Federal Register Vol. 83, No.174,

The NRC is withdrawing draft RIS 2017-XX, “Identifying and Reporting Human Factor Incidents” because after further consideration, the NRC determined that the RIS did not provide the clarification intended regarding licensees' required reporting of human performance incidents “Licensee event report system” under § 50.73 of title 10 of the Code of Federal Regulations (CFR).

Comments Invited

We invite you to send any written relevant data, views, or arguments about this proposal. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2018-0767; Product Identifier 2018-NM-068-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this NPRM. We will consider all comments received by the closing date and may amend this NPRM because of those comments.

We will post all comments we receive, without change, to http://www.regulations.gov, including any personal information you provide. We will also post a report summarizing each substantive verbal contact we receive about this NPRM.

The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Union, has issued EASA Airworthiness Directive 2018-0077 dated April 6, 2018 (referred to after this as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for Fokker Services B.V. Model F28 Mark 0070 and 0100 airplanes. The MCAI states:

You may examine the MCAI in the AD docket on the internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2018-0767.

This NPRM does not propose to supersede AD 2010-22-05. Rather, we have determined that a stand-alone AD would be more appropriate to address the changes in the MCAI. This proposed AD would require replacing the restrictor check valve with an improved valve that has a filter screen. Accomplishment of the proposed actions would then terminate all requirements of AD 2010-22-05.

Fokker Services B.V. has issued Fokker Service Bulletin F100/70 SBF100-32-163, Revision 1, dated February 21, 2018. This service information describes procedures for removing the restrictor check valve in the hydraulic return line of the PBSOV and installing an improved restrictor check valve that has a filter screen. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

This product has been approved by the aviation authority of another country, and is approved for operation in the United States. Pursuant to our bilateral agreement with the State of Design Authority, we have been notified of the unsafe condition described in the MCAI and service information referenced above. We are proposing this AD because we evaluated all the relevant information and determined the unsafe condition described previously is likely to exist or develop on other products of the same type design.

This proposed AD would require accomplishing the actions specified in the service information described previously.

We estimate that this proposed AD affects 4 airplanes of U.S. registry. We estimate the following costs to comply with this proposed AD:

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

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

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

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

For the reasons discussed above, I certify this proposed regulation:

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

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

3. Will not affect intrastate aviation in Alaska; and

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

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

Comments Invited

We invite you to participate in this rulemaking by submitting written comments, data, or views. We also invite comments relating to the economic, environmental, energy, or federalism impacts that might result from adopting the proposals in this document. The most helpful comments reference a specific portion of the proposal, explain the reason for any recommended change, and include supporting data. To ensure the docket does not contain duplicate comments, commenters should send only one copy of written comments, or if comments are filed electronically, commenters should submit only one time.

We will file in the docket all comments that we receive, as well as a report summarizing each substantive public contact with FAA personnel concerning this proposed rulemaking. Before acting on this proposal, we will consider all comments we receive on or before the closing date for comments. We will consider comments filed after the comment period has closed if it is possible to do so without incurring expense or delay. We may change this proposal in light of the comments we receive.

EASA, which is the Technical Agent for the Member States of the European Union, has issued EASA AD No. 2017-0199, dated October 11, 2017, to correct an unsafe condition for Airbus Helicopters Model EC135P1, EC135P2, EC135P2+, EC135P3, EC135T1, EC135T2, EC135T2+, EC135T3, EC635P2+, EC635P3, EC635T1, EC635T2+, and EC635T3 helicopters. EASA advises of a report of a hook separating from the hoist cable. According to EASA, an investigation determined that failure of the internal retaining ring combined with a permanent compression set of the elastomeric energy absorber caused the separation. EASA states that this condition, if not corrected, could lead to the detachment of an external load or person from the hoist, possibly resulting in personal injury or injury to persons on the ground.

The EASA AD consequently requires repetitive inspections of the hook assembly and replacement of the retaining ring. Depending on the findings of the inspection, the EASA AD also requires replacement of the elastomeric energy absorber. According to the manufacturer of the hook, the retaining ring can corrode in a salt-laden environment. Therefore, replacement of the retaining ring is required with each inspection. EASA considers its AD an interim measure and states that further AD action may follow.

These helicopters have been approved by the aviation authority of Germany and are approved for operation in the United States. Pursuant to our bilateral agreement with Germany, EASA, its technical representative, has notified us of the unsafe condition described in its AD. We are proposing this AD because we evaluated all known relevant information and determined that an unsafe condition is likely to exist or develop on other products of the same type design.

We reviewed Goodrich Service Bulletin No. 44301-10-17, Revision 4, dated July 26, 2017. The Goodrich Service Bulletin is attached as an appendix to Airbus Helicopters Alert Service Bulletin No. ASB EC135-85A-069, Revision 0, dated August 2, 2017. This service information specifies an initial and repetitive inspections of the hook assembly and replacement of the retaining ring. If the inspections of elastomeric energy absorber detect a permanent compression set, this service information also specifies replacing the elastomeric energy absorber.

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

This proposed AD would require, within 90 hours time-in-service (TIS) and thereafter at intervals not to exceed 180 hours TIS, replacing the retaining ring and inspecting the elastometric energy absorber for a permanent compression set, and if necessary, replacing the elastometric energy absorber before the next hoist operation.

The EASA AD requires corrective actions in terms of months in service. This proposed AD would require compliance within 90 hours TIS and thereafter at intervals not to exceed 180 hours TIS. The EASA AD applies to Airbus Helicopters Model EC635P2+, EC635P3, EC635T1, EC635T2+, and EC635T3 helicopters. This proposed AD would not because these model helicopters have no FAA type certificate.

We consider this proposed AD to be an interim action. The design approval holder is currently developing a modification that will address the unsafe condition identified in this proposed AD. Once this modification is developed, approved, and available, we might consider additional rulemaking.

We estimate that this proposed AD would affect 278 helicopters of U.S. Registry and that labor costs average $85 per work-hour. Based on these estimates, we expect the following costs:

• Inspecting the hoist cable hook assembly and replacing the retaining ring would require 0.5 work-hour and parts would be minimal for a cost of $43 per helicopter and $11,954 for the U.S. fleet per inspection cycle.

• Replacing an elastomeric energy absorber would require 0.5 work-hour and parts would cost $2,152 for a cost of $2,195 per helicopter.

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

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

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

For the reasons discussed, I certify this proposed regulation:

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

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

3. Will not affect intrastate aviation in Alaska to the extent that it justifies making a regulatory distinction; and

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

We prepared an economic evaluation of the estimated costs to comply with this proposed AD and placed it in the AD docket.

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

In accordance with 29 U.S.C. 661(g), the Occupational Safety and Health Review Commission last implemented a comprehensive revision of its rules of procedure in 2005. Since that time, technological advances, including implementation of the E-filing system, as well as the evolution of practice before the Commission, have called for a careful reexamination of the Commission's rules of procedure, as set forth in 29 CFR part 2200. To assist in determining what revisions should be made, the agency is soliciting recommendations from the public. It is especially interested in hearing from those who practice before it on what rules their experience suggests would benefit from a revision. While recommended changes to any rule will be considered, the Commission is especially interested in whether: Rules on the computation of time should be simplified; electronic filing and service should be mandatory and, if so, what exceptions, if any, should be allowed; the definition of “affected employee” should be broadened; citing to Commission decisions as posted on the agency's website should be allowed; the rule on the staying of a final order is not needed and should be eliminated; the requirement for agency approval of settlements should be narrowed or eliminated; the grounds for obtaining Commission review of interlocutory orders issued by its administrative law judges should be revised; protection of sensitive personal information should be broadened; and whether the threshold amount for cases referred for mandatory settlement proceedings should be increased. Comments suggesting a rule change should include a brief discussion of the reasons for the change, why the change would facilitate improved practice before the Commission, and a reference to authority where necessary.

The Federal Maritime Commission is issuing this notice to obtain public comments on clarification and guidance regarding the Commission's interpretation of the scope of 46 U.S.C. 41102(c) (section 10(d)(1) of the Shipping Act of 1984).1 Section 41102(c) provides that regulated entities “may not fail to establish, observe, and enforce just and reasonable regulations and practices relating to or connected with receiving, handling, storing, or delivering property.” 2

Beginning with the Houben 3 decision in 2010 and presented in full in the Commission's 2013 decision in Kobel v. Hapag-Lloyd, the Commission has held in a line of recent cases that discrete conduct with respect to a particular shipment, if determined to be unjust or unreasonable, represents a violation of § 41102(c), regardless of whether that conduct represents a respondent's practice or regulation. 4 These decisions diverge from consistent Commission precedent dating back to 1935 and reaffirmed as recently as 2001 which required that a regulated entity must engage in a practice or regulation on a normal, customary, and continuous basis in order to be found to have violated § 41102(c) of the Shipping Act. In simple summary, discrete or occasional actions by regulated entities not reflecting a practice or regulation would not constitute a violation of § 41102(c).

Specifically, the Commission is considering an interpretive rule consistent with Commission precedent articulated in cases including Intercoastal Investigation, 5 Altieri, 6 Stockton Elevators, 7 European Trade, 8 A.N. Deringer, 9 and Kamara 10 that would restore the scope of § 41102(c) to prohibiting unjust and unreasonable practices and regulations. These decisions require that a regulated entity engage in a practice or regulation on a normal, customary, and continuous basis and a finding that such practice or regulation is unjust or unreasonable to violate that section of the Shipping Act. The Commission believes that this represents the proper interpretation of the statutory language of the provision that, within the full context of the 1916 Act and the 1984 Act, is consistent with statutory and legislative history, judicial precedent and Commission case law embodied in cases such as Stockton Elevators, and comports with accepted rules of statutory construction.

This interpretation restores § 41102(c) to its proper function and purpose under the Shipping Act of 1984 and will return the Commission's focus and priorities to the activities of maritime regulated entities that negatively affect the broader shipping public—all as intended by Congress in its enactment of the 1916 Act and the 1984 Act. Recognizing that this interpretation would prune and pare back the types of recent claims that have been be filed with the Commission to those related to the purposes of the Shipping Act's § 41102(c), traditional legal venues will continue to be available to parties injured by discrete instances of unreasonable or unjust conduct consistent with long established maritime actions and other statutes specifically enacted by Congress, and long recognized common law remedies, all designed to address such circumstances.

We are seeking comment on this refocus of § 41102(c), how such an interpretation would affect regulated entities including ocean carriers, marine terminal operators (MTOs), and ocean transportation intermediaries (OTIs), as well as members of the shipping public, including cargo shippers and drayage truckers, and whether claims that would no longer fall under § 41102(c) under the contemplated interpretation would be adequately resolved before the Commission under other sections of the Act or in other legal dispute venues. The interpretation would take the form of an interpretive rule codified in 46 CFR part 545. The language of the proposed rule is set forth below.

Congress first used the statutory language addressing the legal duty of transportation common carriers to “establish, observe, and enforce just and reasonable . . . regulations and practices . . . affecting [cargo] classification, rates, or tariffs . . . [and] the manner and method of presenting, marking, packing, and delivering property for transportation . . .” in the 1910 Mann-Elkins Act amendment (Mann-Elkins) 11 to the Interstate Commerce Act (ICA).12 The Mann-Elkins language clearly focused on the operating and business practices of railroads as commonly used and imposed upon passengers and cargo shippers. This fundamental common carrier duty is the foundational cornerstone of the ICA legislation, its statutory purpose, and its proper interpretation.

The provenance of the statutory language and its inclusion six years later in the Shipping Act of 1916 (1916 Act) 13 has been recognized by the courts. In United States Navigation Co. v. Cunard S.S. Co. Ltd. 284 U.S. 474 (1932), the U.S. Supreme Court tied a firm knot binding the ICA and the 1916 Act where the court gave a general review of various sections of the 1916 Act, including section 17 14 and held that, “[t]hese and other provisions of the Shipping Act clearly exhibit the close parallelism between the act and its prototype, the ICA, and the applicability both of the principals of construction and administration.” 15

As the enactment of the 1916 Act demonstrates, together with the use of identical language in other federal statutes,16 Congress fully understood what it was doing in using the phrase “establish, observe, and enforce just and reasonable regulations and practices”—and what those words meant.17

Section 41102(c) of the 1984 Act originates from section 17 of the 1916 Act. Section 17 was commonly divided into two parts and referred to as “section 17, first paragraph” and “section 17, second paragraph.” The first paragraph addressed unjustly discriminatory rates charged to shippers while the second paragraph addressed just and reasonable practices by carriers and other persons subject to the Act. The second paragraph of section 17 reads as follows:

As a part of the general transportation deregulatory reform trends in the 1970's through 1990's,19 Congress eliminated the sentence regarding the Commission's authority to prescribe or order regulations or practices in the 1984 Act. Congress, however, reenacted the first sentence of section 17's second paragraph and placed that provision in section 10(d)(1), which, following the 2006 recodification of the 1984 Act, became 46 U.S.C. 41102(c). That language from section 17, second paragraph, first sentence, requiring that no regulated entity may fail to establish, observe, and enforce just and reasonable regulations and practices relating to or connected with the receiving, handling, storing, or delivery of property—is now found in § 41102(c) of the 1984 Act.

Having a long legislative provenance, Congress used the word “practice” and the full phrase, “establish, observe, and enforce just and reasonable regulations and practices,” in both the original 1916 Act and in section 10(d)(1) of the 1984 Act, now § 41102(c), in a particular way and in a context that was clear to the drafters, to the Commission, and to the reviewing courts.

In Baltimore & Ohio Railroad Company v. United States, 277 U.S. 291 (1923), the U.S. Supreme Court considered the question of what constituted a “practice” within the contemplation of Congress in the Interstate Commerce Act:

The Interstate Commerce Commission (ICC), the United States Shipping Board (USSB) (the agency created by Congress in the 1916 Act), its successor agencies, and the currently constituted Commission,20 together with state and federal courts have consistently ruled that “practice” means; (1) the acts/omissions of the regulated common carrier that were positively established by the regulated common carrier and imposed on the passenger/cargo interest, and (2) such act/omission was the normal,21 customary, often repeated,22 systematic,23 uniform,24 habitual,25 and continuous manner 26 (hereinafter “Normal, Customary & Continuous”) in which the regulated common carrier was conducting business.

The USSBB, a predecessor to the Commission, considered the term “practice” as used in the 1916 Act in Intercoastal Investigation, 1935, 1 FMC 400 (1935), an investigation that covered sixteen years of steam ship conference activities. The USSBB held:

Prior to the 1984 Act, Commission decisions analyzing situations that involved discrete conduct focused on the meaning of the word “practice” and determined that conduct that did not reflect a practice was outside the scope of the first sentence of the second paragraph of section 17. In Altieri, Stockton Elevators, and European Trade Specialists, A.N. Deringer, Kamara, and other cases 28 the Commission used the term “practice” in a consistent manner for all the places it appears in the Shipping Act.

In Stockton Elevators, which was later adopted by the Commission in its entirety, the FMC's Presiding Examiner found that a violation did not occur because of the infrequency of the relevant actions. According to that decision, a practice is something that, “is habitually performed and implies continuity . . . not an occasional transaction such as here shown.” 29 The Presiding Examiner found the respondent's actions to be occasional transactions and not a “practice” because they were not the “usual course of conduct” and so not a violation of section 17.30

Similarly, in European Trade Specialists, Inc. v. Prudential-Grace Lines, Inc., the ALJ specifically noted, “[a] `practice' unless the term is in some way restricted by decision or statute, means “an often repeated and customary action.” 31 There, the ALJ was considering if an alleged failure to notify a shipper of a dispute on the applicable tariff rate violated section 17 of the 1916 Act. The ALJ found that in examining the record, the respondent's normal practice was to notify shippers of problems and this case involved the allegation of a single departure from that practice which was otherwise just and reasonable. Regardless of the unjustness or unreasonableness of the respondent's failure to notify the shipper, such action did not represent a practice and thus there could be no section 17 violation.

In Kamara v. Honesty Shipping Service, 29 S.R.R. 321 (ALJ 2001), the ALJ held that, “It is not clear that a carrier's simple failure to remit payment to a subcontracting carrier constitutes a Shipping Act violation, although the shipper would certainly have a commercial contractual claim.

These cases addressing Section 10(d)(1) violations correctly hold that a complainant must demonstrate regulations and practices and articulates the correct scope and interpretation of § 41102(c). This precedent stands in stark contrast to recent Commission decisions that adopted a far more expansive interpretation of the conduct covered by § 41102(c) untethered to the language of the statute, the legislative history, Commission precedent, or, most importantly, the purpose of the Shipping Act to address common carrier duties.32

In the 2013 Kobel decision, the Commission charted a different course by disjoining the statute's conjunctive language of “establish, observe, and enforce” and specifically identified that § 41102(c) contains three discrete prohibitions: (1) A prohibition against failing to establish just and reasonable regulations and practices; (2) a prohibition against failing to observe just and reasonable regulations and practices; and (3) a prohibition against failing to enforce just and reasonable regulations.33 Since Kobel, the Commission has interpreted section § 41102(c) to mean that a single failure to fulfill a single legal obligation of any description itself could constitute a violation of § 41102(c).” 34

The Commission looked to a single rule of construction, the surplusage cannon, to support its course change from prior Commission and court rulings. That rule provides that, “If possible, every word and every provision is to be given effect.” 35 However, the commentators offer two relevant notes of caution.

First, in discussing the Principle of Interrelating Canons, they advise, “No canon of interpretation is absolute. Each may be overcome by the strength of differing principles that point in other directions . . . It is a rare case in which each side does not appeal to a different canon to suggest its desired outcome.” 36 Second, in later discussion of the surplusage canon, they note, “If a provision is susceptible of (1) a meaning that . . . deprives another provision of all independent effect, and (2) another meaning that leaves both provisions with some independent operation, the later should be preferred . . . So, like all other canons, this one must be applied with judgement and discretion, and with careful regard to context.” 37

The Commission has, in these recent cases, strained to give independent application of the elements, “establish, observe, or enforce” but, in so doing, has deprived any operation of a discussion or application of the alleged unjust or unreasonable practice or regulation being inflicted upon the general shipping public. The “context” of § 41102(c) itself within the Shipping Act and other factors discussed below demonstrate the flaws in the Commission's recent line of section 41102(c) decisions. Moreover, numerous other canons of construction “point in other directions,” 38 all as discussed below.

It is this line of recent cases determining that a discrete failure to observe and enforce an established just and reasonable regulation or practice that the Commission seeks to reform in this rulemaking so as to return the scope of § 41102(c) to its proper role and purpose within the Shipping Act. In the future, the Commission intends to follow the reasoning in Intercoastal Investigation, Altieri, Stockton Elevators, European Trade Specialists, Deringer, and Kamara which offer precedent as to what properly applies the full meaning and purpose of “establish, observe, and enforce just and reasonable regulations and practices” under the Shipping Act and a violation of § 41102(c).

The precedent in Intercoastal Investigation, Altieri, Stockton Elevators, European Trade Specialists, Deringer, and Kamara as to what constitutes “regulations and practice” under the Shipping Act is supported by and consistent with multiple accepted rules of statutory construction. Proper consideration and application of numerous canons of statutory construction demonstrates that Congress has spoken to the issue at hand.39

(1) The Syntactic Canon concerns grammar. Reviewing § 41102(c), the regulated entity is the subject of the sentence. The subject is directed—i.e. do not fail to—then comes the active verbs—“establish, observe, and enforce” just and reasonable regulations and practices. The regulated entity is ordered to, first, initiate the creation, dissemination, and publication of such just and reasonable regulations and practices, and simultaneously, to observe and enforce those regulations and practices that were created by that regulated entity.40

(2) The Ordinary Meaning Canon requires that the words of a statute are to be taken in their natural and ordinary signification and import.41 The judicial interpretation of the phrase “practices” by multiple courts applying the Mann-Elkins Act, the 1916 Act, and other statutes, all utilized the Ordinary Meaning Canon to find the meaning of the term “practice” as intended by Congress.42 All came to a reasoned conclusion that confirms the Commission's proposed interpretation.43

(3) The Prior-Construction Canon requires that “[w]hen administrative and judicial interpretations have settled the meaning of an existing statutory provision, repetition of the same language in a new statute indicates, as a general matter, the intent to incorporate its administrative and judicial interpretations as well.” 44 Congress used the same 1916 Shipping Act language in the new 1984 Act. The Commission's holdings in Intercoastal Investigation, 1935, 1 U.S.S.B.B. 400 (1935), the case law, including ICA federal court cases, cited therein as supporting precedent,45 Altieri, 46 Stockton Elevators, 47 the case law, including ICA federal court cases, cited therein as supporting precedent, and European Trade 48 was incorporated into the new statute as well.49 Justice Felix Frankfurter expressed the maxim as “if a word is obviously transplanted from a legal source, whether the common law or other legislation, it brings the old soil with it.” 50

(4) The Associated Words Canon of construction requires that associated words bear on one another's meaning. In Intercoastal Investigation, 1935, the United States Shipping Board considered the term “practice” as used in the 1916 Act and determined that, “[o]wing to its wide and variable connotation, a practice which unless restricted ordinarily means an often repeated and customary action, is deemed to apply only to acts or things belonging to the class as those meant by the words of the law that are associated with it.” 1 U.S.S.B.B. at 431-432 (emphasis added). The application of the term “practices” must be confined within the regulated transportation world of common carriage, its specialized lexicon and its association with various words including “rates,” “charges,” and “tariffs.” 51

(5) In Atlantic Cleaners & Dryers, Inc. v. United States, 286 U.S. 427 (1932), the U.S. Supreme Court framed the Presumption of Consistent Usage Canon as follows, “[t]here is a natural presumption that identical words used in different parts of the same act are intended to have the same meaning. Id. at 433 (emphasis added). In the 1984 Act, Congress used the term “practice” or “practices” eight times in three different sections of the new legislation: Section 5 (Agreements); section 8 (Tariffs); and section 10 (Prohibited Acts). These usages of “practice” are in complete harmony with the original 1910 Mann-Elkins Act and the original section 17 of the 1916 Act's usage of “practices” referenced above.52

(6) The Whole-Text Canon requires that the entire statutory structure, statutory scheme and analysis must be considered. In K Mart Corp. v. Cartier, Inc., 486 U.S. 281 (1988), the U.S. Supreme Court expressed the Whole-Text Canon as follows, “In ascertaining the plain meaning of the statute, the court must look to the particular statutory language at issue, as well as the language and design of the statute as a whole.” Id. at 291. The Congressional intent, overall context and statutory mandate of the 1984 Shipping Act makes clear that Congress wanted the Commission to focus its regulatory authority on “establish[ing] a nondiscriminatory regulatory process for the common carriage of goods by water . . .” 53 and on maritime activities that: Result in substantial reduction in competition and are detrimental to commerce. In the 1998 amendments, Congress injected additional competitive market-driven provisions into the Shipping Act of 1984.54

(7) The Gruenberg-Reisner decision, supra, also discusses the relevant application of the negative implication canon and the presumption against extraterritorial application canon. Last, Gruenberg-Reisner also discusses the duty of federal agencies to observe and adhere to the doctrine of stare decisis.55

The Commission is aware that modifying the application of recent § 41102(c) cases may pare back complainants' ability in some factual circumstances to claim a Shipping Act violation and thus seek redress before the Commission when they are harmed by an act or omission of a regulated entity. However, § 41102(c) was not designed to be the universal panacea for each and every problem or grievance that arises in the maritime realm of receiving, handling, storing, or delivering property. To interpret the Shipping Act as duplicative of every other statutory and common law maritime remedy would frustrate Congressional intent in enacting different statutory schemes and undermine the purpose of the Shipping Act.

In A.N. Deringer, Inc. v. Marlin Marine Services, Inc., 25 S.R.R. 1273, 1276, 1277 (SO 1990), a post 1984 case that followed the Altieri, Intercoastal Investigation, Stockton Elevators, European Trade Specialists line of precedent in a case considering what is now § 41102(c), the Settlement Officer addressed the effect of an overly broad interpretation of section 10(d)(1) on other maritime statutes, such as the Carriage of Goods by Sea Act (COGSA).56 COGSA is the United States enactment of the international convention commonly referred to as the Hague Rules. This treaty was intended to achieve a common set of international rules for the handling of cargo damage and loss claims.57 The Commission ALJ acknowledged the status of COGSA with the following Commission ruling:

As a further note on the discordant conflict between COGSA and the Commission's current usage of section 10(d)(1) of the Shipping Act, consider that COGSA provides for a limitation of liability scheme, including a cargo valuation cap of $500 per customary freight unit unless the shipper declares a higher cargo value. As the A.N. Deringer decision noted, a claimant could wait for 366 days and then file its claim at the Commission under section 10(d)(1) and thereby avoid any COGSA limitations on the value of its cargo loss.

This proffer of a conflict between section 10(d)(1) and COGSA is not speculation or a mere hypothetical. In the Commission's Kobel decision, supra, Respondent Hapag-Lloyd, the ocean vessel common carrier, was found to have violated section 10(d)(1) by virtue of damaging the Claimant's container during the loading process and then subsequently placing that damaged container on a later Hapag-Lloyd ship. The Commission then held that Hapag-Lloyd was; however, not liable for reparations because the damage to the container was not the proximate cause of the losses to the cargo. If the damaged container had allowed for water inundation with resulting cargo damage, then all legal elements would have been presented for an award to Claimants by virtue of the section 10(d)(1) violation.

As a last observation concerning the comity between COGSA and the Shipping Act, consider section 2 of the Shipping Act's Declaration of Policy where Congress stated:

Returning the Commission's interpretation to its proper statutory purpose and scope will not leave claimants without remedy. Claimants would have full and adequate remedies under numerous legal proscriptions including common law, state statutes, admiralty law, and other federal statutes. Such claims should be presented to proper courts of common pleas. The Commission notes that other provisions or regulations of the Shipping Act could also provide remedy.60 The Commission also notes that bringing actions in traditional venues, such as state and federal courts, may be appropriate. Matters that may now be brought under § 41102(c) could also potentially be adjudicated as matters of contract law, agency law, or admiralty law. In cases prior to Kobel, it has been noted that remedy could have been sought in other venues. In Adair v. Penn-Nordic Lines, Inc., 26 S.R.R. 11 (ALJ 1991), the ALJ noted that the relevant conduct “would undoubtedly have contravened other standards of law under principles of contract and common carrier law applicable in courts of law and quite possibly Mr. Adair could have obtained relief . . . in a court of law or perhaps admiralty rather than before this Commission.” 61 The Commission is seeking public comment on whether alternative avenues for redress would be available should the Commission choose to reinterpret § 41102(c).

The Commission believes that the interpretation and application of § 41102(c) should be properly aligned with the broader common carriage foundation and purposes of the Act. The interpretive rule is consistent with the purposes of the Shipping Act and focuses Commission activities on regulated entities who abuse the maritime shipping public by imposing unjust and unreasonable business methods, and who do so on a normal, customary, and continuous basis, and thereby negatively impact maritime transportation competition or inflict detrimental effect upon the commerce of the United States. This interpretation reflects the clear intent of Congress and reflects Commission precedent articulated in Intercoastal Investigation, Altieri, Stockton Elevators, European Trade, and Deringer. Though the Commission is aware that the interpretive rule may redirect some claims in certain fact situations from being brought under the Shipping Act, the Commission believes that existing alternative avenues of redress are fully sufficient to address those cases. The Commission is therefore seeking comment on the proposed interpretation.

Your comments must be written and in English. To ensure that your comments are correctly filed in the docket, please include the docket number of this document in your comments.

You may submit your comments via email to the email address listed above under ADDRESSES. Please include the docket number associated with this notice and the subject matter in the subject line of the email. Comments should be attached to the email as a Microsoft Word or text-searchable PDF document. Only non-confidential and public versions of confidential comments should be submitted by email.

You may also submit comments by mail to the address listed above under ADDRESSES.

The Commission will provide confidential treatment for identified confidential information to the extent allowed by law. If your comments contain confidential information, you must submit the following by mail to the address listed above under ADDRESSES:

• A transmittal letter requesting confidential treatment that identifies the specific information in the comments for which protection is sought and demonstrates that the information is a trade secret or other confidential research, development, or commercial information.

• A confidential copy of your comments, consisting of the complete filing with a cover page marked “Confidential-Restricted,” and the confidential material clearly marked on each page. You should submit the confidential copy to the Commission by mail.

• A public version of your comments with the confidential information excluded. The public version must state “Public Version—confidential materials excluded” on the cover page and on each affected page, and must clearly indicate any information withheld. You may submit the public version to the Commission by email or mail.

The Commission will consider all comments received before the close of business on the comment closing date indicated above under DATES. To the extent possible, we will also consider comments received after that date.

How can I read comments submitted by other people?

You may read the comments received by the Commission at the Commission's Electronic Reading Room or the Docket Activity Library at the addresses listed above under ADDRESSES.

The Regulatory Flexibility Act (codified as amended at 5 U.S.C. 601-612) provides that whenever an agency is required to publish a notice of proposed rulemaking under the Administrative Procedure Act (APA) (5 U.S.C. 553), the agency must prepare and make available for public comment an initial regulatory flexibility analysis (IRFA) describing the impact of the proposed rule on small entities. 5 U.S.C. 603. An agency is not required to publish an IRFA, however, for the following types of rules, which are excluded from the APA's notice-and-comment requirement: Interpretative rules; general statements of policy; rules of agency organization, procedure, or practice; and rules for which the agency for good cause finds that notice and comment is impracticable, unnecessary, or contrary to public interest. See 5 U.S.C. 553(b).

Although the Commission has elected to seek public comment on this proposed rule, the rule is an interpretative rule. Therefore, the APA does not require publication of a notice of proposed rulemaking in this instance, and the Commission is not required to prepare an IRFA.

The Commission's regulations categorically exclude certain rulemakings from any requirement to prepare an environmental assessment or an environmental impact statement because they do not increase or decrease air, water or noise pollution or the use of fossil fuels, recyclables, or energy. 46 CFR 504.4. The proposed rule describes the Commission's proposed interpretation of the scope of 46 U.S.C. 41102(c) and the elements necessary for a successful claim for reparations under that section. This rulemaking thus falls within the categorical exclusion for matters related solely to the issue of Commission jurisdiction and the exclusion for investigatory and adjudicatory proceedings to ascertain past violations of the Shipping Act. See 46 CFR 504.4(a)(20), (22). Therefore, no environmental assessment or environmental impact statement is required.

The Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521) (PRA) requires an agency to seek and receive approval from the Office of Management and Budget (OMB) before collecting information from the public. 44 U.S.C. 3507. The agency must submit collections of information in proposed rules to OMB in conjunction with the publication of the notice of proposed rulemaking. 5 CFR 1320.11. This proposed rule does not contain any collections of information as defined by 44. U.S.C. 3502(3) and 5 CFR 1320.3(c).

This rule meets the applicable standards in E.O. 12988 titled, “Civil Justice Reform,” to minimize litigation, eliminate ambiguity, and reduce burden.

The Commission assigns a regulation identifier number (RIN) to each regulatory action listed in the Unified Agenda of Federal Regulatory and Deregulatory Actions (Unified Agenda). The Regulatory Information Service Center publishes the Unified Agenda in April and October of each year. You may use the RIN contained in the heading at the beginning of this document to find this action in the Unified Agenda, available at http://www.reginfo.gov/public/do/eAgendaMain.

For the reasons set forth above, the Federal Maritime Commission proposes to amend 46 CFR part 545 as follows:

This rulemaking is issued under the authority of the Office of Federal Procurement Policy (OFPP) Act which provides the authority for an agency head to issue agency acquisition regulations that implement or supplement the FAR.

VA is proposing to revise the VAAR to add new policy or regulatory requirements and to remove any redundant guidance and guidance that is applicable only to VA's internal operating processes or procedures. Codified acquisition regulations may be amended and revised only through rulemaking. All amendments, revisions, and removals have been reviewed and concurred with by an Integrated Product Team of agency stakeholders.

The VAAR uses the regulatory structure and arrangement of the FAR and headings and subject areas are consistent with the FAR content. The VAAR is divided into subchapters, parts (each of which covers a separate aspect of acquisition), subparts, and sections.

The Office of Federal Procurement Policy Act, as codified in 41 U.S.C.1707, provides the authority for the Federal Acquisition Regulation and for the issuance of agency acquisition regulations consistent with the FAR.

When Federal agencies acquire supplies and services using appropriated funds, the purchase is governed by the FAR, set forth at title 48 Code of Federal Regulations (CFR), chapter 1, parts 1 through 53, and the agency regulations that implement and supplement the FAR. The VAAR is set forth at title 48 CFR, chapter 8, parts 801 to 873.

The VA proposes to make the following changes to the VAAR in this phase of its revision and streamlining initiative. For procedural guidance cited below that is proposed to be deleted from the VAAR, each section cited for removal has been considered for inclusion in VA's internal agency operating procedures in accordance with FAR 1.301(a)(2). Similarly, delegations of authorities that are removed from the VAAR will be included in VA Acquisition Manual (VAAM) as internal agency guidance.

In the table in 801.106, we propose to amend the clause number 852.237-7 to 852.237-70 to conform to the FAR numbering system for agency regulations.

We propose to add 41 U.S.C. 1702 as an authority for part 815, which addresses the acquisition planning and management responsibilities of Chief Acquisition Officers and Senior Procurement Executives, to include implementation of unique procurement policies, regulations and standards of the executive agency.

We also propose to add 41 U.S.C. 1121(c)(3) which is from Title 41, Public Contracts, Positive Law codification that speaks to the authority of an executive agency under another law to prescribe policies, regulations, procedures, and forms for procurement that are subject to the authority conferred in the cited section, as well as other sections of Title 41 as shown therein.

In subpart 815.3, Source Selection, we propose to remove 815.303, Responsibilities, to the VAAM since it contains procedural guidance that is internal to the VA and will be updated and moved to the VA Acquisition Manual (VAAM).

We propose to remove 815.304, Evaluation factors and significant subfactors, and move it to the VAAM as it contains procedural guidance that is internal to the VA and will be updated and moved to the VAAM.

We propose to amend section 815.304-70, Evaluation factor commitments, by deleting paragraph (a)(4). This paragraph was removed because the VA Mentor-Protégé Program is no longer current. We propose to revise the section by removing paragraph (b) and moving it to the VAAM as it contains procedural information. We also propose to renumber the paragraphs of the section accordingly.

We propose to amend section 815.304-71, Solicitation provision and clause, to make a correction to add in the words “Small Business” that are missing in the current version of the VAAR.

In subpart 815.3, Source Selection, we propose to add a new section, 815.370, Only one offer. This is a newly developed section for VA. The inclusion of this policy gives the contracting officer the ability to re-solicit for an action if they only receive one offer and if the solicitation gave offerors less than 30 days to submit a proposal. The following sections have been added to this section and provide additional guidance pertaining to this new policy: 815.370-1, Policy; 815.370-2, Promote competition; 815.370-3, Fair and reasonable price, 815.370-4, Exceptions and 815.370-5, Solicitation provision. These subsections under section 815.370 explain that it is VA policy, if only one offer is received in response to a competitive solicitation, to take action to promote competition and ensure that the price is fair and reasonable. It describes the necessary steps to meet these requirements. Section 815.370-4, Exceptions, cites the exceptions to the policy and 815.370-5, Solicitation provision, prescribes the inclusion of 852.215-72, Notice of Intent to Re-solicit, in competitive solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial items that will be solicited for fewer than 30 days, unless an exception at 815.370-4 applies.

We propose to remove subpart 815.4, Contract Pricing, as it contains procedural guidance that is internal to the VA and will therefore be moved to the VAAM.

We propose to remove subpart 815.6, Unsolicited Proposals, as it contains procedural guidance that is internal to the VA and will therefore be moved to the VAAM.

The authority citation for part 816 is revised to correct the citation for 41 U.S.C. 1121 by adding reference to paragraph (c)(3).

In subpart 816.5, we propose to add section 816.506-70, Requirements—supplement for mortuary services, prescribing clause 852.216-76, Requirements—Supplement for Mortuary Services, for all contracts for mortuary services.

We propose to amend the authority citation for part 837 to add reference to the Crime Control Act of 1990 and the Pro-Children Act of 2001 which provide the authority for new clauses that address protection of children under contracts providing child care services. We also propose to add 41 U.S.C. 1121(c)(3) which is from Title 41, Public Contracts, Positive Law codification that speaks to the authority of an executive agency under another law to prescribe policies, regulations, procedures, and forms for procurement that are subject to the authority conferred in the cited section, as well as other sections of Title 41 as shown therein.

We also propose to revise the part 837 authorities to replace the 38 U.S.C. 501 citation with 41 U.S.C. 1702 which addresses the acquisition planning and management responsibilities of Chief Acquisition Officers and Senior Procurement Executives, to include implementation of unique procurement policies, regulations and standards of the executive agency. 38 U.S.C. 501 is a more general authority for the Secretary to utilize to prescribe all rules and regulations. The title 41 authority is more appropriate to cite when publishing the VAAR.

We propose to remove section 837.103, Contracting officer responsibility, and to address the subject of documenting personal versus non-personal services determinations in the VAAM.

We propose to remove the title and text at section 837.110, Solicitation provisions and contract clauses, since FAR 52.237-2 Protection of Government Buildings, Equipment and Vegetation and 852.228-71, Indemnification and Insurance, outline contractor liabilities and required insurance levels.

We propose to amend section 837.110-70, Services provided to eligible beneficiaries, to retitle it “VA solicitation provisions and contract clauses,” to remove the prescription for the clause, 852.271-70, Nondiscrimination in services provided to beneficiaries, and to add the prescriptions for the new clauses 852.237-74, Nondiscrimination in Service Delivery, and 852.237-75, Key Personnel.

In subpart 837.2, Advisory and Assistance Services, and section 837.203, Policy, we propose to remove the entire subpart since it duplicates coverage in FAR.

In subpart 837.4, Nonpersonal Health Care Services, section 837.403, Contract clause, we propose to amend the section to redesignate it as section 837.403-70, VA contract clauses; to renumber clause 852.237-7, Indemnification and Medical Liability Insurance, as 852.237-70 to conform to the FAR guidance for numbering of clauses; to insert in the clause a five day notice requirement for evidence of coverage and of any change in insurance providers during the term of the contract; and to add prescriptions for three new clauses that address protection of children under contracts providing child care services as required by FAR 37.103(d): 852.237-71, Nonsmoking Policy for Children Services; 852.237-72, Crime Control Act—Reporting of Child Abuse; and 852.237-73, Crime Control Act—Requirement for Background Checks.

We propose the following revisions to subpart 837.70, Mortuary Services, to remove internal and outdated guidance and to address only acquisition policy affecting mortuary services:

We propose to add section 837.7000, Scope, and to cite the statutory basis for the mortuary service benefits covered.

We propose to remove the existing section 837.7001, General, and add a new section 837.7001, Solicitation provisions and contract clauses, to prescribe one new provision, 852.237-76, Award to Single Offeror; and four new clauses specific to the coverage of mortuary services: 852.237-77, Area of Performance, which describes the contractor's responsibilities both within and outside of the contract designated area of performance and the basis for payment of any transportation fees for pick-up from or delivery points outside that area; 852.237-78, Performance and Delivery, which requires the contractor's response to requests for services within 36 hours and allows the Government to require that the remains be held for up to 72 hours from completion of services; 852.237-79, Subcontracting, which stipulates that the Contractor shall not subcontract any work under this contract without the contracting officer's written approval and states the clause does not apply to contracts of employment between the Contractor and its personnel; and 852.237-80, Health Department and Transport Permits, which requires to contractor to meet all State and local licensing requirements and obtain and furnish all necessary health department and shipping permits at no additional cost to the Government. We also propose to add a cross-reference to the availability of clauses prescribed in 816.506-70 and 849.504-70.

We propose to remove sections 837.7002, List of qualified funeral directors; 837.7003, Funeral authorization; 837.7004, Administrative necessity; and 837.7005, Unclaimed remains—all other cases, because this material is based on internal VA guidance that has been rescinded.

We propose to revise the authority citation for part 849 to add 41 U.S.C. 1121(c)(3) which is from Title 41, Public Contracts, Positive Law codification that speaks to the authority of an executive agency under another law to prescribe policies, regulations, procedures, and forms for procurement that are subject to the authority conferred in the cited section, as well as other sections of Title 41 as shown therein.

We also propose to revise the part 849 authorities to add 41 U.S.C. 1702 which addresses the acquisition planning and management responsibilities of Chief Acquisition Officers and Senior Procurement Executives, to include implementation of unique procurement policies, regulations and standards of the executive agency.

In part 849, we propose to add subpart 849.5, Contract Termination Clauses, section 849.504, Termination of fixed-price contracts for default, which contains no text but implements FAR 49.504, and section 849.504-70, Termination of mortuary services, to prescribe a new clause 852.249-70, Termination for Default—Supplement for Mortuary Services.

We propose to amend the authority citation for part 852 to add reference to the 20 U.S.C. 7181-7183 (Pro-children Act of 2001), and Public Law 101-647, (Crime Control Act of 1990) which provided the authority for new clauses that address protection of children under contracts providing child care services. We also propose to add as an authority 41 U.S.C. 1303, which is an updated positive law codification to reflect additional authority of the VA as an executive agency to issue regulations that are essential to implement Governmentwide policies and procedures in the agency, as well as to issue additional policies and procedures required to satisfy the specific needs of the VA.

In subpart 852.2, we propose to amend 852.215-70, Service-Disabled Veteran-Owned and Veteran-Owned Small Business Evaluation Factors. This was revised to change it from a clause to a provision and language was added to comply with the statute that requires that any business concern that is determined by VA to have willfully and intentionally misrepresented a company's SDVOSB/VOSB status is subject to debarment for a period of not less than five years.

We propose to amend 852.215-71, Evaluation Factor Commitments. This was revised to add language to comply with the statute that requires that any business concern that is determined by VA to have willfully and intentionally misrepresented a company's SDVOSB/VOSB status is subject to debarment for a period of not less than five years.

We propose to add clause 852.215-72, Notice of Intent to Re-Solicit, which informs offerors that in the event that only one offer is received in response to a solicitation that allows offerors fewer than 30 days to submit their proposal, the Contracting Officer may cancel the solicitation and re-solicit for an additional period of at least 30 days in accordance with 815.370-2.

We propose to add clause 852.216-76, Requirements—Supplement for Mortuary Services, for all requirements contracts for mortuary services.

We are providing the final publication and effective dates of March 2018 for the following clauses published in final under rule AP82: 852.216-71, 852.216-72, 852.216-73, 852.216-74, 852.216-75, 852.228-71, and 852.228-73.

We propose to remove the title and text of clause 852.237-70, Contractor Responsibilities, which is determined to be unnecessary since FAR clause 52.237-2, Protection of Government Buildings, Equipment and Vegetation, and VAAR clause 852.228-71, Indemnification and Insurance, both outline contractor liabilities and required insurance levels.

We propose to revise clause 852.237-7, Indemnification and Medical Liability Insurance, to renumber it 852.237-70, and to make minor revisions to require the contracting officer to insert the dollar amount values of standard coverages prevailing within the local community as to the specific medical specialty, or specialties, concerned, or such higher amount as the contracting officer deems necessary to protect the Government's interests; and to insert a requirement for the contractor to notify the contracting officer within 5 days of becoming aware of a change in insurance providers during the performance period of the contract for all health-care providers performing under it; and to furnish to the contracting officer evidence of insurance at least five days before commencement of work.

We propose to add the following clauses to address protection of children under contracts providing child care services as required by 20 U.S.C. 7181-7183 (Pro-Children Act of 2001), and Public Law 101-647, (Crime Control Act of 1990): 852.237-71, Nonsmoking Policy for Children's Services, prohibiting smoking in facilities where certain federally funded children's services are provided; 852.237-72, Crime Control Act—Reporting of Child Abuse, which imposes responsibilities on certain individuals who, while engaged in a professional capacity or activity, as defined in the Act, on Federal land or in a federally-operated (or contracted) facility, learn of facts that give the individual reason to suspect that a child has suffered an incident of child abuse; and 852.237-73, Crime Control Act—Requirement for Background Checks, which requires the contractor's compliance with the Act requiring that all individuals involved with the provision of child care services, as defined in the act, to children under the age of 18 undergo a criminal background check.

We propose to add new clause 852.237-75, Key Personnel, requiring the written consent of the Contracting Officer to changes in key personnel, and new clauses specific to the coverage of mortuary services: 852.237-76, Award to Single Offeror, to stipulate that awards will be made to a single offeror rather than to multiple offerors; 852.237-77, Area of Performance, to clarify Contractor's responsibilities for its designated area of service; 852.237-78, Performance and Delivery, to specify the required time frame for completion of services and the Government's right to require a hold on services; 852.237-79, Subcontracting, to require the Contracting Officer's written approval to subcontract any work; and 852.237-80, Health Department and Transport Permits, to stipulate the contractor's responsibility to obtain all transport permits required under the contract at no additional cost to the Government.

We propose to add the clause 852.249-70, Termination for Default—Supplement for Mortuary Services, for use in contracts for mortuary services. This clause expressly identifies actions, such as soliciting families of decedents to provide additional services, subcontracting services without Government consent, or refusing to perform services for any particular remains.

We propose to redesignate and retitle clause 852.271-70, Non-discrimination in Services Provided to Beneficiaries, as 852.237-74, Non-discrimination in Service Delivery, and prescribed the clause at under VAAR section 837.110-70(a) to conform to FAR structure. This clause states that it is the policy of the Department of Veterans Affairs that no person otherwise eligible will be excluded from participation in, denied the benefits of, or subjected to discrimination in the administration of VA programs and services based on non-merit factors such as race, color, national origin, religion, sex, gender identity, sexual orientation, or disability (physical or mental). This clause also stipulates that by acceptance of this contract, the contractor agrees to comply with this policy in supporting the program and in performing the services called for under this contract. The clause is revised to clarify the language and the contractor's obligation to ensure that each of its employees, and any sub-contractor staff, is made aware of, understands, and complies with this policy.

In the authority citation for part 871, we propose to add 41 U.S.C. 1121(c)(3) which is from Title 41, Public Contracts, Positive Law codification that speaks to the authority of an executive agency under another law to prescribe policies, regulations, procedures, and forms for procurement that are subject to the authority conferred in the cited section, as well as other sections of Title 41 as shown therein.

We also propose to revise the part 871 authorities to replace the 38 U.S.C. 501 citation with 41 U.S.C. 1702 which addresses the acquisition planning and management responsibilities of Chief Acquisition Officers and Senior Procurement Executives, to include implementation of unique procurement policies, regulations and standards of the executive agency. 38 U.S.C. 501 is a more general authority for the Secretary to utilize to prescribe all rules and regulations. The title 41 authority is more appropriate to cite when publishing the VAAR. In section 871.212, we propose to revise this section to redesignate the first paragraph as (a); to remove the prescription of clause 852.271-70, Nondiscrimination In Services Provided To Beneficiaries; to renumber the remaining paragraphs as (1) through (4); and to add new paragraph (b) to refer the contracting officer to section 837.110-70(a) for the prescription of the new clause 852.237-74, Non-discrimination In Service Delivery.

Title 48, Federal Acquisition Regulations System, Chapter 8, Department of Veterans Affairs, of the Code of Federal Regulations, as proposed to be revised by this rulemaking, would represent VA's implementation of its legal authority and publication of the VAAR for the cited applicable parts. Other than future amendments to this rule or governing statutes for the cited applicable parts, or as otherwise authorized by approved deviations or waivers in accordance with FAR subpart 1.4, Deviations from the FAR, and as implemented by VAAR subpart 801.4, Deviations from the FAR or VAAR, no contrary guidance or procedures would be authorized. All existing or subsequent VA guidance would be read to conform with the rulemaking if possible or, if not possible, such guidance would be superseded by this rulemaking as pertains to the cited applicable VAAR parts.

Executive Orders (E.O.) 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. E.O. 12866, Regulatory Planning and Review defines “significant regulatory action” to mean any regulatory action that is likely to result in a rule that may: “(1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; (2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in this Executive Order.” VA has examined the economic, interagency, budgetary, legal, and policy implications of this regulatory action, and it has been determined this rule is not a significant regulatory action under E.O. 12866. VA's impact analysis can be found as a supporting document at http://www.regulations.gov, usually within 48 hours after the rulemaking document is published. Additionally, a copy of the rulemaking and its impact analysis are available on VA's website at http://www.va.gov/orpm by following the link for VA Regulations Published from FY 2004 Through Fiscal Year to Date.

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

The Paperwork Reduction Act of 1995 (at 44 U.S.C. 3507) requires that VA consider the impact of paperwork and other information collection burdens imposed on the public. Under 44 U.S.C. 3507(a), an agency may not collect or sponsor the collection of information, nor may it impose an information collection requirement unless it displays a currently valid OMB control number. See also 5 CFR 1320.8(b)(3)(vi). This proposed rule will impose one new and one amended information collection requirement. Accordingly, under 44 U.S.C. 3507(d), VA has submitted a copy of this rulemaking action OMB for its review. Notice of OMB approval for the new information collection and the information collection amendment will be published in a future Federal Register document.

Under the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501-3521), a current collection of information, OMB No. 2900-0590, contained in part 837 at proposed section 837.403-70 (currently numbered 837.403) and in part 852 at proposed section 852.237-70 (currently numbered 852.237-7), is being revised as set forth in the SUPPLEMENTARY INFORMATION portion of this proposed rule. The clause number that appears in the table at 801.106 is also proposed to be revised accordingly.

Summary of collection of information: This action contains provisions constituting an existing information collection at 48 CFR 837.403 and 852.237-7, under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521) and has been assigned OMB control number 2900-0590. This action proposes revisions to 837.403 to renumber it as 837.403-70, to retitle it as “VA contract clauses,” and to renumber the clause as 852.237-70 while retaining the title, “Indemnification and Medical Liability Insurance.”

Clause 852.237-70 is used in lieu of FAR clause 52.237-7, Indemnification and Medical Liability Insurance, in solicitations and contracts for the acquisition of non-personal health care services. It requires the apparent successful bidder/offeror, upon the request of the contracting officer, prior to contract award, to furnish evidence of insurability of the offeror and/or all health-care providers who will perform under the contract. In addition, the clause requires the contractor, prior to commencement of services under the contract, to provide Certificates of Insurance or insurance policies evidencing that the firm possesses the types and amounts of insurance required by the solicitation. We propose to modify the collection to require the contractor to notify the contracting officer within five days of becoming aware of a change in insurance providers during the performance period of this contract for all health-care providers performing under this contract, and to provide to the contracting officer evidence of such insurance for any subcontractor at least five days before commencement of work by that subcontractor.

Description of need for information and proposed use of information: The information is required in order to protect VA by ensuring that the firm to which award may be made and the individuals who may provide health care services under the contract are insurable and that, following award, the contractor and its employees will continue to possess the types and amounts of insurance required by the solicitation. It helps ensure that VA will not be held liable for any negligent acts of the contractor or its employees and ensures that VA and VA beneficiaries will be protected by adequate insurance coverage. The clause number is changed to 852.237-70 to conform to the FAR guidance for numbering of clauses. The burden imposed by this collection remains unchanged as follows:

Estimated number of respondents annually: 1,500.

Estimated frequency of responses: One response for each contract to be awarded.

Estimated average burden per collection: 30 minutes.

Estimate of the total annual hour burden of the collection of information: 750 hours.

Annual cost to all respondents: $15,000 (at $20 per hour, based on our belief that the majority of the labor effort would be clerical similar to GS-5).

Under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521), a new collection of information is proposed, under OMB No. 2900-AQ20, that is contained in Part 837 at proposed section 837.403-70 and Part 852 at proposed clause 852.237-73, as set forth in the SUPPLEMENTARY INFORMATION portion of this proposed rule. The clause number and the OMB clearance number would be added to the table at 801.106.

Summary of collection of information: Under the Crime Control Act of 1990 (42 U.S.C. 13041), each agency of the Federal Government, and every facility operated by the Federal Government, or operated under contract with the Federal Government, that hires, or contracts for hire, individuals involved with the provision of child care services to children under the age of 18 shall assure that all existing and newly-hired employees undergo a criminal history background check.

New VAAR clause 852.237-73, Crime Control Act—Requirement for Background Checks, is required in all solicitations, contracts, and orders that involve providing child care services to children under the age of 18, including social services, health and mental health care, child-(day) care, education (whether or not directly involved in teaching), and rehabilitative programs covered under the statute.

Description of need for information and proposed use of information: The contract clause would require the contractor to perform the background checks on behalf of VA to assure the safety of children under the age of 18 that are recipients of services under a VA program. It is intended to assure their safety by avoiding hiring individuals with a history of criminal acts and especially acts of child abuse.

Estimated number of respondents annually: 500.

Estimated frequency of responses: 20 per contract awarded.

Estimated average burden per collection: 1 hour.

Estimate of the total annual hour burden of the collection of information: 10,000 hours.

Annual cost to all respondents: $550,000 ($55 rate including fringe benefits and assuming senior level (GS-13) technical specialist).

This clause would enable the VA to be in compliance with the Crime Control Act of 1990 and to protect children that are within its health care systems.

Interested persons have 60 days in which to provide comment on the information collection. The Department considers comments by the public on proposed collections of information in—

• Evaluating whether the proposed collections of information are necessary for the proper performance of the functions of the Department, including whether the information will have practical utility;

• Evaluating the accuracy of the Department's estimate of the burden of the proposed collections of information, including the validity of the methodology and assumptions used;

• Enhancing the quality, usefulness, and clarity of the information to be collected; and

• Minimizing the burden of the collections of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.

Comments on the collection of information contained in this proposed rule should be submitted to the Office of Management and Budget, Attention: Desk Officer for the Department of Veterans Affairs, Office of Information and Regulatory Affairs, Washington, DC 20503, with copies sent by mail or hand delivery to the Director, Regulation Policy and Management (00REG), Department of Veterans Affairs, 810 Vermont Ave. NW, Room 1068, Washington, DC 20420; fax to (202) 273-9026, email to www.Regulations.gov. Comments should indicate they are submitted in response to “RIN 2900-AQ20.”

Individuals are not required to respond to a collection of information unless it displays a currently valid OMB control number.

OMB is required to make a decision concerning the proposed collection of information contained in this proposed rule between 30 and 60 days after publication of this document in the Federal Register. Therefore, a comment to OMB is best assured of having its full effect if OMB receives it within 30 days of publication. This does not affect the deadline for the public to comment on the proposed regulation.

This proposed rule will not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-612. This proposed rule will generally be small business neutral. The overall impact of the proposed rule will be of benefit to small businesses owned by Veterans or Service-Disabled Veterans as the VAAR is being updated to remove extraneous procedural information that applies only to VA's internal operating procedures. VA estimates no cost impact to individual business would result from these rule updates. On this basis, the adoption of this proposed rule will not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-612. Therefore, under 5 U.S.C. 605(b), this proposed rule is exempt from the initial and final regulatory flexibility analysis requirements of sections 603 and 604.

The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in the expenditure by State, local, and tribal Governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This proposed rule will have no such effect on State, local, and tribal Governments or on the private sector.

The Secretary of Veterans Affairs approved this document and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs. Robert L. Wilkie, Secretary, Department of Veterans Affairs, approved this document on August 20, 2018, for publication.

For the reasons set out in the preamble, VA proposes to amend 48 CFR parts 801, 815, 816, 837, 849, 852 and 871 as follows:

This rulemaking is issued under the authority of the Office of Federal Procurement Policy (OFPP) Act which provides the authority for an agency head to issue agency acquisition regulations that implement or supplement the FAR.

VA is proposing to revise the VAAR to add new policy or regulatory requirements and to remove any redundant guidance and guidance that is applicable only to VA's internal operating processes or procedures. Codified acquisition regulations may be amended and revised only through rulemaking. All amendments, revisions, and removals have been reviewed and concurred with by VA's Integrated Product Team of agency stakeholders.

The VAAR uses the regulatory structure and arrangement of the FAR and headings and subject areas are consistent with the FAR content. The VAAR is divided into subchapters, parts (each of which covers a separate aspect of acquisition), subparts, and sections.

The Office of Federal Procurement Policy Act, as codified in 41 U.S.C. 1707, provides the authority for the Federal Acquisition Regulation and for the issuance of agency acquisition regulations consistent with the FAR.

When Federal agencies acquire supplies and services using appropriated funds, the purchase is governed by the FAR, set forth at title 48 Code of Federal Regulations (CFR), chapter 1, parts 1 through 53, and the agency regulations that implement and supplement the FAR. The VAAR is set forth at title 48 CFR, chapter 8, parts 801 to 873.

VA proposes to make the following changes to the VAAR in this phase of its revision and streamlining initiative. For procedural guidance cited below that is proposed to be deleted from the VAAR, each section cited for removal has been considered for inclusion in VA's internal agency operating procedures in accordance with FAR 1.301(a)(2). Similarly, delegations of authorities that are removed from the VAAR will be included in the VAAM as internal agency guidance. The VAAM is being created in parallel with these revisions to the VAAR and is not subject to the rulemaking process as they are internal VA procedures and guidance. Therefore, the VAAM will not be finalized until corresponding VAAR parts are finalized, and the VAAM is not yet available on line.

This proposed rule contains existing information collection requirements. The proposed rule results in multiple actions affecting these information collections, including outright removal of the information collection.

In 801.106, OMB approval under the Paperwork Reduction Act, we propose to amend 801.106 table columns titled “48 CFR part or section where identified and described,” and “Current OMB control number.” We propose to remove the reference to 852.236-84, Schedule of Work Progress, and discontinue the associated corresponding OMB Control Number 2900-0422 as the information is adequately covered in agency specifications and its use in a clause is not required or appropriate. For access to agency specifications where such information is adequately covered, see the VA Technical Information Library (TIL), VA's source for Electronic Design and Construction Information, at https://www.cfm.va.gov/TIL/, including Master Specification Division 01, General Requirements: 01 32 16.01, Architectural and Engineering CPM Schedules; 01 32 16.13, Network Analysis Schedules; 01 16.15, Project Schedules (Small Projects—Design/Bid/Build); 01 32 16.16, Network Analysis Schedules (Design-Build Only); and, 01 32 16.17, Project Schedules (Small Projects—Design/Build).

In 801.106, in reference to table described, we propose to remove the reference to 852.236-89, Buy American Act, and discontinue the associated corresponding OMB Control Number 2900-0622 as the clause is being removed as set forth in the preamble when describing actions under VAAR part 852 as it duplicates FAR clauses and is unnecessary.

In 801.106, in reference to the table described, we propose to remove the reference to 852.236-91, Special Notes, and discontinue the associated corresponding OMB Control Number 2900-0623. Paragraph (a) of the clause is already covered via required System for Award Management (SAM) representations and certifications. Paragraphs (b), (c) and (d) are addressed in Section 01 00 00, General Requirements, contained in all construction contract specifications (reference the VA Office of Construction and Facilities Management, Technical Information Library (TIL), VA Numbered Standards for Construction, PG-18-1, Master Construction Specifications, Division 01—General Requirements). Paragraph (e), which references claims by the contractor for delay attributed to unusually severe weather under FAR 52.249-14, Excusable Delays, is governed by the Network Analysis System specifications—Section 01 32 16.13, Network Analysis Schedules—Major Projects; 01 32 16.15, Project Schedules (Small Projects Design-Bid-Build); 01 32 16.16, (Network Analysis System (Design-Build Only); or 01 32 16.17, Project Schedule (Small Projects Design-Build), as applicable, which provide details of the requirements the contractor must follow to justify time extensions. VA internal procedures related to how contracting officers and Government Resident Engineers or technical reviewers should analyze contractor data and which records to review to support such claims for time extensions due to unusually severe weather, not having a significant effect beyond the internal operating procedures of the VA, would be moved to the VAAM.

We propose to revise the authority citations under part 825 to include a reference to 41 U.S.C. 1702 which addresses the acquisition planning and management responsibilities of Chief Acquisition Officers and Senior Procurement Executives, to include implementation of unique procurement policies, regulations and standards of the executive agency.

We propose to remove subpart 825.2, Buy American Act—Construction Materials, and the associated prescribed clauses under subpart 825.11, Solicitation Provisions and Contract Clauses, as it is duplicative of the FAR. Clause 852.236-89, Buy American Act, along with its Alternate I and II, is proposed for removal as set forth in VAAR part 852 of the preamble. The clause and its alternates are referenced in a table in 825.1102, Acquisition of construction. As the clause is proposed for removal, this table which prescribes the use of the clause is also proposed for removal. In accordance with FAR drafting standards and the requirement in FAR 1.304(b)(1) that agency acquisition regulations shall not unnecessarily repeat, paraphrase, or otherwise restate material contained in the FAR, these subparts are therefore proposed for removal.

We propose to revise the authority citations under part 836 to include a reference to 41 U.S.C. 1121(c)(3) and 1303(a)(2), which is from Title 41, Public Contracts, and speaks to the authority of an executive agency under another law to prescribe policies, regulations, procedures, and forms for procurement that are subject to the authority conferred in the cited section, as well as other sections of Title 41 as shown therein. 41 U.S.C. 1303(a)(2) is added to reflect VA's authority as an executive agency to issue regulations that are essential to implement Governmentwide policies and procedures in the agency, as well as to issue additional policies and procedures required to satisfy the specific needs of the VA.

We propose to revise the authority citations under part 836 to include a reference to 41 U.S.C. 1702 which addresses the acquisition planning and management responsibilities of Chief Acquisition Officers and Senior Procurement Executives, to include implementation of unique procurement policies, regulations and standards of the executive agency.

In 836.202, Specifications, we propose to remove paragraphs (a) and (b) as internal procedural guidance, and to redesignate and renumber it to 836.202-70 to indicate that it is a VA supplement to FAR 36.202. The title would be revised from “Specifications” to “Specifications—use of equal products” to reflect the topic that fits intelligibly under this section of the FAR. The existing paragraph (c) would be revised to reflect that use of clause 852.236-90, Restriction on Submission and Use of Equal Products, in solicitations and contracts requires approval of the justification documentation required by FAR 11.105, Items peculiar to one manufacturer. The paragraph reference to (c) under this section would be removed as the VAAR is being supplemented and only one paragraph will be reflected which would be unnumbered and unlettered. The existing VAAR language which is proposed for revision with this rule is necessary as the FAR speaks to “brand name or equal” and the purpose of the VA's clause is to be clear that when the VA enters products for items peculiar to one manufacturer (brand name), “or equal” products are not permissible substitutes.

In 836.203, Government estimate of construction costs, we propose to renumber and retitle the section to 836.203-70, Protection of the independent government estimate—sealed bid, and would revise it to more specifically clarify VA procedures to protect the independent government estimate in sealed bid acquisitions when bid openings are held. This would also provide policy regarding marking the Independent Government Estimate (IGE) as “For Official Use Only (FOUO)” as well as procedures for filing the document and later removing the protective marking after a public bid opening.

In 836.204, Disclosure of the magnitude of construction projects, we propose to revise the estimated price ranges to provide a better measure for contractors to gauge estimated construction costs for projects of the National Cemetery Administration and the Office of Construction and Facilities Management.

In 836.206, Liquidated damages, we propose to remove the entire section since the subject matter is adequately covered in the FAR.

In 836.209, Construction contracts with architect-engineer firms, we propose to remove the entire section as internal procedures of VA not having a significant effect beyond the internal operating procedures of the VA (see FAR 1.301(b)), and which would be moved to the VAAM.

In 836.213, Special procedures for sealed bidding in construction contracting, we propose to remove the section title as the underlying subsections are proposed for removal.

We propose to remove 836.213-4, Notice of award, as internal procedures of VA not having a significant effect beyond the internal operating procedures of the VA (see FAR 1.301(b)), and which would be moved to the VAAM.

We propose to remove 836.213-70, Notice to proceed, as procedural information internal to VA which would be moved to the VAAM.

We propose to revise 836.500, Scope of subpart, to remove paragraphs (b) and (c) which duplicate the authority to use other clauses and provisions as already provided for in FAR 36.500. We propose to redesignate paragraph (a) as an unnumbered paragraph in keeping with FAR Drafting Guidelines and formatting style.

We propose to revise 836.501, Performance of work by the contractor, to make minor edits and to add a reference to VAAR subpart 819.70, which implements the Veterans First Contracting Program.

In 836.513, Accident prevention, we propose to remove the entire section since the prescribed clause is duplicative of coverage in FAR clause 52.236-1, Accident Prevention.

We propose to revise 836.521, Specifications and drawings for construction, only to make minor edits for capitalization.

We propose to remove 836.570, Correspondence, as the clause it prescribes 852.236-76, Correspondence, is proposed for removal. The subject matter will be addressed more appropriately in a “Notice to Proceed” letter to the contractor from the contracting officer. Therefore, the clause and its prescription are unnecessary.

We propose to remove 836.571, Reference to “standards,” since the clause it prescribes 852.236-77, Reference to “Standards”, is proposed for removal. The subject matter is addressed in the VA Master Specifications (located at: https://www.cfm.va.gov/til/), and the clause and therefore its prescription is unnecessary.

In 836.572, Government supervision, we propose to remove the entire section and redesignate the numbering and placement to the more appropriate VAAR part 842, Contract Administration and Audit Services, by adding a new section 842.204, Contract clause for Government construction contract administration. The clause would be therefore renumbered and revised accordingly.

In 836.573, Daily report of workers and materials, we propose to amend the title of the section and report to “Contractor production report,” and would prescribe a revised clause 852.236-79, Contractor Production Report.

We propose to revise 836.574, Subcontracts and work coordination, only to make minor edits for capitalization.

We propose to remove 836.575, Schedule of work progress, since the subject matter of the prescribed clause 852.236-84, Schedule of Work Progress, is addressed in the VA Master Specifications, Division 01, General Requirements: 01 32 16.01, Architectural and Engineering CPM Schedules; 01 32 16.13, Network Analysis Schedules; 01 16.15, Project Schedules (Small Projects—Design/Bid/Build); 01 32 16.16, Network Analysis Schedules (Design-Build Only); and, 01 32 16.17, Project Schedules (Small Projects—Design/Build). The clause is proposed for removal and therefore its prescription would be unnecessary.

We propose to remove 836.576, Supplementary labor standards provisions, since the subject matter of the prescribed clause 852.236-85, Supplementary Labor Standards Provisions, is addressed in FAR clauses 52.222-6, Construction Wage Rate Requirements (formerly known as Davis-Bacon Act) and 52.222-8, Payrolls and Basic Records. The clause is proposed for removal and therefore its prescription would be unnecessary.

We propose to remove 836.577, Workers' compensation, which prescribes clause 852.236-86, Workers' Compensation. The clause is unnecessary since it merely cites a Public Law regarding applicability of States' workers' compensation laws. The VAAR is not required to cite individual States' workers' compensation laws to make them applicable to companies performing work in individual states. The clause is proposed for removal and therefore its prescription would be unnecessary.

We propose to remove 836.579, Special Notes, which prescribes the clause at 852.236-91, Special Notes. As stated under VAAR part 801 in the preamble of this proposed rule, the clause's paragraph (a) is already covered via required System for Award Management (SAM) representations and certifications. Paragraphs (b), (c) and (d) are addressed in Section 01 00 00, General Requirements, contained in all construction contract specifications (reference the VA Office of Construction and Facilities Management, Technical Information Library (TIL), VA Numbered Standards for Construction, PG-18-1, Master Construction Specifications, Division 01—General Requirements). And, paragraph (e), which references claims by the contractor for delay attributed to unusually severe weather under FAR 52.249-14, Excusable Delays, is governed by the Network Analysis System specifications—Section 01 32 16.13, Network Analysis System; 01 32 16.13, Project Schedules (Small Projects Design-Bid-Build); 01 32 16.16, (Network Analysis System (Design-Build Only); or 01 32 16.17, Project Schedule (Small Projects Design-Build), as applicable, which provide details of the requirements the contractor must follow to justify time extensions. VA internal procedures related to how contracting officers and Government Resident Engineers or technical reviewers should analyze contractor data and which records to review to support such claims for time extensions due to unusually severe weather, not having a significant effect beyond the internal operating procedures of the VA, would be moved to the VAAM. The clause is proposed for removal and therefore its prescription as contained in this section would be unnecessary.

We propose to add 836.580, Notice to bidders—additive or deductive bid line items, and a prescription requiring the contracting officer to insert the provision 852.236-92, Notice to Bidders—Additive or Deductive Bid Line Items, in invitations for bids when the contracting officer determines that funds may not be available for all the desired construction features at contract award.

We propose to remove 836.602, Selection of firms for architect-engineer contracts. Previously there was no text under this heading/title. As all sections under this are now proposed for removal, no heading/title would be required.

We propose to remove 836.602-1, Selection criteria, as internal procedural information which will be revised and moved to the VA Acquisition Manual.

We propose to remove 836.602-2, Evaluation boards; 836.602-4, Selection authority; and 836.602-5, Short selection process for contracts not to exceed the simplified acquisition threshold, as internal procedural information which will be revised and moved to the VA Acquisition Manual.

We propose to revise 836.603, Collecting data on and appraising firms' qualifications. The title would be revised to correct a typo and the text would be revised to include a Veterans Benefits Administration point of contact for filing and maintaining Standard Form (SF) 330 Files as required by the FAR.

In 836.606, Negotiations, we propose to revise the section in its entirety to remove internal agency procedural guidance in section 836.606-70, General, as unnecessary, and to remove the title, “General,” by redesignating section 836.606-71, Architect-Engineer's proposal, to 836.606-70, and retitling it to read “Architect-Engineer firms' proposal.” We propose to revise the text which requires use of the VA Form 6298, Architect-Engineer Fee Proposal, which has been updated with the new form number and updating FAR citation references and thresholds. This form is used for the submission of a contractor's proposal and supporting cost data from the selected firm during negotiation of an A-E contract for design services estimated at $50,000 or more. And, we propose to change the word “must” to “shall” when requiring the use of the form as prescribed in this section.

In 836.606-72, Contract price, we propose to remove the section in its entirety and move it to the companion VA Acquisition Manual as internal operating procedures of the VA.

We propose to redesignate and revise 836.606-73, Application of 6 percent architect-engineer fee limitation, to section 836.606-71, and retain the same title, “Application of 6 percent architect-engineer fee limitation,” to place all text now under section 836.606 in sequential subsections. 836.606-71, Application of 6 percent architect-engineer fee limitation, would provide policy explaining when the limitation applies, what costs the 6 percent fee limitation does and does not cover, and delete use of VA Form 10-1193, Application for Health Care Facility Program, and VA Form 10-6238, EMIS Construction Program Estimate Worksheet. The forms proposed for deletion are not required for use in this instance.

We propose to add subpart 836.70—Unique Forms for Contracting for Construction, Architect-Engineer Services, and Dismantling, Demolition, or Removal of Improvements, and the sections falling under that subpart—836.7000, Scope of subpart; and 836.7001, Unique construction and architect-engineer services forms. This would prescribe forms contracting officers may use for construction, architect-engineer services or dismantling, demolition or removal of improvements.

In 836.7000, Scope of subpart, it sets forth the requirements for use of VA unique forms.

In the new proposed 836.7001, Unique construction and architect-engineer services forms, we propose to add the following forms as prescribed elsewhere in the VAAR or as reflected in the individual prescriptions—

In paragraph (a) we propose to add information referencing VA Form 6298, Architect-Engineer Fee Proposal (see 853.236-70), and pointing information to the prescription. VA Form 6298, Architect-Engineer Fee Proposal, shall be used as prescribed in 836.606-71.

In paragraph (b) we propose to add the prescription for VA Form 2138, Order for Supplies or Services (Including Task Orders for Construction or A-E Services) (see 853.236-71). VA Form 2138, Order for Supplies or Services (Including Task Orders for Construction or A-E Services), may be used for ordering supplies or services, including task orders for Construction or A-E services, to include dismantling, demolition, or removal of improvements.

In paragraph (c) we propose to add information referencing VA Form 10101, Contractor Production Report (see 853.236-72), and pointing information to the prescription. Contractors may use VA Form 10101, Contractor Production Report, or a contractor generated form containing the same type of information contained in the form, as required by 836.573 which prescribes the clause at 852.236-79, Contractor Production Report.

We propose to revise the authority citations under part 842 to include a reference to 41 U.S.C. 1702 which addresses the acquisition planning and management responsibilities of Chief Acquisition Officers and Senior Procurement Executives, to include implementation of unique procurement policies, regulations and standards of the executive agency.

We propose to add coverage under VAAR subpart 842.2, Contract Administration Services, and 842.271, Contract clause for Government construction contract administration, to prescribe clause 852.242-70, Government Construction Contract Administration, that would describe contract administration functions to be delegated under construction contracts that exceed the micro-purchase threshold for construction. It would describe the role of the designated contracting officer performing contract administration, as well as certain functions that are delegated to VA resident engineers, if assigned. It also contains some language found under the previous clause, 852.236-78, Government Supervision. The information more properly falls under FAR part 42 and the VAAR supplement, so the new clause number more properly follows FAR drafting conventions, to include placing the prescription in the same part where the clause itself is located.

We propose to revise the part 846 authorities to replace the 38 U.S.C. 501 citation with 41 U.S.C. 1702 which addresses the acquisition planning and management responsibilities of Chief Acquisition Officers and Senior Procurement Executives, to include implementation of unique procurement policies, regulations and standards of the executive agency. We also propose to add 41 U.S.C. 1121(c)(3) which is from Title 41, Public Contracts, Positive Law codification that speaks to the authority of an executive agency under another law to prescribe policies, regulations, procedures, and forms for procurement that are subject to the authority conferred in the cited section, as well as other sections of Title 41 as shown therein.

In 846.312, Construction contracts, which prescribes clause 852.236-74, Inspection of construction, we propose to remove the entire section since VA Master Specifications provide the requirements for performing inspections. The clause is proposed for removal and therefore its prescription would be unnecessary.

In 852.236-71, Specifications and Drawings for Construction, we propose to amend the clause to place with the contractor the responsibility for checking all drawings furnished immediately upon receipt, and comparing them and verifying figures before laying out the work. It would also require the prompt notification of the contracting officer of any discrepancies. It would hold the contractor responsible for any errors that might have been avoided by complying with these requirements, for identifying errors or omissions that are necessary to carry out the intent of the drawings and specifications, and for performing such work as if fully and correctly set forth.

In 852.236-72, Performance of Work by the Contractor, we propose to amend the clause and Alternate 1 to make the text gender-neutral, to update terminology and to clarify language.

In 852.236-74, Inspection of Construction, we propose to remove and reserve the clause in its entirety since VA Master Specifications provide the requirements for performing inspections.

In 852.236-76, Correspondence, we propose to remove and reserve the clause since it is administrative guidance covered in the Notice to Proceed letter.

In 852.236-77, Reference to “Standards,” we propose to remove and reserve the clause as unnecessary since VA Master Specifications are used in VA contracts.

In 852.236-78, Government Supervision, we propose to remove and reserve the clause and would propose to include a revised version at 852.242-70, Government Construction Contract Administration.

In 852.236-79, Daily Report of Workers and Materials, we propose to amend the title of the clause to “Contractor Production Report” and would revise the clause to reflect use of VA Form 10101 which is based on industry reporting standards.

In 852.236-80, Subcontracts and Work Coordination, we propose to make minor capitalization corrections for Contractor and Contracting Officer, and to clarify in paragraph (d) that the Government reserves the right to refuse to permit employment on the work, or require dismissal from the work, of any subcontractor or subcontractor employee, who, by reason of previous unsatisfactory work on Department of Veterans Affairs projects or for any other reason, is considered by the contracting officer to be incompetent, careless, or otherwise objectionable. The words “or subcontractor employee” and “careless” would be added that were previously missing from the text.

In 852.236-84, Schedule of Work Progress, we propose to remove the clause in its entirety and reserve it since the subject is already covered in the Network Analysis Schedules section of the VA Master Specifications.

In 852.236-85, Supplementary Labor Standards Provisions, we propose to remove the clause in its entirety and reserve it since it is procedural and is addressed in FAR clauses 52.222-6, Construction Wage Rate Requirements, and 52.222-8, Payrolls and Basic Records.

In 852.236-86, Workers' Compensation, we propose to remove the clause in its entirety and reserve it since it merely cites a Public Law regarding applicability of States' workers' compensation laws. The VAAR is not required to cite individual States' workers' compensation laws to make them applicable to companies performing work in individual states.

In 852.236-87, Accident Prevention, we propose to remove the clause in its entirety and reserve it since the subject is already covered in the Accident Prevention Plan section of the VA Master Specifications.

In 852.236-89, Buy American Act, along with its Alternate I and II, we propose to remove and reserve the clause as it is redundant to the FAR and is unnecessary.

In 852.236-90, Restriction on Submission and Use of Equal Products, we propose to revise the clause to clarify the language to reinforce that the submission of “equal” products is not permitted; and to reformat the clause to standard FAR drafting convention and specify that notwithstanding any other clause or provision, only brand name products for the items listed in the fill-in clause will be authorized for use on the contract. The prescription for this clause would require compliance with the documentation and authorizations required by FAR 11.105 when it is determined that only one product will meet the Government's minimum needs.

In 852.236-91, Special Notes, we propose to remove the clause in its entirety and reserve it since the material addressed is covered by the certification under the System for Award Management or under the Shop Drawings, Product Data & Submittals section of the VA Master Specifications.

We propose to add a new clause 852.236-92, Notice to Bidders—Additive or Deductive Bid Line Items, to provide guidance on how such bid items will be evaluated to determine the low bidder.

We propose to add a new clause 852.242-70, Government Construction Contract Administration, to enumerate the responsibilities being delegated.

We propose to amend the authority if part 853 to add 41 U.S.C. 1121(c)(3) which is from Title 41, Public Contracts, that speaks to the authority of an executive agency under another law to prescribe policies, regulations, procedures, and forms for procurement that are subject to the authority conferred in the cited section, as well as other sections of Title 41 as shown therein. We also propose to replace the 38 U.S.C. 501 citation with 41 U.S.C. 1702 which addresses the acquisition planning and management responsibilities of Chief Acquisition Officers and Senior Procurement Executives, to include implementation of unique procurement policies, regulations and standards of the executive agency.

In subpart 853.1—General, in 853.107, Obtaining forms, we propose to revise the text to provide the current website address where VA forms are obtained now: https://www.va.gov/vaforms/. The outdated address for an old VA office would be removed, as well as the outdated practice of requesting forms in hard copy directly from the agency policy office. All forms will be available online.

In subpart 853.2—Prescription of Forms, we propose to revise the list of forms applicable to VAAR part 836 that are used between VA and its contractors, potential offerors or bidders, or the general public.

In 853.236, Construction and architect-engineer contracts, in section 853.236-70, VA Form 6298, Architect-Engineer Fee Proposal, we are revising the number of the form and changing the location of the prescription reference from 836.606-71 to 836.7001(a).

In 853.236 we also propose to add the following sections identifying forms applicable to part 836:

853.236-71, VA Form 2138, Order for Supplies or Services (Including Task Orders for Construction or A-E Services) which provides the prescription reference for use of the form for ordering supplies or services, including task orders for Construction or A-E services, to include dismantling, demolition, or removal of improvements.

853.236-72, VA Form 10101, Contractor Production Report, which provides the prescription reference for use of the form or a contractor generated form containing the same type of information contained in the form.

Title 48, Federal Acquisition Regulations System, Chapter 8, Department of Veterans Affairs, of the Code of Federal Regulations, as proposed to be revised by this rulemaking, would represent VA's implementation of its legal authority and publication of the VAAR for the cited applicable parts. Other than future amendments to this rule or governing statutes for the cited applicable parts, or as otherwise authorized by approved deviations or waivers in accordance with FAR subpart 1.4, Deviations from the FAR, and as implemented by VAAR subpart 801.4, Deviations from the FAR or VAAR, no contrary guidance or procedures would be authorized. All existing or subsequent VA guidance would be read to conform with the rulemaking if possible or, if not possible, such guidance would be superseded by this rulemaking as pertains to the cited applicable VAAR parts.

Executive Orders (E.O.) 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. E.O. 12866, Regulatory Planning and Review, defines “significant regulatory action” to mean any regulatory action that is likely to result in a rule that may: “(1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal Governments or communities; (2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in this Executive Order.”

VA has examined the economic, interagency, budgetary, legal, and policy implications of this regulatory action, and it has been determined this rule is not a significant regulatory action under E.O. 12866.

VA's impact analysis can be found as a supporting document at http://www.regulations.gov, usually within 48 hours after the rulemaking document is published. Additionally, a copy of the rulemaking and its impact analysis are available on VA's website at http://www.va.gov/orpm by following the link for VA Regulations Published from FY 2004 Through Fiscal Year to Date. This proposed rule is expected to be an E.O. 13771 deregulatory action. Details on the estimated cost savings of this proposed rule can be found in the rule's economic analysis.

This proposed rule impacts eight existing information collection requirements associated with four Office of Management and Budget (OMB) control number approvals. The proposed actions in this rule result in multiple actions affecting some of these information collections, such as: The proposed outright removal of the information collection; no change in information collection burdens although titles and number of the information collection would be slightly revised; or no change to the existing OMB control number and associated burden.

The Paperwork Reduction Act of 1995 (at 44 U.S.C. 3507) requires that VA consider the impact of paperwork and other information collection burdens imposed on the public. Under 44 U.S.C. 3507(a), an agency may not collect or sponsor the collection of information, nor may it impose an information collection requirement unless it displays a currently valid OMB control number. See also 5 CFR 1320.8(b)(3)(vi).

This proposed rule contains one provision constituting a collection of information at 48 CFR 836.606-71, Architect-engineer's proposal, concerning use of and prescription for VA Form 10-6298, Architect-Engineer Fee Proposal, which is proposed to be revised with updated thresholds and FAR citations, as well as an updated number to remove the “10-” currently part of the form number. Under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521), no new collection of information is associated with this provision as a part of this proposed rule. The information collection requirement for 836.606-71 is currently approved by OMB and has been assigned OMB control number 2900-0208. The burden of this information collection would remain unchanged. There would be no change in the information collection burden that is associated with this proposed request. However, we are proposing to amend the information collection requirement to renumber the form currently numbered and titled as VA Form 10-6298, Architect-Engineer Fee Proposal, to now read: VA Form 6298, Architect-Engineer Fee Proposal. Additionally, older dollar thresholds and FAR citations in the form would be updated to current levels and correct citations. In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521), OMB has approved the reporting or recordkeeping provisions that are included in the text and form under 836.606-71 cited above against the assigned OMB control number. For the requested administrative amendments to the form, as required by the Paperwork Reduction Act of 1995 (at 44 U.S.C. 3507(d)), VA has submitted this information collection amendment to OMB for its review. Notice of OMB approval for this information collection will be published in a future Federal Register document. Further proposed revision to the associated OMB control number relating to other provisions of this proposed rule are identified separately in this submittal.

This proposed rule also contains two provisions constituting a collection of information at 48 CFR 852.236-72, Performance of Work by the Contractor; and 48 CFR 852.236-88, Contract Changes—Supplement, that would remain unchanged. Under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521), no new or proposed revised collection of information is associated with these provisions as a part of this proposed rule. The information collection requirements for 852.236-72 and 852.236-88 are currently approved by OMB and have been assigned OMB control number 2900-0422. The burden of these information collections would remain unchanged. In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521), OMB has approved the reporting or recordkeeping provisions that are included in the clause at 852.236-72 and 852.236-88 cited above and against the assigned OMB control number. Further proposed revision to the associated OMB control number relating to other information collections and provisions of this proposed rule are identified separately in this submittal.

This proposed rule would impose the following amended information collection requirements to one of the four existing information collection approval numbers associated with this proposed rule. Although this action contains the following provision constituting a collection of information at 48 CFR 852.236-79, under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501-3521), no new proposed collection of information is associated with this provision as a part of this proposed rule. The information collection requirement for 852.236-79 is currently approved by OMB and has been assigned OMB control number 2900-0208. There would be no change in the information collection burden that is associated with this proposed request. However, we are proposing to amend the information collection requirement to revise the title and to renumber the form currently numbered and titled as VA Form 10-6131, Daily Log (Contract Progress Report—Formal Contract) to replace this form, along with replacing the number and title of VA Form 10-6001a, Supplement Contract Progress Report with one new number, title and format—VA Form 10101, Contractor Production Report. As required by the Paperwork Reduction Act of 1995 (at 44 U.S.C. 3507(d)), VA has submitted this information collection amendment to OMB for its review. Notice of OMB approval for this information collection will be published in a future Federal Register document. The currently approved burden remains unchanged.

This action also contains a provision constituting a collection of information at 48 CFR 852.236-80, however, under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501-3521), no new proposed collection of information is associated with this provision as a part of this proposed rule. The information collection requirement for 852.236-80 is currently approved by OMB and has been assigned OMB control number 2900-0422. The currently approved burden associated with this clause would remain unchanged. However, this information collection has been submitted to OMB to amend the information collection requirement to make a minor correction to the title of the clause, as stated in paragraph 1 of the Supporting Statement, to reflect the full name of the clause—“Subcontracts and Work Coordination” in lieu of an abbreviated title reflected on the Supporting Statement—“Work Coordination.” The clause was otherwise referenced correctly in the remainder of the supporting statement. As required by the Paperwork Reduction Act of 1995 (at 44 U.S.C. 3507(d)), VA has submitted this information collection amendment to OMB for its review to revise the title in paragraph 1 of the submitted statement. Notice of OMB approval for this information collection will be published in a future Federal Register document.

This proposed rule would remove one of the existing information collection requirements associated with this action at 48 CFR 852.236-84, Schedule of Work Progress. Under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501-3521), while the actual OMB control number will remain in existence due to other information collections on the same OMB control number that are approved and active, it discontinues the inclusion of 852.236-84 under the associated corresponding approved OMB control number, 2900-0422. As a result of this proposed rule, there would be a removal in the information collection burden that is associated with it. For 48 CFR 852.236-84, Schedule of Work Progress, as now included on OMB control number 2900-0422, this would result in a removal of 1828.5 estimated annual burden hours and an annual cost savings of $70,800. As required by the Paperwork Reduction Act of 1995 (at 44 U.S.C. 3507(d)), VA has submitted this information collection amendment to OMB for its review. Notice of OMB approval for this information collection will be published in a future Federal Register document.

This proposed rule would remove two of the existing information collection requirements associated with this action at 48 CFR 852.236-89, Buy American Act; and 852.236-91, Special Notes. Under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501-3521), it discontinues the associated corresponding approved OMB control numbers, 2900-0622 and 2900-0623, respectively. As a result of this proposed rule, there would be a removal in the information collection burden that is associated with it. For 48 CFR 852.236-89, Buy American Act, and its corresponding OMB control number 2900-0622, this would result in a removal of 22 estimated annual burden hours and an annual cost savings to respondents of $852. For 48 CFR 852.236-91, Special Notes, and its corresponding OMB control number 2900-0623, this would result in a removal of 778 estimated annual burden hours and an annual cost savings of $30,122. As required by the Paperwork Reduction Act of 1995 (at 44 U.S.C. 3507(d)), VA has submitted these information collection amendments to OMB for its review. Notice of OMB approval for this information collection will be published in a future Federal Register document.

This proposed rule would not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-612. The overall impact of the proposed rule would be of benefit to small businesses owned by Veterans or service-disabled Veterans as the VAAR is being updated to remove extraneous procedural information that applies only to VA's internal operating processes or procedures. VA estimates no cost impact to individual business would result from these rule updates. This rulemaking clarifies VA's policy regarding the contracting order of priority for Service-Disabled Veteran-Owned Small Businesses (SDVOSBs) and Veteran-Owned Small Businesses (VOSBs) as a result of VA's implementation of 38 U.S.C. 8127-8128 as a result of the U.S. Supreme Court's decision in Kingdomware Technologies, Inc. vs. the United States, July 25, 2018, only as it pertains to the application of the VA Rule of Two to contracts for construction and architect-engineer contracts in accordance with Public Law 109-461 as codified at 38 U.S.C. 8127-8128. It does not have an economic impact to individual businesses, and there are no increased or decreased costs to small business entities. On this basis, this proposed rule would not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-612. Therefore, under 5 U.S.C. 605(b), this regulatory action is exempt from the initial and final regulatory flexibility analysis requirements of sections 603 and 604.

The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in the expenditure by State, local, and tribal Governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This proposed rule would have no such effect on State, local, and tribal Governments or on the private sector.

The Secretary of Veterans Affairs approved this document and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs. Robert L. Wilkie, Secretary, Department of Veterans Affairs, approved this document on August 20, 2018, for publication.

For the reasons set out in the preamble, VA proposes to amend 48 CFR parts 801, 825, 836, 842, 846, 852, and 853 as follows:

Table of Contents I. Background II. Summary of the Proposed Regulations A. Proposed Regulations for Net Configuration 1. Eliminate Minimum Mesh Size Restriction 2. Revise the Definition of Mesh Size 3. Eliminate the Prohibition on Double-walled Codends 4. Eliminate Restrictions on the Use of Chafing Gear 5. Summary of Potential Impacts From Proposed Regulations for Net Configuration B. Eliminate the Requirement to Use Selective Flatfish Trawl Shoreward of the RCA and North of 42 N. Latitude C. Proposed Regulations for Vessel Operations 1. Eliminate the Prohibition on Multiple Types of Groundfish Trawl Gears Carried and Fished on the Same Trip 2. Eliminate the Prohibition on Bringing a New Haul Onboard Before All Catch From the Previous Haul Is Stowed 3. Eliminate the Prohibition on Fishing in Multiple IFQ Management Areas on the Same Tow 4. Summary of Potential Impacts From Proposed Regulations for Some Vessel Operations III. Classification IV. Description of Regulated Entities V. Description of the Proposed Regulations VI. Collection of Information Requirements I. Background

Prior to 2011, the Pacific Coast Groundfish fishery was primarily managed with trip and landing limits and area closures and monitoring was limited (e.g., less than 25 percent of groundfish bottom and midwater trawl trip landings were subject to at-sea observer coverage). During that time, NMFS implemented trawl gear restrictions to both reduce groundfish and non-groundfish bycatch and discards, as well as limit access to overfished rockfish habitat. Restrictions included: (1) Minimum mesh size requirements; (2) requirements for chafing gear and cod-ends; (3) the trawl Rockfish Conservation Areas (RCA), which prohibits the use of groundfish bottom trawl gear between certain fathom lines defined in regulation at §§ 660.71 through 660.74; and, (4) a requirement that vessels use selective flatfish trawl, a type of small footrope trawl gear, shoreward of the trawl RCA and north of 40°10′ North (N) latitude.

In 2011, NMFS implemented Amendments 20 and 21 to the Pacific Coast Groundfish Fishery Management Plan (PCGFMP), which established the Trawl Rationalization Program. The Trawl Rationalization Program, a type of catch share program, replaced trip and landing limits with fixed allocations for limited entry trawl participants, through an individual fishing quota (IFQ) management system. To allow managers to accurately account for catch against IFQ, the program increased at-sea and shoreside monitoring to 100 percent of trips and landings for groundfish bottom and midwater trawl vessels. This management system, which increased individual vessel accountability, successfully reduced bycatch of target and non-target rockfish in the trawl fishery. Since implementation of the Trawl Rationalization Program, five of the seven previously overfished rockfish species are now rebuilt.

Building on the successes of the Trawl Rationalization Program at reducing discards, NMFS and the Pacific Fishery Management Council (Council) began working with industry members on several fishery management actions, known as Program Improvements or Enhancements (PIE) trailing actions. The PIE trailing actions included identifying regulations that limit the use and configuration of groundfish bottom and midwater trawl gears, and may no longer be necessary because the Trawl Rationalization Program effectively limits target and non-target species bycatch.

In March 2011, groundfish industry members, through the Council's Groundfish Advisory Sub-Panel (GAP), requested that the Council eliminate and revise various regulations related to mesh size and requirements to use four-seam trawl shoreward of the trawl RCA. To address the GAP's recommendations, the Council formed an ad hoc committee to identify specific regulations that, if revised or eliminated, would allow fishermen to increase the efficiency of their fishing strategy as the Council had intended when they recommended implementation of the Trawl Rationalization Program. The Council authorized the appointment of the new ad hoc committee, the Trawl Rationalization Regulatory Evaluation Committee (TRREC), at its April 2011 meeting.

The TRREC held a meeting during the summer of 2011. At the Council's November meeting that year, the TRREC recommended the Council consider, as part of the PIE trailing actions, revising regulations to: (1) Allow multiple gear (trawl gears and fixed gear) use and possession seaward and shoreward of the trawl RCA; (2) remove restrictions on chafing gear for midwater trawl gear; and, (3) eliminate codend, mesh size, and selective flatfish trawl gear requirements and restrictions. The TRREC prioritized these three measures over others, but also recommended the Council consider revising additional regulations they felt were unnecessary and costly, including the prohibition on fishing more than one individual fishing quota (IFQ) management area and the definitions of large and small footropes.

In March 2012, the Council adopted preliminary preferred alternatives for most of the gear measures under the PIE trailing actions; adopted its preferred alternative for chafing gear requirements for midwater trawl gear and put this action on a fast track for implementation; and, authorized a one-day public workshop of the Council's Enforcement Consultants (EC), GAP, and Groundfish Management Team (GMT) to discuss and make recommendations on the remaining gear related measures. Further discussion on gear measures were delayed until results of the gear workshop were presented to the Council.

The purpose of the gear workshop, which took place August 29-30, 2012, in Portland, Oregon, included scoping of various gear restriction measures that had been recommended to the Council by the TRREC and providing recommendations for how the Council can move forward. The gear workshop report was presented to the Council at its November 2012 meeting and made similar recommendations to those in the TRREC report, including (1) allowing the use of multiple gears (trawl and fixed gear) on the same trip; (2) a reduction in the minimum mesh size for groundfish bottom trawl gear; (3) eliminating the selective flatfish trawl gear requirement; and (4) allowing vessels in the IFQ Program to move fixed gear across management lines. Additionally, the report included a recommendation to allow year-round use of midwater gear within and outside the trawl RCA north of 40°10′ North (N) latitude.

The Council next took action on these measures in September 2015. At the time, the Council adopted the purpose and need statement, a rulemaking schedule, and the range of alternatives, along with some additional alternatives and measures suggested by the GAP. These new measures included changing how mesh size is defined so that regulations would allow for the enforcement of both knotted and knotless webbing; allowing vessels fishing under the Shorebased IFQ Program to fish across IFQ management lines; allowing whiting fishing with any type of trawl gear; allowing a tow to be brought onboard before previous catch is stowed; and, the option to further review and revise additional requirements in regulations at § 660.130 which provides trawl gear requirements and restrictions. After Council and NMFS staff reviewed that section of the regulations, further measures were added to the list of potential gear changes, including eliminating codend restrictions. Several other possible measures were not forwarded at the time due to potential for delays in implementation. The Council scheduled final action on the suite of measures for March 2016.

On March 3, 2016 (81 FR 11189), NMFS published a notice of intent (NOI) to prepare an environmental impact statement (EIS) to consider revisions to the regulations for groundfish bottom and midwater trawl gear used by vessels under the Trawl Rationalization Program. The Council conducted an additional scoping during its March 2016 meeting to gather public comments on the proposed regulations. Based on discussions at the meetings and public comments on the NOI, the Council selected their final preferred alternatives for all of the proposed measures at its March 2016 meeting, except the restriction on fishing across IFQ management lines. The Council delayed its decision on management lines, and selected its final preferred alternative at the June 2016 Council meeting. Detailed information, including the supporting documentation the Council considered at each meeting, is available at the Council's website, www.pcouncil.org.

After the Council selected final recommendations on the proposed measures in March and June 2016, NMFS completed extensive analyses on the measures, including an Endangered Species Act section 7 consultation on the impacts of the PCGFMP on listed salmon stocks. These analyses supported NMFS' determination that the impacts of implementing the proposed measures would likely not be significant and, therefore, there was no need to complete an EIS. Instead NMFS completed an integrated analysis that included an EA. On June 8, 2018, NMFS published a notice to withdraw preparation of the EIS (83 FR 26640). A copy of the draft EA and supporting documents are available from NMFS (see ADDRESSES).

If implemented, the proposed regulations would provide flexibility to groundfish bottom and midwater trawl vessels fishing under the Trawl Rationalization Program in how they may use and configure their gear, and operate on fishing trips. This flexibility is expected to foster innovation and allow for more optimal harvest operations for the groundfish fleet.

The Council deemed the proposed regulations consistent with and necessary to implement this action in an August 14, 2018, letter from Council Executive Director, Chuck Tracy, to Regional Administrator Barry Thom. Under the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act), NMFS is required to publish proposed rules for comment after preliminarily determining whether they are consistent with applicable law. We are seeking comment on the proposed regulations in this action and whether they are consistent with the PCGFMP, the Magnuson-Stevens Act and its National Standards, and other applicable law.

The discussion in this proposed rule and in the EA/RIR/RFA (See ADDRESSES) groups several related measures to reduce redundancy and to consider the collective impacts of similar proposed regulations. Through this action, the Council proposes to:

• Adjust a suite of restrictions related to how nets are configured, including eliminating minimum mesh size restrictions, changing the definition of mesh size, removing chafing gear placement restrictions, and removing restrictions on using double-walled codends from groundfish bottom and midwater trawl vessels fishing under the Trawl Rationalization Program;

• Remove the requirement to use selective flatfish trawl gear north of 40° 10′ N lat. and shoreward of the trawl RCA;

• Adjust a number of provisions related to vessel operations on a single fishing trip, including allowing vessels that fish in the Shorebased IFQ Program under the Trawl Rationalization Program to carry and fish groundfish bottom and midwater trawl gears on the same trip, fish across IFQ management lines, and bring a new haul on deck before the catch from a previous haul is stowed.

This section discusses the proposed regulations that would remove some minimum mesh size restrictions, revise the definition of mesh size, remove chafing gear placement restrictions, and remove the prohibition on using double-walled codends for groundfish bottom and midwater trawl vessels fishing under the Trawl Rationalization Program. These measures all relate to net configuration, and all affect the mesh size for trawl nets. Because changing any of these restrictions could result in similar impacts, the analysis supporting this proposed rule considers both the individual and collective impacts of all of the measures. Below is a short description of each of the proposed regulations followed by a summary of the potential impacts of each of these measures combined.

Mesh size is the opening between opposing knots in a fishing net, and minimum mesh size is the smallest distance allowed from the inside of one knot to the inside of the opposing knot. Currently, vessels fishing with groundfish trawl gear, including chafing gear, must use nets with a minimum mesh size greater than or equal to 4.5 inches (11.4 cm) for bottom trawl, and greater than or equal to 3.0 inches (7.6 cm) for midwater trawl gears. These regulations were first implemented in the 1990s to reduce fishing mortality for smaller fish, thus increasing survival to maturity. Increasing size selectivity through minimum mesh size restrictions was also expected to reduce bycatch of non-target species.

Midwater trawl gear must be constructed so that the first 20 feet (6.51 m) immediately behind the footrope or head-rope is constructed with bare ropes or mesh with a minimum size of 16 inches (40.64 cm). Also implemented in the 1990s, this restriction makes midwater trawl gear impractical or ineffective at capturing fish when in contact with the seafloor, which ensures that vessels do not make bottom contact with midwater trawl gear.

This action would remove both the 4.5 in (11.4 cm) minimum mesh size requirement for groundfish bottom trawl gear and the 3.0 in (7.6 cm) minimum mesh size requirement for midwater trawl. The Council did not recommend revising the current restriction on the minimum mesh size restriction for the first 20 feet (6.51 m) behind the footrope or head-rope for midwater trawl gears. This requirement is essential to the definition of midwater trawl gear.

Under the proposed regulations, it is not anticipated that groundfish bottom or midwater trawl vessel operators would significantly reduce their mesh size, throughout their codend, intermediate, and/or body of the trawl to create less selective fishing gear because this may increase the catch of undersized IFQ species or other unwanted species, decrease the efficiency of the trawl, and increase fuel consumption. Some groundfish bottom trawlers may use smaller meshes closer to the 3.0 in (7.6 cm) minimum allowed for midwater trawl to reduce gilling of species like widow rockfish and yellowtail rockfish. But there does not currently appear to be a need for midwater trawl vessel operators to reduce their minimum mesh size through their trawl gear lower than the requirement, even though they would be allowed to do so under the proposed regulatory changes, because the current 3.0 in (7.6 cm) minimum mesh size requirement is sufficient for preventing excessive gilling of midwater species (e.g., widow and yellowtail rockfish) while maintaining high catch rates.

The proposed regulations would likely provide vessel operators with the flexibility to configure their gear to enable efficient catch of target species, including the strategic use of smaller mesh sizes to facilitate the use or construction of excluder devices (e.g., flexible grates), the use of smaller meshes to herd or guide fish through the net and reduce gilling, and to reinforce the net where the excluder or guiding panels are attached to reduce wear on the net meshes.

In addition to revising minimum mesh size restrictions for bottom and midwater trawl gear, this action updates the definition for measuring minimum mesh size to include knotless nets, as well as redefining the approach for measuring mesh size as the opening between opposing corners. These changes to the definition for mesh size are necessary because most vessels today use knotless trawl gear. Revising the definition of mesh size would allow NMFS Office of Law Enforcement (OLE) to enforce current mesh size requirements for nets that do not have knots. Additionally, removing the minimum mesh size requirements would reduce minor enforcement violations that occur when net shrinkage reduces mesh size below legal limits.

Even if the minimum mesh size requirement is eliminated, as discussed under Section A.1. above, this revision to the definition of mesh size would still be necessary because vessels using midwater trawl nets will still be required to adhere to minimum mesh size requirements for the first 20 feet (6.51 m) behind the footrope or head-rope.

The current groundfish regulations prohibit double-walled codends on any trawl gear, and prohibits vessel operators from outfitting nets with chafing gear to effectively create a double-walled codend. Double-walled codend is defined in regulation as a codend constructed of two walls or layers of webbing. The prohibition was originally implemented in 1992 to prevent vessel operators from using double-walled codends to effectively reduce their mesh size below the minimum size requirements, which would have prevented undersized species from escaping the net, and resulted in more discards.

The Council recommended and NMFS proposes eliminating the restrictions that prohibit groundfish bottom and midwater trawl vessels from using double-walled codends. This proposed regulations could provide flexibility necessary to reinforce webbing in certain areas of the trawl net that could facilitate escapement of fish through escape panels (e.g., reinforced webbing to attach ramps, funnels, or other selective devices to codend or intermediate meshes) and to prevent abrasion of the net from various trawl components, such as restraining straps. This revision could also result in escapement of smaller fish by reducing the effective mesh size of the codend and herd fish through the net, and increase net protection by “armoring” the trawl.

The November 2011 TRREC report also suggested eliminating restrictions on the use of chafing gear. The groundfish regulations define chafing gear as a webbing or other material that attaches to the codend to protect trawl nets from wear and damage from bottom contact and contact with the vessels during net retrieval. Regulations implemented in the 1990s required chafing gear with large meshes be fastened to allow escapement of small fish through mesh openings (57 FR 12212, April 9, 1992). These regulations were intended to prevent vessel operators from using chafing gear to create double-walled codends or effectively reducing the mesh size below the minimum mesh size restrictions. Over the past 30 years, NMFS implemented several proposed regulations to expand the use of chafing gear to protect trawl nets to better align with regulations off Alaska.

The current regulations allow vessels to configure chafing gear to encircle no more than 50 percent of a bottom trawl net's circumference. Chafing gear on bottom trawls may be used only on the last 50 meshes, issued from the terminal (closed) end of the codend. Only the front edge (edge closest to the open end of the codend) and sides of each section of chafing gear may be attached to the codend. With the exception of the corners, the terminal edge (edge closest to the closed end of the codend) of each section of chafing gear must not be attached to the net. Chafing gear must be attached outside any riblines and restraining straps.

For midwater trawl, current regulations allow that chafing gear may cover the bottom and sides of the codend in either one or more sections. Only the front edge (edge closest to the open end of the codend) and sides of each section of chafing gear may be attached to the codend; except at the corners, the terminal edge (edge closest to the closed end of the codend) of each section of chafing gear must not be attached to the net. Chafing gear is not permitted on the top codend panel on midwater trawl gear except for a band of mesh (a “skirt”) may encircle the net under or over transfer cables, lifting or splitting straps (chokers), riblines, and restraining straps, but must be the same mesh size and coincide knot-to-knot with the net to which it is attached and be no wider than 16 meshes.

NMFS proposes removing all restrictions in regulations on the use of chafing gear for groundfish bottom trawl and midwater trawl gear. Removing these restrictions would allow vessel operator flexibility in how they use chafing gear to protect nets and codends and how they fish relative to the seafloor. It is anticipated that under the proposed regulations, vessel operators would use chafing gear strategically to provide protection in areas where the net can be susceptible to wear. This will allow vessels to extend the life of their nets and ultimately reduce operational costs.

It is not anticipated that vessel operators would attach large sections of chafing gear to these additional sections for added net protection, because doing so would increase the drag on the net, which could increase fuel consumption and reduce fishing efficiency. In addition, it would likely provide no additional protection from bottom contact, because the top of the net and tapered portion of the net in front of the codend rarely contact the seabed. Wear patterns on midwater trawl nets indicate that when bottom contact occurs, it typically occurs at the very end of the codend, which can already be protected by chafing gear under the current regulations. The ability of vessels to fish in more rocky habitat has more to do with the size of the footrope than the chafing gear protections, and vessels operators would still be required to abide by the small footrope requirement shoreward of the trawl RCA. Therefore, limiting their ability to fish in high relief areas regardless of chafing gear requirements.

This change is not expected to result in increased catch of undersized or non-target fish. Attaching more chafing gear than necessary to protect the net could also limit the flow within the net, which is needed to allow for adequate escapement of undersized fish, if meshes are blocked. Researchers have also shown there is no detectable difference in selectivity between codends with and without top-side chafing gear if the chafing gear consists of larger meshes than the codend mesh size (e.g., 2 times larger) and if the chafing gear is attached to the codend loosely (i.e., to allow space between the top-side chafing gear and the codend meshes). For those species that escape through the top meshes of codends and intermediates, properly hung top-side chafing gear with large meshes may not block or mask codend meshes and therefore may not measurably impede escapement.

This change is not expected to substantially alter gear contact with the bottom. Numerous disincentives already exist for midwater vessel operators to fish close to the substrate. These disincentives include: (a) Risk of damage to the net from snagging or hanging on hard bottom would not be lessened by increases in chafing gear coverage; (b) reduced gear efficiency and increased operating costs when bottom contact occurs; and (c) bare footropes, sweeps, and 16 in (40.64 cm) mesh size restriction for the first 20 ft (6.1 m) on the front of the net make the gear impractical or ineffective for fishing hard on the bottom (soft or hard bottom).

Eliminating restrictions on groundfish bottom and midwater trawl net configuration would allow vessels to experiment with different mesh sizes, chafing gear placement, and use of double-walled codends. Each of these proposed regulations individually, and collectively, could result in potential negative impacts to the physical and biological environments. However, in most instances, these impacts are mitigated through incentives and disincentives built into the Trawl Rationalization Program. Additionally, many of the proposed regulations would have a positive impact on harvesters, processors, and the communities they support.

Proposed regulations which could result in a reduction in mesh sizes used and increased net protections could increase bottom trawl effort targeting semi-pelagic rockfish species or longspine thornyhead, and therefore result in some redistribution of effort or a shift of effort to deeper waters. These shifts in effort are not anticipated to result in additional impacts to the physical environment beyond what already occurs under the current regulations. The proposed regulations do not open any new areas to trawling. Any redistribution of effort would not be expected to impact any new habitats which are not already fished with trawl gear. Other restrictions on net configurations, such as the small-footrope requirement shoreward of the trawl RCA, haven been shown to be very effective in limiting effort in high relief areas. Vessel operators would still be at risk of damage to their nets and hang-ups from entering into high relief habitats, even with the ability to provide additional chafing gear or codend protections, which do not provide any protection to the ropes.

Increasing net protections which result in extensively armoring the trawl and reducing mesh sizes is also unlikely for many reasons, including: (a) Increased drag and decreased flow; (b) increased expense while hauling due to increased fuel consumption; (c) increased expense to purchase smaller mesh, additional chafing gear, and double-walled nets; and (d) increased retention of undersized and unmarketable fish. It is important to note that increased drag may not only increase fuel consumption, but also may reduce fishing efficiency, such as reducing door spread of the trawl net.

If vessels make mesh size, chafing gear, or double-walled codend changes throughout the codend and/or intermediate net in a manner that reduces trawl gear selectivity, then catches of undersized or unwanted groundfish could increase. However, the Trawl Rationalization Program creates a strong disincentive for vessel operators to avoid the catch of undersized, unmarketable groundfish. Catching more small fish is not economically advantageous to vessel operators. Although most undersized fish are unmarketable, vessels operators must still account for the catching of undersized fish with individual quota pounds. Vessel operators must debit each pound of unmarketable, undersized fish caught from their total allocation for that species, which means they must forgo the opportunity to use their allocation for marketable catch. For this reason, catching unmarketable, undersized fish has the potential to reduce vessel revenue, as well as add sorting time (workload), for the vessel's crew and processor's employees.

Revisions to the restrictions on net configurations could have a positive impact on harvesters by allowing vessel operators to configure their nets in the most efficient way possible, including the opportunity to experiment with excluders and various combinations of mesh size and mesh shape (square or T-90 mesh) that could reduce bycatch while simultaneously improving the sustainability of the fishery and increasing the likelihood of attainment. Vessel operators have repeatedly testified to the Council that they desire more flexibility to experiment with trawl gear to reduce catch of unwanted species and increase catch of marketable fish. This may ultimately result in improved quality and consistency of product to first receivers and processors over time. Vessel operators would also benefit from the reduced complexity of the regulations by removing additional restrictions that they were subject to previously. This could save time and effort for vessel operators and ultimately reduce operational costs as vessel operators would no longer need to ensure compliance with these regulations.

Eliminating restrictions on mesh size will also likely reduce enforcement costs. Although enforcement of the remaining mesh size restriction on midwater trawl gear would still be required, enforcement of the other restrictions would be removed.

Selective flatfish trawl is a type of small footrope trawl developed to maintain a nearshore flatfish trawl fishery while reducing the non-target catch of canary rockfish and other overfished rockfish species. The selective flatfish trawl features a headrope set back from a flattened net body to capture low-swimming flatfish while allowing rockfish, particularly canary rockfish, to escape over the upper edge of the trawl net. Along with the elimination of the codend, chafing gear, and mesh size provisions, the 2011 TRREC report suggested the Council consider eliminating the selective flatfish trawl gear requirement and replace them with a small footrope requirement, as well as revising the definition of selective flatfish trawl to allow for four-seam nets. Similar to the adjustments discussed above in Section A., the TRREC pointed to the Trawl Rationalization Program to support this regulatory change.

The current regulations define selective flatfish trawl as a two-seamed net with no more than two riblines, excluding the codend. The breastline may not be longer than 3 feet (0.92 m). There may be no floats along the center third of the headrope or attached to the top panel except on the riblines. The footrope must be less than 105 feet (32.26 m). The headrope must be no less than 30 percent longer than the footrope. The headrope is issued along the length of the headrope from the outside edge to the opposite outside edge.

Since 2005, the groundfish regulations have required the use of selective flatfish trawl gear shoreward of the trawl RCA north of 40°10′ N latitude. The regulations further prohibit vessels fishing north of 40°10′ N latitude from having small footrope trawl gear on board, other than selective flatfish trawl gear, while fishing shoreward of the trawl RCA. Vessels are allowed, but not required, to use selective flatfish trawl gear shoreward of the trawl RCA south of 40°10′ N latitude, and seaward of the trawl RCA coastwide.

This rule proposes revising the definition of selective flatfish trawl gear to allow either a two-seam or a four-seam net with up to four riblines, while retaining all the other existing restrictions related to the configuration of this gear. In addition, the Council proposed eliminating the requirement that vessels use selective flatfish trawl gear shoreward of the trawl RCA north of 40°10′ N latitude. Instead, groundfish bottom trawl vessels would be allowed to use any small footrope trawl gear shoreward of the trawl RCA north and south of 40°10′ N latitude. Large footrope trawl gear would still be prohibited in this area.

Revising the definition of selective flatfish trawl to allow for a four-seam net could potentially provide for better flow and improved selectivity compared to a two-seam net. A four-seam net has more open meshes for smaller fish to escape. In addition, studies have demonstrated that improved flow within nets improves fishing efficiency, which may increase catch of marketable target and non-target groundfish (e.g., widow rockfish, yellowtail rockfish, and Pacific cod), and reduce bycatch of small or unmarketable groundfish (e.g., undersized redstripe rockfish, rosethorn rockfish, sand dabs).

Eliminating the requirement to use selective flatfish trawl gear north of 40°10′ N. latitude could result in a shift in bottom trawl effort shoreward of the trawl RCA north of 40°10′ N. latitude and increased catch of selected pelagic or semi-pelagic groundfish species (e.g., widow and canary rockfish) over the continental shelf. The shift in fishing effort away from the area seaward of the trawl RCA, is most likely to occur prior to May 15th when midwater trawling is prohibited. Any increased catch would be expected to remain within the current annual catch limits for target and non-target groundfish, and non-groundfish stocks. Furthermore, increased efficiency (e.g., more open meshes due to use of four-seam trawl, improved flow, catch of larger rockfish and roundfish, and improved function of selective devices) may lead to some reduction in overall bottom trawling effort, an increase catch of larger marketable fish, and a decrease catch of small unwanted species.

During development of the proposed action for the 2017 Salmon Biological Opinion, the Council considered several analyses that discussed the potential impacts that the future fishery, including possible impacts from the elimination of the selective flatfish trawl gear requirement, may have on the incidental take of Chinook salmon in the Pacific Coast's groundfish trawl fishery. NMFS presented an analysis at the April 2017 Council meeting, under the 2017 Salmon Biological Opinion agenda item, that suggested that removal of this requirement could dramatically increase the incidental take of Chinook salmon north of 40°10′ N. latitude. At the time, the data that were used suggested this gear requirement is driving the differences in bycatch rates. However, that analysis acknowledged numerous caveats associated with comparing bycatch rates between different periods of time (i.e. now vs. 20 years ago) and uncertainty as to how this information could be applied to today's fishery.

To gather data about the potential impacts of changing the existing selective flatfish trawl gear requirement for today's fishery, NMFS issued two EFPs for the 2017 and 2018 groundfish fishing years that, among other measures, exempted vessels from the selective flatfish trawl gear requirement. At its March 2017 and March 2018 meetings, during development of the 2017 and 2018 Trawl Gear EFPs, the Council twice considered and rejected including the area shoreward of the trawl RCA between 42° N latitude and 40°10′ N latitude in the exemption to the selective flatfish trawl gear requirement due to concerns over potential impacts to Chinook salmon. NMFS ultimately permitted more than 40 vessels to participate in the two EFPs. These vessels have completed more than 200 EFP trips. Based on the analysis of this new information, changes that have occurred within the fishery over the past several year, and the analysis in the December 2017 biological opinion, NMFS has determined that Chinook salmon bycatch is unlikely to increase in the area north of 42° N latitude (the southern boundary of the 2017 and 2018 Trawl Gear EFPs) on a scale shown in the report NMFS presented April 2017.

Potential impacts to Chinook salmon in the area between 42° N latitude and 40°10′ N latitude are less certain. The December 2017 biological opinion on salmon bycatch in the Pacific Coast Groundfish Fishery discussed that significant uncertainty exists in the magnitude of impacts, especially the species-level impacts, for fisheries in locations or time periods outside the available data. Areas south of 42° N latitude, particularly between January and early May (outside the Pacific primary whiting season), have particularly limited information because most fishing tends to take place north of 42° N latitude due to other restrictions (i.e. federal prohibition on whiting processing south of 42° N lat.).

In addition to concerns about the uncertainty in Chinook salmon bycatch in the groundfish fishery in the area between 42° N. latitude and 40°10′ N latitude, NMFS has made the preliminary determination that the proposed changes to the selective flatfish trawl gear requirement shoreward of the trawl RCA between 42° N latitude and 40°10′ N latitude may be out of compliance with the terms and conditions of the December 2017 Salmon Incidental Take Statement. Term and Condition 4b requires that “prior to allowing additional non-whiting trawling south 42° N latitude, NMFS will implement one or more EFPs designed to collect information about Chinook and coho bycatch levels and stock composition from fishing in those areas or at those times for a minimum of three years.”

Based on these concerns and the information presented at the Council meetings and while developing this rule, NMFS is specifically asking for public comment on the elimination of the requirement to use selective flatfish trawl gear in the area between 42° N latitude and 40°10′ N latitude.

This section discusses the three proposed regulations that relate to vessel operations on a single fishing trip, including allowing vessels that fish in the Shorebased IFQ Program under the Trawl Rationalization Program to carry and fish groundfish bottom and midwater trawl gears on the same trip, fish across IFQ management lines, and bring a new haul on deck before the catch from a previous haul is stowed. These three measures are discussed together because they could have similar impacts on vessel operations and catch accounting. Below is a short description of each of the proposed regulations followed by a summary of the potential impacts of each of these measures combined.

The GMT suggested the use of multiple fishing gears on a single trip under the Shorebased IFQ Program to the Council at its November 2011 meeting. The current restrictions on the use of multiple fishing gears during a single trip under the IFQ Program are complex, with different sections of the regulations allowing vessels to carry different gear combinations in different parts of the EEZ. For example, the regulations prohibit vessels from using multiple types of bottom trawl gear during a single trip when fishing seaward or shoreward of the trawl RCA south of 40°10′ N latitude. However, the regulations do not include a similar prohibition for the area north of 40°10′ N latitude, where vessels may fish with multiple types of trawl gear seaward of the trawl RCA. The GMT suggested that simplifying the regulations to allow vessels to carry and fish with multiple types of gear on the same trip could improve economic efficiency and improve safety at sea by reducing the number of trips and days at sea.

Regulations define the following trawl gear types: Large footrope trawl, small footrope trawl, selective flatfish trawl, and midwater trawl. North of 40°10′ N latitude, a vessel may not have both groundfish trawl gear and non-groundfish trawl gear on board simultaneously, or have multiple trawl gear types (groundfish bottom or midwater trawl gear) on board simultaneously. A vessel may, however, have more than one type of limited entry bottom trawl gear on board (selective flatfish trawl or small footrope trawl gear), either simultaneously or successively, during a trip limit period, with one exception. Only a selective flatfish trawl is allowed onboard when fishing shoreward of the trawl RCA (§ 660.130(c)(2)). Finally, a vessel may have more than one type of midwater groundfish trawl gear on board, either simultaneously or successively, during a cumulative period. South of 40°10′ N latitude, a vessel may not have both groundfish trawl gear and non-groundfish trawl gear on board simultaneously, may not have both bottom trawl gear and midwater trawl gear on board simultaneously, and may not have small footrope trawl gear and any other type of bottom trawl gear on board simultaneously.

Limited entry trawl vessels were allowed to fish with multiple trawl gears during the same trip prior to the development of the trawl RCA. To ensure that bottom trawl gear was not used within trawl RCA, a new regulation was published in 2003 to allow no more than one type of trawl gear on board during a single fishing trip (68 FR 907, January 7, 2003). Regulations requiring vessel monitoring systems (VMS), paired with vessel declarations, became effective on January 1, 2004, to ensure adequate monitoring and to enforce these new gear-specific area restrictions (68 FR 62375, November 4, 2003). Additional monitoring requirements implemented through the Trawl Rationalization Program and changes to when a declaration can be made, proposed through this rule, have made the prohibition unnecessary to achieve its original purpose.

The Council recommended and NMFS proposes eliminating the prohibition on vessels carrying both groundfish bottom trawl gear and midwater trawl gear onboard simultaneously while fishing under the Shorebased IFQ Program north of 40°10′ N latitude, or south of 40°10′ N latitude. Additionally, the rule proposes eliminating the prohibition on having bottom trawl gear, other than selective flatfish trawl gear, on board shoreward of the RCA and north of 40°10′ N latitude. Instead, vessels would be allowed to have any type of bottom trawl (small/large footrope or selective flatfish trawl) and midwater trawl gear on board simultaneously and would be allowed to fish any of these trawl gears during a single trip as long as the appropriate declaration is made when gears are changed. Vessels would be required to keep and land all catch separately by gear type, and catch would be reported on electronic fish tickets by gear type. This rule would not adjust the current provision that requires vessels to stow any gear not authorized for use in the area when transiting through a groundfish conservation area. For species managed with trip limits, crossover provisions, and gear-specific trip limits, all current regulations would remain in effect.

This rule would also modify recordkeeping and reporting requirements for vessels fishing in the Shorebased IFQ Program who choose to use more than one type of groundfish trawl gear on the same trip. These vessels would be required to make a new gear declaration from sea to indicate that they have chosen to fish with a new gear type (i.e., groundfish bottom trawl vs. midwater trawl). Currently, the regulations only allow vessels to declare one type of trawl gear at a time when fishing in the Trawl Rationalization Program. Vessel operators must declare a gear type for a trip prior to leaving port. Therefore, under the current regulations, after a vessel operator has submitted a gear declaration report to NMFS, the vessel cannot change activities, including fishing with any gear other than the gear type that the vessel declared at the start of the trip, until the vessel returns to port and offloads all fish. The proposed regulations would allow vessels operators in the Shorebased IFQ Program who choose to use multiple groundfish trawl gears on the same trip to adjust their trip declarations from sea. Vessel operators would need to make a declaration any time they switched to a gear other than the gear that was declared at the start of the fishing trip, to continued enforcement of closed areas, but they would not be required to return to port to make the new declaration.

Allowing the use of multiple IFQ trawl gears on the same trip could potentially reduce the time at sea, further reducing daily fuel and observer coverage costs. It would also allow greater flexibility for harvesters while at sea when choosing how best to use quota pounds. For instance, vessels could choose to avoid using bottom trawl gear when that gear might result in high catch of prohibited species. Instead they could switch their gear type, and fishing strategy, to target non-whiting midwater species complexes in the same area, which may have reduced interactions with prohibited species, by changing to another trawl gear type. Alternatively, a vessel could choose to target more abundant bottom trawl species on the same trip if it finds targeting non-whiting midwater species to be less profitable or carry increased risk of encountering non-target catch.

Allowing groundfish bottom and midwater trawl gear to be fished on the same trip could have some limited indirect effects on stock assessments for target and non-target species. Because it is impossible for observers and vessels using electronic monitoring to monitor the hold once the catch is stored, there is the potential that removing the prohibition on multiple types of trawl gear could reduce the quality of stock assessments and economic analysis to some extent if the catch mingles and is recorded incorrectly.

The proposed elimination of the prohibition on bringing a new haul on board before all catch from a previous haul had been stowed first came to the Council from the GAP at the Council's November 2015 during discussions of the range of alternatives for the trawl gear changes package. Under current regulations, vessels fishing in the Shorebased IFQ Program are prohibited from bringing a new haul on board the deck until all catch from the previous haul has been stowed. Catch cannot be stowed until all protocols under the Electronic Monitoring Program or the West Coast Groundfish Observer Program (WCGOP) have been completed. Additionally, the regulations require vessels to stow all catch from a haul before the new haul is brought onboard. These requirements were added to the regulations in 2011, through implementation of the Trawl Rationalization Program, to aid observers in carrying out their duties.

This rule proposes eliminating the existing prohibition on bringing a haul on board before the previous haul has been stowed, and the requirement to stow all catch before catch from a new haul is brought on board. However, vessels would be required to keep separate catch from separate hauls until the observer could complete the haul-specific collection of catch for sampling. Vessels fishing with electronic monitoring would be required to keep catch from different hauls separate on deck until fully documented according to protocols established in the specific vessel's monitoring plan. All vessels would still be required to land any catch that was caught using different gears separated by gear type.

Eliminating this prohibition could provide some limited benefit to the vessels. Completely sorting and stowing catch from a haul in the trawl fishery can take several hours. There have been some instances when the onboard observer may not require all catch to be removed from deck and stowed to successfully complete sampling duties. As long as catch from different hauls does not mingle, the vessel operator could bring a second haul onboard while the observer is completing their duties.

Eliminating the prohibition on bringing a new haul on board could have some potential negative effects on observers if this causes vessel operators to pressure observers to complete their duties more quickly so a new haul could be brought onboard. Degraded observer data could result in indirect impacts on stocks if stock data is affected. The current regulations require that the observers are provided reasonable assistance to complete all duties, including providing adequate time and space to do so. These regulations would still be enforced if the prohibition on bringing a new haul onboard is eliminated.

There are currently four IFQ management areas in the regulations that are based on the stock information for select species, harvest allocations, and the corresponding quota shares for species. The IFQ management areas include:

The Council created these areas as part of the Trawl Rationalization Program to allow for different management measures for species or species groups in different IFQ management areas. Several IFQ species are tracked either as a single species with different quota share by area, or as a single species in one area and as a component of an assemblage in another area (e.g., minor shelf or slope complex north or south of 40°10′ N latitude). To address differences in management measures for species or species complexes among IFQ management areas, vessels have been prohibited from fishing in different IFQ management areas during the same fishing trip.

As mentioned previously, the Council held a workshop in Portland, Oregon on August 29 and 30, 2012. The result of that workshop was a list of recommendations to the Council at its November 2012 meeting. One of those recommendations included the elimination of the prohibition on fishing across management lines for vessels fishing under the Shorebased IFQ Program. Instead, participants suggested allowing vessels to move across IFQ management lines on a single tow.

This rule proposes eliminating the prohibition on fishing in multiple IFQ management areas on the same trip for vessels fishing in the Shorebased IFQ Program. These vessels would be allowed to fish in multiple IFQ management areas on the same trip and the same haul. If retaining catch from multiple IFQ management areas, catch would not need to be sorted by area. Catch from multiple IFQ management areas would be recorded on the same ticket.

Based on recommendations from industry, this rule also proposes to allow vessels to fish across management lines in the same tow. Catch from vessels fishing across management lines would be assigned to an area and quota pounds would be deducted from vessel accounts based on the proportion of hauls in a given management area. For example, if six hauls were taken in one IFQ management area, and two hauls were taken in another management area, the total catch would be apportioned to management areas by a 6 to 2 ratio.

The proposed regulations would improve flexibility for vessels when selecting their harvest strategies to best utilize their available IFQ. Vessels that operate near a management line would most likely benefit the most from reduced operational costs by not having to haul back gear and reset to start a new haul on the other side of the management area boundary line. Vessel towing across lines could reduce the number of hauls and therefore fuel costs and time at sea.

The proposed regulations do increase the catch accounting complexity and could potentially reduce the accuracy of catch reporting. NMFS would need to accurately track the number of hauls in a given area and apply this estimation to total catch landing weight to determine the pro-rata assignment. Additionally, the combination of allowing multiple trawl gears onboard and fishing in multiple management areas creates more complexity to managers in assigning catches.

The proposed regulations would change how vessels in the Shorebased IFQ Program may operate as they would be allowed to tow across IFQ management areas, carry and fish with groundfish bottom and midwater trawl gear, and bring a new haul on board before the previous haul has been stowed. The effect of eliminating these prohibitions is most directly felt by harvesters who would have more flexibility in how they operate their vessels. The proposed regulations are unlikely to increase fishing effort (i.e. number of trips) or cause a significant shift in fishing behavior. However, vessels may change where they fish, and would be expected to be more efficient in their fishing practices, which could ultimately increase effort (i.e. catch/hour). These impacts are expected to be minimal as most vessels will likely not choose to carry and fish multiple gears on every trip. Additional impacts to the physical environment caused by the proposed regulations are not anticipated because these provisions do not open any new areas to fishing, and vessels will still be required to abide by all groundfish conservation areas. Direct impacts to the biological environment are not expected from these measures. Vessels in the Shorebased IFQ Program are required to cover all catch with quota pounds. Net configurations would not be affected by these proposed regulations.

Vessel operators are expected to use the flexibility to create an efficient fishing strategy that best limits bycatch of non-target and protected species while still maximizing catch of their target species. Vessels would maximize attainment of IFQ by carrying and fishing with both midwater and groundfish bottom trawl gear on the same trip. According to vessel operators, trawl vessels average between 10 and 20 days spent annually traveling back and forth to port to change gear types. If vessels in the Shorebased IFQ Program had less restrictions on how they operate their vessels, including carrying multiple types of trawl gear onboard, vessel operators may be able to eliminate most days spent traveling back and forth to port to change gears resulting in financial savings. For example, the mean fixed operational costs for non-whiting trawl vessels in the Trawl Rationalization Program is just over $5,000 per day. If these vessels were to eliminate 10-20 days which had been previously used to transit back and forth to port, then that would be a savings of between $50,000 and $100,000 per vessel per year.

Vessel operators would also likely create efficiencies and save money if fishing near an IFQ management line. A vessel operator would not have to haul back gear and reset to start a new haul in a new management area. Vessel towing across IFQ management lines could reduce the number of hauls and therefore the amount of fuel spent trawling and maneuvering the vessel to optimize harvest, potentially increasing attainment for the few vessels that are currently hampered by their inability to cross management lines.

Eliminating regulations that manage vessel operations could also have some potential negative impacts to processors, observers, and managers. Due to the complexity of the sorting options for vessels fishing across IFQ management lines, processors could have difficulty handling deliveries, as the number of hauls in each area would need to be tracked and reported on fish tickets. Additional catch accounting complexity would also result from needing to track the number of hauls by management area. Vessels using multiple groundfish trawl gears on a single trip would need to keep all catch separated by gear type. However, as there are no monitors or cameras below deck, it would be impossible for shoreside monitors, first receivers, vessel operators, or observers to ensure that catch has been kept separate.

A vessel observer's ability to process samples would be the limiting factor for increased efficiency on vessels where an operator would like to bring a new haul onboard before the previous haul has been stowed. Catch from hauls caught by the same gear could not be mixed until the observer had taken all the necessary samples. Therefore, additional pressure on the observer to do their work quickly may result. This pressure could cause mistakes and ultimately degrade data quality. Maintaining restrictions on pressuring observers or catch monitors would ensure continued accurate monitoring and reporting of catch, and help maintain quality catch at sea and landing data used to manage the fishery in season and for stock assessments used to develop catch limits and harvest guidelines.

Pursuant to section 304(b)(1)(A) of the Magnuson-Stevens Act, the NMFS Assistant Administrator has made a preliminary determination that this proposed rule is consistent with the Pacific Coast Groundfish FMP, other provisions of the Magnuson-Stevens Act, and other applicable law. In making the final determination, NMFS will consider the data, views, and comments received during the public comment period. NMFS also prepared an environmental assessment (EA) for this action. Copies of the draft EA and other supporting documentation is available from NMFS (see ADDRESSES) or visit NMFS's website at http://www.westcoast.fisheries.noaa.gov/fisheries/groundfish_catch_shares/rules_regulations/trawl_regulations_compliance_guides.html.

The Office of Management and Budget has determined that this proposed rule is not significant for purposes of Executive Order 12866.

This proposed rule does not contain policies with Federalism or “takings” implications as those terms are defined in E.O. 13132 and E.O. 12630, respectively.

The Chief Counsel for Regulation of the Department of Commerce certified to the Chief Counsel for Advocacy of the Small Business Administration that this proposed rule, if adopted, would not have a significant economic impact on a substantial number of small entities.

The proposed regulations for groundfish bottom trawl and midwater trawl gear would directly affect vessels fishing under the Pacific Coast Groundfish Fishery's Trawl Rationalization Program. Eliminating restrictions on mesh size, chafing gear, and codend will allow vessels to experiment with different mesh sizes and net coverings, which could help reduce fishing operational costs and days on sea. Removing the requirement to use selective flatfish trawl gear and revising the definition to allow for four-seam nets will allow vessel operators to target recently rebuilt overfished stocks, such as widow and yellowtail rockfishes. Allowing vessels that fish in the Shorebased IFQ Program, a component of the Trawl Rationalization Program, to carry and fish with multiple groundfish trawl gears, fish across management lines, and bring a new haul onboard the vessel before the previous haul is stowed could help improve the efficiency of fishing practices. Vessels would not be required to return to port to change gears or haul back to move and reset on the other side of an IFQ management line. Vessels could spend less time at sea, which would reduce fuel and observer costs. Our analysis of the likely economic impacts of this action predicts that these regulatory changes will have positive impacts on fishing vessels, seafood processors, and fishing communities.

For the purposes of our Regulatory Flexibility Act (RFA) analysis, the proposed action is expected to affect entities that both process and harvest groundfish under the Trawl Rationalization Program. The U.S. Small Business Association (SBA) established criteria for business in the fishery sector to qualify as small entities. Under that standard, two small processing entities, each of which owns one groundfish permit, would be regulated by the proposed rule. Seven large entities, which own 30 groundfish permits, would be regulated by the proposed rule.

For RFA purposes only, NMFS established a small business size standard for businesses, including their affiliates, whose primary industry is commercial fishing (see 50 CFR 200.2). A business primarily engaged in commercial fishing (NAICS code 11411) is classified as a small business if it is independently owned and operated, is not dominant in its field of operation (including its affiliates), and has combined annual receipts not in excess of $11 million for all its affiliated operations worldwide. The determination as to whether the entity is large or small is based on the average annual revenue for the 3 years from 2013 through 2015. Limited entry groundfish vessels are required to self-report size across all affiliated entities. Of the businesses who earn the majority of their revenue from commercial fishing, one self-reported as large. This entity owns four groundfish permits. The remaining 117 entities primarily involved in seafood harvest self-identified as small, and own 139 permits.

A total of 113 vessels harvested groundfish in the Trawl Rationalization at some point and would potentially benefit from some or all of the flexibility offered in the proposed rule. However, this number of entities represents the maximum number of affected entities. Not all permit owners choose to fish each season, therefore, not all 113 vessels would benefit from this action each year. Only those vessels which are active vessels are the most likely to benefit and be directly impacted by regulations.

The proposed regulations would eliminate and revise regulations that govern the use and configuration of groundfish bottom and midwater trawl gear fished under the Pacific Coast Groundfish Fishery's Trawl Rationalization Program. The specific revisions would eliminate the minimum mesh size requirement for groundfish bottom trawl and midwater trawl gear; the prohibition on the use of double-walled cod-ends; restrictions on where and how chafing gear can be attached to the trawl net; the requirement to use selective flatfish trawl gear shoreward of the trawl RCA; the prohibition on carrying and using multiple types of groundfish trawl gear (bottom trawl and midwater trawl) on the same trip; the prohibition on fishing across individual fishing quota management lines on the same haul; and the prohibition on bringing a new haul onboard before all catch from the previous haul has been stowed.

This action contains a change to an information collection requirement, which has been approved by the Office of Management and Budget (OMB) under OMB Control Number 0648-0573: Expanded Vessel Monitoring System Requirement for the Pacific Groundfish Fishery. The proposed regulatory change, which is described above in section C.1 of the preamble, would allow vessel operators who fish in the Shorebased IFQ Program to make a new declaration from sea when a new gear fished on a trip. This revision would remove the requirement that vessels return to port to make a new declaration. The numbers of declaration reports the vessel operator is required to submit to NMFS would not change under this request. Therefore, no small entity would be subject to additional reporting requirements.

Overall, the proposed regulations are expected to have a positive economic effect on small entities. The elimination of these regulations would alleviate some restrictions on how vessels fishing in the Trawl Rationalization may use and configure their gear. Eliminating regulations that may be constraining on industry members and are no longer needed due to the new management system is likely to generate additional groundfish gross revenues as vessels are able to obtain more of their quota and reducing their fishing operational costs. Allowing vessels more flexibility to configure their gear will also allow vessel operators to innovate and adapt to an ever changing environment.

This action is not expected to have a significant economic impact on a substantial number of small entities. The effects on the regulated small entities identified in this analysis are expected to be positive. Under the proposed action, small entities would not be placed at a competitive disadvantage relative to large entities, and the regulations would not reduce the profits for any small entities. As a result, an initial regulatory flexibility analysis is not required, and none has been prepared.

For the reasons set out in the preamble, 50 CFR part 660 is proposed to be amended as follows:

The revisions read as follows: