is for wired telecommunications carriers. The U.S. Census Bureau defines this industry as “establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired communications networks. Transmission facilities may be based on a single technology or a combination of technologies. Establishments in this industry use the wired telecommunications network facilities that they operate to provide a variety of services, such as wired telephony services, including VoIP services, wired (cable) audio and video programming distribution, and wired broadband internet services. By exception, establishments providing satellite television distribution services using facilities and infrastructure that they operate are included in this industry.” Under that size standard, such a business is small if it has 1,500 or fewer employees. Census data for 2012 show that there were 3,117 firms that operated that year. Of this total, 3,083 operated with fewer than 1,000 employees. Thus, under this category and the associated small business size standard, the majority of other toll carriers can be considered small.

42. Wireless Telecommunications Carriers (except Satellite). Since 2007, the Census Bureau has placed wireless firms within this new, broad, economic census category. Under the present and prior categories, the SBA has deemed a wireless business to be small if it has 1,500 or fewer employees. For the category of wireless telecommunications carriers (except Satellite), Census data for 2012 show that there were 967 firms that operated for the entire year. Of this total, 955 firms had fewer than 1,000 employees. Thus, under this category and the associated size standard, the Commission estimates that the majority of wireless telecommunications carriers (except satellite) are small entities. Similarly, according to internally developed Commission data, 413 carriers reported that they were engaged in the provision of wireless telephony, including cellular service, Personal Communications Service (PCS), and Specialized Mobile Radio (SMR) services. Of this total, an estimated 261 have 1,500 or fewer employees. Thus, using available data, the Commission estimates that the majority of wireless telecommunications carriers can be considered small.

43. Satellite Telecommunications Providers. The category of satellite telecommunications “comprises establishments primarily engaged in providing telecommunications services to other establishments in the telecommunications and broadcasting industries by forwarding and receiving communications signals via a system of satellites or reselling satellite telecommunications.” This category has a small business size standard of $32.5 million or less in average annual receipts, under SBA rules. For this category, Census Bureau data for 2012 show that there were a total of 333 firms that operated for the entire year. Of this total, 299 firms had annual receipts of under $25 million. Consequently, the Commission estimates that the majority of satellite telecommunications firms are small entities.

44. All Other Telecommunications. All other telecommunications comprise, inter alia, “establishments primarily engaged in providing specialized telecommunications services, such as satellite tracking, communications telemetry, and radar station operation. This industry also includes establishments primarily engaged in providing satellite terminal stations and associated facilities connected with one or more terrestrial systems and capable of transmitting telecommunications to, and receiving telecommunications from, satellite systems. Establishments providing Internet services or voice over Internet protocol (VoIP) services via client-supplied telecommunications connections are also included in this industry.” The SBA has developed a small business size standard for the category of All Other Telecommunications. Under that size standard, such a business is small if it has $32.5 million in annual receipts. For this category, Census Bureau data for 2012 show that there were a total of 1,442 firms that operated for the entire year. Of this total, 1,400 had annual receipts below $25 million per year. Consequently, the Commission estimates that the majority of all other telecommunications firms are small entities.

45. Toll Resellers. The Commission has not developed a definition for toll resellers. The closest NAICS Code Category is Telecommunications Resellers. The Telecommunications Resellers industry comprises establishments engaged in purchasing access and network capacity from owners and operators of telecommunications networks and reselling wired and wireless telecommunications services (except satellite) to businesses and households. Establishments in this industry resell telecommunications; they do not operate transmission facilities and infrastructure. Mobile virtual network operators (MVNOs) are included in this industry. The SBA has developed a small business size standard for the category of Telecommunications Resellers. Under that size standard, such a business is small if it has 1,500 or fewer employees. Census data for 2012 show that 1,341 firms provided resale services during that year. Of that number, 1,341 operated with fewer than 1,000 employees. Thus, under this category and the associated small business size standard, the majority of these resellers can be considered small entities. According to Commission data, 881 carriers have reported that they are engaged in the provision of toll resale services. Of this total, an estimated 857 have 1,500 or fewer employees. Consequently, the Commission estimates that the majority of toll resellers are small entities.

46. Local Resellers. The SBA has developed a small business size standard for the category of telecommunications resellers. The telecommunications resellers industry comprises establishments engaged in purchasing access and network capacity from owners and operators of telecommunications networks and reselling wired and wireless telecommunications services (except satellite) to businesses and households. Establishments in this industry resell telecommunications; they do not operate transmission facilities and infrastructure. Mobile virtual network operators (MVNOs) are included in this industry. Under that size standard, such a business is small if it has 1,500 or fewer employees. Census data for 2012 show that 1,341 firms provided resale services during that year. Of that number, all operated with fewer than 1,000 employees. Thus, under this category and the associated small business size standard, the majority of these prepaid calling card providers can be considered small entities.

47. Prepaid Calling Card Providers. The SBA has developed a small business size standard for the category of telecommunications resellers. The telecommunications resellers industry comprises establishments engaged in purchasing access and network capacity from owners and operators of telecommunications networks and reselling wired and wireless telecommunications services (except satellite) to businesses and households. Establishments in this industry resell telecommunications; they do not operate transmission facilities and infrastructure. Mobile virtual network operators (MVNOs) are included in this industry. Under that size standard, such a business is small if it has 1,500 or fewer employees. Census data for 2012 show that 1,341 firms provided resale services during that year. Of that number, all operated with fewer than 1,000 employees. Thus, under this category and the associated small business size standard, the majority of these prepaid calling card providers can be considered small entities.

48. The Report and Order creates an exemption for threatening calls and calls to non-public emergency services from the Commission's Caller ID privacy rules. These changes affect small and large companies equally, and apply equally to all classes of regulated entities identified above.

49. Reporting and Recordkeeping Requirements. There are no new reporting requirements. The Report and Order amends the caller privacy rules to exempt threatening calls from the CPN privacy rules, so that associated law enforcement and, as directed by law enforcement, security personnel have quick access to information they need to aid their investigations. Voice service providers do not need to change their current recordkeeping as they have been able to provide CPN when requested in the past.

50. The Report and Order adds a recordkeeping requirement. The Commission amends its rules to allow non-public emergency services to obtain blocked Caller ID information associated with calls requesting assistance. Voice service providers will need to keep a record of when they provide blocked Caller ID associated with calls requesting assistance to non-public emergency services providers.

51. Other Compliance Requirements. Voice service providers will be required to release blocked Caller ID information when it is requested by law enforcement in conjunction with circumstances amounting to a threatening call and when a non-public emergency service requests blocked Caller ID. To do so, voice service providers must comply with law enforcement requests for CPN as they currently do under ECPA. The Commission anticipates the impact will be small because of the statutory requirements already in place.

52. The RFA requires an agency to describe any significant alternatives that it has considered in reaching its approach, which may include the following four alternatives, among others: (1) the establishment of differing compliance or reporting requirements timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance or reporting requirements under the rule for small entities; (3) the use of performance, rather than design, standards; and (4) an exemption from coverage of the rule, or any part thereof, for small entities.

53. The Commission considered feedback from the Caller ID NPRM in crafting the final order. The Commission evaluated the comments in light of the goal of removing regulatory roadblocks to help security and law enforcement personnel responsible for the safety of parties receiving certain threatening calls obtain quick access to the Caller ID information needed to identify and thwart threatening callers. While a commenter suggested permissive rules, the Commission implemented mandatory rules in light of public safety concerns. The Commission adopts an exemption instead of simply streamlining the waiver process to allow for virtually immediate access to blocked Caller ID information upon proper request in threatening situations. The Commission considered continuing the waiver process, but inherent delays in the waiver process do not meet the goal of streamlining access to information needed to investigate threatening calls. In addition, the Commission reduced uncertainty, burdens and costs on small business providers that seek to relay the blocked Caller ID information, by putting the identification of “security personnel” in the hands of law enforcement as opposed to providers.

54. The Commission does not see a need to establish a special timetable for small entities to reach compliance with the modification to the rules. No small business has asked for a delay in implementing the rules. In considering the burden on small business, the Commission notes that they already have responsibilities under ECPA, and the Commission aligns its threatening call definition with that of ECPA. Similarly, there are no design standards or performance standards to consider in this rulemaking.

55. None.

56. Pursuant to the authority contained in sections 1-4, 201 and 222 of the Communications Act of 1934, as amended, 47 U.S.C. 151-154, 201, 222, This Report and Order IS ADOPTED and that part 64 of the Commission's rules, 47 CFR 64.1600, 64.1601, are amended.

57. The Commission's Consumer & Governmental Affairs Bureau, Reference Information Center, sent a copy of the Report and Order to Congress and the Government Accountability Office pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

For the reasons discussed in the preamble, the Federal Communications Commission amends 47 CFR part 64 as follows:

In the U.S. Caribbean EEZ, the reef fish fishery is managed under the FMP. The FMP was prepared by the Council and is implemented through regulations at 50 CFR part 622 under the authority of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act) (16 U.S.C. 1801 et seq.).

On September 19, 2017, NMFS published a proposed rule for Regulatory Amendment 6 and requested public comment (82 FR 43733). The proposed rule and Regulatory Amendment 6 outline the rationale for the actions contained in this final rule. A summary of the management measures described in the Regulatory Amendment 6 and implemented by this final rule is provided below.

The current AMs in the EEZ off Puerto Rico, applicable to Council-managed reef fish species or species groups, require NMFS to reduce the length of the Federal fishing season in the fishing year following a determination that landings for a species or species group exceeded the applicable sector annual catch limit (ACL). As specified in the FMP, the landings determination is based on the applicable 3-year landings average. Currently, an AM-based closure is triggered and applied when the sector ACL is exceeded, even if the total ACL (i.e., combined commercial and recreational ACLs) for a species or species group is not exceeded. For all Council-managed reef fish species or species groups, the total ACL equals the annual estimate of OY and is set at a level that is considered to be sustainable for the species or species group. Therefore, the application of the current AM for Puerto Rico reef fish could translate into yield below the OY from the affected species or species group (if the sector ACL is exceeded, but the total ACL is not), potentially resulting in negative socio-economic impacts.

Sector-specific data are not available for other federally-managed species in the EEZ off Puerto Rico (e.g., queen conch, spiny lobster) or for other federally-managed species or species groups in the U.S. Caribbean EEZ, so those species and species groups are not included in Regulatory Amendment 6. Therefore, Regulatory Amendment 6 and this proposed rule apply only to federally-managed reef fish species and species groups in the EEZ off Puerto Rico.

This final rule revises the trigger for implementing AM-based fishing season reductions for all reef fish species or species groups managed by the Council in the EEZ off Puerto Rico. Specifically, an AM-based closure will be triggered only when both the applicable sector (recreational or commercial) ACL and the total ACL for a species or species group are exceeded. If both the sector ACL and the total ACL are exceeded, the AM will be applied to the sector or sectors that experienced the overage. The duration of any implemented AM-based closure will continue to be based on the extent to which the applicable sector ACL was exceeded and will be calculated and applied using the current practices and methods. However, consistent with the current regulations, if NMFS determines that either the sector or total ACL was exceeded because of enhanced data collection and monitoring efforts, instead of an increase in catch, NMFS will not reduce the length of the fishing season.

This final rule to implement Regulatory Amendment 6 is expected to increase the likelihood that OY is achieved on a continuing basis and to minimize adverse socio-economic effects from the implementation of AMs, while still helping to ensure that AM-based closures constrain harvest to the total ACL and prevent overfishing. Modifying the AM trigger for a fishing season reduction, from an overage of the sector ACL to an overage of both the sector and the total ACL, increases the likelihood that OY for a species or species group will be achieved on a continuing basis. Additionally, the revision to the AM is likely to result in the AM being triggered less frequently and thereby result in fewer fishing season reductions. Sector fishing season reductions that are shorter in duration and that may occur less frequently are expected to result in increased socio-economic benefits to the applicable sector and the associated fishing communities. NMFS notes that the method for calculating the landings determination using the 3-year landings average for a species or species group will not change through this final rule.

NMFS notes that in the codified text for this final rule, amendatory instruction 2 revises the entire § 622.12. While this final rule only affects management in Puerto Rico Federal waters, the section as a whole is revised as a result of the action to more clearly and distinctly describe the AMs and ACLs throughout the U.S. Caribbean EEZ. This final rule also revises some regulatory citations within §§ 622.12 and 622.491 to reflect changes made to the regulatory text as a result of this final rule.

NMFS received three total comments on the proposed rule. One comment expressed overall support for the amendment and the rule. One comment was not related to the action in the amendment or the proposed rule. The other comment, as well as NMFS' response, is summarized below.

Comment 1: The AM closure trigger should not be revised to allow a given sector to stay open and continue fishing after it has reached its ACL as any harvest in excess of the sector ACL is not sustainable. Fishing within each sector must be sustainable to avoid negative economic impact.

Response: NMFS disagrees. Under the current application of AMs for Council-managed reef fish in Puerto Rico, yield may be below the OY for a species or species group over time. The Council developed Regulatory Amendment 6 as a means to increase the likelihood that OY for a species or species group will be achieved on a continuing basis while preventing overfishing, and, to the extent practicable, minimizing adverse socio-economic effects to fishers and fishing communities from the application of AMs. For all Council-managed reef fish species or species groups, the total ACL equals an annual estimate of OY and is set at a level that is considered to be sustainable for the species or species group. Therefore, the application of the current AM for Puerto Rico reef fish could translate into yield below the OY from the affected species or species group (if the sector ACL is exceeded, but the total ACL is not), potentially resulting in negative socio-economic impacts. Since sector-specific data is available for reef fish species or species groups in the EEZ off Puerto Rico, sector-specific ACLs were established, yet the overall health of the stocks continues to be managed in relation to the total ACL. Ensuring that the total ACL for a stock is not exceeded, even if there is a specific sector ACL overage, maintains the overall health of the stock and is also consistent with the use of AMs for reef fish throughout the rest of the Caribbean EEZ, where fishing is not managed by sectors. The AM trigger revision in this final rule increases the likelihood that OY for a species or species group will be achieved on a continuing basis without reducing the long-term sustainability of the resource.

The Regional Administrator, Southeast Region, NMFS has determined that this final rule is consistent with Regulatory Amendment 6, the FMPs, the Magnuson-Stevens Act, and other applicable law.

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

The Magnuson-Stevens Act provides the statutory basis for this rule. No duplicative, overlapping, or conflicting Federal rules have been identified. In addition, no new reporting, record-keeping, or other compliance requirements are introduced by this final rule.

The Chief Counsel for Regulation of the Department of Commerce certified to the Chief Counsel for Advocacy of the Small Business Administration during the proposed rule stage that this rule would not have a significant adverse economic impact on a substantial number of small entities. The factual basis for this determination was published in the proposed rule and is not repeated here. No changes to this final rule were made in response to public comments. As a result, a final regulatory flexibility analysis was not required and none was prepared.

For the reasons set out in the preamble, 50 CFR part 622 is amended as follows: