Federal Register Vol. 83, No.126,

The substance of these special conditions previously has been published in the Federal Register for public comment. These special conditions have been derived without substantive change from those previously issued. It is unlikely that prior public comment would result in a significant change from the substance contained herein. Therefore, the FAA has determined that prior public notice and comment are unnecessary, and finds that, for the same reason, good cause exists for adopting these special conditions upon publication in the Federal Register.

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

We will consider all comments we receive by the closing date for comments. We may change these special conditions based on the comments we receive.

On December 6, 2017, Bombardier applied for an amendment to Type Certificate No. T00008NY to include the new Model BD-500-1A10 and BD-500-1A11 airplanes. These airplanes, which are a derivative of the Model BD-500 currently approved under Type Certificate No. T00008NY, are transport-category, twin-engine airplanes. The BD-500-1A10 has seating for 110 to 130 passengers and an estimated maximum take-off weight of 129,000 lbs. The BD-500-1A11 has seating for 130-150 passengers and an estimated maximum take-off weight of 144,000 lbs.

Under the provisions of title 14, Code of Federal Regulations (14 CFR) 21.101, Bombardier must show that the Model BD-500-1A10 and BD-500-1A11 airplanes meet the applicable provisions of the regulations listed in Type Certificate No. T00008NY, or the applicable regulations in effect on the date of application for the change except for earlier amendments as agreed upon by the FAA.

If the Administrator finds that the applicable airworthiness regulations (i.e., 14 CFR part 25) do not contain adequate or appropriate safety standards for the Bombardier Model BD-500-1A10 and BD-500-1A11 airplanes because of a novel or unusual design feature, special conditions are prescribed under the provisions of § 21.16.

Special conditions are initially applicable to the model for which they are issued. Should the type certificate for that model be amended later to include any other model that incorporates the same novel or unusual design feature, or should any other model already included on the same type certificate be modified to incorporate the same novel or unusual design feature, these special conditions would also apply to the other model under § 21.101.

In addition to the applicable airworthiness regulations and special conditions, the Bombardier Model BD-500-1A10 and BD-500-1A11 airplanes must comply with the fuel-vent and exhaust-emission requirements of 14 CFR part 34, and the noise-certification requirements of 14 CFR part 36.

The FAA issues special conditions, as defined in 14 CFR 11.19, in accordance with § 11.38, and they become part of the type certification basis under § 21.101.

The Bombardier Model BD-500-1A10 and BD-500-1A11 airplanes will incorporate the following novel or unusual design feature:

Installation of inflatable lap belts on seats.

The inflatable lap belt has two potential advantages over other means of head-impact protection. First, it can provide significantly greater protection than would be expected with energy-absorbing pads, and second, it can provide essentially equivalent protection for occupants of all stature. These are significant advantages from a safety standpoint, because such devices will likely provide a level of safety that exceeds the minimum standards of part 25. Conversely, inflatable lap belts in general are active systems and must be relied upon to activate properly when needed, as opposed to an energy-absorbing pad or upper torso restraint that is passive and always available. Therefore, the potential advantages must be balanced against this and other potential disadvantages to develop standards for this design feature.

The FAA has considered the installation of inflatable lap belts to have two primary safety concerns: First, that they perform properly under foreseeable operating conditions; and second, that they do not perform in a manner or at such times as would constitute a hazard to the airplane or occupants. This latter point has the potential to be the more rigorous of the requirements, owing to the active nature of the system.

The inflatable lap belt will rely on electronic sensors for signaling, and will employ an automatic inflation mechanism for activation, so that it is available when needed. These same devices could be susceptible to inadvertent activation, causing deployment in a potentially unsafe manner. The consequences of such deployment must be considered in establishing the reliability of the system. The applicant must substantiate that the effects of an inadvertent deployment in flight are either not a hazard to the airplane, or that such deployment is an extremely improbable occurrence (less than 10−9 per flight hour). The effect of an inadvertent deployment on a passenger or crewmember that might be positioned close to the inflatable lap belt should also be considered. The person could be either standing or sitting. A minimum reliability level will have to be established for this case, depending upon the consequences, even if the effect on the airplane is negligible.

The potential for an inadvertent deployment could be increased as a result of conditions in service. The installation must take into account wear and tear so that the likelihood of an inadvertent deployment is not increased to an unacceptable level. In this context, an appropriate inspection interval and self-test capability are considered necessary. Other outside influences are lightning and high-intensity radiated fields (HIRF). Existing regulations regarding lightning, § 25.1316, and HIRF, § 25.1317, are applicable. For compliance with those conditions, if inadvertent deployment could cause a hazard to the airplane, the inflatable lap belt is considered a critical system; if inadvertent deployment could cause injuries to persons, the inflatable lap belt should be considered an essential system. Finally, the inflatable lap-belt installation should be protected from the effects of fire, so that an additional hazard is not created by, for example, a rupture of a pyrotechnic squib.

To function as an effective safety system, the inflatable lap belt must function properly and must not introduce any additional hazards to occupants as a result of its functioning. The inflatable lap belt differs variously from traditional occupant-protection systems and requires special conditions to ensure adequate performance.

Because the inflatable lap belt is essentially a single-use device, it could potentially deploy under crash conditions that are not sufficiently severe as to require head-injury protection from the inflatable lap belt. And because an actual crash is frequently composed of a series of impacts before the airplane comes to rest, this could render the inflatable lap belt useless if a larger impact follows the initial impact. This situation does not exist with energy-absorbing pads or upper-torso restraints, which tend to provide continuous protection regardless of severity or number of impacts in a crash event. Therefore, the inflatable lap-belt installation should be such that the inflatable lap belt will provide protection when it is required, by not expending its protection during a less-severe impact. Also, it is possible to have several large impact events during the course of a crash, but there will be no requirement for the inflatable lap belt to provide protection for multiple impacts.

Given that each occupant's restraint system provides protection for that occupant only, the installation must address unoccupied seats. It will be necessary to show that the required protection is provided for each occupant regardless of the number of occupied seats, and that unoccupied seats may have lap belts that are active.

The inflatable lap belt should be effective for a wide range of occupants. The FAA has historically considered the range from the 5th percentile female to the 95th percentile male as the range of occupants that must be taken into account. In this case, the FAA is proposing consideration of a broader range of occupants due to the nature of the lap-belt installation and its close proximity to the occupant. In a similar vein, these persons could have assumed the brace position for those accidents where an impact is anticipated. Test data indicate that occupants in the brace position do not require supplemental protection, so it would not be necessary to show that the inflatable lap belt will enhance the brace position. However, the inflatable lap belt must not introduce a hazard when it is deployed into a seated, braced occupant.

Another area of concern is the use of seats so equipped by children, whether they are lap-held, sitting in approved child-safety seats, or occupying the seat directly. Although specifically prohibited by FAA operating regulations, the use of the supplementary loop belt (“belly belt”) may be required by other civil aviation authorities, and should also be considered with the purpose of meeting those regulations. Similarly, if the seat is occupied by a pregnant woman, the installation needs to address such usage, either by demonstrating that it will function properly, or by adding appropriate limitation on usage.

The inflatable lap belt will be electrically powered. Likewise, the system could possibly fail due to a separation in the fuselage. Because this system is intended as crash/post-crash protection means, failure due to fuselage separation is not acceptable. As with emergency lighting, the restraint system should function properly if such a separation occurs at any point in the fuselage.

Because the inflatable lap belt is likely to have a large volume displacement, the inflated bag could potentially impede egress of passengers. However, the lap-belt bag deflates to absorb energy, so it is likely that an inflatable lap belt would be deflated by the time passengers begin to leave their seats. Nonetheless, it is appropriate to specify a time interval after which the inflatable lap belt may not impede rapid egress. The maximum time allowed for an exit to open fully after actuation is 10 seconds, according to § 25.809(b)(2). Therefore, the FAA has established 10 seconds as the time interval that the inflatable lap belt must not impede rapid egress from the seat after it is deployed. In actuality, it is unlikely that a flight attendant would prepare an exit this quickly in an accident severe enough to warrant deployment of the inflatable lap belt. The inflatable lap belt will likely deflate much more quickly than 10 seconds.

This potential impediment to rapid egress is even more critical at the seats installed in the emergency-exit rows. Installation of inflatable restraints at the Type III exit rows presents different egress concerns as compared with front-row seats. However, the need to address egress is already part of the special conditions, so the special conditions are not changed at this time. As noted below, the method of compliance with the special conditions may involve specific considerations when an inflatable restraint is installed at Type III exits. Section 25.813 clearly requires access to the exit from the main aisle in the form of an unobstructed passageway, and no interference in opening the exit. The restraint system must not create an impediment to the access to, and the opening of, the exit. These lap belts should be evaluated in the exit row under existing regulations (§§ 25.809 and 25.813) and guidance material. The inflatable lap belts must also be evaluated in post-crash conditions, and should be evaluated using representative restraint systems in the bag-deployed condition.

This evaluation would include reviewing the access to, and opening of, the exit, specifically for obstructions in the egress path; and any interferences in opening the exit. Each unique interior configuration must be considered, e.g., passageway width, single or dual passageways with outboard seat removed, etc. If the restraint creates any obstruction or interference, it is likely that it could impede rapid egress from the airplane. In some cases, the passenger is the one who will open the exit, such as a Type III over-wing hatch. Project-specific means-of-compliance guidance is likely necessary if these restraint systems are installed at the Type III exit rows.

Note that the special conditions are applicable to the inflatable lap-belt system as installed. The special conditions are not an installation approval. Therefore, while the special conditions relate to each such system installed, the overall installation approval is separate, and must consider the combined effects of all such systems installed.

Bombardier will install inflatable lap belts, a novel design feature, on certain seats of their Model BD-500-1A10 and BD-500-1A11 airplanes, to reduce the potential for head injury if an accident occurs. The inflatable lap belt works similar to an automotive inflatable air bag, except that the air bag in the applicant's design is integrated into the lap belt of the restraint system.

The performance criteria for head-injury protection in objective terms is stated in § 25.562. However, none of these criteria are adequate to address the specific issues raised concerning seats with inflatable lap belts. The FAA therefore has determined that, in addition to the requirements of part 25, special conditions are needed to address requirements particular to the installation of seats with inflatable lap belts.

Accordingly, in addition to the passenger-injury criteria specified in § 25.785, these special conditions are for Bombardier Model BD-500-1A10 and BD-500-1A11 airplanes equipped with inflatable lap belts. Other conditions may be developed, as needed, based on further FAA review and discussions with the manufacturer and civil-aviation authorities.

Part I of part 25, appendix F specifies the flammability requirements for interior materials and components. There is no reference to inflatable restraint systems in appendix F, because such devices did not exist at the time the flammability requirements were written. The existing requirements are based on material types as well as use, and have been specified in light of state-of-the-art materials available to perform a given function. Without a specific reference, the default requirement would apply to the type of material used in making the inflatable restraint, which is a fabric in this case. However, in writing special conditions, the FAA must also consider the use of the material, and whether the default requirement is appropriate. In this case, the specialized function of the inflatable restraint means that highly specialized materials are needed. The standard normally applied to fabrics is a 12-second vertical ignition test. However, materials that meet this standard do not perform adequately as inflatable restraints. Because the safety benefit of the inflatable restraint is significant, the flammability standard appropriate for these devices should not screen out suitable materials and thereby effectively eliminate the use of inflatable restraints. The FAA must establish a balance between the safety benefit of the inflatable restraint and its flammability performance. Presently, the 2.5-inch-per-minute horizontal test is considered to provide that balance. As the state-of-the-art in materials progresses (which is expected), the FAA may change this standard in subsequent special conditions to account for improved materials.

These special conditions contain the additional safety standards that the Administrator considers necessary to establish a level of safety equivalent to that established by the existing airworthiness standards.

As discussed above, these special conditions are applicable to Bombardier Model BD-500-1A10 and BD-500-1A11 airplanes. Should Bombardier apply at a later date for a change to the type certificate to include another model incorporating the same novel or unusual design feature, these special conditions would apply to that model as well.

This action affects only a certain novel or unusual design feature on one model series of airplanes. It is not a rule of general applicability.

The authority citation for these special conditions is as follows:

Accordingly, pursuant to the authority delegated to me by the Administrator, the following special conditions are issued as part of the type certification basis for Bombardier Model BD-500-1A10 and BD-500-1A11 airplanes.

1. The inflatable lap belt must be shown to deploy and provide protection under crash conditions where it is necessary to prevent serious head injury. The means of protection must take into consideration a range of stature from a two-year-old child to a 95th percentile male. The inflatable lap belt must provide a consistent approach to energy absorption throughout that range of occupants. In addition, the following situations must be considered.

The seat occupant is:

2. The inflatable lap belt must provide adequate protection for each occupant regardless of the number of occupants of the seat assembly, considering that unoccupied seats may have an active airbag system in the lap belt.

3. The design must prevent the inflatable lap belt from being either incorrectly buckled or incorrectly installed such that the inflatable lap belt would not properly deploy. Alternatively, it must be shown that such deployment is not hazardous to the occupant, and will provide the required head-injury protection.

4. The inflatable lap-belt system must be shown not to be susceptible to inadvertent deployment as a result of wear and tear, or inertial loads resulting from in-flight or ground maneuvers (including gusts and hard landings), likely to be experienced in service.

5. Deployment of the inflatable lap belt must not introduce injury mechanisms to the seated occupant, nor result in injuries that could impede rapid egress. This assessment should include an occupant who is in the brace position when it deploys, and an occupant whose inflatable lap belt is loosely fastened.

6. An inadvertent deployment that could cause injury to a standing or sitting person must be shown to be improbable.

7. It must be shown that inadvertent deployment of the airbag system in the lap belt, during the most critical part of the flight, either will not cause a hazard to the airplane or its occupants, or meets the requirement of § 25.1309(b).

8. The inflatable lap belt must be shown to not impede rapid egress of occupants 10 seconds after its deployment.

9. The inflatable lap-belt system must be protected from lightning and HIRF. The threats specified in existing regulations regarding lightning, § 25.1316, and HIRF, § 25.1317, are incorporated by reference for the purpose of measuring lightning and HIRF protection. For the purposes of complying with HIRF requirements, the inflatable lap-belt system is considered a “critical system” if its deployment could have a hazardous effect on the airplane; otherwise it is considered an “essential” system.

10. The inflatable lap belt must function properly after loss of normal airplane electrical power, and after a transverse separation of the fuselage at the most critical location. A separation at the location of the lap belt does not have to be considered.

11. The inflatable lap belt must be shown to not release hazardous quantities of gas or particulate matter into the cabin.

12. The inflatable lap-belt installation must be protected from the effects of fire such that no hazard to occupants will result.

13. A means must be available for a crewmember to verify the integrity of the inflatable-lap-belt-activation system prior to each flight, or it must be demonstrated to reliably operate between inspection intervals.

14. The inflatable material may not have an average burn rate of greater than 2.5 inches per minute when tested using the horizontal-flammability test as defined in 14 CFR part 25, appendix F, section I(b)(5).

15. The airbag system in the lap belt, once deployed, must not adversely affect the emergency-lighting system (i.e., block floor-proximity lights to the extent that the lights no longer meet their intended function).

NMFS manages the groundfish fisheries in the exclusive economic zone under the Fishery Management Plan for Groundfish of the Gulf of Alaska (GOA FMP) and under the Fishery Management Plan for Groundfish of the Bering Sea and Aleutian Islands Management Area (BSAI FMP). The North Pacific Fishery Management Council (Council) prepared the FMPs under the authority of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act), 16 U.S.C. 1801 et seq. Regulations governing U.S. fisheries and implementing the FMPs appear at 50 CFR parts 600 and 679.

NMFS published the proposed rule for this action on December 27, 2017 (82 FR 61243), with comments invited through January 26, 2018.

NMFS received five comment letters during the applicable comment period. Four of these comment letters were on topics that were outside the scope of this action. One comment letter addressed the proposed rule and contained five substantive comments which are summarized and responded to under the heading “Response to Comments” below.

A detailed review of the provisions of the regulations to modify specific provisions of the North Pacific Observer Program (Observer Program) and the rationale for these regulations are provided in the preamble to the proposed rule (82 FR 61243, December 27, 2017) and are briefly summarized in this final rule.

Regulations at subpart E of 50 CFR part 679 require that most vessels fishing for groundfish or halibut must carry an observer for some or all fishing activities to ensure the collection of data necessary to manage the groundfish and halibut fisheries.

The Observer Program is an integral component in the management of North Pacific fisheries. The Observer Program has two observer coverage categories: Partial and full. Regulations at 50 CFR 679.51 require vessels and processors in the full coverage category to carry an observer at all times when fish are caught or processed. This final rule affects catcher/processors in the full coverage category (i.e., vessels that catch and process their own catch at-sea), and all motherships (i.e., those vessels that receive unsorted catch from other vessels and process that catch at-sea). Owners of vessels or processors in the full coverage category must contract directly with a permitted observer provider and pay for required observer coverage. Two groups of vessels are required to carry an observer with a nontrawl LL2 deployment endorsement.

The first group of vessels includes vessels named on a License Limitation Program license with a Pacific cod catcher/processor hook-and-line endorsement for the Bering Sea, Aleutian Islands, or both the Bering Sea and Aleutian Islands (BSAI). These vessels are subject to monitoring requirements at 50 CFR 679.100 and are referred to as “freezer longline vessels” throughout this final rule. Pursuant to 50 CFR 679.100, a freezer longline vessel must carry an observer with a nontrawl LL2 deployment endorsement when the vessel (1) operates in either the BSAI or Gulf of Alaska groundfish fisheries and directed fishing for Pacific cod is open in the BSAI, or (2) when the vessel participates in the CDQ groundfish fisheries. These monitoring requirements for freezer longline vessels were implemented in 2012 and require freezer longline vessel owners and operators to select between one of two monitoring options: Either carry two observers so that all catch can be sampled, or carry one observer and use a motion-compensated flow scale to weigh Pacific cod before it is processed. Both monitoring options require the vessel to carry one observer endorsed as a nontrawl LL2 observer (77 FR 59053; September 26, 2012).

The second group of vessels that is required to carry an observer with a nontrawl LL2 deployment endorsement includes catcher/processors that use pot gear when participating in the CDQ groundfish fisheries (groundfish CDQ fishing) (77 FR 6492; February 8, 2012). These pot catcher/processors are required to carry an observer with a nontrawl LL2 deployment endorsement when groundfish CDQ fishing and may participate in other fisheries that do not require a nontrawl LL2 observer. Regulations at 50 CFR 679.32 describe the specific monitoring requirements for vessels when participating in the sablefish CDQ, pollock CDQ, and other groundfish CDQ fisheries.

Since 2014, observer providers contracted by vessels in the full coverage category have reported that they have been unable to create and retain an adequate pool of qualified nontrawl LL2 observers resulting in a diminishing pool of qualified observers employed by those observer providers. The requirements in this final rule are intended to increase the number of observers that qualify for a nontrawl LL2 deployment endorsement and thereby minimize additional costs to affected entities for an observer to obtain a nontrawl LL2 deployment endorsement. This final rule also implements provisions that are intended to maintain observer safety and data quality.

This final rule includes three elements. The first element implements new sampling experience requirements for an observer to obtain a nontrawl LL2 deployment endorsement. These sampling requirements allow sampling experience on a trawl catcher/processor or mothership vessel to count toward a nontrawl LL2 deployment endorsement. These requirements also authorize the Observer Program to require additional training for observers as necessary to adequately prepare them to safely perform data collection duties relevant to the nontrawl LL2 deployment endorsement.

The second element of this final rule requires the operator or manager of a vessel that carries nontrawl LL2 observers to participate in a pre-cruise meeting with the observer assigned to the vessel if notified to do so by NMFS. This final rule requires freezer longline vessels and pot catcher/processors when groundfish CDQ fishing to notify the Observer Program prior to embarking on a trip with a nontrawl LL2 observer who has not deployed on that vessel in the past 12 months. Subsequently, the Observer Program may contact the vessel and require the vessel operator or manager and the observer assigned to the vessel to participate in a pre-cruise meeting prior to embarking on a trip.

The third element of this final rule removes duplicative and unnecessary reporting requirements and makes minor changes to reduce observer requirements for specific vessels participating in the CDQ Program.

NMFS received five comment letters during the comment period. Four of these comment letters were outside the scope of this action. These letters raised issues not relevant to this rulemaking and are not addressed in this final rule. One comment letter directly addressed the proposed rule and contained five substantive comments that are summarized and responded to below. This comment letter was from the Freezer Longline Coalition (FLC) that represents members of the Freezer Longline Conservation Cooperative (FLCC), which includes freezer longline vessels impacted by this action.

Comment 1: We support implementing new requirements for an observer to obtain a nontrawl LL2 deployment endorsement, and for the operator or manager of a vessel required to carry an observer with a nontrawl LL2 deployment endorsement to participate in a pre-cruise meeting with the observer if notified by NMFS to do so.

Response: NMFS acknowledges this comment.

Comment 2: We agree that increasing the number of observers that may qualify for a nontrawl LL2 deployment endorsement will reduce costs to vessel owners required to carry a nontrawl LL2 endorsed observer.

Response: NMFS acknowledges this comment.

Comment 3: NMFS' proposed rule did not include sufficient explanation about how the implementation of the nontrawl LL2 observer training class will result in enough observers receiving a nontrawl LL2 deployment endorsement to minimize additional costs to the industry.

Response: NMFS disagrees. The preamble to the proposed rule includes a description of the minimum and potential maximum demand for nontrawl LL2 observer training classes (82 FR 61243, December 27, 2017). As described in the preamble to the proposed rule and the RIR, observer providers and representatives of freezer longline vessels reported shortages in 2014 of nontrawl LL2 observers on freezer longline vessels, and that this shortage resulted in delayed fishing operations in some cases. This final rule provides a path for observers with sampling experience on trawl vessels to qualify for a nontrawl LL2 deployment endorsement. NMFS expects this to increase the availability of qualified nontrawl LL2 observers, which would reduce the potential for delayed fishing operations and would reduce costs associated with delays, such as costs for crew time, food, and missed fishing opportunities. Section 4.3.2 and Table 16 of the RIR and the preamble to the proposed rule include additional information about the costs to industry created by a shortage of nontrawl LL2 observers.

In addition, the proposed rule cites the best scientific information available, and Section 3.3.5 of the RIR provided a description of the estimated costs to the freezer longline fleet due to the shortage of nontrawl LL2 endorsed observers. Specifically, Section 3.3.5 of the RIR summarizes the costs of voluntarily carrying a second observer to allow the observer to gain experience required for a nontrawl LL2 deployment endorsement. That cost is estimated to be $11,130 per observer for a 30-day trip. NMFS estimated this cost per trip by using information provided in Table 16 of the RIR. NMFS multiplied the estimated length of a freezer longline trip (30 days) by the estimated cost per day to deploy an observer ($371). NMFS then multiplied that total by the number of trips for which a freezer longline vessel voluntarily carried a second observer to obtain the total annual estimated cost.

NMFS expects that the cost for an observer with the requisite experience aboard a vessel using trawl gear to obtain a LL2 deployment endorsement through a two to three day training course will be significantly lower than the cost associated with a 30-day deployment. Based on the best available scientific information, NMFS anticipates that providing at least one nontrawl LL2 observer training class annually will meet the demand for additional nontrawl LL2 deployment endorsements, and freezer longline vessels will not need to voluntarily carry a second observer and incur associated additional costs.

In addition, the Observer Program routinely determines the training necessary for an observer to receive certification, annual endorsements and deployment endorsements, and responds to requests from observer providers to schedule training classes at NMFS facilities. The Observer Program may adjust the number of nontrawl LL2 training classes offered each year if required to meet demand.

Comment 4: NMFS should not apply the Small Business Administration (SBA) principles of affiliation for the purpose of determining if members of the FLCC are considered small entities under the Regulatory Flexibility Act (RFA). In addition, SBA's principles are not the best guide for considering affiliation for RFA analyses performed by NMFS.

Response: NMFS disagrees. Under Executive Order 13272, signed on August 13, 2002, the SBA's Office of Advocacy is directed to provide Federal agencies with training and information on how to comply with the RFA. The SBA provides information about how to comply with the RFA through its regulations at 13 CFR part 121 and guidance posted on its website at www.sba.gov. Therefore, it is appropriate for NMFS to apply regulations and guidelines developed by the SBA in classifying entities for RFA analyses.

Based on the contractual relationships, recognized since the formation of the FLCC in August 2010, NMFS determined that all members of the FLCC are affiliated as described under 13 CFR 121.103(f) for the purpose of analyses prepared under the RFA. This application of the SBA principles of affiliation is consistent with how NMFS has applied this size standard to vessels and processors in fishing cooperatives in the North Pacific since at least 2001 (66 FR 65028; December 17, 2001). NMFS has applied this same determination to vessels and processors in fishing cooperatives under the American Fisheries Act, the Crab Rationalization Program, the Amendment 80 Program, the Gulf of Alaska Rockfish Program, and for the FLCC.

The FLCC is a registered active non-profit corporation in the State of Washington and, through the FLC, maintains an active website identifying all member vessels (http://www.freezerlonglinecoalition.com/members.html). In addition, the FLC affirms that the FLCC operates as a voluntary fishery cooperative in its letter of comment on the proposed rule by stating that “All members of the FLC [Freezer Longline Coalition] are also members of the Freezer Longline Conservation Cooperative (FLCC), a voluntary fishing cooperative established in 2010.”

Thus, NMFS maintains that the members of the FLCC are recognized as members of a voluntary fishing cooperative with a single identity of interest in the harvest of the annual allocation of Pacific cod to the BSAI freezer longline vessels such that interests should be aggregated for the purpose of analysis prepared under the RFA. The contractual relationship among vessels in the cooperative allows members to work together to more efficiently harvest fishery allocations. The ability to plan ahead, cooperate in harvest decisions, and share some expenses constitutes a degree of economic dependence not available to independent fishing vessels. In addition, the conclusion that the members of the FLCC are affiliated for purposes of the RFA is consistent with previous actions implemented since the formation of the FLCC in 2010 and impacting the same fleet prosecuting the same resources (77 FR 59053, September 26, 2012; 77 FR 58775, September 24, 2012; 79 FR 603, January 6, 2014; 79 FR 68610, November 18, 2014).

Comment 5: NMFS incorrectly classifies freezer longline vessels as predominantly engaged in fish harvesting rather than fish processing for the purpose of analysis required under the RFA. The commenter asserts that catcher/processors should be classified as predominantly involved in fish processing and the associated threshold of employing 750 or fewer persons on a full-time, part-time, temporary, or other basis, at all affiliated operations worldwide should be applied to determine if an entity is considered small under the RFA.

Response: NMFS disagrees. As described in the response to Comment 4, all freezer longline vessels impacted by this action are members of the FLCC. In a letter received by NMFS on May 19, 2011 from the FLCC, the FLCC describes itself as a voluntary fishing cooperative with the purpose of “promoting, fostering, and encouraging the intelligent and orderly harvest of Pacific cod and other groundfish species in the Bering Sea/Aleutian Islands longline fisheries off Alaska . . .” The FLCC's description of its members refers to coordinating the harvest of finfish and does not refer to processing as a primary activity. Further, the members of the FLCC have exclusive harvesting rights to the annual allocation in the BSAI to the defined class of longline catcher/processor subsector participants rather than exclusive processing rights. Additionally, none of the FLCC members purchase unprocessed catch for the sole purpose of increasing processing activity; therefore, the processing activity of an individual freezer longline vessel is limited by its harvesting activity. Without the primary harvesting activity, the secondary processing activity does not occur. For these reasons, NMFS affirms its determination that, for purposes of RFA analyses, the freezer longline vessels affected by this action are primarily engaged in commercial fishing. Therefore, it is appropriate for NMFS to classify freezer longline vessels in the commercial fishing industry category (NAICS 11411), and to apply the small business size standard of $11 million in annual gross receipts to the group of affiliated vessels.

NMFS made three changes to this final rule. These changes provide minor clarifications that do not substantively modify the regulations as proposed.

The first change adds the word “either” and the regulatory text in paragraph (a)(5)(v)(C)(4) of the proposed rule to paragraph § 679.53(a)(5)(v)(C)(3) to clarify that either one of the two minimum sampling experience requirements may satisfy one of the three conditions set forth in paragraph (a)(5)(v)(C) necessary to deploy as a nontrawl lead level 2 observer.

The second change adds the words “at least” to § 679.53(a)(5)(v)(C)(3) to clarify that at least 100 or more sampled hauls on catcher/processors using trawl gear satisfies the minimum sampling experience requirement specified in this paragraph.

The third change correctly identifies the locations in 50 CFR part 679 where the term “Observer Program Office” will be replaced with the term “Observer Program” by including § 679.52(a)(2), (b)(1)(iii)(A), (b)(2)(iv), (b)(3)(ii)(B), and (b)(8) introductory text. These paragraphs were inadvertently incorrectly listed in the table as paragraphs of § 679.51 in the proposed rule.

Section 3507(c)(B)(i) of the Paperwork Reduction Act (PRA) requires that agencies inventory and display a current control number assigned by the Director of the Office of Management and Budget (OMB), for each agency information collection. Section 902.1(b) identifies the location of NOAA regulations for which OMB control numbers have been issued. Because this final rule revises and adds data elements within a collection-of-information for recordkeeping and reporting requirements, this final rule includes revisions to 15 CFR 902.1(b) to correctly reference the control number and associated regulation sections included in this final rule.

The Administrator, Alaska Region, NMFS, has determined that this final rule is necessary for the conservation and management of the groundfish fishery and is consistent with the GOA and BSAI FMPs, the Magnuson-Stevens Act, and other applicable law.

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

The Chief Counsel for Regulation of the Department of Commerce certified to the Chief Counsel for Advocacy of the Small Business Administration (SBA) that this final rule will not have a significant economic impact on a substantial number of small entities. NMFS published a proposed rule on December 27, 2017 (82 FR 61243). An IRFA was prepared and included in the “Classification” section of the preamble to the proposed rule. The comment period closed on January 26, 2018. NMFS received five letters of comment on the proposed rule. One comment letter contained two comments on the IRFA, which are summarized in the “Response to Comments” section (Comments 4 and 5). The comments on the IRFA were considered by NMFS in the decision to certify this final rule. The Chief Counsel for Advocacy of the SBA did not file any comments on the proposed rule.

The factual basis for certification of this final rule is described below. This action includes three elements that modify specific provisions of the Observer Program. The first element modifies sampling experience requirements for an observer to obtain a nontrawl LL2 deployment endorsement. The second element requires the operator or manager of a vessel required to carry an observer with a nontrawl LL2 deployment endorsement to participate in a pre-cruise meeting when notified to do so by NMFS. The third element removes duplicative and unnecessary reporting requirements and makes minor changes to reduce or remove observer-related requirements for specific vessels when participating in the CDQ Program.

This action directly regulates observers and owners and operators of the following vessels: (1) Freezer longline vessels that participate in the BSAI hook-and-line Pacific cod fishery; and (2) pot catcher/processors, trawl catcher/processors, nontrawl catcher/processors, and motherships when groundfish CDQ fishing. For reasons explained in more detail in the IRFA and in responses to Comment 4 and Comment 5 in the preamble to this final rule, NMFS has determined that there are no small entities directly regulated by this final rule.

In addition, this action is expected to reduce the cost for vessels to comply with observer coverage requirements and is not expected to impose significant costs of complying with new reporting requirements. This action will benefit all affected vessels by increasing the number of observers that may qualify for a nontrawl LL2 deployment endorsement and will remove observer-related requirements for specific vessels when participating in the CDQ Program.

For all of these reasons, this action is not expected to have a significant economic impact on a substantial number of small entities. As a result, a final regulatory flexibility analysis is not required, and none has been prepared. The economic analysis contained in the RIR (see ADDRESSES) and in the IRFA included in the “Classification” section of the proposed rule prepared for this action further describes the regulatory and operational characteristics of the affected vessels, including the history of this action, and the details of the alternatives considered for this action, including the preferred alternative.

This final rule contains collection-of-information requirements subject to the Paperwork Reduction Act (PRA) and which have been approved by the Office of Management and Budget (OMB) under OMB control number 0648-0318 (North Pacific Observer Program). The public reporting burden for these collection-of-information requirements includes the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information.

This final rule will require that the Observer Program be notified by phone at least 24 hours prior to departure when a vessel will carry an observer who has not deployed on that vessel in the past 12 months. Public reporting burden per response to notify the Observer Program by phone is estimated to be five minutes.

Send comments on these burden estimates or any other aspect of this data collection, including suggestions for reducing the burden, to NMFS Alaska Region (see ADDRESSES), and by email to [email protected], or by fax to (202) 395-5806.

Notwithstanding any other provision of the law, no person is required to respond to, and no person shall be subject to penalty for failure to comply with, a collection of information subject to the requirements of the PRA, unless that collection of information displays a currently valid OMB control number. All currently approved NOAA collections of information may be viewed at http://www.cio.noaa.gov/services_programs/prasubs.html.

For the reasons set out in the preamble, NMFS amends 15 CFR part 902 and 50 CFR part 679 as follows:

In the Federal Register of November 2, 2012 (77 FR 66287), the Commodity Futures Trading Commission published final rules adopting new regulations to implement particular provisions of the Commodity Exchange Act, as added by the Dodd-Frank Wall Street Reform and Consumer Protection Act. That document inadvertently failed to remove several obsolete provisions in § 1.33(a)(2) and (b)(3). Accordingly, the Commission is making a correcting amendment to § 1.33 that removes the second paragraph (a)(2)(ii), removes paragraph (a)(2)(v), and removes the introductory clause to paragraph (b)(3).

Accordingly, 17 CFR part 1 is corrected by making the following correcting amendments:

Sponsors of approved or conditionally approved applications for new animal drugs containing an antimicrobial active ingredient are required by section 512 of the Federal Food, Drug, and Cosmetic Act (FD&C Act) (21 U.S.C. 360b), as amended by section 105 of the Animal Drug Use Fee Amendments of 2008 (ADUFA 105) (Pub. L. 110-316), to submit to us an annual report on the amount of each such ingredient in the drug that is sold or distributed for use in food-producing animals. We are also required by ADUFA 105 to publish annual summary reports of the data we receive from animal drug sponsors. In accordance with the law, sponsors of the affected antimicrobial new animal drug products began submitting their sales and distribution data to us on an annual basis, and we have published summaries of such data for each calendar year beginning with 2009.

In the Federal Register of May 11, 2016 (81 FR 29129), we published a final rule entitled “Antimicrobial Animal Drug Sales and Distribution Reporting” that amended our existing records and reports regulation in part 514 (21 CFR part 514) to incorporate the sales and distribution data reporting requirements specific to antimicrobial new animal drugs that were added to the FD&C Act by ADUFA 105. The rule also added an additional reporting provision intended to improve our understanding of antimicrobial animal drug sales intended for use in specific food-producing animal species. In accordance with the new rule, the sponsor of each approved or conditionally approved new animal drug product that contains an antimicrobial active ingredient must submit an annual report to us on the amount of each such ingredient in the drug product that is sold or distributed for use in food-producing animals, including information on any distributor-labeled product. The final rule, which is codified at §§ 514.80 and 514.87, became effective July 11, 2016.

We examined the economic implications of the final rule as required by the Regulatory Flexibility Act (5 U.S.C. 601-612) and determined that the final rule will not have a significant economic impact on a substantial number of small entities (81 FR 29129 at 29138). Nonetheless, we determined not to certify that finding due to the remote possibility that, in the future, a very small company could enter the market and sponsor an application for an antimicrobial new animal drug product that would be sold or distributed for use in food-producing animals. Thus, in compliance with section 212 of the Small Business Regulatory Enforcement Fairness Act (Pub. L. 104-121, as amended by Pub. L. 110-28), we are making available this SECG to explain the actions that a potential future market entrant small entity must take to comply with the rule.

We are issuing this SECG consistent with our good guidance practices regulation (21 CFR 10.115(c)(2)). The SECG represents the current thinking of FDA on this topic. It does not establish any rights for any person and is not binding on FDA or the public. You can use an alternative approach if it satisfies the requirements of the applicable statutes and regulations. This guidance is not subject to Executive Order 12866.

This guidance refers to previously approved collections of information found in FDA regulations. These collections of information are subject to review by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). The collections of information in § 514.87 have been approved under OMB control number 0910-0659. The collections of information in § 514.80 have been approved under OMB control number 0910-0284.

Persons with access to the internet may obtain the SECG at either https://www.fda.gov/AnimalVeterinary/GuidanceComplianceEnforcement/GuidanceforIndustry/default.htm or https://www.regulations.gov.

This document and additional information concerning OFAC are available from OFAC's website (www.treasury.gov/ofac).

On November 3, 1997, the President issued Executive Order 13067, “Blocking Sudanese Government Property and Prohibiting Transactions With Sudan” (E.O. 13067), declaring a national emergency to deal with the unusual and extraordinary threat to the national security and foreign policy of the United States posed by the policies and actions of the Government of Sudan. E.O. 13067 blocked all property and interests in property of the Government of Sudan that were in the United States, that thereafter came within the United States, or that thereafter came within the possession or control of United States persons. E.O. 13067 also prohibited: (a) The importation into the United States of any goods or services of Sudanese origin; (b) the exportation or reexportation, directly or indirectly, to Sudan of goods, technology, or services from the United States or by a United States person, wherever located, or requiring the issuance of a license by a Federal agency; (c) the facilitation by a United States person of the exportation or reexportation of goods, technology, or services to or from Sudan; (d) the performance by any United States person of any contract, including a financing contract, in support of an industrial, commercial, public utility, or governmental project in Sudan; (e) the grant or extension of credits or loans by any United States person to the Government of Sudan; (f) any transaction by a United States person relating to transportation of cargo to or from Sudan; and (g) any transaction by any United States person, or within the United States that evaded or avoided, or had the purpose of evading or avoiding, or attempted to violate any of the prohibitions set forth in E.O. 13067.

On July 1, 1998, OFAC issued the Sudanese Sanctions Regulations, 31 CFR part 538 (SSR), as a final rule to implement E.O. 13067. The SSR were amended on various occasions to, among other things, implement further Executive orders and add additional authorizations.

On April 26, 2006, in Executive Order 13400 (E.O. 13400), the President determined that the conflict in Sudan's Darfur region posed an unusual and extraordinary threat to the national security and foreign policy of the United States, expanded the scope of the national emergency declared in E.O. 13067 to deal with that threat, and ordered the blocking of property of certain persons connected to the conflict. On May 28, 2009, OFAC issued the Darfur Sanctions Regulations, 31 CFR part 546 (DSR), as a final rule to implement E.O. 13400. On October 13, 2006, the President issued Executive Order 13412 (E.O. 13412) to take additional steps with respect to the national emergency and to implement the Darfur Peace and Accountability Act of 2006, Public Law 109-344, 120 Stat. 1869.

On January 13, 2017, President Obama issued Executive Order 13761, “Recognizing Positive Actions by the Government of Sudan and Providing for the Revocation of Certain Sudan-Related Sanctions” (E.O. 13761). In E.O. 13761, President Obama found that the situation that gave rise to the actions taken in E.O.s 13067 and 13412 related to the policies and actions of the Government of Sudan had been altered by Sudan's positive actions over the prior six months. These actions included a marked reduction in offensive military activity, culminating in a pledge to maintain a cessation of hostilities in conflict areas in Sudan, and steps toward the improvement of humanitarian access throughout Sudan, as well as cooperation with the United States on addressing regional conflicts and the threat of terrorism. Given these developments, and in order to see these efforts sustained and enhanced by the Government of Sudan, President Obama ordered that, effective July 12, 2017, sections 1 and 2 of E.O. 13067 be revoked, and E.O. 13412 be revoked in its entirety, provided that a review before that date determined certain criteria were met.

On July 11, 2017, President Trump issued Executive Order 13804, “Allowing Additional Time for Recognizing Positive Actions by the Government of Sudan and Amending Executive Order 13761” (E.O. 13804). In E.O. 13804, President Trump amended E.O. 13761, extending until October 12, 2017, the review period established by E.O. 13761. This review period provided for the revocation of certain sanctions if the Government of Sudan sustained the positive actions that gave rise to E.O. 13761, including carrying out a pledge to maintain a cessation of hostilities in conflict areas in Sudan; continuing improvement of humanitarian access throughout Sudan; and maintaining its cooperation with the United States on addressing regional conflicts and the threat of terrorism.

On October 11, 2017, the Secretary of State, in consultation with the Secretary of the Treasury, the Director of National Intelligence, and the Administrator of the U.S. Agency for International Development, published notice in the Federal Register stating that the Government of Sudan had sustained the positive actions that gave rise to E.O. 13761. That notice also stated that the Secretary of State had provided to the President the report described in section 10 of E.O. 13761, fulfilling the requirement set forth in E.O. 13761, as amended by E.O. 13804, that make effective the revocation of certain economic sanctions related to Sudan. As such, effective October 12, 2017, pursuant to E.O. 13761, as amended by E.O. 13804, sections 1 and 2 of E.O. 13067 were revoked and E.O. 13412 was revoked in its entirety. As a result of the revocation of these sanctions provisions, U.S. persons are no longer prohibited from engaging in transactions that were previously prohibited solely under the SSR. Consistent with the revocation of these sanctions provisions, OFAC is removing the SSR from the Code of Federal Regulations.

The emergency declared by the President with respect to Sudan in E.O. 13067, and expanded in E.O. 13400, has not been terminated. These authorities remain the basis for the DSR, which remain in effect with respect to Darfur and continues to block the property and interests in property of certain persons connected with the conflict in Darfur.

Pursuant to section 1 of E.O. 13761, as amended by E.O. 13804, the revocation of sections 1 and 2 of E.O. 13067 and the entirety of E.O. 13412 shall not affect any violation of any rules, regulations, orders, licenses, or other forms of administrative action under those orders during the period that those provisions were in effect.

Pursuant to Section 906 of the Trade Sanctions Reform and Export Enhancement Act of 2000, 22 U.S.C. 7205 (TSRA), an OFAC license is still required for certain exports and reexports to Sudan of agricultural commodities, medicine, and medical devices as a result of Sudan's inclusion on the State Sponsors of Terrorism List. Effective October 12, 2017, OFAC issued and made available on its website General License A. This general license authorized exports and reexports of these items to Sudan. Today, OFAC is incorporating General License A into the Terrorism List Government Sanctions Regulations, 31 CFR part 596, as new § 596.506. No OFAC license is required for financing of these exports and reexports.

U.S. persons and non-U.S. persons will still need to obtain any licenses required by the Department of Commerce's Bureau of Industry and Security (BIS) to export or reexport to Sudan certain items (commodities, software, and technology) that are on the Commerce Control List (CCL), Supp. No. 1 to part 774 of the Export Administration Regulations, 15 CFR parts 730 through 774 (EAR). In limited circumstances, U.S. persons and non-U.S. persons may also need to obtain licenses from BIS to export or reexport to Sudan items that are subject to the EAR but not specifically listed on the CCL (“EAR99” items) if such transactions implicate certain end-use or end-user concerns (see 15 CFR part 744).

Because the Regulations involve a foreign affairs function, the provisions of Executive Order 12866 and the Administrative Procedure Act (5 U.S.C. 553) requiring notice of proposed rulemaking, opportunity for public participation, and delay in effective date, as well as the provisions of Executive Order 13771, are inapplicable. Because no notice of proposed rulemaking is required for this rule, the Regulatory Flexibility Act (5 U.S.C. 601-612) does not apply.

The Paperwork Reduction Act does not apply because this rule does not impose information collection requirements that would require the approval of the Office of Management and Budget under 44 U.S.C. 3501 et seq.

For the reasons set forth in the preamble, and under the authority of 3 U.S.C. 301; 50 U.S.C. 1601-1651; E.O. 13067, 62 FR 59989, 3 CFR, 1997 Comp., p. 230; E.O. 13412, 71 FR 61369, 3 CFR, 2006 Comp., p. 244; E.O. 13761, 82 FR 5331, as amended by E.O. 13804, 82 FR 23611, OFAC amends 31 CFR parts 538 and 596 as follows:

Electronic Availability

This document and additional information concerning OFAC are available from OFAC's website (www.treasury.gov/ofac).

On December 23, 2016, the President signed the Global Magnitsky Human Rights Accountability Act (Pub. L. 114-328, Title XII, Subtitle F) (the “Act”) into law. The Act authorized the President to impose targeted sanctions on any foreign person the President determines is, among other things, responsible for extrajudicial killings, torture, or other gross violations of internationally recognized human rights, or a government official, or a senior associate of such an official, responsible for, or complicit in, ordering, controlling, or otherwise directing, acts of significant corruption.

On December 20, 2017, the President, invoking the authority of, inter alia, the International Emergency Economic Powers Act (50 U.S.C. 1701-1706) (IEEPA), issued Executive Order 13818 (82 FR 60839, December 26, 2017) (E.O. 13818), effective at 12:01 a.m. eastern standard time on December 21, 2017.

In E.O. 13818, the President determined that serious human rights abuse and corruption around the world constitute an unusual and extraordinary threat to the national security, foreign policy, and economy of the United States and declared a national emergency to deal with that threat.

OFAC is issuing the Global Magnitsky Sanctions Regulations, 31 CFR part 583 (the “Regulations”), to implement the Act and E.O. 13818, pursuant to authorities delegated to the Secretary of the Treasury in E.O. 13818. A copy of E.O. 13818 appears in appendix A to this part.

The Regulations are being published in abbreviated form at this time for the purpose of providing immediate guidance to the public. OFAC intends to supplement this part 583 with a more comprehensive set of regulations, which may include additional interpretive and definitional guidance, general licenses, and statements of licensing policy. The appendix to the Regulations will be removed when OFAC supplements this part with a more comprehensive set of regulations.

Because the Regulations involve a foreign affairs function, the provisions of Executive Order 12866 and the Administrative Procedure Act (5 U.S.C. 553) requiring notice of proposed rulemaking, opportunity for public participation, and delay in effective date, as well as the provisions of Executive Order 13771, are inapplicable. Because no notice of proposed rulemaking is required for this rule, the Regulatory Flexibility Act (5 U.S.C. 601-612) does not apply.

The collections of information related to the Regulations are contained in 31 CFR part 501 (the “Reporting, Procedures and Penalties Regulations”). Pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3507), those collections of information have been approved by the Office of Management and Budget under control number 1505-0164. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid control number.

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

The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(3)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because it would be impracticable. This regulated area must be established by July 14, 2018 and we lack sufficient time to provide a reasonable comment period and then consider those comments before issuing this rule. The NPRM process would delay the establishment of the special local regulation until after the scheduled date of the regatta and compromise public safety.

Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register. Delaying the effective date of this rule would be contrary to the public interest because immediate action is necessary to ensure the safety of persons and vessels during the regatta.

The Coast Guard is issuing this rule under authority in 33 U.S.C. 1233. The Captain of the Port Sector Corpus Christi (COTP) has determined that potential hazards associated with the vessel traffic occurring on July 14, 2018 through July 21, 2018 will be a safety concern for participants within the boating course. Potential hazards include risk of injury or death resulting from near or actual contact among participant vessels and spectator vessels or waterway users if normal vessel traffic were to interfere with the event. The purpose of this rule is to ensure safety of participants, spectators, and transiting vessels in the regulated area before, during, and after the Youth World's Championship regatta.

This rule establishes a temporary special local regulation from 6:15 a.m. through 3 p.m. each day from July 14, 2018 through July 21, 2018 in Corpus Christi Bay, approximately 3,000 feet east of People's Street T-Head in Corpus Christi, TX. The regatta will be inside a rectangular area with the most northwestern point located at 027°47′31″ N, 097°22′33.05″ W, most northeastern point located at 027°47′29.46″ N, 097°19′44.26″ W, most southeastern point located at 027°46′12.06″ N, 097°19′44.78″ W, and the most southwestern located at 027°46′09.55″ N, 097°22′28.78″ W. The duration of the special local regulation is intended to protect the public from potential navigation hazards before, during, and after the event. No vessel or person is permitted to enter the regulated area without obtaining permission from the COTP or a designated representative. A designated representative may be a Patrol Commander (PATCOM). The PATCOM will be aboard either a Coast Guard or Coast Guard Auxiliary vessel. The PATCOM may be contacted on Channel 16 VHF-FM (156.8 MHz) by the call sign “PATCOM”.

All persons and vessels not registered with the sponsor as participants or official patrol vessels are considered spectators. The “official patrol vessels” consist of any Coast Guard, state, or local law enforcement and sponsor provided vessels assigned or approved by the COTP to patrol the regulated area.

Spectator vessels desiring to enter, transit through or within, or exit the regulated area may do so only with permission from the COTP or a designated representative, and when permitted, must operate at a minimum safe navigation speed in a manner which will not endanger participants in the regulated area or any other vessels. No spectator vessel shall anchor, block, loiter, or impede the through transit of participants or official patrol vessels in the regulated area during the effective dates and times, unless cleared for entry by or through an official patrol vessel. Any spectator vessel may anchor outside the regulated area, but may not anchor in, block, or loiter in a navigable channel.

The COTP or a designated representative may forbid and control the movement of all vessels in the regulated area. When hailed or signaled by an official patrol vessel, a vessel shall come to an immediate stop and comply with the directions given. Failure to do so may result in expulsion from the area, citation for failure to comply, or both.

The COTP or a designated representative may terminate the event or the operation of any vessel at any time it is deemed necessary for the protection of life or property. The COTP or a designated representative can terminate enforcement of the special local regulations at the conclusion of the event.

The COTP or a designated representative would inform the public of the enforcement times for this regulated area through Broadcast Notices to Mariners (BNMs), Local Notices to Mariners (LNMs), and/or Marine Safety Information Bulletins (MSIBs) as appropriate.

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

Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. Executive Order 13771 directs agencies to control regulatory costs through a budgeting process. This rule has not been designated a “significant regulatory action” under Executive Order 12866. Accordingly, this rule has not been reviewed by the Office of Management and Budget (OMB), and pursuant to OMB guidance it is exempt from the requirements of Executive Order 13771.

This regulatory action determination is based on size, location, duration, and time-of-day for the special local regulation. Vessel traffic will be able to safely navigate around the regulated area, which will impact only a small portion of the Laguna Madre for 3 hours and 15 minutes on one day. Moreover, the Coast Guard will issue Broadcast Notices to Mariners (BNMs) via VHF-FM marine channel 16 about the regulation so that waterway users may plan accordingly for transits during this restriction, and the rule allows vessels to seek permission from the COTP or a designated representative to enter the regulated area.

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

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

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

If you think that your business, organization, or governmental jurisdiction qualifies as a small entity and that this rule would have a significant economic impact on it, please submit a comment (see ADDRESSES) explaining why you think it qualifies and how and to what degree this rule would economically affect it.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section. The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.

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

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

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

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

We have analyzed this rule under Department of Homeland Security Directive 023-01 and Commandant Instruction M16475.1D, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have made a preliminary determination that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule is a special local regulation that limits daily access to certain navigable waters of Corpus Christi Bay over eight days. Normally such actions are categorically excluded from further review under paragraph L61 of Appendix A, Table 1 of DHS Instruction Manual 023-01-001-01, Rev. 01. A preliminary Record of Environmental Consideration supporting this determination is available in the docket where indicated under ADDRESSES.

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

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 100 as follows:

The Coast Guard will enforce the safety zone for the annual LaPointe Fireworks in 33 CFR 165.943(a)(5) from 9:30 p.m. through 11:30 p.m. on July 4, 2018, with a rain date of 9:30 p.m. through 11:30 p.m. on July 5, 2018, on all waters of Lake Superior bounded by the arc of a circle with a 350-foot radius from the fireworks launch site with its center in position 46°46′40″ N, 090°47′22″ W.

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

This document is issued under authority of 33 CFR 165.943 and 5 U.S.C. 552(a). In addition to this publication in the Federal Register, the Coast Guard will provide the maritime community with advance notification of the enforcement of this safety zone via Broadcast Notice to Mariners.

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

On January 17, 2018, the Kentucky Dam Marina notified the Coast Guard that it would be conducting a fireworks display from 7 p.m. through 10 p.m. on June 30, 2018. The fireworks are to be launched from the break wall of Kentucky Dam Marina. In response, on April 26, 2018, the Coast Guard published a notice of proposed rulemaking (NPRM) titled Safety Zone; Tennessee River, Gilbertsville, KY (83 FR 18241). There we stated why we issued the NPRM, and invited comments on our proposed regulatory action related to this fireworks display. During the comment period that ended May 29, 2018, we received no comments.

Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register. Delaying the effective date of this rule would be contrary to the public interest because immediate action is needed to respond to the potential safety hazards associated with this fireworks display.

The Coast Guard is issuing this rule under authority in 33 U.S.C. 1231. The Captain of the Port Sector Ohio Valley (COTP) has determined that potential hazards associated with the fireworks to be used in this June 30, 2018 display will be a safety concern for anyone within a 350-foot radius from the fireworks launch site on the Kentucky Dam Marina break wall in Gilbertsville, KY. Hazards from firework displays include accidental discharge of fireworks, dangerous projectiles, and falling hot embers or other debris. The purpose of this rule is to ensure safety of vessels and the navigable waters in the safety zone before, during, and after the scheduled event.

As noted above, we received no comments on our NPRM published April 26, 2018. However, we have noticed an error in the title of the proposed rule, which included “Ohio” River, instead of “Tennessee” River. The regulatory text of this rule corrects an error in the title of the regulatory text of this temporary final rule.

This rule establishes a temporary safety zone from 6:50 p.m. through 10:10 p.m. on June 30, 2018. The safety zone will cover all navigable waters within a 350-foot radius from the fireworks launch site on the Kentucky Dam Marina break wall in Gilbertsville, KY. The duration of the zone is intended to ensure the safety of vessels on these navigable waters before, during, and after the scheduled fireworks display. No vessel or person will be permitted to enter the safety zone without obtaining permission from the COTP or a designated representative. Persons or vessels desiring to enter into or pass through the zone must request permission from the COTP or a designated representative. They may be contacted on VHF-FM Channel 16 or by phone at 1-800-253-7465. If permission is granted, all persons and vessels must transit at their slowest safe speed and comply with all lawful directions issued by the COTP or a designated representative. The COTP or a designated representative will inform the public through Broadcast Notice to Mariners (BNMs) of the enforcement period for the safety zone as well as the date and time of enforcement.

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

Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. Executive Order 13771 directs agencies to control regulatory costs through a budgeting process. This rule has not been designated a “significant regulatory action,” under Executive Order 12866. Accordingly, this rule has not been reviewed by the Office of Management and Budget (OMB), and pursuant to OMB guidance it is exempt from the requirements of Executive Order 13771.

This regulatory action determination is based on the size, location, duration and time-of-day of the safety zone. Vessel traffic would be able to safely transit around this safety zone, which will impact a 350-foot designated area of the Tennessee River for approximately three hours on one evening. Moreover, the Coast Guard will issue a Broadcast Notice to Mariners (BNMs) via VHF-FM marine channel 16 about the zone, and the rule allows vessels to seek permission to enter the zone.

The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard received no comments from the Small Business Administration on this rulemaking. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.

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

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

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

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

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

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

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

We have analyzed this rule under Department of Homeland Security Directive 023-01 and Commandant Instruction M16475.1D, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969(42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves a safety zone lasting approximately three hours that will prohibit entry within 350 feet of a break wall at Kentucky Dam Marina in Gilbertsville, KY. It is categorically excluded from further review under paragraph L60(a) of Appendix A, Table 1 of DHS Instruction Manual 023-01-001-01, Rev. 01. A Record of Environmental Consideration supporting this determination is available in the docket where indicated under ADDRESSES.

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

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

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

The background for this action is discussed in detail in our September 18, 2017 proposal (82 FR 43506). In that document we proposed to approve revisions to the Arkansas SIP submitted on July 26, 2010, and March 24, 2017, including supplemental information submitted on November 30, 2015, May 26, 2016, July 5, 2017, July 27, 2017, and March 16, 2018. The revisions addressed in our proposal included revisions to the Arkansas minor NSR permitting thresholds and de minimis levels, as well as, additional revisions to the minor NSR provisions that are considered to be non-substantive.

We received one set of comments on the proposal. The full text of the comment letter received during the public comment period, which closed on October 18, 2017, is included in the publicly posted docket associated with this action at www.regulations.gov. Below the EPA provides a summary of the comments received and corresponding responses.

Comment: The commenter stated that the revised minor NSR rule fails to provide legally enforceable procedures to ensure new sources that could interfere with NAAQS attainment or maintenance or violate the control strategy won't be allowed to construct. More specifically, they stated that the minor NSR program does not explain how “actual emissions” are to be determined for a new source with no operational history. To the extent that Arkansas Department of Environmental Quality (ADEQ) determined applicability for new sources based on projected actual emissions, then the rule could ultimately allow sources with emissions greater than the permitting thresholds to construct without a permit and without evaluation of air quality impacts by a new source underestimating emission factors and/or operating parameters and exceeding those projected emissions after its construction. Therefore, the commenter stated it is unclear what size of sources could ultimately end up exempt from Arkansas' minor NSR program. The commenter claims that because of the noted deficiencies there is a problem with any attempt to determine whether the revised minor NSR rule's applicability thresholds are set to the appropriate level to ensure the state meets the applicable federal requirements found in CAA section 110(a)(2)(C) and 40 CFR 51.160(b).

Response: This comment is not relevant to our current rulemaking. As shown in Section IV of the Technical Support Document that accompanied our proposed approval action, our rulemaking only addresses revisions to the permitting thresholds values contained in Reg. 19.401. The applicability determination for the minor NSR program and its reliance on “actual emissions” was not revised by Arkansas as part of the July 26, 2010, or May 24, 2017 SIP revision submittals. Therefore, the applicability determination as originally SIP-approved October 16, 2000 (65 FR 61103) remains unchanged, is not a part of this rulemaking, and any comment on it is not relevant to the current rulemaking.

While the comments regarding the applicability determination basis are not relevant to this rulemaking, we will respond to the commenter's assertion that any attempt to determine if the revised minor NSR permitting thresholds meet the referenced federal requirements is problematic. We do not agree with this statement. As outlined in our proposed rulemaking, we evaluated several analyses submitted by Arkansas in support of the revised thresholds, including an emissions inventory analysis, a monitoring trends analysis, and a modeling analysis. Based on our evaluation of those analyses along with the SIP revisions submittals documentation (found in the Technical Support Document (TSD)), we find that the proposed thresholds will meet applicable federal requirements and not interfere with NAAQS attainment or maintenance or violate the control strategy. As required by Reg. 19.401, a source with actual emissions greater than the applicability thresholds would be required to obtain a permit and is subject to enforcement action if the source fails to do so. The emissions from a new source to be compared with the permitting thresholds would be based on controlled emission factors and projected operations (hours of operation and/or amounts of material processed). This approach allows permitting applicability to be based on emissions that are close to actual emissions. The regulation specifically does not allow construction and operation of sources with actual emissions in excess of the thresholds, and any source that did underestimate their emissions and exceed the emissions thresholds would be in violation of the regulations and beyond the scope of the analyses conducted to demonstrate the regulation's compliance with applicable federal requirements for minor NSR programs.

Comment: The commenter stated that the rule exempting de minimis changes at existing sources from permitting fails to provide legally enforceable procedures to ensure that modified sources that could interfere with NAAQS attainment or maintenance or violate the control strategy won't be allowed to construct. More specifically, they stated a physical change or change in the method of operation at a source with no existing permit has no existing “permitted rates” to compare “proposed permitted rates” to, and the rule does not explain how applicability is determined in such cases and the rule does not clearly say that it applies only to sources with existing permits. In addition, the commenter stated that Reg. 19 does not clearly require a permit application for de minimis changes. Therefore, they claim that de minimis exemptions rule does not meet the requirements of 40 CFR 51.160(a) of providing legally enforceable procedures.

Response: We do not agree that the applicability of the de minimis changes rule to existing sources with no permits is unclear. The de minimis change provisions are found in paragraph C of Reg. 19.407 of Arkansas' “Minor Source Review” regulation (Reg. 19, Chapter 4). Reg. 19.407 is titled “Permit Amendments” and as stated in our original 2000 approval of Reg. 19.407 (65 FR 26795; finalized at 65 FR 61103), this section describes the procedures for amending a permit. Because Reg. 19.407 describes permit amendments, including de minimis changes, these provisions are not applicable to a source that does not have a permit. Existing sources with no existing permit would be subject to the minor NSR permitting thresholds found in Reg. 19.401 under the “General Applicability” section to determine if the source was subject to minor NSR permitting requirements. In addition to the clarity provided in the rule itself, the current “Air Application Instructions for Registrations, Minor Source Permits, or Title V Permits” made available on ADEQ's air permitting website also indicates that de minimis applications are for “small modifications to a permit.” (Pg. 5) 1 Page 12 of the application instructions reiterates the applicability of the de minimis rule and states that a de minimis application “applies to facilities having a current air permits [sic].” Much like the de minimis change provisions in the rule, it is clear based on ADEQ's current air permit application guidance that the de minimis change rule only applies to existing permitted facilities and not new facilities.

The portion of the comment raised regarding permit application requirements for de minimis changes is not relevant to our current rulemaking. As shown in Section IV of the Technical Support Document that accompanied our proposed action, our rulemaking only addresses revisions related to de minimis changes that are found in Reg. 19.407(C)(2)(a) and (b). Permit application requirements, which are found in Reg. 19.404, are currently SIP-approved and were not revised as part of the July 26, 2010, or May 24, 2017 SIP revision submittals under review in this rulemaking. Similarly, Reg. 19.407(C)(7) was not revised in the 2010 or 2017 SIP revision submittals. Therefore, the SIP-approved Reg. 19.404 and Reg. 19.407(C)(7) provisions as most-recently approved on October 16, 2000 (65 FR 61103) and April 12, 2007 (72 FR 18394), respectively, remain unchanged and are not part of this rulemaking and any comment on those provisions is not relevant.

Comment: The commenter claims that Arkansas has failed to adequately justify the basis for its revised emission thresholds for exempting new sources and de minimis changes from its minor NSR program. They state that 40 CFR 51.160(e) requires states to identify the types and sizes of sources subject to its minor NSR program and to explain the basis for determining which facilities are subject to review. ADEQ's justification for the emission thresholds adopted in its minor NSR program for Reg. 19, Chapter 4, was essentially that these tons per year thresholds were the same thresholds identified as “de minimis” under major NSR permitting programs. However, there has been no analysis with current modeling techniques that the major NSR significance levels are adequate to ensure a modified source won't interfere with the attainment or maintenance of all of the various current NAAQS, which differ in stringency from the NAAQS applicable at the time the PSD significant emission rates were developed. The commenter also stated that the AERMOD (dispersion) modeling results, which they believe underestimate actual impacts, indicate that the pollutant concentrations resulting from the emissions exempt from permitting based on the revised thresholds are significantly higher than 4% of the NAAQS, which was a threshold for the EPA's analyses from 1980, 1987, and 2008 for demonstrating that the significant emission levels were de minimis to the PSD program.

Response: We do not agree with this comment. Although ADEQ did include the data referenced by the commenter in their initial 2010 SIP revision submittal, the basis for ADEQ's findings regarding the appropriateness of the revised thresholds was different and they also provided additional analyses to demonstrate the scope of the exempt sources and modifications resulting from the revised minor NSR permitting thresholds and de minimis change levels and to demonstrate that the revised thresholds will not interfere with attainment or maintenance of the NAAQS. These analyses were included in their entirety in the March 24, 2017 SIP revision submittal and included: (1) An emissions inventory analysis that determined the percentage of the total statewide emissions that were to be exempt under the revised minor NSR permitting thresholds and de minimis change levels; (2) a monitoring trends analysis that included a review of the current status of ambient air quality, as well as, the impacts of the revised thresholds on ambient concentration monitoring trends in the state of Arkansas; and (3) a modeling analysis that included photochemical and dispersion modeling analyses that evaluated the impacts of the revised thresholds through model predicted results. The air quality modeling analysis report included in Appendix D of the March 24, 2017 SIP submittal describes the modeling approach used by ADEQ as part of the demonstration showing that the revised minor NSR permitting thresholds and de minimis change levels will not adversely impact the current NAAQS. Based on our review of the modeling analysis, which did use current air quality modeling techniques, and the other analyses completed by ADEQ, we found that the impacts resulting from the revised minor NSR permitting thresholds and de minimis levels would not interfere with the state's ability to maintain compliance with the NAAQS.

As discussed in the Technical Support Document accompanying our proposed action, ADEQ conducted both regional scale photochemical modeling using CMAQ and local-scale dispersion modeling using AERMOD to examine the predicted impacts from sources or de minimis changes that would be exempt from minor NSR permitting based on the revised thresholds.2 ADEQ employed this combined modeling approach in an effort to look at both regional and local scale impacts from emissions equal to the revised thresholds for VOC, NOX, SO2, CO, PM10, and PM2.5. In both the regional- and local-scale modeling analyses, ADEQ modeled hypothetical sources with emissions equal to the minor NSR permitting and de minimis change thresholds and stack parameters set equal to median values based on the 2011 National Emissions Inventory (NEI) for Arkansas sources. As part of photochemical modeling, the maximum CMAQ-derived impacts on daily maximum 8-hour ozone, 24-hour PM2.5, annual average PM2.5, 1-hour NO2, 1-hour SO2, and 24-hour PM10 were calculated. The statewide maximum impacts for each day resulting from the hypothetical sources was added to the unmodified future year concentration for each day and grid cell. The resulting concentrations represented the worst-case ambient concentrations including impacts from the threshold emission increases at any location in Arkansas. These worst-case ambient concentrations were then used to calculate relative response factors (RRFs) to estimate future design values (FDVs) at both monitored and unmonitored locations throughout Arkansas.3 4 The FDVs were compared with FDVs without the thresholds increase impacts, as well as, the NAAQS in an effort to determine whether emissions increases less than the minor NSR thresholds would cause or contribute to NAAQS violations or potentially interfere with NAAQS maintenance. Similar to the regional-scale photochemical modeling, the hypothetical sources modeling in the near-field dispersion modeling analysis were modeled with emission rates equal to the minor NSR permitting thresholds and de minimis levels and stack parameters were set equal to median stack parameter based on the 2011 NEI data. The maximum AERMOD-derived impacts on daily maximum 1-hr NO2, annual average NO2, daily maximum 1-hour SO2, daily maximum 1-hour CO, daily maximum 8-hour average CO, and 24-hour average PM10 were calculated for each air quality control region. The daily AERMOD-derived concentrations were added to the CMAQ-derived concentrations for the same location, using the CMAQ values as “background.” ADEQ stated that the values determined for the statewide daily maximum impacts are expected to represent the near-field concentrations assuming worst-case impacts from threshold emission increases at a range of locations through Arkansas. The daily maximum worst case AERMOD impacts were added to the unmodified future year concentration for each day and grid cell. The resulting concentrations represented the worst-case ambient concentrations including impacts from the threshold emission increases at any location in Arkansas. Similar to the CMAQ-only modeling analysis, the worse-case modeled impacts were used to calculate RRFs and FDVs. The calculated FDVs were compared with the original unmodified FDVs and the NAAQS in order to examine the potential impacts of the proposed minor NSR threshold emissions on NAAQS attainment and maintenance. The modeling conducted by Arkansas utilized current air quality modeling techniques to demonstrate that the predicted impacts resulting from emissions at or below the revised minor NSR permitting thresholds and de minimis change levels, which happen to be equal in magnitude to the major NSR significance levels, will not interfere with the attainment or maintenance of the NAAQS current in effect at the time of the analysis—including those that were not applicable at the time the PSD significant emission rates were developed.

Further, the entirety of the additional analyses provided by ADEQ in the March 24, 2017 SIP revision submittal, including the NAAQS non-interference modeling demonstration, was the basis of the EPA's finding that the revised thresholds were approvable. As such, a linkage to the PSD significant emission rate values and/or comparison of modeled impacts to percentage thresholds relied upon during the EPA's development of the significant emission rates in 1980, 1987, and 2008 for the PSD program was not applicable to our proposed approval of the revised minor NSR permitting thresholds and de minimis levels. Elsewhere in this final rulemaking, we have addressed the comments specifically made regarding the modeling techniques used by Arkansas and restated our finding that those techniques were reasonable and appropriate for the NAAQS non-interference demonstration required by CAA section 110(l).

Comment: The commenter stated that modified major sources exempted from major source permitting under the PSD program will also be exempt from minor source permitting under Arkansas' de minimis changes rule and that the revised minor NSR program will not pick up the slack and ensure protection of the NAAQS as was intended when EPA promulgated the 2002 revisions to the major source NSR rules.

Response: The commenter is incorrect that modifications to existing PSD major sources, which are exempt from PSD permitting, would be exempt from minor source permitting under the de minimis change rule. As discussed below, any change at an existing major NSR source (PSD source) is prohibited from using the de minimis change process because the de minimis change rule at Reg. 19.407(C) is located in Chapter 4 of Reg. 19, which does not apply to PSD sources or any modifications at those sources.

The SIP-approved Arkansas NSR program is comprised of two types of review: “Minor Source Review” and “Major Source Review”. Arkansas operates a so-called “merged, one permit” system, which is divided into these two types of review based on whether a source is required to obtain a title V operating permit. As such, “Minor Source Review”, which is contained in Reg. 19, Chapter 4, applies only to those sources that are not subject to title V permitting and require only a title I NSR authorization.5 All sources that are subject to title V, which would include PSD sources, are subject to “Major Source Review” under Reg. 26 provisions incorporated by reference in Reg. 19, Chapter 11. Therefore, all permitting at PSD sources, including all modifications, would be subject to Reg. 19, Chapter 11 “Major Source Review” under the Arkansas NSR permitting program and cannot use the de minimis change provisions, which are limited to “Minor Source Review” in Chapter 4. Only those non-title V sources that are minor under the SIP-approved definition of minor source may qualify for the de minimis change exemption found in Reg. 19.407(C). As discussed in our proposed rulemaking and the accompanying TSD, the emissions inventory analysis for the de minimis changes found that the scope of changes expected to qualify for the de minimis change exemption is very small with emissions associated with those exempted changes making up a fraction of a percent of statewide emissions. The range of percentage of statewide emissions for the pollutants determined in the emissions inventory analysis for de minimis changes was 0.0005% to 0.019%. At these levels it would require over 50 times the NOX emissions authorized in 2016 to approach 1% of the statewide emissions and over 300 times the emissions for the other pollutants.

The state did not rely solely on the emissions inventory analysis to demonstrate NAAQS compliance. This emissions inventory analysis was coupled with additional analyses specifically looking at ambient concentrations (monitoring trends analysis) and potential ambient impacts (modeling analysis) that were completed by ADEQ as part of the 110(l) demonstration. The results from the modeling analysis indicate that while the addition of the exempt emissions did result in slight increases in the model predicted impacts, it did not violate the NAAQS. As such, the modeling analysis portion of the 110(l) demonstration shows that revised minor NSR program will continue to ensure NAAQS protection.

EPA's intent at the time of promulgation of the 2002 revisions to the major source NSR rules is not relevant here. What is relevant here is the approvability of these revisions in the context of the current regulatory framework as promulgated. The commenter has not cited any ambiguous regulatory language in order to justify an examination of EPA's intent. In the absence of any ambiguity in regulatory language it is not necessary to address EPA's intent here as there is no dispute regarding interpretation on the applicable rules.

Comment: The commenter stated that EPA has previously required minor NSR programs to use much smaller emission thresholds than the major modification significant impact levels and gave the example of the Montana minor NSR program includes a de minimis increase exemption threshold of 5 TPY, which was approved by EPA, after a 15 TPY threshold that was initially set by Montana was not approved by EPA into the SIP.

Response: In the case of Montana, which was referenced by the commenter, the state did not provide an adequate demonstration to support the approval of the 15 TPY exemption threshold that was initially established by the state into the SIP. The state later revised the threshold to 5 TPY and submitted this threshold for SIP approval along with an analysis to show that the 5 TPY exemption would not interfere with NAAQS attainment or maintenance or violate the control strategy. Based on the revised submittal and supporting information, EPA approved the lower threshold of 5 TPY into the Montana SIP. Our proposed approval of the de minimis change levels in Arkansas does not contradict the previous Montana approval. In fact, our proposed approval mirrors the Montana SIP approval in that we requested analyses from Arkansas as part of the 110(l) demonstration for the revised de minimis change levels and our approval is based on those analyses as documented in the proposed rulemaking. Specifically, we found that Arkansas' documentation adequately demonstrates that these revised thresholds will not interfere with NAAQS compliance. Our approval of one de minimis exemption threshold level in one state does not preclude the approval of a different threshold in another state. Each state's universe of minor NSR sources, meteorology, and ambient air quality conditions are unique and influence the types of exemptions that would not interfere with the minor NSR program's ability to meet the applicable federal requirements.

Comment: The commenter stated that the de minimis change rule contradicts with how applicability is determined under PSD permitting requirements and thus fails to ensure projects that should be required to obtain a PSD permit will not be instead considered a de minimis change under Reg. 19.407(C). They also state that EPA must disapprove the current submittal and require Arkansas to revise its de minimis rule and relevant definitions rule to clearly state that changes that are considered major modifications under the PSD permitting regulations cannot be considered as de minimis changes. Without such language clearly stated, the Arkansas minor NSR program could allow sources that would otherwise be subject to PSD permitting to improperly avoid major source PSD permitting requirements for a major modification. The commenter also states that EPA must disapprove the version of Reg. 19.407(C) currently approved into the SIP which EPA has reopened with this action to the extent the provisions could interfere with compliance with the PSD permitting regulations.

Response: We agree with the commenter that changes that are considered major modifications under the PSD permitting regulations cannot be considered as de minimis changes. However, the commenter is incorrect that the revisions to the de minimis change provisions will interfere with proper implementation of the PSD permitting requirements. As previously stated in our responses, the de minimis change rules contained in Chapter 4 of Reg. 19 cannot be used for any changes at PSD sources/modifications. Therefore, our proposed approval of revisions to Chapter 4, including the de minimis change rule, will not impact PSD permitting implementation. Changes that are considered major would be subject to permitting under Reg. 26 is incorporated by reference in Chapter 11, which utilizes an actual-to-projected actual test for modifications to existing units and an actual-to-potential test for new units, are not exempted from the requirements of Chapter 11 by the provisions we are approving in this rulemaking. As noted in Section IV of the TSD, we are not taking action on any portion of Chapter 11 and the requirements of that chapter, which mainly incorporate by reference the requirements of the federal PSD program at 40 CFR 52.21, remain in effect.

Regarding the commenter's statement that EPA should take action to disapprove Reg. 19.407(C) as it is currently approved into the SIP, aside from the revisions to 407(C)(2)(a) and 407(C)(2)(b) which are clearly annotated in Section IV of the TSD, the other portions of Reg. 19.407 are not being revised by our current rulemaking.6 Therefore, the other SIP-approved portions of Reg. 19.407 will remain unchanged by our rulemaking. As previously stated in our responses, any comment on provisions that are not being revised as part of our rulemaking is irrelevant to this action. Further, our current rulemaking does not reopen the current SIP-approved and unchanged provisions for any action, including disapproval.

Comment: The commenter stated that because the minor NSR revisions could allow for increased deterioration in air quality over PSD baseline concentration the EPA cannot approve such a SIP revision without a demonstration that it will not cause or contribute to a violation of the applicable PSD increment. The commenter listed the following as chances for increased deterioration resulting from the SIP revision: (1) The minor NSR SIP revisions submitted by ADEQ allow for an increase in allowable emission rates to occur under the de minimis provisions of Reg. 19.407(C)(7); (2) Reg. 19.417 allows sources currently holding permits pursuant to Reg. 19 but whose emissions are below the permitting thresholds to submit a registration request under Reg. 18.315, which is a state-only rule and not part of the SIP, and request that their permit containing federally enforceable requirements be terminated; and (3) to the extent ADEQ ensures compliance with the PSD increment as part of its minor NSR program, the relaxation in the sizes of sources and modifications subject to minor NSR permitting also could allow increased deterioration of air quality above baseline concentration. The commenter also stated that the modeling analysis provided by ADEQ to support approval of the minor NSR relaxations included violations of the Class I and Class II PM10 increments that were predicted due to the increased emissions thresholds that would exempt from minor NSR review under the proposed SIP revision, which indicates that an unpermitted source pursuant to the expanded exemptions from Arkansas' minor NSR could cause an exceedance of the PM10 increment. The commenter also stated that pursuant to CAA section 110(l) and 40 CFR 51.166(a)(2), EPA cannot approve a SIP submittal which admittedly allows a violation of the PSD increments.

Response: We agree with the commenter that the revisions to the Arkansas minor NSR program do allow larger increases in allowable emissions to be authorized via the de minimis change rule by increasing the de minimis change thresholds. We also agree that the revisions allow currently permitted sources with emissions that fall between the old minor NSR permitting thresholds and the revised permitting thresholds to submit a registration under Reg. 18.315 and request that their Reg. 19 permit be terminated. However, the applicable legal test for determining approvability of these revisions, which revise the minor NSR program so that it becomes less stringent, is the requirement of CAA section 110(l), EPA cannot approve a revision to the SIP if it interferes with applicable requirements of the Act. The PSD increment requirement found at 40 CFR 51.166(a)(2) is inapplicable here because it is required to be met by a major source/major modification application, not a minor NSR permitting application. The major source/major modification application must show that the PSD increment is not violated and the applicant's modeling must include the emissions from all of the nearby minor sources, as well as any other nearby major sources. If the major source/major modification modeling shows the PSD increment will be violated by the proposed construction/modification, then the major source/major modification must reduce its requested emissions or obtain reductions from the other sources impacting the increment. Because the burden of not violating the PSD increment is placed on the source subject to PSD, the PSD increment requirement does not apply to a minor NSR permitting SIP. As stated previously in our responses to the commenter, the PSD increment requirements are contained in the PSD rules under 40 CFR 51.166 and apply only to sources subject to PSD. They do not apply to minor sources. Therefore, an increment analysis would only be required to be completed as part of a PSD permitting action (Reg. 19, Chapter 9) and would be a separate analysis than that completed as part of the NAAQS demonstration. Further, the air quality modeling that was conducted by Arkansas was conducted for NAAQS compliance demonstration purposes as part of the 110(l) non-interference demonstration. (See the March 24, 2017 SIP Revision Submittal, Appendix D—Air Quality Modeling Analysis of Minor Source Permit Thresholds.) Because the PSD increment analysis and NAAQS analysis serve separate and distinct purposes, these analyses use different modeling approaches and often different model inputs. Therefore, a modeling demonstration conducted for NAAQS compliance cannot be relied upon to make a modeled PSD increment analysis determination, such as if a PSD increment violation exists. Therefore, we do not agree with the commenter that the NAAQS modeling indicates that the proposed SIP revision allows a violation of the PSD increments. We also do not agree that the modeled PM10 impacts exceed the referenced increments because the state's modeling analysis did not include a PSD increment analysis for comparison with the PSD increments to determine if a predicted exceedance occurred. In addition, we reiterate that a PSD increment analysis is not necessary as part of a 110(l) analysis to support revisions to a minor NSR permitting program, since the federal PSD increment analysis requirement at 40 CFR 51.166(a)(2) is not applicable to minor NSR programs.

Comment: The commenter stated that a comparison of emissions that could be exempt from the relaxed minor NSR with total statewide emissions across the state of more than 53,000 square miles does not give any indication of whether the exempted emissions would interfere with attainment or maintenance of the NAAQS or increments. As such, the commenter stated that the emissions comparison analysis does not provide information relevant to whether the relaxations to Arkansas' minor NSR program will interfere with attainment or maintenance of the NAAQS or any other CAA requirement.

Response: We do not agree with the commenter that the emissions inventory analysis for the emissions exempt from minor NSR permitting based on the revised permitting thresholds does not provide information that is relevant to the 110(l) analysis. This analysis serves to determine the scope, or portion of emissions that would not undergo minor NSR permitting requirements relative to the statewide emissions. The approach to determine the scope is independent of the physical size of the state since the emissions inventory analysis was conducted to compare exempt emissions with the statewide emissions inventory. As detailed in our proposed rulemaking the scope of emissions anticipated to be exempt from minor NSR permitting by the revised permitting thresholds was minimal. The pollutant-based emissions inventory analysis showed that the scope of emissions exempt from permitting based on the revised permitting thresholds ranged from 0.006% to 0.125% of the total statewide emissions. This analysis clearly demonstrates that the magnitude of emissions that would be exempt from minor NSR permitting program makes up an extremely small portion of the statewide emissions. The state did not rely solely on the emissions inventory analysis to demonstrate NAAQS compliance. This emissions inventory analysis was coupled with additional analyses specifically looking at ambient concentrations (monitoring trends analysis) and potential ambient impacts (modeling analysis) that were completed by ADEQ as part of the 110(l) demonstration. The modeling trends analysis looked specifically at the current status of ambient air quality and the trends in ambient concentrations since the 2008 state adoption and on-going implementation of the revised minor NSR permitting thresholds. The modeling analysis examined the potential impacts of the exempt emissions on ambient air quality via local and regional air quality modeling. (See the March 24, 2017 SIP Revisions Submittal Appendix C—2010 Minor NSR Permitting Thresholds and De Minimis Levels SIP Technical Support Document and Appendix D—Air Quality Modeling Analysis of Minor Source Permitting Thresholds. Monitoring analysis is discussed on pages 3-17 of Appendix C. Modeling analysis is discussed on pages 17-25 of Appendix C and pages 1-35 of Appendix D.) Regarding interference with increments, we previously responded regarding the non-applicability of PSD increment requirements to the 110(l) analysis completed for this rulemaking.

Comment: The commenter stated that ADEQ's emissions analysis was incomplete because it analyzed sources with allowable emissions less than the emission thresholds of Reg. 19.401 when the exemptions for new sources are not based on “allowable emissions,” but instead are based on “actual emissions.” The commenter also claimed the analysis was incomplete because it does not project total emissions that might be exempt from minor NSR in the future and instead reflects on sources that may request permits to be revoked because they are no longer subject to minor NSR permitting requirements found in Reg. 19, Chapter 4.

Response: We do not agree with the commenter that the emissions inventory analysis conducted for the permitting thresholds exemptions was incomplete. In their analysis, ADEQ compiled a complete list of all currently permitted minor NSR sources and determined which currently permitted sources would not be required to obtain a permit based on the revised permitting thresholds. It is important to note that this analysis included the review of all currently permitted facilities in the minor NSR program which spanned the entirety of the program—meaning all active minor NSR permits that had been issued by ADEQ. EPA originally SIP-approved the Arkansas construction permitting requirements in October 1976 (effective November 1976).7 This means that ADEQ looked at all minor NSR permits that had ever been issued and were still active. To determine the percentage of emissions exempt from permitting, the permitted emission rates were totaled for each pollutant and compared with the total emissions from the statewide emissions inventory. The state's analysis based on the permitted allowable emissions is more conservative than the use of actual emissions for those permitted sources since they represent the maximum permit allowable emissions for the particular source. In most cases, the actual emissions would be less than the allowable emissions because of actual operations at less than maximum levels during a given calendar year and because of non-operational periods that may have taken place. If the state had further refined their analysis to determine the historical actual emissions emitted by the currently permitted sources which would not be required to be permitted under the new thresholds and compared the total actual emissions with the total statewide emissions inventory, the actual emissions would be expected to make up an even smaller fraction of the total statewide emissions.

As stated above, Arkansas conducted the emissions review as a part of the 110(l) demonstration to determine the scope of emissions that were previously subject to minor NSR permitting that would be exempt from permitting under the revised thresholds. As stated above, Arkansas reviewed their entire minor NSR permitting universe, which included all active permits that had historically been issued by ADEQ, to determine the currently permitted emissions that would be exempt from minor NSR permitting under the revised permitting thresholds.8 They found that the magnitude of currently permitted emissions that would be exempt from minor NSR permitting was a fraction of a percent of the total emissions in the statewide emissions inventory. (The range of calculated percentages by pollutant was 0.006% to 0.125%.) While emissions will be exempt in the future, the emissions inventory analysis shows the percentage of statewide emissions that were exempt from permitting for the entire minor NSR program based on the revised permitting thresholds indicates that the magnitude of emissions exempt from minor NSR permitting in the future will continue to make up a small fraction of the total statewide emissions. In addition, the state's regulations require that a source exempt from minor NSR permitting based on the new revised permitting thresholds but with emissions greater than the previous thresholds obtain a registration in accordance with Reg. 18.315, which allows ADEQ to keep track of the sources exempt as a result of the new thresholds. In addition to the emissions inventory analysis, Arkansas provided additional analyses, both monitoring and modeling, to further show the limited potential impacts of the revised minor NSR permitting thresholds. The monitoring analysis examined statewide ambient air quality data since the adoption of the revised minor NSR permitting thresholds in 2008 for CO, NOX, SO2, VOC, and PM10, including the examination of trends in design values (DVs). Since adoption of the revised thresholds, the DVs remain unchanged or show downward thresholds since the 2008 adoption of revised thresholds.9 The modeling analysis included regional-scale photochemical and local-scale air dispersion modeling to examine the potential impacts from emissions exempt from minor NSR permitting based on the revised thresholds. (See the March 24, 2017 SIP Revision Submittal, Appendix D—Air Quality Modeling Analysis of Minor Source Permit Thresholds.) As expected, both the regional and local modeling indicated some increases in model predicted concentration as a result of adding the exempt emissions into the modeled emissions inventory. However, for all pollutants and averaging period, the resulting ambient concentrations were less than the corresponding NAAQS. As stated in our proposed rulemaking, we find that the analyses submitted by Arkansas as part of the 110(l) demonstration show that the revised thresholds will not interfere with attainment or maintenance of the NAAQS.10

Comment: The commenter stated that the emissions inventory analysis of the de minimis increases allowed (based on the 2016 de minimis approvals) is not persuasive because, the increased de minimis thresholds have not yet been approved as part of the SIP, and thus it is not reasonable to assume that all sources that might take advantage of this rule did take advantage of this rule in 2016. The commenter also states that because the revised minor NSR permitting thresholds and de minimis levels have not been approved as part of the SIP, the state cannot infer anything in the monitoring trends analysis regarding the impacts of the revised minor NSR rules on air pollutant concentrations from reviewing past monitoring data and trends since it is likely that sources would be unwilling to rely on the revised values prior to SIP approval.

Response: We do agree with the commenter's claims that the SIP approval status of the revised minor NSR permitting thresholds and de minimis change levels impacts the validity or persuasiveness of the data included in the emissions inventory and monitoring trends analyses. While the revised de minimis change rule provisions are not approved into the current Arkansas SIP, they are adopted by the state into the state regulations and thereby state law. The CAA requires states to adopt, after reasonable notice and public hearings, revised regulations for submission to EPA as SIP revisions. (See CAA 110(a)(1)). Since adoption of the revised permitting thresholds and de minimis change levels into their states regulations, Arkansas has been implementing those revised levels through the issuance of Reg. 18 registrations and de minimis change approvals. Lookback information regarding the historical de minimis change approvals was specifically cited in the emissions inventory analysis portion of the 110(l) demonstration. The calendar year (CY2016) de minimis change approvals included approval issued based on the revised thresholds that were adopted as state law December 2008 (effective January 2009). ADEQ has subsequently provided more information regarding the number of Reg. 18 registrations (issued to those sources exempt from minor NSR permitting with emissions that fall within the old and revised permitting thresholds) submitted and de minimis change approvals issued since the adoption of the revised regulations. This additional lookback information clearly indicates that sources have been utilizing the revised thresholds—75 registrations have been submitted since the permitting thresholds were revised and 476 de minimis change actions have taken place since 2010.11 Because state law requires that if a source used either the minor NSR permitting thresholds or de minimis changes levels to avoid minor NSR permitting the source must submit the required registration (in accordance with Reg. 19.417 and Reg. 18.315) or obtain the required approval (in accordance with Reg. 19.407(C)(6)), a source not accounted for in the lookback information provided by ADEQ would have been, and still is, in violation of state law. Furthermore, ADEQ has indicated that since the adoption of the revised minor NSR permitting thresholds and de minimis change levels, they are not aware of any instance where a source has been unwilling to utilize the revised thresholds because of the status of the revisions with respect to the SIP.12 Based on the historical information provided, we find that the data included in the emissions inventory and monitoring trends analyses is valid and reflects the reality and do not agree with the commenter that nothing can be inferred from those analyses regarding the impacts of the revised minor NSR permitting thresholds and de minimis levels. Following adoption of the revised permitting thresholds and de minimis change levels in 2008, Arkansas began implementing the revised provisions (at the owner or operator's own risk of federal enforcement) to exempt qualifying sources from minor NSR permitting requirements. The persuasiveness of data used in the monitoring trends analysis is not dependent on the SIP approval status.

Comment: The commenter stated that the de minimis exemption is based on a comparison of allowable emissions increases, thus it could allow larger increases in actual emissions than the tpy emissions thresholds in Reg. 19.407(C). Thus, the commenter states that any analysis, including the emissions inventory analysis, presented by ADEQ about the thresholds is not sufficient to ensure that the actual emissions increases allowed by the de minimis exemption will not threaten NAAQS attainment or maintenance or otherwise interfere with the control strategy. Similarly, the commenter also stated that the photochemical modeling also did not model the true increase in emissions that could be allowed—the actual emissions increases resulting from a de minimis change could be significantly higher than the de minimis levels and the actual emissions from a new source could exceed projected actuals that were used as a basis to exempt the source from permitting.

Response: We do not agree with the commenter that the emissions inventory analysis and modeling analysis provided by ADEQ is not sufficient to support the proposed revisions to the de minimis change levels. Also, we do not agree with the commenters that the analysis provided by Arkansas did not model the true increase in emissions that could be allowed under Arkansas' relaxed minor NSR program (i.e., those emissions exempt from minor NSR permitting requirements based on the revised permitting thresholds and de minimis change levels) under the revised minor NSR program. As stated in our proposed rulemaking, the de minimis change levels listed in Reg. 19.407(C)(2)(a) are the maximum increases in permitted emission rates that can be exempt from minor NSR permitting requirements via the de minimis change rule. As such, to demonstrate that the proposed SIP revision resulting in revised de minimis change levels will not interfere with NAAQS compliance, it is reasonable that the 110(l) demonstration should evaluate the projected impacts resulting from the maximum emission increases allowed by the revised rule (i.e., the de minimis change levels). As documented in the modeling report submitted as part of the March 24, 2017 SIP revision submittal, Arkansas did follow this approach in their 110(l) demonstration and evaluated the impacts resulting from emission rates equal to the de minimis change levels. (See the March 24, 2017 SIP Revision Submittal, Appendix D—Air Quality Modeling Analysis of Minor Source Permit Thresholds.) When a source seeks authorization for a proposed change at a facility via the de minimis change provision, they are requesting authorization specifically for the increase in the permitting emission rates. The previously permitted emission rates underwent a previous minor NSR permitting review and were demonstrated to be in compliance with the NAAQS. Evaluation of emissions accounted for in the pre-de minimis change permitted emission rates, which were previously authorized and evaluated for NAAQS compliance under an existing permit, are beyond the scope of the 110(l) analysis for the revised de minimis change levels. Therefore, a NAAQS demonstration associated with the potential impacts from a de minimis change should be based on the magnitude of increases in the permitted emission rates, which are being authorized via the de minimis change rule. With respect to the photochemical modeling, the purpose of the modeling analysis submitted by Arkansas was to demonstrate that those emissions exempt from permitting based on the revised thresholds would not cause a NAAQS violation.

In the case of a new source that has actual emissions in excess of the minor NSR permitting thresholds without an issued permit authorizing those emissions, the source would be in violation of the minor NSR permitting requirements contained in Reg. 19, Chapter 4, and they could be subject to an enforcement action. For example, if a source was initially constructed as a seasonal source with emission below the de minimis levels, it is exempt from permitting. However, if the source's actual emissions rise above those levels without first obtaining a permit, it would be in violation of minor NSR. It is reasonable (for the purposes of demonstrating compliance with 110(l)) to assume a new source would be required to obtain a permit to authorize the emissions and demonstrate they will not cause or contribute to a violation of a NAAQS if they have actual emissions above the minor NSR permitting thresholds. Therefore, the scenarios involving potentially violating sources are not a reasonable scenario to be included in an analysis conducted to support the minor NSR permitting thresholds.

In the case of a de minimis change, the emissions exempt from minor NSR permitting by the de minimis change rule are the increases in the permitted emission rates. For the de minimis revisions to be approvable the analysis should demonstrate that the increases in the permitted emissions will not cause a NAAQS violation. By modeling the minor NSR permitting thresholds and de minimis change levels for each pollutant, Arkansas did evaluate the prospective impacts associated with the emission levels that could qualify for exemption from minor NSR permitting requirements under the revised rule.

Comment: The commenter stated that the analysis of the de minimis increases allowed (based on the 2016 de minimis approvals) is not persuasive because 2016 only reflects one year of implementation and this rule will be in effect for the foreseeable future.

Response: We do not agree with the commenter that the emissions inventory analysis for the de minimis changes is not persuasive because it is limited to 2016. CY2016 provides a portion of time when the revised thresholds were being relied upon by owners and operators in Arkansas. The review of emissions associated with de minimis changes limited to CY2016 found that the 2016 emissions inventory analysis shows the percentage of statewide emissions exempt by the de minimis change levels in the range of 0.0005 to 0.019%. While the analysis was limited to one calendar year, as discussed in our proposal, at these percentage levels it would require over 50 times the NOX emissions authorized in 2016 to approach 1% of the statewide emissions and over 300 times the emissions for the other pollutants. In addition, this analysis conservatively did not account for any emissions decreases occurring as part of the approved de minimis changes. In addition, the analysis for 2016 was conservative in that it did not account for emissions decreases that did occur as part of the de minimis changes. We believe that additional analysis beyond one calendar year is unnecessary because the CY2016 data, that did not account for any associated emissions decreases, shows that exempt emissions makes up such a small fraction (much less than 1% for all pollutants) of the total statewide emissions.

Comment: The commenter restates that a comparison of emissions that could be exempt from minor NSR permitting based on the revised de minimis change levels with total statewide emissions does not give any indication of whether the exempt emissions would interfere with attainment or maintenance of the NAAQS because of the various factors (such as: Stack parameters, operational stages, topography, and meteorology) that dictate ambient impacts. Because of the variability of these factors between sources, the commenter stated that the fact that two sources have similar annual emissions is not a rational basis to claim that they have similar ambient impacts.

Response: We do agree with the commenter that a variety of factors may dictate ambient impacts, and that reliance on the state's emissions inventory analysis does not demonstrate non-interference with the NAAQS. Instead, the emissions inventory analysis serves to determine the scope, or portion, of emissions that would not undergo minor NSR permitting based on the revised thresholds. However, the state did not only rely upon the emissions inventory analysis to demonstrate NAAQS compliance. The state addressed ambient concentrations and potential ambient impacts by looking specifically at the current status of ambient air quality, the historical ambient air quality trends since adoption in 2008 and the on-going implementation of the revised de minimis levels, and the potential impacts of the exempt emissions on ambient air quality via local dispersion (AERMOD) and regional photochemical (CMAQ) air quality modeling. As previously discussed in our responses, the monitoring analysis shows that since the adoption and implementation of the revised permitting thresholds and de minimis change levels the overall trends in DVs are either unchanged or decreasing. Meanwhile, the local and regional modeling analyses show that model predicted concentrations resulting from the addition of the emissions exempt from permitting remain less than the NAAQS. (See the March 24, 2017 SIP Revision Submittal, Appendix D—Air Quality Modeling Analysis of Minor Source Permit Thresholds.) While the emissions inventory analysis served to determine the scope, or portion of emissions that would not undergo minor NSR permitting requirements based on the revised de minimis change levels relative to the statewide emissions, the monitoring and modeling analyses completed as part of the 110(l) analysis accounted for the various factors cited by the commenter in evaluating the impacts of the revised de minimis levels. Specifically, the results from the air quality modeling analyses were impacted by the following factors, which are included as air quality model inputs: Emissions, stack parameters, topography and meteorology.

Comment: The commenter stated that there are numerous other factors that came into play during the same timeframe that could cause pollutant concentrations to decrease in the timeframe right after the December 2008 adoption of the minor NSR rule relaxations, including: The Great Recession began in 2007 and continued through 2009; natural gas prices dropped significantly and renewable sources of power generation became more competitive, reducing demand for coal-fired power plants which was replaced by gas turbines and renewables; various vehicle emission and liquid fuel standards came into effect; and less fuel efficient vehicles were replaced with more fuel efficient vehicles. The commenter stated that these factors make it very difficult for ADEQ to infer anything regarding the relaxations to its minor NSR program through the review of how air monitoring design values have changed over time.

Response: We agree that the monitoring data reflects not only the impacts of the revised thresholds and de minimis levels, but other factors such as those cited by the commenter as well. However, the monitoring analysis does show that since Arkansas' adoption in 2008 and ongoing implementation of the revised values, the monitored ambient concentration data shows no NAAQS issues along with overall decreasing trends in DVs for some pollutants indicative of improved air quality since 2008. The monitoring analysis submitted by Arkansas spanned eight years of ambient data (2007-2014, which includes and extends beyond the time period referenced as “the Great Recession” by the commenter). The 8-year period covered in the ambient monitoring study is a reasonable and representative period of time to examine the impacts of the revised thresholds while also accounting for the variability in the other factors that may contribute to ambient concentrations. Further, we would like to point out that a NAAQS demonstration, including demonstrations of non-interference with attainment or maintenance of the NAAQS under section 110(l), should reflect ambient air quality as a whole, which would take into account the impacts on ambient concentrations resulting from the revised minor NSR regulations, as well as, the other factors mentioned by the commenter. As shown in the referenced monitoring analysis, the resulting ambient concentrations including the impacts from the minor NSR program revisions do not indicate NAAQS compliance issues. As stated in our proposal, the monitoring trends analysis is one part of the demonstration provided by Arkansas that supports the finding that the revised permitting thresholds and de minimis levels will not adversely impact NAAQS attainment or maintenance. In addition to the monitoring analysis, the modeling analysis is an important element of the NAAQS compliance demonstration and as discussed in our proposed rulemaking and previous responses, the modeling results indicate that the addition of the emissions exempt from minor NSR permitting requirements will not interfere with NAAQS compliance. (See the March 24, 2017 SIP Revision Submittal, Appendix D—Air Quality Modeling Analysis of Minor Source Permit Thresholds.)

Comment: The commenter stated that because the state does not have a monitoring network that covers all pollutants and all areas of the state where industrial sources are constructing and operating, a review of the monitoring data from Arkansas monitors provides an incomplete picture of the NAAQS attainment status around the state.

Response: We do not agree that Arkansas' submittal provided an incomplete picture of NAAQS attainment around the state. The ambient monitoring analysis was one part of the demonstration provided by the state to meet the 110(l) requirement. The monitoring trends analysis discussion included in Appendix C of the March 24, 2017 SIP revision submittal includes a figure showing the Arkansas Ambient Air Monitoring Network. This network includes ambient monitoring for the NAAQS 13 at monitoring sites located throughout the state in accordance with federal requirements.14 The State of Arkansas' ambient air monitoring network is reviewed each year to ensure the air quality surveillance system continues to meet applicable requirements. The most recent review of the ambient air monitoring network for Arkansas, the 2017 Annual Monitoring Network Plan, was reviewed and approved by EPA on October 3, 2017, as meeting the requirements of 40 CFR and its appendices. The analysis of the available monitoring data does provide valuable information about the current ambient air quality in the state, and the historical trends analysis of the data shows that since the adoption in 2008 and the ongoing implementation of the revised exemption thresholds, ambient air quality has not been adversely impacted. In fact, as discussed in our proposed rulemaking, for several pollutants the ambient air quality has shown continued improvements since the state adoption and implementation of the revised thresholds. This information was supplemented by the additional analyses conducted by Arkansas, one of which specifically addresses the comment regarding the completeness of the picture of attainment status around the state. As discussed in our proposed rulemaking, Arkansas completed a modeling analysis to determine the potential impacts from sources exempt from permitting based on the revised minor NSR permitting thresholds and de minimis change levels, which included statewide modeling. (See the March 24, 2017 SIP Revision Submittal, Appendix D—Air Quality Modeling Analysis of Minor Source Permit Thresholds.) Arkansas conducted photochemical modeling to support the revised thresholds based on a previous statewide modeling effort conducted for the 2008 base year and the 2008/2015 future year scenarios. For the minor NSR thresholds analysis, the future year (2015) emissions inventory was modified to include eight hypothetical point sources that were distributed throughout the state's Air Quality Control Regions. The emission rates for each of the hypothetical sources were set equal to the revised minor NSR permitting thresholds and de minimis levels. The statewide maximum impacts for each day resulting from the hypothetical sources was added to the unmodified future year concentration for each day and grid cell. The resulting concentrations represented the maximum ambient concentrations including impacts from the threshold emission increases at any location located throughout Arkansas. While the results from the photochemical modeling showed that while the addition of the hypothetical source emissions may increase the predicted concentrations within most grid cells, the calculated FDVs were still less than each of the NAAQS at each monitoring site. (See the March 24, 2017 SIP Revision Submittal, Appendix D—Air Quality Modeling Analysis of Minor Source Permit Thresholds.)

Comment: The commenter stated that it is not appropriate to rely on a modeling assessment intended to estimate future pollutant concentrations out to 2015 to assess whether Arkansas' relaxed minor NSR program will interfere with attainment or maintenance of the NAAQS. The commenter based their statement on the possibility that some of the rules that were relied on for the 2015 emission inventories could go away, the possibility of an economic boom in the state, the possibility of growth in a certain type of industry, or a combination of these events, which in turn could result in the approval of this SIP relaxation interfering with attainment or maintenance of the NAAQS in the future despite the CMAQ (photochemical) modeling predictions for 2015.

Response: We do not agree with the commenter that the use of the future year (FY) modeling for 2015 is not appropriate.15 Arkansas submitted several analyses as part of the 110(l) demonstration, with the modeling assessment being one part of the demonstration submitted to support the proposed revisions to the Arkansas SIP. As such, our determination regarding the approvability of the SIP revisions relied on the combined demonstration and not just one element. Regarding the use of the future year modeling, Arkansas used this modeling in combination with the baseline modeling to determine RRFs both with and without the hypothetical exempt sources to calculate FDVs) 16 17 18 These FDVs were used to compare and contrast those DVs and determine the potential impacts of the exempt sources. This approach allowed for a quantitative comparison to determine what potential impacts would be expected from the additional emissions associated with sources and/or de minimis changes that would be exempt from minor NSR permitting requirements based on the revised thresholds. The quantitative comparison provided information regarding relative difference in impacts both with and without the newly exempt emissions compared with the NAAQS. When conducting future year modeling, informed assumptions must be made and some of these assumptions may differ from the actual real world conditions present when the future year becomes the present.19 However, it is important to note that the future year modeling approach was conducted in order to quantify the relative change in ambient concentrations resulting from the added potential impacts from the newly exempt sources using RRFs. Specifically, this analysis results in the calculation of FDVs both with and without the hypothetical source emissions and the difference between the FDVs represents the modeled predicted impacts from those emissions on ambient concentrations. The results of this quantitative comparison of ambient impacts with and without the newly exempt sources are not expected to deviate significantly, even with actual real world conditions potentially being different than the assumed modeled conditions, since the analysis focused on the relative impacts of the addition of the hypothetical source emissions. We believe that the future year modeling approach used by Arkansas that focused on the quantitative difference in the relative ambient impacts with and without the hypothetical sources is reasonable and informative for a 110(l) demonstration in that it specifically evaluated the impacts from newly exempt emissions based on revised minor NSR permitting thresholds and de minimis levels. The concerns raised by the commenter regarding the state's ability to predict the exact conditions of a future year do not change our determination that this approach is reasonable. In fact, the inclusion of informed assumptions in a future year modeling analysis is not only reasonable, but also necessary, since neither we nor Arkansas can know with any certainty what emissions and/or sources may change in the future. The inclusion of informed assumptions in the modeling analysis provides a reasonable estimate of future levels, given the inability to foresee the future. If ADEQ modified or removed any SIP-approved regulations (as relied upon to make these assumptions) and relax the SIP and render them substantially inadequate to attain or maintain the relevant NAAQ's standard, EPA has the authority to publish a SIP call Federal Register notice requiring the state to adopt and submit a 110(l) justification for the relaxation. Regarding the commenter's concern with potential boom in industrial growth, those sources seeking a construction permit, such as a PSD permit, would have to demonstrate NAAQS compliance as part of their permit application modeling. As such, we find that the state's analysis based on future year photochemical modeling, along with the additional modeling, monitoring, and emissions inventory analyses, demonstrate that the revised thresholds are not expected to adversely impact the state's ability to attain and maintain the NAAQS.

Comment: The commenter stated that photochemical modeling submitted by Arkansas in support of the SIP revisions does not give a rational picture of the effect the SIP relaxations could have on air quality in Arkansas. The commenter stated that first, there could clearly be more than 8 sources, which was the number of sources included in the photochemical modeling, exempt from permitting under the revised minor NSR rules. The commenter also stated that the photochemical modeling did not model the worst case conditions such as terrain, stack height, stack temperature and velocity.

Response: While we agree with the commenters that the potential number of exemptions resulting from the revised rule may not be limited to 8 sources, we do not agree with their assessment that the modeling analysis was limited to the impacts from only those 8 sources. Arkansas submitted statewide modeling that accounted for cumulative impacts from the 8 hypothetical sources along with the emissions contained in the statewide emissions inventory. (See the March 24, 2017 SIP Revision Submittal, Appendix D—Air Quality Modeling Analysis of Minor Source Permit Thresholds.) The 8 modeled sources were distributed throughout the state's Air Quality Control Regions. The modeling results showed the impacts of the addition of these eight hypothetical sources to the predicted ambient concentrations. In addition, the modeling extrapolated for the maximum modeled impacts from the hypothetical sources applied at each modeled grid cell throughout the state. In addition to examining the modeled impacts from these 8 hypothetical sources in their chosen locations in the Air Quality Control Regions, the modeling analysis conducted by Arkansas also looked at the impacts of sources with emissions equal to the revised thresholds throughout the state. This analysis was accomplished by determining the statewide maximum modeled impacts in the photochemical modeling for each day resulting from the hypothetical sources and adding those impacts to the unmodified future year concentration for each day and grid cell. This approach allowed the examination of the maximum predicted hypothetical source impacts combined at different geographic/topographic locations along with looking at those impacts combined with a variety of cumulative source inventory impacts throughout the state. It is impossible for the state to project each source that may be exempt under the revised rule and unreasonable to expect the inclusion of every potentially exempt source within an air quality modeling analysis. We determined that the approach used by Arkansas to include a number of hypothetical sources throughout the state and to examine the combined impacts of these sources with background emissions sources at each modeled grid cell in Arkansas provides information and a rational picture regarding the potential impacts of newly exempt emissions throughout the state. By modeling these 8 hypothetical sources with emission rates equal to the revised thresholds, the state's approach provided for the examination of the actual model predicted impacts at locations within each Air Quality Control Region from the maximum level of emissions that could be exempt from permitting for a source based on the revised minor NSR permitting thresholds and de minimis change levels. As a second step, the approach to apply the daily maximum modeled impacts from the hypothetical sources to each grid cell for each day in the modeled period provided for the examination of the impacts of the exempt emissions at each grid cell throughout the state. In the case of the minor NSR program revisions proposed by Arkansas, the state developed a 110(l) demonstration comprised of air quality modeling, as well as an emissions inventory analysis and a monitoring trends analysis. As stated in our proposed rulemaking, we found in combination that the modeling analysis along with the other analyses submitted by the state demonstrated that the proposed revisions would not interfere with NAAQS attainment or maintenance. Based on our review, we find the analysis conducted and the methods used to be appropriate and sufficient to support the proposed SIP revisions, especially for exemptions from minor NSR permitting requirements that are expected to make up fractional percentages (<1% for all pollutants) of the total emissions in the statewide emissions inventory—as documented in the state supplied emissions inventory analysis.

Regarding the commenter's statement regarding the modeling of worst-case conditions, we do not agree with the commenter. The modeling of the worst case conditions such as terrain, stack height, stack temperature and velocity is inappropriate for assessing whether the relaxed applicability to Arkansas' minor NSR rule would violate the NAAQs. The hypothetical sources included in the 110(l) demonstration modeling were meant to represent the exempt emissions that could occur from a variety of sources and were being modeled to examine the potential impacts from exempt emissions as part of the demonstration of non-interference with attainment or maintenance of the NAAQS under CAA section 110(l). Arkansas determined representative values to be used as model inputs for the hypothetical sources by reviewing real world stack parameters available through their emissions inventory data. Based on their review, the state chose the average stack conditions from the emissions inventory data as the representative inputs for the modeled hypothetical sources. As stated in the modeling report included in the March 24, 2017 SIP revision submittal and in our proposed rulemaking, the state modeled the hypothetical sources with the maximum emissions exempt by the rule (i.e., emissions equal to the thresholds values), even though not all exempt sources would have those emissions levels.

The use of the worst case conditions (as referenced by the commenter) is typically applied in modeling for an existing source or a proposed source of known type/size and location as part of a case-by-case NSR modeling analysis, such as a modeling analysis completed as part of a PSD permit action. In the case of the modeling analysis conducted by Arkansas to support the proposed SIP revisions, the state was examining the potential impacts of emissions exempt from minor NSR permitting by adding hypothetical exempt sources to represent those added emissions in the modeled emissions inventory. The modeling conducted by Arkansas as part of the 110(l) demonstration modeling serves a different purpose, and therefore is inherently different than PSD permit modeling. PSD permit modeling is conducted as part of the source analysis PSD requirement (40 CFR 51.21(k)) to examine the impacts from the construction or major modification of a specific, known PSD source where model inputs are based on the actual design and operational parameters of the emission points located at the source. That said, we do not agree that the modeling analysis conducted by Arkansas did not take terrain into account. As discussed previously in this response, at least one of the modeled hypothetical sources was located in each of the AQCRs. This allowed the examination of model predicted impacts across the different geographic and topographic areas in the state, including those areas in NW Arkansas with more elevated/complex terrain (1 source located in AQCR 17 and 2 sources located in AQCR 21), which are expected to have higher impacts. As discussed in our evaluation of the photochemical modeling conducted by Arkansas, the model predicted impacts from the hypothetical sources did not indicate any model predicted violations of the NAAQS for any pollutant or averaging period. The photochemical modeling approach was one element of the 110(l) demonstration provided by the state to support the proposed SIP revisions. The approaches used by Arkansas in their modeling demonstration to determine the potential impacts from the newly exempt emissions were reasonable and appropriate for 110(l) analysis being conducted to demonstrate non-interference, especially considering the small amounts of emissions expected to be exempt from minor NSR permitting based on the revised rule relative to the current statewide emissions.

Comment: The commenter stated that the photochemical modeling gave no justification for where it located the sources within the state and it is not clear if the sources were located in areas where the source's plume could cause high concentrations due to nearby elevated terrain or in areas where there are other significant sources of air pollutants to determine the cumulative impacts.

Response: We do not agree with the commenter that no justification was provided for the location of the hypothetical sources within the photochemical modeling. Arkansas did state that they placed at least one source in each of their Air Quality Control Regions. They also stated that the sources were typically located in or near more urban areas of the state. A figure was included in the modeling report showing the location of the modeled sources relative to the populated areas in the state, which are also more likely to have larger “background” emissions within the modeled emissions inventory. (See the March 24, 2017 SIP Revision Submittal, Appendix C—2010 Minor NSR Permitting Thresholds and De Minimis Levels SIP Technical Support Document, Figure 19.) The chosen locations allowed for the examination of impacts throughout the various regions of the state, focused on the more populated areas. As stated in our previous response, two of the modeled hypothetical sources were included in the areas in NW Arkansas with more elevated/complex terrain (1 source located in AQCR 17 and 2 sources located in AQCR 21). Additionally, the modeling approach used by the state in their 110(l) demonstration included a separate analysis to specifically examine the model predicted concentrations at each grid cell throughput the state when the maximum modeled impacts from the hypothetical sources were applied. This approach allowed the examination of the maximum hypothetical source impacts combined at different geographic locations along with looking at those impacts combined with a variety of cumulative source inventory impacts throughout the state.

Comment: The commenter stated that the photochemical modeling did not attempt to take into account the cumulative impacts of exempt sources or modifications, and it did not include the possibility of multiple exempt sources locating nearby each other, nor did the modeling attempt to model more than one exemption at a single or multiple sources over time.

Response: As discussed previously in our responses, we do not agree that cumulative impacts analysis was not conducted as part of the state's modeling analysis. The photochemical modeling analysis combined the impacts from the hypothetical sources with the impacts of background emissions inventory sources via emissions inventory model inputs.20 Further, this cumulative impacts analysis was conducted in such a way as to examine the maximum modeled impacts from the hypothetical sources with the impacts from the background emissions inventory sources at each grid cell in the state. Regarding the cumulative impacts from multiple exempt sources potentially located nearby each other, the modeling report included in the March 24, 2017 SIP revision submittal stated that “since the modeled impacts occur within or nearby the source location, cumulative effects from multiple sources in multiple grid cells are expected to be small.” Based on the 110(l) demonstration provided by Arkansas, which included modeling that looked at cumulative impacts from hypothetical exempt sources and the background emissions sources inventory, we do not find the revised thresholds to adversely impact the NAAQS.

Comment: The commenter stated that there is no indication that the modeling took into account variability of emission rates over time to account for the very likely possibility that an exempt source could emit at higher rates over shorter periods of time rather than emitting at a consistent level.

Response: It is unreasonable to expect the type of modeling conducted by Arkansas to examine the potential impacts of a small subset of minor sources that make up much less than 1% of the total emissions in the statewide emissions inventory (less than or equal to 0.125% of the statewide emissions for minor NSR permitting thresholds; less than or equal to 0.019% of the statewide emissions for de minimis change levels) to include variable emissions modeling. The evaluation of impacts from variable emission rates is typically associated with modeling an existing source or a proposed source of known type/size and operation as part of a case-by-case NSR modeling analysis (such as the modeling conducted for PSD permitting). As stated in our previous responses, the modeling analysis conducted by Arkansas as part of the SIP revision submittal was completed as part of a 110(l) demonstration for the purposes of determining the potential impacts of the revised missions exempt from minor NSR permitting by adding hypothetical exempt sources to represent those added emissions in the modeled emissions inventory. Modeling conducted as part of the 110(l) demonstration is conducted to determine whether a SIP revision will interfere with attainment or maintenance of the NAAQS, any required milestone, or any other requirement of the Act. Because the modeled sources were hypothetical in nature, source-specific information including emission rates and their potential variability, cannot be available, nor does it need to be. As stated in the modeling report included in the March 24, 2017 SIP revision submittal and in our proposed rulemaking, in the modeling analysis the hypothetical source emission rates were set equal to the revised minor NSR permitting thresholds and de minimis change levels to examine the potential impacts resulting from the newly exempt emissions. (See the March 24, 2017 SIP Revision Submittal, Appendix D—Air Quality Modeling Analysis of Minor Source Permit Thresholds.) The approaches used by Arkansas in their modeling demonstration to determine the potential impacts from the newly exempt emissions were reasonable and appropriate for the type of analysis being conducted, especially considering the relatively small amount of emissions expected to be exempt from minor NSR permitting based on the revised rule compared to statewide emissions.

Comment: The commenter stated that because presumably the same emission rates, stack parameters, and sources locations were modeled with AERMOD (dispersion model) as were modeled in the CMAQ photochemical modeling. Therefore, they stated that all of the prior comments raised with the CMAQ (photochemical) modeling also apply to the AERMOD (dispersion) modeling results. The commenter also stated that there is no indication that the air dispersion modeling accounted for impacts from startup, shutdown and malfunction emissions.

Response: The comments raised on the CMAQ photochemical modeling were addressed above. Those responses would also apply to the AERMOD dispersion modeling, with some slight clarifications due to the inherent differences between photochemical and dispersion modeling analyses. We provide the following clarification related to the comments raised on cumulative impacts analyses since the CMAQ photochemical modeling and AERMOD dispersion modeling have different approaches to account for cumulative impacts because the models differ on how off-site background sources emissions inventories are represented and how impacts are determined. As discussed in the modeling report included in the March 24, 2017 SIP revisions submittal, the CMAQ photochemical modeled concentrations/impacts from the background emissions inventory sources were included as background values in the AERMOD dispersion modeling and added to the AERMOD dispersion modeled concentrations from the hypothetical sources to determine cumulative impacts from the exempt emissions and the off-site emissions. (See the March 24, 2017 SIP Revision Submittal, Appendix D—Air Quality Modeling Analysis of Minor Source Permit Thresholds.) Although these approaches differ because of the nature of the modeling system used, both the CMAQ photochemical and AERMOD dispersion modeling analyses include the cumulative impacts of the hypothetical sources plus the background emissions inventory sources.

Regarding the modeling of impacts from startup, shutdown and malfunction emissions, the evaluation of impacts from routine and/or predictable startup and shutdown emissions would be associated with modeling an existing source or a proposed source of known type/size and operation as part of a case-by-case NSR modeling analysis, such as PSD permit modeling.21 The routine and predictable startups and shutdowns are permitted emissions which are accounted for in the emissions inventory. As stated in our previous responses, the hypothetical sources included in the 110(l) demonstration modeling were meant to represent the exempt emissions that could occur from a variety of sources and were being modeled to examine the potential impacts from exempt emissions. Because the modeled sources were hypothetical in nature, information regarding source inputs including a small subset of their emissions such as source-specific startup, shutdown and malfunction emissions, was not available, nor should it be. Further, the emissions expected to be exempt from minor NSR permitting based on the revised permitting thresholds and de minimis levels made up much less than 1% of the total statewide emissions (less than or equal to 0.125% of the statewide emissions for minor NSR permitting thresholds; less than or equal to 0.019% of the statewide emissions for de minimis change levels) meaning that the startup, shutdown and malfunctions being a small subset of total emissions would make up an even smaller fraction of the statewide emissions. The commenter's expectation for this type of analysis is unreasonable on the basis that these emissions make up such a small fraction of the statewide emissions (that is, a small subset of the total exempt emissions that are anticipated to make up much less than 1% of the statewide emissions). As stated in the modeling report included in the March 24, 2017 SIP revision submittal and in our proposed rulemaking, the hypothetical source emission rates were set equal to the revised minor NSR permitting thresholds and de minimis change levels to examine the potential impacts resulting from the newly exempt emissions. The approaches used by Arkansas in their modeling demonstration to determine the potential impacts from the newly exempt emissions were reasonable and appropriate for the type of analysis being conducted, especially considering the relatively small amount of emissions expected to be exempt from minor NSR permitting based on the revised rule compared to statewide emissions.

Comment: The commenter stated that the dispersion modeling did not include the modeling of line sources and that fugitive PM10 emissions often cause increment and NAAQS violations. Therefore, the commenter claims that the AERMOD (dispersion) modeling does not reflect reasonable worst case impacts that could occur due to the sources and de minimis changes exempt from minor NSR based on the SIP revisions.

Response: As discussed in our previous responses, the worst case impacts conditions (or potential worst case source type in the case of this comment) referenced by the commenter are typically associated with case-by-case NSR modeling of an existing source or a proposed source with known stack/emission characteristics (such as, modeling associated with a PSD permit action). This would also be the case for the modeling of line sources mentioned by the commenter. The 110(l) demonstration modeling conducted by Arkansas in support of the SIP revisions has a different purpose and associated requirements than case-by-case NSR modeling. As discussed in our earlier response to the comment raised regarding worst case stack parameters, Arkansas relied on real world stack parameters available in their emissions inventory data to determine representative stack parameters to represent emissions newly exempt from minor NSR permitting via the inclusion of hypothetical sources in their modeling analyses. Specifically, they reviewed the stack parameters and determined the average stack parameters included as hypothetical point sources with emissions set equal to the minor NSR permitting thresholds and de minimis change levels. Because the modeled sources were hypothetical in nature, source-specific information including whether or not any portion of the emissions were fugitive in nature (such as road emissions) versus stack emissions, cannot be available, nor does it need to be. Modeling of hypothetical sources with emissions rates set equal to the revised minor NSR permitting and de minimis change thresholds ensures that the analysis accounts for the maximum amount of emissions that would be exempt from minor NSR permitting based on the revisions. The approaches used by Arkansas in their modeling demonstration and their reliance on representative stack parameters to determine the potential impacts from the newly exempt emissions were reasonable and appropriate for the type of analysis being conducted, especially considering the relatively small fraction of emissions expected to be exempt from minor NSR permitting based on the revised rule compared with statewide emissions.

Comment: The commenter stated that the revised Arkansas NSR program conflicts with the requirements of section 110(2)(C). More specifically, the commenter stated that the de minimis change exemptions will exempt most if not all modifications at existing major stationary sources from minor NSR permitting. They indicate that this is in direct contrast with the intention for the new source review program required by CAA section 110(a)(2)(C) and 40 CFR 51.160 to be a backstop on threats to attainment or maintenance of the NAAQS posed by new source growth that is not planned for in existing SIP rules.

Response: We do not agree with the commenter that the de minimis exemptions will exempt most if not all modifications at existing major stationary sources from minor NSR permitting. As previously stated in our responses, the SIP-approved Arkansas NSR program is comprised of two types of review: “Minor Source Review” and “Major Source Review”. Arkansas operates a so-called “merged, one permit” system, which is divided into these two types of review based on whether a source is required to obtain a title V operating permit. As such, “Minor Source Review”, which is contained in Reg. 19, Chapter 4, applies only to those sources that are not subject to title V permitting and require only a title I minor NSR authorization.22 Any source that would be a major source for purposes of PSD review would also be a major source subject to title V permitting. Compare 40 CFR 52.21(b)(1) (establishing major source thresholds of 100 and 250 tons per year) with Reg. 26, Chapter 2 (defining major sources to include, inter alia, any source with the potential to emit 100 tons per year). Therefore, any source subject to title V, which would include any new PSD major source and/or any modification to an existing PSD major source, cannot utilize the de minimis change exemption found at Reg. 19.407(C). Instead, all modifications at title V sources that are not be subject to Reg. 19, Chapter 9 would instead be subject to the “Major Source Review” requirements found in Reg. 26 and incorporated by reference in Reg. 19, Chapter 11 and cannot use the de minimis change provisions, which are limited to “Minor Source Review” in Chapter 4 of Reg. 19. The revisions addressed in our proposed rulemaking are limited to “Minor Source Review” under Chapter 4 of Reg. 19 and do not impact “Major Source Review” in Chapter 11, which has already been approved into the SIP as part of Arkansas' minor NSR program, most recent approval on March 4, 2015 (See 80 FR 11573), and which contains the permitting requirement provisions applicable to the modifications not subject to Reg. 19, Chapter 9 at all title V sources, including all of the sources referenced by the commenter.

Comment: The commenter stated that the NSR program required by CAA section 110(a)(2)(C) and 40 CFR 51.160 is intended to be a backstop on threats to attainment or maintenance of the NAAQS posed by new sources growth that is not planned for in existing SIP rules. Because of the commenter's assessment that NSR program is an important part of the SIP, they stated that EPA cannot approve exemptions from a minor NSR program unless it is shown that the exemptions are truly de minimis to the purposes of the program.

Response: We agree that the NSR program is an important part of the SIP but this does not mean that under the CAA and the minor NSR SIP rules, EPA cannot approve exemptions from a minor NSR program. Consequently, what is relevant is whether or not the revisions to the Arkansas minor NSR program are approvable under the plain reading of the applicable statute and rules. There is no regulatory or statutory prohibition that prohibits the types and/or sizes of sources that could be exempt from the minor NSR program. In fact, the minor NSR SIP rules at 40 CFR 51.160(e) only require that the minor NSR program include procedures that “identify types and sizes of facilities, buildings, structures, or installations which will be subject to review under this section. [and] The plan must discuss the basis for determining which facilities will be subject to review.” These rules furthermore require that the plan must ensure that the issuance of minor NSR permits not result in a violation of the control strategy or interfere with the attainment or maintenance of a national standard. The CAA at section 110((a)(2)((C) requires regulation of the modification or construction of any stationary source within the area as necessary (emphasis added) to assure that the standards are achieved. As such, the CAA at section 110((a)(2)(C) and the minor NSR SIP rules found at 40 CFR 51.160-165, as well as case law,23 allow exemptions from a minor NSR permitting program. In cases such as this, where the minor NSR SIP is being revised, the state must also demonstrate that the revisions meet the requirements of CAA section 110(l). Similar to the provisions of the Act and rules discussed above, section 110(l) requires that EPA cannot approve revisions to the Arkansas minor NSR SIP unless EPA finds that the changes would not interfere with any applicable requirement concerning attainment and reasonable further progress, as well as any other applicable statutory requirement. The clear reading of the Act and the EPA rules are that EPA can approve exemptions to the Arkansas minor NSR SIP program as long as it finds these exemptions will not interfere with attainment or maintenance of a NAAQS or other control strategy. Consistent with what is allowed, Arkansas has identified revised permitting thresholds and de minimis change levels to serve as the exemption thresholds for their minor NSR permitting program. To support the revised exemption thresholds, Arkansas provided analyses to define the scope of the exemptions and to demonstrate that these revised thresholds will not adversely impact NAAQS maintenance or attainment. The analyses, which were submitted as part of the March 24, 2017 SIP revision submittal, included: (1) An emissions inventory analysis that determined the percentage of the statewide total emissions inventory that would be newly exempt by the revised thresholds; (2) a monitoring analysis that included a review of the current status of ambient air quality in the state along with a review of the trends in monitoring data since the state adopted and implemented the revised thresholds; and (3) a modeling analysis that examined the impacts of the exempt emissions on ambient concentrations. The analyses provided by Arkansas in the SIP revision submittals show that the minor NSR permitting exemptions resulting from the revised rule were limited in scope and comprised much less than 1% of the total emissions in the statewide emissions inventory and that the impacts from the newly exempt emissions would not adversely impact NAAQS maintenance or attainment, as part of their 110(l) demonstration. The EPA's review of these analyses and our finding that the proposed SIP revisions were approvable were detailed in the proposed rulemaking and the Technical Support Document accompanying the rulemaking.

Comment: The commenter stated that the results from the state's AERMOD (dispersion) modeling show that the exemptions are not “de minimis.” The commenter also states that the EPA must not approve the revised program because it will interfere with the requirements that SIPs include programs to ensure that new and modified sources not be allowed to construct or modify if they would interfere with attainment or maintenance of the NAAQS.

Response: Our proposed rulemaking specifically addressed the scope of the exemptions resulting from the revised minor NSR permitting thresholds and de minimis levels. As discussed in our proposal, Arkansas provided an analysis to quantify the amount of emissions that would be expected to be exempt from minor NSR permitting requirements relative to total emissions from the statewide emissions inventories. For all pollutants, the exempt emissions for both the permitting thresholds and de minimis levels made up a fraction of 1% of the statewide emissions. Therefore, we find that the scope of emissions expected to be exempt from minor NSR permitting as a result of the revised minor NSR program thresholds and de minimis change levels is extremely limited. Regarding the commenter's claim that the revised program will interfere with NAAQS attainment or maintenance, the 110(l) demonstration submitted by Arkansas in support of the proposed revisions to the SIP specifically addressed the anticipated impacts on the NAAQS through both a review of the current status of ambient air quality in Arkansas and an evaluation the impacts of the revised thresholds on ambient air quality via air monitoring and air modeling data. As discussed in our proposed rulemaking, based on the ambient monitoring trend analysis, the implementation of the revised minor NSR permitting thresholds and de minimis levels following state adoption of the revisions in 2008 and ongoing implementation have not negatively impacted ambient air quality or interfered with the attainment of the NAAQS. In fact, for several pollutants the ambient air quality has shown continued improvements via decreases in monitored DVs during this period; and currently Arkansas does not have any areas classified as nonattainment for any NAAQS. Our proposal also summarized the air quality modeling results that Arkansas submitted as part of the SIP revisions. The modeling analysis included an evaluation of both statewide regional-scale (photochemical) and local-scale impacts. (See the March 24, 2017 SIP Revision Submittal, Appendix D—Air Quality Modeling Analysis of Minor Source Permit Thresholds.) The photochemical modeling was designed to specifically examine ozone and PM2.5, the model also simulates NO2, SO2, and PM10 so the results for those pollutants were also examined. The maximum photochemical modeling derived impacts including the hypothetical source emissions on daily maximum 8-hr ozone, 24-hr PM2.5, and annual average PM2.5 for any location in Arkansas was calculated. The maximum impacts including hypothetical source emissions on daily maximum 1-hr NO2 and SO2 and 24-hr average PM10 was also calculated. These maximum impacts were added to the baseline modeled predicted concentrations for each day and grid cell for the future year simulation. The resultant model predicted concentrations represented the future year concentrations assuming the worst-case impacts from the threshold emission increases at any location within the modeling grid. These model results were used in conjunction with the baseline modeling results to calculate the RRFs necessary to estimate FDVs. The FDVs were used to examine whether emission increases less than or equal to the revised thresholds will cause or contribute to a NAAQS violation or interfere with NAAQS maintenance. To further examine the potential near-field impacts from new or existing sources with emission increases less than or equal to the revised permitting and de minimis change thresholds, a dispersion modeling analysis was conducted. The dispersion model was applied for the same hypothetical sources used in the photochemical modeling with emissions set to the revised thresholds. The dispersion model was applied for one year for NOX, SO2, CO, and PM10. For each source location, daily concentrations (for the receptor with the maximum annual average value) taken from the dispersion modeling were added to the photochemical model -derived concentrations for that same location. In this manner, the photochemical modeling values were used as “background”. The statewide daily maximum impact (maximum over all locations/AQCRs) obtained were expected to represent the near-field future-year concentrations assuming worst-case impacts from threshold emission increases at a range of locations throughout the state. Similar to the photochemical modeling, these maximum impacts were added to the baseline modeled predicted concentrations for each day and grid cell for the future year simulation. The resultant model predicted concentrations represented the future year concentrations assuming the worst-case impacts from the threshold emission increases at any location within the modeling grid. The resultant concentrations were used in conjunction with the baseline modeling results to calculate the RRFs necessary to estimate FDVs. Once again, the FDVs were used to examine if the emissions under the revised threshold values would cause/contribute to a NAAQS violation and/or interfere with NAAQS attainment. Both the photochemical and dispersion modeling results did show that the addition of exempt emissions via modeled hypothetical sources may result in some increases in ambient concentrations. However, as discussed in the TSD accompanying our proposed rulemaking, the FDVs calculated as part of the regional-scale modeling analysis that were based on the maximum modeled impacts from the hypothetical source were less than the NAAQS for each pollutant and averaging period.24 Similarly, the results from the near-field dispersion modeling also showed the modeled impacts from the hypothetical sources combined with background concentrations were all less than their corresponding NAAQS.25 Based on our evaluation of these analyses conducted by ADEQ to support the revised minor NSR permitting thresholds and de minimis levels, we find that the increased levels will not interfere with attainment or maintenance of the NAAQS.

Comment: The commenter stated that EPA does not cite to the specific rule that states that “de minimis changes are still required to meet minor NSR requirements contained in Reg. 19, Chapter 4 including a demonstration that the proposed modification will not interfere with the NAAQS on a case-by-case basis” and that the EPA's claim that this requirement remains is without merit. The commenter stated that EPA may be assuming that Reg. 19.402 applies since a permit revision is implied by Reg. 19.407(C)(6), it is not clear that this requirement applies to what appears to be an administrative amendment to a source's permit if it makes a de minimis change. The commenter also states that ADEQ made it clear that it does not plan to require or base any decision for de minimis changes on air quality modeling, and without conducting modeling, they will not be able to ensure that the proposed modification will not interfere with attainment or maintenance of a NAAQS on a case-by-case basis. So, the commenter stated that it is unlikely that ADEQ considered Reg. 19.402 as applying to de minimis permit changes.

Response: We do not agree that our proposed rulemaking did not include a citation to the specific rule related to a case-by-case demonstration of non-interference with the NAAQS that is applicable to de minimis changes. We also do not agree that our statement that de minimis changes must still meet minor NSR requirements is without merit. Our position that de minimis changes must include a demonstration that the proposed modification will not interfere with the NAAQS on a case-by-case basis is based on the applicability of Reg. 19.405(A)(1) to these changes. Further, the provisions in the de minimis change rule indicate that de minimis changes include an application submittal/review process at Reg. 19.407(C)(5) at it references applications for de minimis changes. In addition to the rule language, the current “Air Application Instructions for Registrations, Minor Source Permits, or Title V Permits” made available on ADEQ's air permitting website indicate that the forms are to be used for de minimis changes.26 As such, we do not agree with the commenter that EPA assuming the de minimis changes include an application process without a basis. Further we do not agree with the commenter, that our proposed rulemaking did not clearly state the specific rule regarding the referenced technical review requirement to demonstrate NAAQS compliance for a de minimis change. In our proposed rulemaking, we specifically stated that the requirement found at Reg. 19.405(A)(1) requires ADEQ must ensure as part of their technical review of de minimis change applications that the source will be modified to operate without interfering with NAAQS attainment or maintenance.27 The de minimis change rule found at Reg. 19.407(C)(2) of the current Arkansas SIP exempts qualified proposed changes at an existing source from minor NSR permitting requirements, including public notice. The exemption only exempts the de minimis change from minor NSR permitting requirements and not all applicable minor NSR requirements. Therefore, the exemption does not exempt the change from the technical review requirements found at Reg. 19.405(A). Reg. 19.405(A) applies to the review of applications submitted under Chapter 4 of Reg. 19, where the de minimis change rule is located, and requires that on an application-by-application basis ADEQ must ensure as part of their technical review that the source will be modified to operate without interfering with NAAQS attainment or maintenance. Our approval of the de minimis change level revisions does not revise or in any way change the applicability of the SIP-approved technical review requirements found in Reg. 19.405(A), or any other applicable minor NSR requirements, to de minimis changes. It is important to note that the Reg. 19.405(A) technical review requirements do not specify that modeling be completed to demonstrate that the source will be constructed/modified without interfering with attainment or maintenance of the NAAQS. The EPA minor NSR SIP rules found in 40 CFR 51.160-165 do not require modeling either. We do not agree with the commenter that without conducting modeling, ADEQ cannot ensure that a de minimis change will not interfere with attainment or maintenance of a NAAQS on a case-by-case basis. Case-by-case modeling, such as air dispersion modeling, is one of the methods that is commonly used to meet NAAQS requirements, but it is not the only method. Depending on the source and the proposed de minimis change, as part of their technical review ADEQ could alternatively utilize past modeling analyses, such as the statewide modeling that was included as part of the 110(l) demonstration in the March 24, 2017 SIP revision submittal, or existing ambient monitoring data or emissions inventory data relevant to the proposed change to make a determination regarding NAAQS compliance. In addition, the SIP-approved provision found at Reg. 19.407(C)(1)(b) specifies that “a proposed change to a facility will be considered De Minimis if: . . . the change will result in a trivial environmental impact.” Our rulemaking does not revise or in any way change this provision.

Comment: The commenter stated that EPA has not evaluated whether the SIP revision satisfies CAA section 193. They state that because the revisions allow ADEQ to relax emission limits via de minimis changes and for previously permitting sources to terminate the existing permit and replace with a registration, EPA's review should include an evaluation pursuant to CAA section 193 of whether these relaxations would allow for the relaxation of any control requirements in effect before November 15, 1990, in any nonattainment area, in which case equivalent or greater emissions reductions.

Response: We do not agree with the commenter that this rulemaking is subject to CAA section 193. Section 193 applies to nonattainment areas only and provides that “[n]o control requirement in effect, or required to be adopted by an order, settlement agreement, or plan in effect before the date of the enactment of the Clean Air Act Amendments of 1990 in area for any air pollutant may be modified after such enactment in any manner unless the modifications insures equivalent or greater emission reductions of such air pollutant.” The proposed rule does not change control requirements in nonattainment areas, of which Arkansas currently has none. Therefore, EPA did not address section 193 in the proposed approval action, since it does not apply. In the future, should an area become designated as nonattainment, Arkansas when developing the required nonattainment NSR permitting program would have to ensure that this program applied the Act's thresholds, which might require Arkansas to revise its minor NSR SIP program.

In this action, EPA is approving revisions to the minor NSR permitting program as submitted as revisions to the Arkansas SIP on July 26, 2010, and March 24, 2017, including supplemental information submitted on November 30, 2015, May 26, 2016, July 5, 2017, July 27, 2017, and March 16, 2018. Our approval includes the following revisions to the Arkansas SIP:

• Revisions to Reg. 19.401 (submitted 07/26/2010 and 03/24/2017);

• Revisions to Reg. 19.407(C)(2)(a) and (b) (submitted 07/26/2010 and 03/24/2017); and

• Revisions to Reg. 19.417(A) and (B) (submitted 07/26/2010).

As previously stated in our proposed rulemaking, this final action does not remove or modify the existing federal and state requirements that each NSR permit action issued by ADEQ include an analysis completed by the Department and their determination that the proposed construction or modification authorized by the permit action will not interfere with attainment or maintenance of a national ambient air quality standard.

In this rule, the EPA is finalizing regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, the EPA is finalizing the incorporation by reference of the revisions to the Arkansas regulations as described in the Final Action section above. The EPA has made, and will continue to make, these materials generally available through www.regulations.gov and at the EPA Region 6 Office (please contact Ashley Mohr for more information). Therefore, these materials have been approved by EPA for inclusion in the SIP, have been incorporated by reference by EPA into that plan, are fully federally enforceable under sections 110 and 113 of the CAA as of the effective date of the final rulemaking of EPA's approval, and will be incorporated by reference in the next update to the SIP compilation.

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

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

• Is not an Executive Order 13771 (82 FR 9339, February 2, 2017) regulatory action because SIP approvals are exempted under Executive Order 12866;

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

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

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

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

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

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

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

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

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

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by August 28, 2018. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

40 CFR part 52 is amended as follows:

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

Michigan revised its rule R 336.1618 “Use of cutback or emulsified paving asphalt” along with several other of its VOC rules. Michigan also revised rules R 336.1611 to R 336.1614, R 336.1619, R 336.1622, R 336.1625, R336.1627 to R 336.1629, R 336.1632, R 336.1651, R 336.1660, and R 336.1661 for the purpose of removing adoptions by reference which have been moved to and consolidated in R 336.1902 “Adoption of standards by reference.” Revisions to R 336.1622, R 336.1627 to R 336.1629, and R 336.1632 update references to federal test methods.

On March 30, 2018 (83 FR 13710) EPA published a notice of proposed rulemaking (NPR) proposing approval of Michigan's VOC revisions. The specific details of Michigan's VOC revisions and the rationale for EPA's approval are discussed in the NPR and will not be restated here. EPA received no relevant comments on this proposal.

EPA is approving Michigan's VOC revisions in Part 6 and Part 9 because they satisfy the EPA's requirement of reasonably available control technology.

In this rule, EPA is finalizing regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, EPA is finalizing the incorporation by reference of the Michigan Regulations described in the amendments to 40 CFR part 52 set forth below. EPA has made, and will continue to make, these documents generally available through www.regulations.gov and at the EPA Region 5 Office (please contact the person identified in the For Further Information Contact section of this preamble for more information). Therefore, these materials have been approved by EPA for inclusion in the SIP, have been incorporated by reference by EPA into that plan, are fully federally enforceable under sections 110 and 113 of the CAA as of the effective date of the final rulemaking of EPA's approval, and will be incorporated by reference in the next update to the SIP compilation.1

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

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

• Is not an Executive Order 13771 (82 FR 9339, February 2, 2017) regulatory action because SIP approvals are exempted under Executive Order 12866;

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

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

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

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

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

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

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

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

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

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

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by August 28, 2018. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

40 CFR part 52 is amended as follows:

This is a summary of the Commission's Report and Order (R&O) in WC Docket No. 17-310; FCC 18-82, adopted on June 19, 2018, and released on June 25, 2018. The full text of this document is available for public inspection during regular business hours in the FCC Reference Center, Room CY-A257, 445 12th Street SW, Washington, DC 20554, or at the following internet address: https://docs.fcc.gov/public/attachments/FCC-18-82A1.pdf.

1. Technology and telemedicine have assumed an increasingly important role in health care delivery, particularly in rural and remote areas of the country. For Americans living in rural and isolated areas, doctor shortages and hospital closures are endemic, and obtaining access to high-quality health care is a constant challenge. Broadband greatly changes that equation, however, by enabling a wide range of telemedicine services—from specialists providing consultations via video conferencing to radiologists remotely reading X-rays via high-speed connectivity. Today, the Commission takes steps to help ensure that health care providers participating in the Commission's RHC Program can continue providing these and other essential telemedicine services to their communities.

2. In 1996, Congress recognized the value of providing rural health care providers with “an affordable rate for the services necessary for the provision of telemedicine,” and the Commission established the RHC Program the following year. At that time, the Commission capped RHC Program funding at $400 million annually, and for many years, the $400 million funding cap was sufficient to fulfill Program demand. More recently, however, funding requests for high-speed broadband from health care providers have outpaced the RHC Program funding cap, placing a strain on the Program's ability to increase access to broadband for health care providers, particularly in rural areas, and foster the deployment of broadband health care networks. Further, rural health care providers face imminent financial hardship in FY 2017 due to the significant, automatic proration of their funding requests pursuant to RHC Program rules. These funding reductions have forced providers to assume additional costs of providing critical health care services to their communities.

3. Given rural health care providers' urgent need for funding, the Commission takes immediate action in the R&O to address the current funding shortfall in the RHC Program, including by raising the annual Program funding cap to $571 million and applying it to the current funding year to fully fund eligible funding requests for FY 2017. The Commission takes this action consistent with the goals of ensuring that rural health care providers are able to get the funding they need from the RHC Program. At the same time, the Commission is mindful of the need to guard against Program waste, fraud, and abuse to ensure that this funding is being spent appropriately. The Commission remains committed to this goal and for that reason, have proposed and sought comment in this proceeding on measures to ensure compliance and to reduce waste, fraud, and abuse in the RHC Program.

4. In the R&O, the Commission adopts measures to address the increased demand for funding from the RHC Program and thereby promote health care delivery and telemedicine in rural America. Specifically, the Commission (1) increases the annual RHC Program funding cap to $571 million and apply it to FY 2017; (2) decides to annually adjust the RHC Program funding cap to reflect inflation, beginning with FY 2018; and (3) establishes a process to carry-forward unused funds from past funding years for use in future funding years. These actions will provide rural health care providers with a sufficient and more predictable source of universal service funding to deliver vital telemedicine services to their communities.

5. Background. In the 2017 NPRM and Order (FCC 17-164), the Commission sought comment on whether to increase the RHC Program's $400 million annual funding cap and how to determine the appropriate funding cap level. The Commission explained that one metric would be to consider what the cap would have been if adjusted by inflation since its adoption. It therefore sought comment on whether to establish a new RHC Program funding cap based on the expected level had the Commission initiated an annual inflation adjustment in 1997 using the gross domestic product chain-type price index (GDP-CPI). The Commission also sought comment on whether to apply any increased funding cap to FY 2017.

6. The majority of commenters agree that the Commission should raise the RHC Program funding cap. Of those commenters, most argue that setting the cap at $571 million, the level it would be had the Program been indexed for inflation since its inception, is a sufficient and appropriate metric for establishing a new funding cap today. Some commenters instead argue that the cap should be raised beyond $571 million to account for the expansion of eligible services and entities since the Program's inception, as well as advances in telehealth capabilities and technologies, and increased broadband requirements. Other commenters contend that the GDP-CPI index does not sufficiently represent Program demand because the costs of providing health care services have historically outpaced inflation, or they assert that the funding cap should simply be doubled to $800 million to account for inflation, the increased number of eligible entities, and advances in technology.

7. Additionally, some parties assert that the Commission's analysis in setting the original cap of $400 million was arbitrary or based on incorrect estimates of the number of qualifying rural health care providers. Despite this, these commenters advocate raising the annual funding cap based on the broadband communications requirements for health care providers, the increased demand for the services that such broadband can support, other potential sources of funding of rural health care broadband needs, or indexing the $400 million cap to GDP-CPI.

8. Discussion. The Commission concludes that raising the RHC Program funding cap is necessary to address current and future demand for supported services by health care providers. Raising the funding cap to $571 million responds to the significant increase in RHC Program demand resulting from the expansion of eligible services and entities since the Program's creation, as well as the advances in technology that often require higher bandwidth (e.g., higher-speed bandwidth, less latency, and diverse routing) than was contemplated by the Commission when it established a $400 million cap for the Program in 1997. The Commission also finds that increasing the funding cap to what it would have been if indexed annually for inflation since the inception of the Program, using the GDP-CPI index, ensures that RHC Program funding is sufficient to meet current demand, while also minimizing the increased costs of funding, which are imposed on USF contributors and generally passed on to consumers. In addition, adjusting the funding cap to account for inflation over the past 20 years maintains the purchasing power in today's dollars that health care providers held when the RHC Program was first instituted. On these bases, the Commission raises the RHC Program annual funding cap from $400 million to $571 million.

9. The Commission disagrees with those commenters who advocate doubling the RHC Program funding cap to $800 million at this time. The $171 million increase in the annual funding cap exceeds the current demand of $521 million, and commenters fail to provide reliable data justifying a $400 million increase. Moreover, the Commission believes that adopting such a substantial increase at this time is especially imprudent given the concerns in this proceeding about whether potential waste in the RHC Telecommunications Program has contributed to reaching the cap sooner than anticipated and what steps the Commission should take to reduce such waste.

10. Accordingly, the Commission concludes that increasing the cap to $571 million strikes the appropriate balance between ensuring adequate funding for vital telehealth services while minimizing the burden placed on USF contributors and consumers. As necessary, the Commission will assess the need for any future increases in the cap to ensure that the RHC Program is sufficiently funded to achieve the Program's goals of increasing access to broadband for health care providers, particularly in rural areas, and fostering the deployment of broadband health care networks. For these reasons, the Commission is not persuaded by the arguments submitted by SHLB, ACS, and others that raising the cap to $571 million is insufficient to address RHC Program demand. By raising the cap by $171 million and taking the other steps discussed in this R&O (i.e., indexing the cap to reflect inflation and adopting a carry-forward process for unused funding), the Commission is addressing the substantial increase in RHC Program demand.

11. The Commission is also unpersuaded by AT&T's arguments that until the Telecommunications Program is fundamentally reformed, it is premature to consider increasing the annual RHC Program funding cap. In light of the current funding shortfall in the RHC Program, the Commission believes that raising the funding cap to $571 million now is necessary to ensure that sufficient funding is available for eligible health care providers to maintain their current network connections and telehealth services, and to provide additional certainty as health care providers consider their future bandwidth needs. The Commission does, however, agree with AT&T and other commenters that managing waste, fraud, and abuse in the RHC Program is essential to ensuring efficient Program disbursements, and that the Commission should consider additional measures to ensure Program compliance. For that very reason, the 2017 NPRM and Order proposed and sought comment on measures to control outlier costs and reform support calculations in the Telecommunications Program, improve competitive bidding, and establish more effective oversight of the RHC Program.

12. In addition to raising the annual RHC Program funding cap, the Commission addresses the immediate needs of participating health care providers by applying the increased cap to the current funding year (FY 2017). Given the significant financial hardship faced by rural health care providers due to the scarcity of Program funding and the substantial proration of FY 2017 funding requests, it is incumbent on the Commission to make available the additional funding in this funding year. This decision will eliminate the need to prorate the amount of qualified FY 2017 funding requests and relieve rural health care providers of burdensome service cost increases resulting from the required proration.

13. None of the commenters who support raising the annual funding cap oppose applying the funding cap to FY 2017. In the 2017 NPRM and Order, the Commission sought comment on whether to raise the funding cap, and whether the funding cap should be increased for FY 2017 to address the financial distress that can result from the proration of funding requests. The Commission anticipated that demand would exceed the funding cap in FY 2017, potentially at a level requiring a deeper proration than required in FY 2016, and recognized that the “proration that comes with capped funding may be especially hard on small, rural healthcare providers with limited budgets. . . .” USAC has since announced and applied a significant proration factor for FY 2017, and the hardship anticipated by the Commission has been reflected in petitions for relief and correspondence filed in the RHC Program dockets. The Commission concludes that the public health consequences that could result from rural health care providers receiving reduced funding as a result of the proration of their funding requests in FY 2017 weighs in favor of increasing the FY 2017 RHC Program cap to the $571 million level as adopted by this R&O.

14. By taking this action, the Commission makes significant funding available to issue commitments for the full amount approved for FY 2017 funding requests prior to proration. The Commission directs USAC to collect the additional funds needed to fully fund FY 2017 demand over the next two quarters in accordance with the standard process for calculating and announcing the quarterly contribution factor to reduce the impact on ratepayers. The Commission further directs USAC to take any other steps necessary to reverse the proration of approved FY 2017 funding requests, consistent with this R&O.

15. Background. In addition to whether and how to raise the RHC Program annual funding cap, in the 2017 NPRM and Order, the Commission sought comment on whether the cap should be adjusted annually for inflation. The Commission noted that other universal service support mechanisms use the GDP-CPI inflation index to adjust funding caps, and inquired whether the RHC Program cap should also be adjusted annually on the same basis. Commenters that support raising the RHC Program funding cap to the level that it would be had it been indexed for inflation using GDP-CPI since the inception of the Program also support adjusting the cap for inflation in future funding years.

16. Discussion. The Commission adopts a rule that, beginning in FY 2018, the RHC Program funding cap will be adjusted annually for inflation using the GDP-CPI inflation index. By itself, raising the cap does not create the flexibility necessary to ensure that rural health care providers have affordable access to telecommunications and broadband services in the event of future price inflation. Accordingly, the Commission must also institute an annual inflation adjustment to ensure that the RHC Program maintains consistent purchasing power without unreasonably increasing the size of the USF and increasing the USF contribution charges that are ultimately passed through to consumers.

17. The Commission concludes that it is appropriate to rely upon the GDP-CPI index for the RHC Program's inflation adjustment. There is no index that specifically examines the cost of services funded under the RHC Program. Given that GDP-CPI is the same index the Commission uses to inflation-adjust the E-Rate Program cap, the high-cost loop support mechanism cap, and in other contexts to estimate inflation of carrier costs, the Commission concludes that it is reasonable to use the GDP-CPI to approximate the impact of inflation on RHC Program supported services. In the event of periods of deflation, the Commission will maintain the prior-year cap to maintain predictability.

18. To compute the annual inflation adjustment, the percentage increase in the GDP-CPI from the previous year will be used. The increase shall be rounded to the nearest 0.1 percent. The increase in the inflation index will then be used to calculate the maximum amount of funding for the next RHC Program funding year which runs from July 1 to June 30. When the calculation of the yearly average GDP-CPI is determined, the Wireline Competition Bureau (Bureau) will publish a Public Notice in the Federal Register within 60 days announcing any increase in the annual funding cap based on the rate of inflation. For FY 2018, based on GDP-CPI, the RHC Program funding cap will be $581 million.

19. Background. In the 2017 NPRM and Order, the Commission sought comment on whether to allow unused funds committed in one funding year to be carried forward to a subsequent funding year. In fact, in the accompanying Order (FCC 17-164), the Commission directed that unused funds from prior years be carried forward to reduce the effect of proration for certain health care providers in FY 2017. All those who commented on this issue supported the proposal that unused funds be carried forward for use in subsequent years.

20. Discussion. The Commission finds that, beginning in FY 2018, unused funds may be carried forward from previous years for use in subsequent funding years. Unused funds are the difference between the amount of funds collected, or made available for that particular funding year, and the amount of funds disbursed or to be disbursed for that funding year. Funds carried forward from one funding year may be rolled over to multiple funding years until ultimately committed and disbursed. Considering the high demand for RHC Program funding, the Commission concludes that this action is consistent with the goals of the RHC Program, aligns the RHC Program with the E-Rate Program's carry-forward process, and is in the public interest.

21. Additionally, as in the E-Rate Program, the Commission will require USAC to provide quarterly estimates to the Commission regarding the amount of unused funds that will be available for carryover in subsequent years. This requirement codifies USAC's existing reporting practice and reporting cycle. The quarterly estimate will also provide stakeholders of the RHC Program with general notice regarding the estimated amount of unused funds that may be made available in the subsequent year.

22. Further, the Commission will make unused funds available annually in the second quarter of each calendar year for use in the next full funding year of the RHC Program. Based on the estimates provided by USAC, the Commission will announce a specific amount of unused funds from prior funding years to be carried forward to increase available funding for future funding years. This unused funding may be used to commit to eligible services in excess of the annual funding cap in the event demand in a given year exceeds the cap, or it may be used to reduce collections for the RHC Program in a year when demand is less than the cap. The Bureau will announce the availability and amount of carryover funds during the second quarter of the calendar year.

23. Finally, the Commission finds it is in the public interest to carry forward unused funds for disbursement on an annual basis. Distribution of unused funds on an annual basis allows USAC to refine its calculation of available funds over four reporting quarters as the funding year progresses. The Commission also believes that the timing of this process provides certainty regarding when unused funds will be carried forward for use in the RHC Program with minimal disruption to the administration of the Program.

24. This document contains no new information collection requirements subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. In addition, the Commission notes that pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), it previously sought specific comments on how the Commission might further reduce the information collection burden for small business concerns with fewer than 25 employees. The Commission describes impacts that might affect small businesses, which includes most business with fewer than 25 employees, in the Final Regulatory Flexibility Analysis (FRFA).

25. The Commission will send a copy of the R&O to Congress and the Government Accountability Office, pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

26. The Regulatory Flexibility Act of 1980 (RFA) requires that an agency prepare a regulatory flexibility analysis for notice and comment rulemakings, unless the agency certifies that “the rule will not, if promulgated, have a significant economic impact on a substantial number of small entities.” Accordingly, we have prepared a Final Regulatory Flexibility Analysis (FRFA) concerning the possible impact of the rule changes contained in the R&O on small entities. The Commission will send a copy of the R&O, including the FRFA below, in a report to be sent to Congress and the Government Accountability Office pursuant to the Small Business Regulatory Enforcement Fairness Act of 1996. In addition, the Commission will send a copy of the R&O, including the FRFA, to the Chief Counsel for Advocacy of the Small Business Administration. A copy of the R&O and FRFA (or summaries thereof) will also be published in the Federal Register.

27. As required by the Regulatory Flexibility Act of 1980, as amended (RFA), an Initial Regulatory Flexibility Analysis (IRFA) of the possible significant economic impact on a substantial number of small entities by the policies and rules was incorporated into the 2017 Notice of Proposed Rulemaking. Written comments were requested on this IRFA. This present FRFA conforms to the RFA.

28. Through the R&O, the Commission seeks to improve the Rural Health Care (RHC) Program's capacity to distribute telecommunications and broadband support to health care providers—especially small, rural health care providers—in the most equitable, effective, efficient, clear, and predictable manner as possible. Telemedicine has become an increasingly vital component of health care delivery to rural Americans and, in Funding Year (FY) 2016, for the first time in the RHC Program's twenty-year history, and then again in FY 2017, demand for support exceeded the $400 million annual cap which necessitated reduced, pro rata distribution of support. In light of the significance and scarcity of RHC Program support, the Commission adopts several measures to most effectively meet health care providers' needs while responsibly stewarding the RHC Program's limited funds. Specifically, the Commission adopts rules that: (1) Raise the annual RHC Program funding cap to $571 million to apply to FY 2017; (2) adjust the annual RHC Program funding cap for inflation; and (3) establish a mechanism to carry-forward unused funds from past funding years for use in future funding years.

29. There were no comments filed that specifically addressed the rules and policies proposed in the IRFA.

30. The Chief Counsel did not file any comments in response to the proposed rules in this proceeding.

31. The RFA directs agencies to provide a description of and, where feasible, an estimate of the number of small entities that may 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. A small business concern is one that: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the Small Business Administration (SBA).

32. Small Businesses, Small Organizations, Small Governmental Jurisdictions. The Commission's actions, over time, may affect small entities that are not easily categorized at present. The Commission therefore describes here, at the outset, three broad groups of small entities that could be directly affected herein. First, while there are industry specific size standards for small businesses that are used in the RFA, according to data from the SBA's Office of Advocacy, in general a small business is an independent business having fewer than 500 employees. These types of small businesses represent 99.9 percent of all businesses in the United States, which translates to 28.8 million businesses.

33. Next, the type of small entity described as a “small organization” is generally “any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.” Nationwide, as of August 2016, there were approximately 356,494 small organizations based on registration and tax data filed by nonprofits with the Internal Revenue Service (IRS).

34. Finally, the small entity described as a “small governmental jurisdiction” is defined generally as “governments of cities, counties, towns, townships, villages, school districts, or special districts, with a population of less than fifty thousand.” U.S. Census Bureau data from the 2012 Census of Governments indicate that there were 90,056 local governmental jurisdictions consisting of general purpose governments and special purpose governments in the United States. Of this number, there were 37,132 General purpose governments (county, municipal and town or township) with populations of less than 50,000 and 12,184 Special purpose governments (independent school districts and special districts) with populations of less than 50,000. The 2012 U.S. Census Bureau data for most types of governments in the local government category show that the majority of these governments have populations of less than 50,000. Based on this data the Commission estimates that at least 49,316 local government jurisdictions fall in the category of “small governmental jurisdictions.”

35. Small entities potentially affected by the reforms adopted herein include eligible non-profit and public health care providers and the eligible service providers offering them services, including telecommunications service providers, Internet Service Providers (ISPs), and vendors of the services and equipment used for dedicated broadband networks.

36. Offices of Physicians (except Mental Health Specialists). This U.S. industry comprises establishments of health practitioners having the degree of M.D. (Doctor of Medicine) or D.O. (Doctor of Osteopathy) primarily engaged in the independent practice of general or specialized medicine (except psychiatry or psychoanalysis) or surgery. These practitioners operate private or group practices in their own offices (e.g., centers, clinics) or in the facilities of others, such as hospitals or health maintenance organization (HMO) medical centers. The SBA has created a size standard for this industry, which is annual receipts of $11 million or less. According to 2012 U.S. Economic Census, 152,468 firms operated throughout the entire year in this industry. Of that number, 147,718 had annual receipts of less than $10 million, while 3,108 firms had annual receipts between $10 million and $24,999,999. Based on this data, the Commission concludes that a majority of firms operating in this industry are small under the applicable size standard.

37. Offices of Physicians, Mental Health Specialists. The U.S. industry comprises establishments of health practitioners having the degree of M.D. (Doctor of Medicine) or D.O. (Doctor of Osteopathy) primarily engaged in the independent practice of psychiatry or psychoanalysis. These practitioners operate private or group practices in their own offices (e.g., centers, clinics) or in the facilities of others, such as hospitals or HMO medical centers. The SBA has established a size standard for businesses in this industry, which is annual receipts of $11 million dollars or less. The U.S. Economic Census indicates that 8,809 firms operated throughout the entire year in this industry. Of that number 8,791 had annual receipts of less than $10 million, while 13 firms had annual receipts between $10 million and $24,999,999. Based on this data, the Commission concludes that a majority of firms in this industry are small under the applicable standard.

38. Offices of Dentists. This U.S. industry comprises establishments of health practitioners having the degree of D.M.D. (Doctor of Dental Medicine), D.D.S. (Doctor of Dental Surgery), or D.D.S. (Doctor of Dental Science) primarily engaged in the independent practice of general or specialized dentistry or dental surgery. These practitioners operate private or group practices in their own offices (e.g., centers, clinics) or in the facilities of others, such as hospitals or HMO medical centers. They can provide either comprehensive preventive, cosmetic, or emergency care, or specialize in a single field of dentistry. The SBA has established a size standard for that industry of annual receipts of $7.5 million or less. The 2012 U.S. Economic Census indicates that 115,268 firms operated in the dental industry throughout the entire year. Of that number 114,417 had annual receipts of less than $5 million, while 651 firms had annual receipts between $5 million and $9,999,999. Based on this data, the Commission concludes that a majority of business in the dental industry are small under the applicable standard.

39. Offices of Chiropractors. This U.S. industry comprises establishments of health practitioners having the degree of D.C. (Doctor of Chiropractic) primarily engaged in the independent practice of chiropractic. These practitioners provide diagnostic and therapeutic treatment of neuromusculoskeletal and related disorders through the manipulation and adjustment of the spinal column and extremities, and operate private or group practices in their own offices (e.g., centers, clinics) or in the facilities of others, such as hospitals or HMO medical centers. The SBA has established a size standard for this industry, which is annual receipts of $7.5 million or less. The 2012 U.S. Economic Census statistics show that in 2012, there were 33,940 firms operated throughout the entire year. Of that number 33,910 operated with annual receipts of less than $5 million per year, while 26 firms had annual receipts between $5 million and $9,999,999. Based on that data, the Commission concludes that a majority of chiropractors are small.

40. Offices of Optometrists. This U.S. industry comprises establishments of health practitioners having the degree of O.D. (Doctor of Optometry) primarily engaged in the independent practice of optometry. These practitioners examine, diagnose, treat, and manage diseases and disorders of the visual system, the eye and associated structures as well as diagnose related systemic conditions. Offices of optometrists prescribe and/or provide eyeglasses, contact lenses, low vision aids, and vision therapy. They operate private or group practices in their own offices (e.g., centers, clinics) or in the facilities of others, such as hospitals or HMO medical centers, and may also provide the same services as opticians, such as selling and fitting prescription eyeglasses and contact lenses. The SBA has established a size standard for businesses operating in this industry, which is annual receipts of $7.5 million or less. The 2012 Economic Census indicates that 18,050 firms operated the entire year. Of that number, 17,951 had annual receipts of less than $5 million, while 70 firms had annual receipts between $5 million and $9,999,999. Based on this data, the Commission concludes that a majority of optometrists in this industry are small.

41. Offices of Mental Health Practitioners (except Physicians). This U.S. industry comprises establishments of independent mental health practitioners (except physicians) primarily engaged in (1) the diagnosis and treatment of mental, emotional, and behavioral disorders and/or (2) the diagnosis and treatment of individual or group social dysfunction brought about by such causes as mental illness, alcohol and substance abuse, physical and emotional trauma, or stress. These practitioners operate private or group practices in their own offices (e.g., centers, clinics) or in the facilities of others, such as hospitals or HMO medical centers. The SBA has created a size standard for this industry, which is annual receipts of $7.5 million or less. The 2012 U.S. Economic Census indicates that 16,058 firms operated throughout the entire year. Of that number, 15,894 firms received annual receipts of less than $5 million, while 111 firms had annual receipts between $5 million and $9,999,999. Based on this data, the Commission concludes that a majority of mental health practitioners who do not employ physicians are small.

42. Offices of Physical, Occupational and Speech Therapists and Audiologists. This U.S. industry comprises establishments of independent health practitioners primarily engaged in one of the following: (1) Providing physical therapy services to patients who have impairments, functional limitations, disabilities, or changes in physical functions and health status resulting from injury, disease or other causes, or who require prevention, wellness or fitness services; (2) planning and administering educational, recreational, and social activities designed to help patients or individuals with disabilities, regain physical or mental functioning or to adapt to their disabilities; and (3) diagnosing and treating speech, language, or hearing problems. These practitioners operate private or group practices in their own offices (e.g., centers, clinics) or in the facilities of others, such as hospitals or HMO medical centers. The SBA has established a size standard for this industry, which is annual receipts of $7.5 million or less. The 2012 U.S. Economic Census indicates that 20,567 firms in this industry operated throughout the entire year. Of this number, 20,047 had annual receipts of less than $5 million, while 270 firms had annual receipts between $5 million and $9,999,999. Based on this data, the Commission concludes that a majority of businesses in this industry are small.

43. Offices of Podiatrists. This U.S. industry comprises establishments of health practitioners having the degree of D.P.M. (Doctor of Podiatric Medicine) primarily engaged in the independent practice of podiatry. These practitioners diagnose and treat diseases and deformities of the foot and operate private or group practices in their own offices (e.g., centers, clinics) or in the facilities of others, such as hospitals or HMO medical centers. The SBA has established a size standard for businesses in this industry, which is annual receipts of $7.5 million or less. The 2012 U.S. Economic Census indicates that 7,569 podiatry firms operated throughout the entire year. Of that number, 7,545 firms had annual receipts of less than $5 million, while 22 firms had annual receipts between $5 million and $9,999,999. Based on this data, the Commission concludes that a majority of firms in this industry are small.

44. Offices of All Other Miscellaneous Health Practitioners. This U.S. industry comprises establishments of independent health practitioners (except physicians; dentists; chiropractors; optometrists; mental health specialists; physical, occupational, and speech therapists; audiologists; and podiatrists). These practitioners operate private or group practices in their own offices (e.g., centers, clinics) or in the facilities of others, such as hospitals or HMO medical centers. The SBA has established a size standard for this industry, which is annual receipts of $7.5 million or less. The 2012 U.S. Economic Census indicates that 11,460 firms operated throughout the entire year. Of that number, 11,374 firms had annual receipts of less than $5 million, while 48 firms had annual receipts between $5 million and $9,999,999. Based on this data, the Commission concludes that the majority of firms in this industry are small.

45. Family Planning Centers. This U.S. industry comprises establishments with medical staff primarily engaged in providing a range of family planning services on an outpatient basis, such as contraceptive services, genetic and prenatal counseling, voluntary sterilization, and therapeutic and medically induced termination of pregnancy. The SBA has established a size standard for this industry, which is annual receipts of $11 million or less. The 2012 Economic Census indicates that 1,286 firms in this industry operated throughout the entire year. Of that number 1,237 had annual receipts of less than $10 million, while 36 firms had annual receipts between $10 million and $24,999,999. Based on this data, the Commission concludes that the majority of firms in this industry are small.

46. Outpatient Mental Health and Substance Abuse Centers. This U.S. industry comprises establishments with medical staff primarily engaged in providing outpatient services related to the diagnosis and treatment of mental health disorders and alcohol and other substance abuse. These establishments generally treat patients who do not require inpatient treatment. They may provide a counseling staff and information regarding a wide range of mental health and substance abuse issues and/or refer patients to more extensive treatment programs, if necessary. The SBA has established a size standard for this industry, which is $15 million or less in annual receipts. The 2012 U.S. Economic Census indicates that 4,446 firms operated throughout the entire year. Of that number, 4,069 had annual receipts of less than $10 million while 286 firms had annual receipts between $10 million and $24,999,999. Based on this data, the Commission concludes that a majority of firms in this industry are small.

47. HMO Medical Centers. This U.S. industry comprises establishments with physicians and other medical staff primarily engaged in providing a range of outpatient medical services to the HMO subscribers with a focus generally on primary health care. These establishments are owned by the HMO. Included in this industry are HMO establishments that both provide health care services and underwrite health and medical insurance policies. The SBA has established a size standard for this industry, which is $32.5 million or less in annual receipts. The 2012 U.S. Economic Census indicates that 14 firms in this industry operated throughout the entire year. Of that number, 5 firms had annual receipts of less than $25 million, while 1 firm had annual receipts between $25 million and $99,999,999. Based on this data, the Commission concludes that approximately one-third of the firms in this industry are small.

48. Freestanding Ambulatory Surgical and Emergency Centers. This U.S. industry comprises establishments with physicians and other medical staff primarily engaged in (1) providing surgical services (e.g., orthoscopic and cataract surgery) on an outpatient basis or (2) providing emergency care services (e.g., setting broken bones, treating lacerations, or tending to patients suffering injuries as a result of accidents, trauma, or medical conditions necessitating immediate medical care) on an outpatient basis. Outpatient surgical establishments have specialized facilities, such as operating and recovery rooms, and specialized equipment, such as anesthetic or X-ray equipment. The SBA has established a size standard for this industry, which is annual receipts of $15 million or less. The 2012 U.S. Economic Census indicates that 3,595 firms in this industry operated throughout the entire year. Of that number, 3,222 firms had annual receipts of less than $10 million, while 289 firms had annual receipts between $10 million and $24,999,999. Based on this data, the Commission concludes that a majority of firms in this industry are small.

49. All Other Outpatient Care Centers. This U.S. industry comprises establishments with medical staff primarily engaged in providing general or specialized outpatient care (except family planning centers, outpatient mental health and substance abuse centers, HMO medical centers, kidney dialysis centers, and freestanding ambulatory surgical and emergency centers). Centers or clinics of health practitioners with different degrees from more than one industry practicing within the same establishment (i.e., Doctor of Medicine and Doctor of Dental Medicine) are included in this industry. The SBA has established a size standard for this industry, which is annual receipts of $20.5 million or less. The 2012 U.S. Economic Census indicates that 4,903 firms operated in this industry throughout the entire year. Of this number, 4,269 firms had annual receipts of less than $10 million, while 389 firms had annual receipts between $10 million and $24,999,999. Based on this data, the Commission concludes that a majority of firms in this industry are small.

50. Blood and Organ Banks. This U.S. industry comprises establishments primarily engaged in collecting, storing, and distributing blood and blood products and storing and distributing body organs. The SBA has established a size standard for this industry, which is annual receipts of $32.5 million or less. The 2012 U.S. Economic Census indicates that 314 firms operated in this industry throughout the entire year. Of that number, 235 operated with annual receipts of less than $25 million, while 41 firms had annual receipts between $25 million and $49,999,999. Based on this data, the Commission concludes that approximately three-quarters of firms that operate in this industry are small.

51. All Other Miscellaneous Ambulatory Health Care Services. This U.S. industry comprises establishments primarily engaged in providing ambulatory health care services (except offices of physicians, dentists, and other health practitioners; outpatient care centers; medical and diagnostic laboratories; home health care providers; ambulances; and blood and organ banks). The SBA has established a size standard for this industry, which is annual receipts of $15 million or less. The 2012 U.S. Economic Census indicates that 2,429 firms operated in this industry throughout the entire year. Of that number, 2,318 had annual receipts of less than $10 million, while 56 firms had annual receipts between $10 million and $24,999,999. Based on this data, the Commission concludes that a majority of the firms in this industry are small.

52. Medical Laboratories. This U.S. industry comprises establishments known as medical laboratories primarily engaged in providing analytic or diagnostic services, including body fluid analysis, generally to the medical profession or to the patient on referral from a health practitioner. The SBA has established a size standard for this industry, which is annual receipts of $32.5 million or less. The 2012 U.S. Economic Census indicates that 2,599 firms operated in this industry throughout the entire year. Of this number, 2,465 had annual receipts of less than $25 million, while 60 firms had annual receipts between $25 million and $49,999,999. Based on this data, the Commission concludes that a majority of firms that operate in this industry are small.

53. Diagnostic Imaging Centers. This U.S. industry comprises establishments known as diagnostic imaging centers primarily engaged in producing images of the patient generally on referral from a health practitioner. The SBA has established size standard for this industry, which is annual receipts of $15 million or less. The 2012 U.S. Economic Census indicates that 4,209 firms operated in this industry throughout the entire year. Of that number, 3,876 firms had annual receipts of less than $10 million, while 228 firms had annual receipts between $10 million and $24,999,999. Based on this data, the Commission concludes that a majority of firms that operate in this industry are small.

54. Home Health Care Services. This U.S. industry comprises establishments primarily engaged in providing skilled nursing services in the home, along with a range of the following: Personal care services; homemaker and companion services; physical therapy; medical social services; medications; medical equipment and supplies; counseling; 24-hour home care; occupation and vocational therapy; dietary and nutritional services; speech therapy; audiology; and high-tech care, such as intravenous therapy. The SBA has established a size standard for this industry, which is annual receipts of $15 million or less. The 2012 U.S. Economic Census indicates that 17,770 firms operated in this industry throughout the entire year. Of that number, 16,822 had annual receipts of less than $10 million, while 590 firms had annual receipts between $10 million and $24,999,999. Based on this data, the Commission concludes that a majority of firms that operate in this industry are small.

55. Ambulance Services. This U.S. industry comprises establishments primarily engaged in providing transportation of patients by ground or air, along with medical care. These services are often provided during a medical emergency but are not restricted to emergencies. The vehicles are equipped with lifesaving equipment operated by medically trained personnel. The SBA has established a size standard for this industry, which is annual receipts of $15 million or less. The 2012 U.S. Economic Census indicates that 2,984 firms operated in this industry throughout the entire year. Of that number, 2,926 had annual receipts of less than $15 million, while 133 firms had annual receipts between $10 million and $24,999,999. Based on this data, the Commission concludes that a majority of firms in this industry are small.

56. Kidney Dialysis Centers. This U.S. industry comprises establishments with medical staff primarily engaged in providing outpatient kidney or renal dialysis services. The SBA has established assize standard for this industry, which is annual receipts of $38.5 million or less. The 2012 U.S. Economic Census indicates that 396 firms operated in this industry throughout the entire year. Of that number, 379 had annual receipts of less than $25 million, while 7 firms had annual receipts between $25 million and $49,999,999. Based on this data, the Commission concludes that a majority of firms in this industry are small.

57. General Medical and Surgical Hospitals. This U.S. industry comprises establishments known and licensed as general medical and surgical hospitals primarily engaged in providing diagnostic and medical treatment (both surgical and nonsurgical) to inpatients with any of a wide variety of medical conditions. These establishments maintain inpatient beds and provide patients with food services that meet their nutritional requirements. These hospitals have an organized staff of physicians and other medical staff to provide patient care services. These establishments usually provide other services, such as outpatient services, anatomical pathology services, diagnostic X-ray services, clinical laboratory services, operating room services for a variety of procedures, and pharmacy services. The SBA has established a size standard for this industry, which is annual receipts of $38.5 million or less. The 2012 U.S. Economic Census indicates that 2,800 firms operated in this industry throughout the entire year. Of that number, 877 has annual receipts of less than $25 million, while 400 firms had annual receipts between $25 million and $49,999,999. Based on this data, the Commission concludes that approximately one-quarter of firms in this industry are small.

58. Psychiatric and Substance Abuse Hospitals. This U.S. industry comprises establishments known and licensed as psychiatric and substance abuse hospitals primarily engaged in providing diagnostic, medical treatment, and monitoring services for inpatients who suffer from mental illness or substance abuse disorders. The treatment often requires an extended stay in the hospital. These establishments maintain inpatient beds and provide patients with food services that meet their nutritional requirements. They have an organized staff of physicians and other medical staff to provide patient care services. Psychiatric, psychological, and social work services are available at the facility. These hospitals usually provide other services, such as outpatient services, clinical laboratory services, diagnostic X-ray services, and electroencephalograph services. The SBA has established a size standard for this industry, which is annual receipts of $38.5 million or less. The 2012 U.S. Economic Census indicates that 404 firms operated in this industry throughout the entire year. Of that number, 185 had annual receipts of less than $25 million, while 107 firms had annual receipts between $25 million and $49,999,999. Based on this data, the Commission concludes that more than one-half of the firms in this industry are small.

59. Specialty (Except Psychiatric and Substance Abuse) Hospitals. This U.S. industry consists of establishments known and licensed as specialty hospitals primarily engaged in providing diagnostic, and medical treatment to inpatients with a specific type of disease or medical condition (except psychiatric or substance abuse). Hospitals providing long-term care for the chronically ill and hospitals providing rehabilitation, restorative, and adjustive services to physically challenged or disabled people are included in this industry. These establishments maintain inpatient beds and provide patients with food services that meet their nutritional requirements. They have an organized staff of physicians and other medical staff to provide patient care services. These hospitals may provide other services, such as outpatient services, diagnostic X-ray services, clinical laboratory services, operating room services, physical therapy services, educational and vocational services, and psychological and social work services. The SBA has established a size standard for this industry, which is annual receipts of $38.5 million or less. The 2012 U.S. Economic Census indicates that 346 firms operated in this industry throughout the entire year. Of that number, 146 firms had annual receipts of less than $25 million, while 79 firms had annual receipts between $25 million and $49,999,999. Based on this data, the Commission conclude that more than one-half of the firms in this industry are small.

60. Emergency and Other Relief Services. This industry comprises establishments primarily engaged in providing food, shelter, clothing, medical relief, resettlement, and counseling to victims of domestic or international disasters or conflicts (e.g., wars). The SBA has established a size standard for this industry, which is annual receipts of $32.5 million or less. The 2012 U.S. Economic Census indicates that 541 firms operated in this industry throughout the entire year. Of that number, 509 had annual receipts of less than $25 million, while 7 firms had annual receipts between $25 million and $49,999,999. Based on this data, the Commission concludes that a majority of firms in this industry are small.

61. Incumbent Local Exchange Carriers (LECs). Neither the Commission nor the SBA has developed a small business size standard specifically for incumbent local exchange services. The closest applicable NAICS Code category is Wired Telecommunications Carriers and under the SBA size standard, such a business is small if it has 1,500 or fewer employees. U.S. Census Bureau data for 2012 indicate that 3,117 firms operated during 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 that may be affected by our actions. According to Commission data, one thousand three hundred and seven (1,307) Incumbent Local Exchange Carriers reported that they were incumbent local exchange service providers. Of this total, an estimated 1,006 have 1,500 or fewer employees. Thus, using the SBA's size standard the majority of Incumbent LECs can be considered small entities.

62. Interexchange Carriers (IXCs). Neither the Commission nor the SBA has developed a definition of small entities specifically applicable to providers of IXCs. The closest NAICS Code category is Wired Telecommunications Carriers and the applicable size standard under SBA rules consists of all such companies having 1,500 or fewer employees. U.S. Census Bureau data for 2012 indicate that 3,117 firms operated during that year. Of that number, 3,083 operated with fewer than 1,000 employees. According to internally developed Commission data, 359 companies reported that their primary telecommunications service activity was the provision of interexchange services. Of this total, an estimated 317 have 1,500 or fewer employees. Consequently, the Commission estimates that the majority of interexchange service providers that may be affected are small entities.

63. Competitive Access Providers. Neither the Commission nor the SBA has developed a definition of small entities specifically applicable to competitive access services providers (CAPs). The closest applicable definition under the SBA rules is Wired Telecommunications Carriers and under the size standard, such a business is small if it has 1,500 or fewer employees. U.S. Census Bureau data for 2012 indicate that 3,117 firms operated during that year. Of that number, 3,083 operated with fewer than 1,000 employees. Consequently, the Commission estimates that most competitive access providers are small businesses that may be affected by these actions. According to Commission data the 2010 Trends in Telephone Report, dated September 2010, 1,442 CAPs and competitive local exchange carriers (competitive LECs) reported that they were engaged in the provision of competitive local exchange services. Of these 1,442 CAPs and competitive LECs, an estimated 1,256 have 1,500 or few employees and 186 have more than 1,500 employees. Consequently, the Commission estimates that most providers of competitive exchange services are small businesses.

64. 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. U.S. 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 size standard, the majority of firms in this industry can be considered small.

65. Wireless Telecommunications Carriers (except Satellite). This industry comprises establishments engaged in operating and maintaining switching and transmission facilities to provide communications via the airwaves. Establishments in this industry have spectrum licenses and provide services using that spectrum, such as cellular services, paging services, wireless internet access, and wireless video services. The appropriate size standard under SBA rules is that such a business is small if it has 1,500 or fewer employees. For this industry, U.S. Census Bureau data for 2012 shows that there were 967 firms that operated for the entire year. Of this total, 955 firms had employment of 999 or fewer employees and 12 had employment of 1,000 employees or more. Thus, under this category and the associated size standard, the Commission estimates that the majority of wireless telecommunications carriers (except satellite) are small entities.

66. The Commission's own data—available in its Universal Licensing System—indicate that, as of October 25, 2016, there are 280 Cellular licensees that will be affected by these actions. The Commission does not know how many of these licensees are small, as the Commission does not collect that information for these types of 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) Telephony services. Of this total, an estimated 261 have 1,500 or fewer employees, and 152 have more than 1,500 employees. Thus, using available data, the Commission estimates that the majority of wireless firms can be considered small.

67. Wireless Telephony. Wireless telephony includes cellular, personal communications services, and specialized mobile radio telephony carriers. The closest applicable SBA category is Wireless Telecommunications Carriers (except Satellite) and the appropriate size standard for this category under the SBA rules is that such a business is small if it has 1,500 or fewer employees. For this industry, U.S. Census Bureau 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 and 12 firms has 1,000 employees or more. Thus, under this category and the associated size standard, the Commission estimates that a majority of these entities can be considered small. According to Commission data, 413 carriers reported that they were engaged in wireless telephony. Of these, an estimated 261 have 1,500 or fewer employees and 152 have more than 1,500 employees. Therefore, more than half of these entities can be considered small.

68. Satellite Telecommunications. This category comprises firms “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.” Satellite telecommunications service providers include satellite and earth station operators. The category has a small business size standard of $32.5 million or less in average annual receipts, under SBA rules. For this category, U.S. Census Bureau data for 2012 shows that there were a total of 333 firms that operated for the entire year. Of this total, 299 firms had annual receipts of less than $25 million. Consequently, the Commission estimates that the majority of satellite telecommunications providers are small entities.

69. All Other Telecommunications. The “All Other Telecommunications” category is comprised of establishments that are 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 “All Other Telecommunications,” which consists of all such firms with gross annual receipts of $32.5 million or less. For this category, U.S. Census Bureau data for 2012 show that there were 1,442 firms that operated for the entire year. Of these firms, a total of 1,400 had gross annual receipts of less than $25 million and 42 firms had gross annual receipts of $25 million to $49, 999,999. Thus, the Commission estimates that a majority of “All Other Telecommunications” firms potentially affected by our action can be considered small.

70. Internet Service Providers (Broadband). Broadband internet service providers include wired (e.g., cable, DSL) and VoIP service providers using their own operated wired telecommunications infrastructure fall in the category of Wired Telecommunication Carriers. Wired Telecommunications Carriers are comprised of 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 telecommunications networks. Transmission facilities may be based on a single technology or a combination of technologies. The SBA size standard for this category classifies a business as small if it has 1,500 or fewer employees. U.S. Census Bureau 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, under this size standard, the majority of firms in this industry can be considered small.

71. Internet Service Providers (Non-Broadband). Internet access service providers such as Dial-up internet service providers, VoIP service providers using client-supplied telecommunications connections and internet service providers using client-supplied telecommunications connections (e.g., dial-up ISPs) fall in the category of All Other Telecommunications. The SBA has developed a small business size standard for All Other Telecommunications, which consists of all such firms with gross annual receipts of $32.5 million or less. For this category, U.S. Census Bureau data for 2012 show that there were 1,442 firms that operated for the entire year. Of these firms, a total of 1,400 had gross annual receipts of less than $25 million. Consequently, under this size standard, a majority of firms in this industry can be considered small.

72. Vendors of Infrastructure Development or “Network Buildout.” The Commission has not developed a small business size standard specifically directed toward manufacturers of network facilities. There are two applicable SBA categories in which manufacturers of network facilities could fall and each have different size standards under the SBA rules. The SBA categories are “Radio and Television Broadcasting and Wireless Communications Equipment” with a size standard of 1,250 employees or less and “Other Communications Equipment Manufacturing” with a size standard of 750 employees or less.” U.S. Census Bureau data for 2012 show that for Radio and Television Broadcasting and Wireless Communications Equipment firms 841 establishments operated for the entire year. Of that number, 828 establishments operated with fewer than 1,000 employees, 7 establishments operated with between 1,000 and 2,499 employees and 6 establishments operated with 2,500 or more employees. For Other Communications Equipment Manufacturing, U.S. Census Bureau data for 2012 show that 383 establishments operated for the year. Of that number, 379 firms operated with fewer than 500 employees and 4 had 500 to 999 employees. Based on this data, the Commission concludes that the majority of Vendors of Infrastructure Development or “Network Buildout” are small.

73. Telephone Apparatus Manufacturing. This industry comprises establishments primarily engaged in manufacturing wire telephone and data communications equipment. These products may be standalone or board-level components of a larger system. Examples of products made by these establishments are central office switching equipment, cordless telephones (except cellular), PBX equipment, telephones, telephone answering machines, LAN modems, multi-user modems, and other data communications equipment, such as bridges, routers, and gateways.” The SBA size standard for Telephone Apparatus Manufacturing is all such firms having 1,250 or fewer employees. According to U.S. Census Bureau data for 2012, there were a total of 266 establishments in this category that operated for the entire year. Of this total, 262 had employment of under 1,000, and an additional 4 had employment of 1,000 to 2,499. Thus, under this size standard, the majority of firms can be considered small.

74. Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing. This industry comprises establishments primarily engaged in manufacturing radio and television broadcast and wireless communications equipment. Examples of products made by these establishments are: Transmitting and receiving antennas, cable television equipment, GPS equipment, pagers, cellular phones, mobile communications equipment, and radio and television studio and broadcasting equipment. The SBA has established a small business size standard for this industry of 1,250 employees or less. U.S. Census Bureau data for 2012 show that 841 establishments operated in this industry in that year. Of that number, 828 establishments operated with fewer than 1,000 employees, 7 establishments operated with between 1,000 and 2,499 employees and 6 establishments operated with 2,500 or more employees. Based on this data, the Commission concludes that a majority of manufacturers in this industry are small.

75. Other Communications Equipment Manufacturing. This industry comprises establishments primarily engaged in manufacturing communications equipment (except telephone apparatus, and radio and television broadcast, and wireless communications equipment). Examples of such manufacturing include fire detection and alarm systems manufacturing, Intercom systems and equipment manufacturing, and signals (e.g., highway, pedestrian, railway, traffic) manufacturing. The SBA has established a size for this industry as all such firms having 750 or fewer employees. U.S. Census Bureau data for 2012 show that 383 establishments operated in that year. Of that number, 379 operated with fewer than 500 employees and 4 had 500 to 999 employees. Based on this data, the Commission concludes that the majority of Other Communications Equipment Manufacturers are small.

76. There are no new or different reporting, recordkeeping, or other compliance requirements adopted in this R&O that would likely financially impact either large or small entities, including health care providers and service providers.

77. The RFA requires an agency to describe any significant, specifically small business, alternatives that it has considered in reaching its proposed approach, which may include the following four alternatives (among others): “(1) The establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance and reporting requirements under the rule for such 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 such small entities.”

78. In the R&O, the Commission increases available funding for all eligible RHC Program entities including small entities. Specifically, the Commission increases RHC Program support, and thereby increases support available for rural, mostly small, health care providers, by: (1) Increasing the RHC Program support cap to $571 million to apply to FY 2017; (2) prospectively increasing the $571 million RHC Program support cap via inflation using the Gross Domestic Price Chain-type Price Index (GDP-CPI) in FY 2018 and beyond; and (3) “carrying forward” unused funds committed in one funding year into subsequent funding years.

79. In the R&O, the Commission carefully balanced the significant financial hardship faced by rural health care providers due to the otherwise scarcity of funding and the public health consequences that could result from lack of broadband service with the increase in funding needed to meet the new cap. The Commission considered and rejected arguments to double the cap or to increase it beyond the $571 million adopted in the R&O. The increased cap, indexed to inflation, and the carry forward of unused funds will make more funding available to eligible health care providers including small entities, while minimizing the amount of funds that are needed to be collected. No commenters proposed significant small business alternatives.

80. The Commission will send a copy of the R&O, including this FRFA, in a report to be sent to Congress pursuant to the Congressional Review Act. In addition, the Commission will send a copy of the R&O, including this FRFA, to the Chief Counsel for Advocacy of the SBA. A copy of the R&O and FRFA (or summaries thereof) will also be published in the Federal Register.

81. The Commission finds good cause to make the rule changes herein effective June 29, 2018, pursuant to section 553(d) of the Administrative Procedure Act. Agencies determining whether there is good cause to make a new rule or rule revision take effect less than 30 days after Federal Register publication must balance the necessity for immediate implementation against principles of fundamental fairness that require that all affected persons be afforded a reasonable time to prepare for the effective date of the new rule. Making these rule changes effective June 29, 2018 enables eligible health care providers to benefit from the increased funding cap for FY 2017, thereby avoiding the financial hardship caused by the proration of their funding commitments and the potential public health crises that could result. As noted earlier, the current reduction in funding may impede the ability of rural health care providers to provide essential health care services in their rural communities, or require them to scale back service offerings or quality, and these consequences could be particularly severe for small, rural health care providers with limited budgets.

82. Further, making these rule changes effective upon publication will not burden contributors or RHC Program participants. As a practical matter, contributors pass through their contribution obligations to their end users by a line item on the end user's invoice, which they update quarterly based on the contribution factor. The additional funding required by the R&O to be applied to FY 2017 will be collected over the next two quarters in accordance with our regular course of business for calculating and announcing the quarterly contribution factor, thus requiring no additional or different administrative burden on contributors. No additional time is needed for affected parties to prepare for the rules' effectiveness because USAC and interested parties have already applied for and processed the requests for funding for the current RHC Program year (FY 2017). Additionally, the rule change to increase the funding cap enables eligible health care providers to benefit from increased funding in the current funding year and does not oblige them to take any particular action. The rule changes that index the funding cap to inflation and carry forward unused funds do not impose any additional requirement on RHC Program participants and will be implemented by Commission staff and USAC during FY 2018. Thus, the Commission finds good cause to make these rule changes effective June 29, 2018.

83. Accordingly, it is ordered that, pursuant to sections 4(i) through (j), 201(b), and 254 of the Communications Act of 1934, as amended, 47 U.S.C. 154(i) through (j), 201(b), 254, the Report and Order is adopted.

84. It is furthered ordered that part 54 of the Commission's rules, 47 CFR part 54, is amended, and such rules shall become effective June 29, 2018.

85. It is further ordered that, pursuant to the authority contained in sections 1 through 4 and 254 of the Communications Act of 1934, as amended, 47 U.S.C. 151 through 154 and 254, and pursuant to § 1.3 and of the Commission's rules, 47 CFR 1.3, that § 54.675 of the Commission's rules, 47 CFR 54.675, is waived to the extent provided herein.

86. It is further ordered that, pursuant to the authority contained in sections 1 through 4 and 254 of the Communications Act of 1934, as amended, 47 U.S.C. 151 through 154 and 254, the petitions for waiver filed by Schools, Health, and Libraries Broadband Coalition filed on April 3, 2018, Advanced Data Solutions (on behalf of Frontier Community Services, Central Peninsula Hospital, Cordova Community Medical Center, Camai Community Health Center, IHS/ABQ Alamo Health Center and Kenaitze Indian Tribe) filed on May 15, 2018, Bristol Bay Area Health Corporation filed on April 2, 2018, and Council of Athabascan Tribal Government filed on April 9, 2018 are dismissed as moot.

87. It is further ordered that, pursuant to 5 U.S.C. 801(a)(1)(A), the Commission shall send a copy of the Report and Order to Congress and to the Government Accountability Office pursuant to the Congressional Review Act.

88. It is further ordered that the Commission's Consumer and Governmental Affairs Bureau, Reference Information Center, shall send a copy of the Report and Order, including the Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration.

For the reasons discussed in the preamble, the Federal Communications Commission amends 47 CFR part 54 as follows:

I. Background

DoD published a proposed rule in the Federal Register at 81 FR 73007 on October 21, 2016, to amend the DFARS to provide a more transparent means of documenting the impact of costs incurred during the undefinitized period of an undefinitized contract action (UCA), and to recognize when contractors demonstrate efficient management and internal cost control systems through the submittal of a timely, auditable proposal in furtherance of definitization of a UCA. In some cases, DoD contracting personnel have not documented their consideration of the reduced risk to the contractor of costs incurred during the undefinitized period of a UCA. While such costs generally present very little risk to the contractor, the contracting officer should consider the reasons for any delays in definitization in making their determination of the appropriate assigned value for contract type risk.

Two respondents submitted public comments in response to the proposed rule. DoD reviewed the public comments in the development of this final rule. An analysis of the comments is provided as follows:

The following changes were made to the language published in the proposed rule:

1. The term “auditable proposal” in 215.404-71-2 is revised as “qualifying proposal as defined in 217.7401(c)” for consistency with 10 U.S.C. 2326.

2. The instructions for completing blocks 24a and 24b have been revised for clarity.

3. The language at 215.404-71-3(d)(2)(ii) is revised for clarity.

Comment: One respondent did not see the need to change the current weighted guidelines form and structure to address unique requirements associated with establishing profit objectives for undefinitized contract actions, and therefore recommended no change to the current weighted guidelines application. The respondent asserted that the Government should comply with guidance provided by USD/AT&L, and the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2017, which stipulates that allowable profit should reflect the cost risk at the time that a contractor submits a qualifying proposal. The respondent stated that contractors should not be penalized for positive and efficient performance because they agreed to start work before final agreement on price, particularly when Government action or inaction is the cause of the delay. The respondent therefore asserted that profit should be based upon the risk at the time of the proposal and not at the time of negotiation.

Response: The stated purpose of this rule is to provide a more transparent means of documenting the impact of costs incurred during the undefinitized period of a UCA, and to recognize when contractors demonstrate efficient management and internal cost control systems through the submittal of a timely, auditable proposal in furtherance of definitization of a UCA. Therefore, the weighted guidelines form is revised to provide a means of clearly demonstrating that the contracting officer has appropriately considered and documented the risk to the contractor during the undefinitized period, as well as the contractor's due diligence in submitting a timely, auditable proposal. DFARS case 2017-D022 has been opened to implement section 811, Modified Restrictions on Undefinitized Contractual Actions, of the NDAA for FY 2017.

Comment: One respondent stated that the requirements of DFARS 215.404-71-3(d)(2), which direct contracting officers to assess the extent to which costs have been incurred prior to definitization of the UCA, are inconsistent with the tenets of the NDAA for FY 2017 and should also be deleted.

Response: The requirements of DFARS 215.404-71-3(d)(2) are consistent with the requirements of section 811 of the NDAA for FY 2017, which are being implemented under DFARS case 2017-D022.

Comment: One respondent expressed concern that the 1 percent adjustment to the management/cost control factor is tied to the contractor's timely submission of an auditable proposal. The respondent stated that in many cases, industry submits timely, auditable proposals only to have the Government, usually after lengthy delay, deem them insufficient and request an updated proposal. This becomes an endless loop of auditing, requests for updated information (including actuals), more auditing, more requests for updated information, etc.

Response: The adjustment to the management/cost control factor in the weighted guidelines is established to allow contracting officers to recognize when contractors demonstrate efficient management and internal cost control systems through the submittal of a timely, auditable proposal in furtherance of definitization of a UCA. It is incumbent on contractors to provide timely, auditable proposals in order to demonstrate their efficient management and internal cost control systems.

Comment: Both respondents expressed concern that the rule does not address the need for the Government to definitize UCAs in a timely manner.

Response: To provide for enhanced management and oversight of UCAs, departments and agencies prepare and maintain semiannual Consolidated UCA Management Plans and UCA Management Reports to ensure contracting officers are actively and efficiently pursuing definitization of UCAs. Likewise, contractors are expected to submit timely, auditable proposals, including adequate supporting data in order to avoid unnecessary delays.

This rule amends the DFARS to provide a more transparent means of documenting the impact of costs incurred during the undefinitized period of an undefinitized contract action on allowable profit. The revisions do not add any new burdens or impact applicability of clauses and provisions at or below the simplified acquisition threshold, or to commercial items.

Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is not a significant regulatory action and, therefore, was not subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.

This rule is not an E.O. 13771, Reducing and Controlling Regulatory Costs, regulatory action, because this rule is not significant under E.O. 12866.

This rule will not have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601 et seq.

The objective of the rule is to gain visibility into the contracting officer's rationale for the contract type risk values entered on the DD Form 1547, Record of Weighted Guidelines Application. The rule requires contracting officers to document in the price negotiation memorandum their rationale for assigning a specific contract type risk value. In addition, Item 24 on the DD Form 1547 is separated into Item 24a, Contract Type Risk (based on contractor incurred costs under a UCA) and Item 24b, Contract Type Risk (based on Government projected costs).

This rule will not have a significant economic impact on a substantial number of small entities. This rule only changes processes that are internal to the Government by providing a more transparent means of documenting the impact of costs incurred during the undefinitized period of a UCA when calculating negotiation profit objectives. This rule does not revise the current regulatory requirements at DFARS 215.404-71-3(d)(2), which direct contracting officers to assess the extent to which costs have been incurred prior to definitization of the contract action. However, to recognize when contractors demonstrate efficient management and cost control through the submittal of a timely, auditable proposal in furtherance of definitization of a UCA, and the proposal demonstrates effective cost control from the time of award to the present, the contracting officer may add 1 percentage point to the value determined for management/cost control up to the maximum of 7 percent.

There is no change to reporting or recordkeeping as a result of this rule. The rule does not duplicate, overlap, or conflict with any other Federal rules.

There are no known significant alternative approaches to the rule that would meet the requirements. DoD considers the approach described in the proposed rule to be the most practical and beneficial for both Government and industry.

The rule does not contain any information collection requirements that require the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).

Therefore, 48 CFR parts 215, 217, and 243 are amended as follows:

I. Background

DoD is amending the DFARS to remove the DFARS clause 252.216-7010, Requirements, the Alternate clause, the associated clause prescription at DFARS 216.506, and a cross-reference to the clause at DFARS 247.271-3(p).

The DFARS clause is included in contracts for preparation of personal property for movement or storage, or for intra-city or intra-area movement; advises contractors that a requirements contract has been issued and how quantities work under the contract; that the delivery of items or performance of work is subject to the issuance of orders; and, that the Government shall order all requirements covered by the contract from the contractor, unless certain circumstances apply.

FAR clause, 52.216-21, Requirements, advises contractors of the same information in the DFARS clause, and also provides a date after which the contractor is not required to make any deliveries under the contract. The DFARS clause is no longer necessary, because the FAR clause applies to the situations in which the DFARS clause is prescribed for use and covers the information contained in the DFARS clause. As such, this DFARS clause is now redundant and can be removed.

The removal of this DFARS clause supports a recommendation from the DoD Regulatory Reform Task Force. On February 24, 2017, the President signed Executive Order (E.O.) 13777, “Enforcing the Regulatory Reform Agenda,” which established a Federal policy “to alleviate unnecessary regulatory burdens” on the American people. In accordance with E.O. 13777, DoD established a Regulatory Reform Task Force to review and validate DoD regulations, including the DFARS. A public notification of the establishment of the DFARS Subgroup to the DoD Regulatory Reform Task Force, for the purpose of reviewing DFARS provisions and clauses, was published in the Federal Register at 82 FR 35741 on August 1, 2017, and requested public input. No public comments were received on this provision. Subsequently, the DoD Task Force reviewed the requirements of DFARS clause 252.216-7010, Requirements, and determined that the DFARS coverage was redundant and recommended removal.

This rule does not add any new solicitation provisions or contract clauses. This rule only removes obsolete DFARS provision 252.216-7010, Requirements. Therefore, the rule does not impose any new requirements on contracts at or below the simplified acquisition threshold and for commercial items, including commercially available off-the-shelf items.

Executive Order (E.O.) 12866, Regulatory Planning and Review; and E.O. 13563, Improving Regulation and Regulatory Review, direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. The Office of Management and Budget, Office of Information and Regulatory Affairs (OIRA), has determined that this is not a significant regulatory action as defined under section 3(f) of E.O. 12866 and, therefore, was not subject to review under section 6(b). This rule is not a major rule as defined at 5 U.S.C. 804(2).

This rule is not an E.O. 13771, Reducing Regulation and Controlling Regulatory Costs, regulatory action, because this rule is not significant under E.O. 12866.

The statute that applies to the publication of the Federal Acquisition Regulation (FAR) is the Office of Federal Procurement Policy statute (codified at title 41 of the United States Code). Specifically, 41 U.S.C 1707(a)(1) requires that a procurement policy, regulation, procedure or form (including an amendment or modification thereof) must be published for public comment if it relates to the expenditure of appropriated funds, and has either a significant effect beyond the internal operating procedures of the agency issuing the policy, regulation, procedure, or form, or has a significant cost or administrative impact on contractors or offerors. This final rule is not required to be published for public comment, because DoD is not issuing a new regulation; rather, this rule merely removes an obsolete clause from the DFARS.

Because a notice of proposed rulemaking and an opportunity for public comment are not required to be given for this rule under 41 U.S.C. 1707(a)(1) (see section V. of this preamble), the analytical requirements of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) are not applicable. Accordingly, no regulatory flexibility analysis is required and none has been prepared.

The rule does not contain any information collection requirements that require the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).

Therefore, 48 CFR parts 216, 247, and 252 are amended as follows: