83 FR 47574 - Capital Leases

DEPARTMENT OF TRANSPORTATION
Federal Transit Administration

Federal Register Volume 83, Issue 183 (September 20, 2018)

Page Range		47574-47576
FR Document		2018-20474
This rulemaking rescinds the regulation implementing the requirement for recipients to conduct a cost-effectiveness analysis before leasing public transportation equipment or facilities with Federal transit funds. The requirement to conduct a cost-effectiveness analysis was rescinded by statute in 2015.
Federal Register, Volume 83 Issue 183 (Thursday, September 20, 2018)
[Federal Register Volume 83, Number 183 (Thursday, September 20, 2018)]
[Rules and Regulations]
[Pages 47574-47576]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-20474]


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DEPARTMENT OF TRANSPORTATION

Federal Transit Administration

49 CFR Part 639

[Docket No. FTA-2018-0006]
RIN 2132-AB34


Capital Leases

AGENCY: Federal Transit Administration (FTA), Department of 
Transportation.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: This rulemaking rescinds the regulation implementing the 
requirement for recipients to conduct a cost-effectiveness analysis 
before leasing public transportation equipment or facilities with 
Federal transit funds. The requirement to conduct a cost-effectiveness 
analysis was rescinded by statute in 2015.

DATES: This final rule is effective on September 20, 2018.

FOR FURTHER INFORMATION CONTACT: Mark Montgomery, Office of Chief

[[Page 47575]]

Counsel, (202) 366-1017 or [email protected]. Office hours are 
from 9 a.m. to 5:30 p.m., ET, Monday through Friday, except Federal 
holidays.

SUPPLEMENTARY INFORMATION:

Electronic Access and Filing

    This document is viewable online through the Federal eRulemaking 
portal at http://www.regulations.gov. Retrieval help and guidelines are 
available on the website. It is available 24 hours each day, 365 days a 
year. An electronic copy of this document is available for download 
from the Office of the Federal Register home page at: http://www.ofr.gov and the Government Publishing Office web page at: http://www.thefederalregister.org.

Background

    49 CFR part 639 limits capital leasing arrangements for use in 
public transportation to those that are more cost-effective than 
purchase or construction. This part implements section 3003 of the 
Transportation Equity Act for the 21st Century (Pub. L. 105-178) (TEA-
21), which amended section 5302 of title 49, United States Code 
(Section 5302), to allow a recipient to use capital funds to finance 
the leasing of facilities and equipment on the condition that the 
leasing arrangements are more cost-effective than purchase or 
construction. This section also required the Secretary to promulgate 
regulations to implement the cost-effectiveness limitation. Recently, 
section 3002 of the Fixing America's Surface Transportation Act (Pub. 
L. 114-357) (FAST Act) amended the definition of ``capital project'' 
under section 5302 to remove this requirement and the mandate to 
promulgate regulations to carry out this requirement. For this reason, 
FTA is issuing this final rule to rescind 49 CFR part 639.
    FTA will continue to evaluate its regulations and guidance to 
promote improvements to the capital leasing process in the least 
burdensome manner.

Discussion of the Changes

    Under the amended statutory definition of ``capital project,'' 
capital leases are no longer subject to the requirement or regulation 
limiting leasing arrangements to those that are more cost-effective 
than purchase or construction. Accordingly, this rulemaking rescinds 49 
CFR part 639, which outlines the procedures for conducting the cost-
effectiveness analysis. This rule does not affect the general 
procurement standards in 2 CFR part 200, nor does it alter the award 
management requirements in FTA's Circular 5010.1E.
    Under the Administrative Procedure Act (APA) (5 U.S.C. 553(b)), an 
agency may waive the normal notice and comment procedure if it finds, 
for good cause, that it is impracticable, unnecessary, or contrary to 
the public interest. Additionally, 5 U.S.C. 553(d) provides that an 
agency may waive the 30-day delayed effective date upon finding of good 
cause.
    Section 3003 of TEA-21 amended section 5302 to allow a recipient to 
use capital funds to finance the leasing of facilities and equipment, 
``subject to regulations that the Secretary prescribes limiting the 
leasing arrangements to those that are more cost-effective than 
purchase or construction.'' By removing this language, section 3002 of 
the FAST Act eliminated the requirement limiting capital leases to 
those that are more cost-effective than purchase or construction. FTA 
finds good cause that notice and comment for this rule is unnecessary 
due to the nature of the revisions (i.e., the rule simply carries out 
the statutory language found in the FAST Act). The statutory language 
does not require regulatory interpretation to carry out its intent, and 
comments cannot alter the regulation given that the statute abrogated 
its purpose. Further, the delayed effective date is unnecessary because 
the removal of the cost-effectiveness analysis requirement was already 
made effective by the FAST Act. Accordingly, FTA finds good cause under 
5 U.S.C. 553(b)(3)(B) and (d)(3) to waive notice and opportunity for 
comment and the delayed effective date.

Rulemaking Analyses and Notices

Executive Order 12866 (Regulatory Planning and Review), Executive Order 
13563 (Improving Regulation and Regulatory Review), Executive Order 
13771 (Reducing Regulation and Controlling Regulatory Costs), and 
Department of Transportation (DOT) Regulatory Policies and Procedures

    FTA has determined that this rulemaking is not a significant 
regulatory action within the meaning of Executive Order 12866, and 
within the meaning of DOT regulatory policies and procedures. This 
action complies with Executive Orders 12866, 13563 and 13771 to improve 
regulation.
    FTA classifies this rule as a deregulatory action under Executive 
Order 13771, because it removes the mandatory cost-effectiveness 
analysis. FTA finds that the cost savings are minor. On average, there 
are twelve leases per year subject to the requirement, and the analysis 
takes approximately a week for transit agencies to compile and prepare 
and approximately eight hours for FTA to review and approve the 
certification. Thus, removing these requirements would provide a 
maximum average annual cost savings of $32,373 and impose no additional 
costs on recipients.

Regulatory Flexibility Act

    Because FTA finds good cause under 5 U.S.C. 553(b)(3)(B) to waive 
notice and opportunity for comment for this rule, the provisions of the 
Regulatory Flexibility Act (Pub. L. 96-354, 5 U.S.C. 601-612) do not 
apply. FTA evaluated the effects of this action on small entities and 
determined the action would not have a significant economic impact on a 
substantial number of small entities. FTA hereby certifies that this 
rule will not have a significant economic impact on a substantial 
number of small entities.

Unfunded Mandates Reform Act of 1995

    FTA has determined that this rule does not impose unfunded 
mandates, as defined by the Unfunded Mandates Reform Act of 1995 (Pub. 
L. 104-4, March 22, 1995, 109 Stat. 48). This rule does not include a 
Federal mandate that may result in expenditures of $155.1 million or 
more in any 1 year (when adjusted for inflation) in 2012 dollars for 
either State, local, and tribal governments in the aggregate, or by the 
private sector. Additionally, the definition of ``Federal mandate'' in 
the Unfunded Mandates Reform Act excludes financial assistance of the 
type in which State, local, or tribal governments have authority to 
adjust their participation in the program in accordance with changes 
made in the program by the Federal Government. The Federal Transit Act 
permits this type of flexibility.

Executive Order 13132 (Federalism Assessment)

    Executive Order 13132 requires agencies to assure meaningful and 
timely input by State and local officials in the development of 
regulatory policies that may 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. This action has been analyzed in 
accordance with the principles and criteria contained in Executive 
Order 13132 dated August 4, 1999, and FTA determined this action will 
not have a substantial direct effect

[[Page 47576]]

or sufficient federalism implications on the States. FTA also 
determined this action will not preempt any State law or regulation or 
affect the States' ability to discharge traditional State governmental 
functions.

Executive Order 12372 (Intergovernmental Review)

    The regulations implementing Executive Order 12372 regarding 
intergovernmental consultation on Federal programs and activities apply 
to this program.

Paperwork Reduction Act

    Federal agencies must obtain approval from the Office of Management 
and Budget (OMB) for each collection of information they conduct, 
sponsor, or require through regulations. FTA has analyzed this rule 
under the Paperwork Reduction Act and believes that it does not impose 
additional information collection requirements for the purposes of the 
Act above and beyond existing information collection clearances from 
OMB.

National Environmental Policy Act

    Federal agencies are required to adopt implementing procedures for 
the National Environmental Policy Act (NEPA) that establish specific 
criteria for, and identification of, three classes of actions: (1) 
Those that normally require preparation of an Environmental Impact 
Statement, (2) those that normally require preparation of an 
Environmental Assessment, and (3) those that are categorically excluded 
from further NEPA review (40 CFR 1507.3(b)). This rule qualifies for 
categorical exclusions under 23 CFR 771.118(c)(4) (planning and 
administrative activities that do not involve or lead directly to 
construction). FTA has evaluated whether the rule will involve unusual 
or extraordinary circumstances and has determined that it will not.

Executive Order 12630 (Taking of Private Property)

    FTA has analyzed this rule under Executive Order 12630, 
Governmental Actions and Interference with Constitutionally Protected 
Property Rights. FTA does not believe this rule effects a taking of 
private property or otherwise has taking implications under Executive 
Order 12630.

Executive Order 12988 (Civil Justice Reform)

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

Executive Order 13045 (Protection of Children)

    FTA has analyzed this rule under Executive Order 13045, Protection 
of Children from Environmental Health Risks and Safety Risks. FTA 
certifies that this action will not cause an environmental risk to 
health or safety that might disproportionately affect children.

Executive Order 13175 (Tribal Consultation)

    FTA has analyzed this rule under Executive Order 13175, dated 
November 6, 2000, and believes that it will not have substantial direct 
effects on one or more Indian tribes; will not impose substantial 
direct compliance costs on Indian tribal governments; and will not 
preempt tribal laws. Therefore, a tribal summary impact statement is 
not required.

Executive Order 13211 (Energy Effects)

    FTA has analyzed this action under Executive Order 13211, Actions 
Concerning Regulations That Significantly Affect Energy Supply, 
Distribution, or Use. FTA has determined that this action is not a 
significant energy action under that order and 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.

Executive Order 12898 (Environmental Justice)

    Executive Order 12898 (Federal Actions to Address Environmental 
Justice in Minority Populations and Low-Income Populations) and DOT 
Order 5610.2(a) (77 FR 27534, May 10, 2012) (available online at http://www.fhwa.dot.gov/environment/environmental_justice/ej_at_dot/order_56102a/index.cf) require DOT agencies to achieve Environmental 
Justice (EJ) as part of their mission by identifying and addressing, as 
appropriate, disproportionately high and adverse human health or 
environmental effects, including interrelated social and economic 
effects, of their programs, policies, and activities on minority and 
low-income populations. All DOT agencies must address compliance with 
Executive Order 12898 and the DOT Order in all rulemaking activities. 
On August 15, 2012, FTA's Circular 4703.1 became effective, which 
contains guidance for recipients of FTA financial assistance to 
incorporate EJ principles into plans, projects, and activities 
(available online at http://www.fta.dot.gov/documents/FTA_EJ_Circular_7.14-12_FINAL.pdf).
    FTA has evaluated this action under the Executive Order, the DOT 
Order, and the FTA Circular. The rule rescinds the requirement of 
conducting cost-effectiveness analysis for capital leases, and FTA has 
determined that this action will not cause disproportionately high and 
adverse human health and environmental effects on minority or low-
income populations.

Regulation Identifier Number

    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 rule with the 
Unified Agenda.

List of Subjects in 49 CFR Part 639

    Grant programs--transportation, Mass transportation.

    Issued in Washington, DC, under authority delegated in 49 CFR 
1.90:
K. Jane Williams,
Acting Administrator.

Title 49--Transportation

PART 639--[REMOVED AND RESERVED]

0
In consideration of the foregoing, and under the authority of 49 U.S.C. 
5302 and Public Law 114-357, amend 49 CFR chapter VI by removing and 
reserving part 639, consisting of Sec. Sec.  639.1 through 639.33.

[FR Doc. 2018-20474 Filed 9-19-18; 8:45 am]
BILLING CODE P
47574 Federal Register / Vol. 83, No. 183 / Thursday, September 20, 2018 / Rules and Regulations

In addition, the SIP is not approved reference, Intergovernmental relations, (e) Redesignation to attainment. On
to apply on any Indian reservation land Nitrogen dioxide, Ozone, Volatile September 12, 2016, and February 16,
or in any other area where EPA or an organic compounds. 2018, Missouri submitted requests to
Indian tribe has demonstrated that a redesignate its portion of the St. Louis
40 CFR Part 81
tribe has jurisdiction. In those areas of MO-IL area to attainment of the 2008
Indian country, the rule does not have Environmental protection, ozone standard. The Missouri portion of
tribal implications and will not impose Administrative practice and procedure, the St. Louis MO-IL area includes
substantial direct costs on tribal Air pollution control, Designations and Jefferson, Franklin, St. Charles, and St.
governments or preempt tribal law as classifications, Intergovernmental Louis Counties along with the City of St.
specified by Executive Order 13175 (65 relations, Nitrogen dioxide, Ozone, Louis. As part of the redesignation
FR 67249, November 9, 2000). Reporting and recordkeeping request, the State submitted a plan for
The Congressional Review Act, 5 requirements, Volatile organic maintaining the 2008 ozone standard
U.S.C. 801 et seq., as added by the Small compounds.
Business Regulatory Enforcement through 2030 in the area as required by
Fairness Act of 1996, generally provides Dated: September 13, 2018. section 175A of the Clean Air Act.
that before a rule may take effect, the James B. Gulliford,
Regional Administrator, Region 7. PART 81—DESIGNATION OF AREAS
agency promulgating the rule must
FOR AIR QUALITY PLANNING
submit a rule report, which includes a
For the reasons stated in the PURPOSES
copy of the rule, to each House of the
preamble, EPA amends 40 CFR parts 52
Congress and to the Comptroller General
and 81 as set forth below: ■ 3. The authority citation for part 81
of the United States. EPA will submit a
report containing this action and other continues to read as follows:
PART 52—APPROVAL AND
required information to the U.S. Senate, PROMULGATION OF Authority: 42 U.S.C. 7401, et seq.
the U.S. House of Representatives, and IMPLEMENTATION PLANS
the Comptroller General of the United Subpart C—Section 107 Attainment
States prior to publication of the rule in ■ 1. The authority citation for part 52 Status Designations
the Federal Register. A major rule continues to read as follows:
cannot take effect until 60 days after it ■ 4. Section 81.326 is amended by
is published in the Federal Register. Authority: 42 U.S.C. 7401 et seq.
revising the entry for ‘‘St. Louis-St.
This action is not a ‘‘major rule’’ as Charles-Farmington, MO-IL’’ in the table
Subpart—AA Missouri
defined by 5 U.S.C. 804(2). entitled ‘‘Missouri—2008 8-Hour Ozone
List of Subjects ■ 2. Amend § 52.1342 by adding NAAQS (Primary and Secondary)’’ to
paragraph (e) to read as follows: read as follows:
40 CFR Part 52
Environmental protection, Air § 52.1342 Control strategy: Ozone. § 81.326 Missouri.
pollution control, Incorporation by * * * * * * * * * *

MISSOURI—2008 8-HOUR OZONE NAAQS
[Primary and secondary]

Designation Classification
Designated area
Date 1 Type Date 1 Type

St. Louis-St. Charles-Farmington, MO-IL 2:
Franklin County ........................................................................................ 9/20/2018 Attainment.
Jefferson County ...................................................................................... 9/20/2018 Attainment.
St. Charles County ................................................................................... 9/20/2018 Attainment.
St. Louis County ....................................................................................... 9/20/2018 Attainment.
St. Louis City ............................................................................................ 9/20/2018 Attainment.

* * * * * * *
1 This date is July 20, 2012, unless otherwise noted.
2 Excludes Indian country located in each area, unless otherwise noted.

* * * * * DEPARTMENT OF TRANSPORTATION SUMMARY: This rulemaking rescinds the
[FR Doc. 2018–20326 Filed 9–19–18; 8:45 am] regulation implementing the
BILLING CODE 6560–50–P Federal Transit Administration requirement for recipients to conduct a
cost-effectiveness analysis before leasing
49 CFR Part 639 public transportation equipment or
[Docket No. FTA–2018–0006] facilities with Federal transit funds. The
requirement to conduct a cost-
tkelley on DSKBCP9HB2PROD with RULES2

RIN 2132–AB34 effectiveness analysis was rescinded by
statute in 2015.
Capital Leases
DATES:This final rule is effective on
AGENCY: Federal Transit Administration September 20, 2018.
(FTA), Department of Transportation.
FOR FURTHER INFORMATION CONTACT:
ACTION: Final rule.
Mark Montgomery, Office of Chief

VerDate Sep<11>2014 16:15 Sep 19, 2018 Jkt 244001 PO 00000 Frm 00028 Fmt 4700 Sfmt 4700 E:\FR\FM\20SER1.SGM 20SER1
Federal Register / Vol. 83, No. 183 / Thursday, September 20, 2018 / Rules and Regulations 47575

Counsel, (202) 366–1017 or part 200, nor does it alter the award requirement, and the analysis takes
mark.montgomery@dot.gov. Office management requirements in FTA’s approximately a week for transit
hours are from 9 a.m. to 5:30 p.m., ET, Circular 5010.1E. agencies to compile and prepare and
Monday through Friday, except Federal Under the Administrative Procedure approximately eight hours for FTA to
holidays. Act (APA) (5 U.S.C. 553(b)), an agency review and approve the certification.
SUPPLEMENTARY INFORMATION: may waive the normal notice and Thus, removing these requirements
comment procedure if it finds, for good would provide a maximum average
Electronic Access and Filing cause, that it is impracticable, annual cost savings of $32,373 and
This document is viewable online unnecessary, or contrary to the public impose no additional costs on
through the Federal eRulemaking portal interest. Additionally, 5 U.S.C. 553(d) recipients.
at http://www.regulations.gov. Retrieval provides that an agency may waive the Regulatory Flexibility Act
help and guidelines are available on the 30-day delayed effective date upon
website. It is available 24 hours each finding of good cause. Because FTA finds good cause under
day, 365 days a year. An electronic copy Section 3003 of TEA–21 amended 5 U.S.C. 553(b)(3)(B) to waive notice
of this document is available for section 5302 to allow a recipient to use and opportunity for comment for this
download from the Office of the Federal capital funds to finance the leasing of rule, the provisions of the Regulatory
Register home page at: http:// facilities and equipment, ‘‘subject to Flexibility Act (Pub. L. 96–354, 5 U.S.C.
www.ofr.gov and the Government regulations that the Secretary prescribes 601–612) do not apply. FTA evaluated
Publishing Office web page at: http:// limiting the leasing arrangements to the effects of this action on small
www.gpo.gov. those that are more cost-effective than entities and determined the action
purchase or construction.’’ By removing would not have a significant economic
Background impact on a substantial number of small
this language, section 3002 of the FAST
49 CFR part 639 limits capital leasing Act eliminated the requirement limiting entities. FTA hereby certifies that this
arrangements for use in public capital leases to those that are more rule will not have a significant
transportation to those that are more cost-effective than purchase or economic impact on a substantial
cost-effective than purchase or construction. FTA finds good cause that number of small entities.
construction. This part implements notice and comment for this rule is
section 3003 of the Transportation Unfunded Mandates Reform Act of 1995
unnecessary due to the nature of the
Equity Act for the 21st Century (Pub. L. FTA has determined that this rule
revisions (i.e., the rule simply carries
105–178) (TEA–21), which amended does not impose unfunded mandates, as
out the statutory language found in the
section 5302 of title 49, United States defined by the Unfunded Mandates
FAST Act). The statutory language does
Code (Section 5302), to allow a recipient Reform Act of 1995 (Pub. L. 104–4,
not require regulatory interpretation to
to use capital funds to finance the March 22, 1995, 109 Stat. 48). This rule
carry out its intent, and comments
leasing of facilities and equipment on does not include a Federal mandate that
cannot alter the regulation given that the
the condition that the leasing may result in expenditures of $155.1
statute abrogated its purpose. Further,
arrangements are more cost-effective million or more in any 1 year (when
the delayed effective date is
than purchase or construction. This adjusted for inflation) in 2012 dollars
unnecessary because the removal of the
section also required the Secretary to for either State, local, and tribal
cost-effectiveness analysis requirement
promulgate regulations to implement governments in the aggregate, or by the
was already made effective by the FAST
the cost-effectiveness limitation. private sector. Additionally, the
Act. Accordingly, FTA finds good cause
Recently, section 3002 of the Fixing definition of ‘‘Federal mandate’’ in the
under 5 U.S.C. 553(b)(3)(B) and (d)(3) to
America’s Surface Transportation Act Unfunded Mandates Reform Act
waive notice and opportunity for
(Pub. L. 114–357) (FAST Act) amended excludes financial assistance of the type
comment and the delayed effective date.
the definition of ‘‘capital project’’ under in which State, local, or tribal
section 5302 to remove this requirement Rulemaking Analyses and Notices governments have authority to adjust
and the mandate to promulgate their participation in the program in
Executive Order 12866 (Regulatory
regulations to carry out this accordance with changes made in the
Planning and Review), Executive Order
requirement. For this reason, FTA is program by the Federal Government.
13563 (Improving Regulation and
issuing this final rule to rescind 49 CFR The Federal Transit Act permits this
Regulatory Review), Executive Order
part 639. type of flexibility.
13771 (Reducing Regulation and
FTA will continue to evaluate its
Controlling Regulatory Costs), and Executive Order 13132 (Federalism
regulations and guidance to promote
Department of Transportation (DOT) Assessment)
improvements to the capital leasing
Regulatory Policies and Procedures Executive Order 13132 requires
process in the least burdensome
manner. FTA has determined that this agencies to assure meaningful and
rulemaking is not a significant timely input by State and local officials
Discussion of the Changes regulatory action within the meaning of in the development of regulatory
Under the amended statutory Executive Order 12866, and within the policies that may have a substantial
definition of ‘‘capital project,’’ capital meaning of DOT regulatory policies and direct effect on the States, on the
leases are no longer subject to the procedures. This action complies with relationship between the national
requirement or regulation limiting Executive Orders 12866, 13563 and government and the States, or on the
leasing arrangements to those that are 13771 to improve regulation. distribution of power and
more cost-effective than purchase or FTA classifies this rule as a responsibilities among the various
tkelley on DSKBCP9HB2PROD with RULES2

construction. Accordingly, this deregulatory action under Executive levels of government. This action has
rulemaking rescinds 49 CFR part 639, Order 13771, because it removes the been analyzed in accordance with the
which outlines the procedures for mandatory cost-effectiveness analysis. principles and criteria contained in
conducting the cost-effectiveness FTA finds that the cost savings are Executive Order 13132 dated August 4,
analysis. This rule does not affect the minor. On average, there are twelve 1999, and FTA determined this action
general procurement standards in 2 CFR leases per year subject to the will not have a substantial direct effect

VerDate Sep<11>2014 16:15 Sep 19, 2018 Jkt 244001 PO 00000 Frm 00029 Fmt 4700 Sfmt 4700 E:\FR\FM\20SER1.SGM 20SER1
Document Created: 2018-09-20 02:09:25
Document Modified: 2018-09-20 02:09:25
Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Rules and Regulations
Action		Final rule.
Dates		This final rule is effective on September 20, 2018.
Contact		Mark Montgomery, Office of Chief Counsel, (202) 366-1017 or [email protected] Office hours are from 9 a.m. to 5:30 p.m., ET, Monday through Friday, except Federal holidays.
FR Citation		83 FR 47574
RIN Number		2132-AB34
CFR Associated		Grant Programs-Transportation and Mass Transportation
83 FR 47574 - Capital Leases

DEPARTMENT OF TRANSPORTATIONFederal Transit Administration

Federal Register Volume 83, Issue 183 (September 20, 2018)

DEPARTMENT OF TRANSPORTATION
Federal Transit Administration
