Federal Register Vol. 83, No.225,

The NRC is amending its regulations in parts 37, 40, 70, 71, 72, 73, 76, and 95 of title 10 of the Code of Federal Regulations (10 CFR) to make miscellaneous corrections. These changes include removing an office from a list of office recipients, removing an office reference, correcting an office designation and a phone number, removing and correcting division titles, and removing a followup reporting instruction. This document is necessary to inform the public of these non-substantive amendments to the NRC's regulations.

Remove Office Reference. In § 37.7(a), this final rule removes the Director, Division of Security Policy, Office of Nuclear Security and Incident Response, from the list of recipients.

Remove Reporting Instruction. In §§ 37.81(g) and 40.64(c)(2) and (3), this final rule removes the erroneous instructions for where to submit a copy of a followup notification. These paragraphs already point to the sections that provide the appropriate mailing address and addressee(s).

Remove Division Title. In §§ 37.77, 40.23(b)(1), 40.66(a) and (b)(5), 40.67(a), 70.5, 70.20, 71.97, 73.4, 73.37, 73.71, 73.72, 73.73, and 73.74, this final rule removes the Division of Security Policy to ensure that correspondence goes directly to the Director, Office of Nuclear Security and Incident Response rather than to a division director.

Correct Division Title. In §§ 40.23(c), 40.66(c), and 40.67(c) and (d), 73.26, 73.27, 73.67, and 76.5a, this final rule corrects the title of the Division of Security Policy to read as Division of Physical and Cyber Security Policy.

Correct Designation. In § 40.23(b)(2)(ix), this final rule replaces the Division of Security Policy with the higher level designation of the Office of Nuclear Security and Incident Response.

Correct Telephone Number. In § 40.23(d), this final rule removes the incorrect telephone number “(301) 415-6828” and replaces it with the correct telephone number “(301) 287-3598” for the Director of the Division of Physical and Cyber Security Policy.

Correct Office Designation. In § 70.32(c)(2), (e), and (i), this final rule replaces the Office of Nuclear Security and Incident Response with the Office of Nuclear Material Safety and Safeguards.

Remove Division Title. In § 72.186(b), this final rule removes the Division of Spent Fuel Management so that notifications go to the Director, Office of Nuclear Material Safety and Safeguards rather than to division level management.

Remove Division Title. In § 95.9(a), this final rule removes the Division of Security Operations so that notification go to Office level management rather than division level management.

Under section 553(b) of the Administrative Procedure Act (5 U.S.C. 553(b)), an agency may waive the requirements for publication in the Federal Register of a notice of proposed rulemaking and opportunity for comment if it finds, for good cause, that it is impracticable, unnecessary, or contrary to the public interest. As authorized by 5 U.S.C. 553(b)(3)(B), the NRC finds good cause to waive notice and opportunity for comment on these amendments, because notice and opportunity for comment is unnecessary. The amendments will have no substantive impact and are of a minor and administrative nature dealing with corrections to certain CFR sections or are related only to management, organization, procedure, and practice. These changes include removing an office from a list of office recipients, removing an office reference, correcting an office designation and a phone number, removing and correcting division titles, and removing a followup reporting instruction. The Commission is exercising its authority under 5 U.S.C. 553(b) to publish these amendments as a final rule. The amendments are effective December 21, 2018. These amendments do not require action by any person or entity regulated by the NRC, and do not change the substantive responsibilities of any person or entity regulated by the NRC.

The NRC has determined that this final rule is the type of action described in 10 CFR 51.22(c)(2), which categorically excludes from environmental review rules that are corrective or of a minor, nonpolicy nature and do not substantially modify existing regulations. Therefore, neither an environmental impact statement nor an environmental assessment has been prepared for this rule.

This final rule does not contain a collection of information as defined in the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) and, therefore, is not subject to the requirements of the Paperwork Reduction Act of 1995.

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

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

The NRC has determined that the corrections in this final rule do not constitute backfitting and are not inconsistent with any of the issue finality provisions in 10 CFR part 52. The amendments are non-substantive in nature, including removing an office from a list of office recipients, removing an office reference, correcting an office designation and a phone number, removing and correcting division titles, and removing a followup reporting instruction. They impose no new requirements and make no substantive changes to the regulations. The corrections do not involve any provisions that would impose backfits as defined in 10 CFR chapter I, or would be inconsistent with the issue finality provisions in 10 CFR part 52. For these reasons, the issuance of the rule in final form would not constitute backfitting or represent a violation of any of the issue finality provisions in 10 CFR part 52. Therefore, the NRC has not prepared any additional documentation for this correction rulemaking addressing backfitting or issue finality.

This final rule is not a rule as defined in the Congressional Review Act (5 U.S.C. 801-808).

For the reasons set out in the preamble and under the authority of the Atomic Energy Act of 1954, as amended; the Energy Reorganization Act of 1974, as amended; and 5 U.S.C. 552 and 553, the NRC is adopting the following amendments to 10 CFR parts 37, 40, 70, 71, 72, 73, 76, and 95:

The Board is adopting a new supervisory ratings framework for certain large financial institutions that is designed to:

• Align with the Federal Reserve's current supervisory programs and practices;

• Enhance the clarity and consistency of supervisory assessments and communications of supervisory findings and implications; and

• Provide transparency related to the supervisory consequences of a given rating.

The final ratings framework applies to bank holding companies and non-insurance, non-commercial savings and loan holding companies with total consolidated assets of $100 billion or more, and U.S. intermediate holding companies of foreign banking organizations established under Regulation YY with total consolidated assets of $50 billion or more.

In the years following the 2007-2009 financial crisis, the Federal Reserve developed a supervisory program specifically designed to enhance resiliency and address the risks posed by large financial institutions to U.S. financial stability (LFI supervisory program). As set forth in SR letter 12-17/CA letter 12-14, the LFI supervisory program focuses supervisory attention on the core areas that are most likely to threaten the firm's financial and operational strength and resilience (capital, liquidity, and governance and controls).1 This orientation is intended to reduce the likelihood of the failure or material distress of a large financial institution, and reduce the risk to U.S. financial stability in the event of failure.

The Federal Reserve coordinates its supervision of firms that pose the greatest risk to U.S. financial stability through the Large Institution Supervision Coordinating Committee (LISCC). The LISCC supervisory program conducts annual horizontal reviews of LISCC firms and firm-specific examination work focused on evaluating those firms' (i) capital adequacy under normal and stressed conditions; (ii) liquidity positions and risk management practices; (iii) recovery and resolution preparedness; and (iv) governance and controls.2 For large financial institutions that are not LISCC firms, the Federal Reserve performs horizontal reviews and firm-specific supervisory work focused on capital, liquidity, and governance and control practices, which are tailored to reflect the risk characteristics of these institutions.

Since 2004, the Federal Reserve has used the “RFI/C(D)” rating system (referred to as the “RFI rating system”) to communicate its supervisory assessment of every bank holding company regardless of its asset size, complexity, or systemic importance.3 The RFI rating system is focused on the risk management practices (R component) and financial condition (F component) of the consolidated organization, and includes an assessment of the potential impact (I component) of a bank holding company's nondepository entities on its subsidiary depository institution(s).

The Federal Reserve has not modified the RFI rating system to reflect the substantial changes to the statutory and regulatory framework relating to large financial institutions, or the Federal Reserve's implementation of the LFI supervisory program in recent years. In light of these changes, the Board is adopting a new rating system applicable to these firms that is more closely aligned with the LFI supervisory program, so that the ratings more directly communicate the results of the Federal Reserve's supervisory assessment.

Because the statutory, regulatory, and supervisory framework for community and regional bank holding companies has not undergone material changes since the financial crisis, the RFI rating system remains a relevant and effective tool for developing and communicating supervisory assessments for those firms. Therefore, the RFI rating system will continue to be used in the supervision of these organizations.

On August 17, 2017, the Board invited public comment on a notice of proposed rulemaking to adopt a new rating system for large financial institutions (proposed LFI rating system).4 The proposed LFI rating system would have applied to bank holding companies and non-insurance, non-commercial savings and loan holding companies with total consolidated assets of $50 billion or more, and U.S. intermediate holding companies (U.S. IHCs) of foreign banking organizations established under Regulation YY.5

Under the proposed LFI rating system, each banking organization would have been assigned ratings for three separate components: Capital Planning and Positions; Liquidity Risk Management and Positions; and Governance and Controls. The ratings would have been assigned using a four-point non-numeric scale (Satisfactory/Satisfactory Watch, Deficient-1, and Deficient-2).6 A firm would need a “Satisfactory” or “Satisfactory Watch” rating for each of the three component ratings to be considered “well managed” for various purposes under the Board's rules and federal law. The proposal would not have included the assignment of a standalone composite rating or any subcomponent ratings. In addition, the proposal would have amended certain provisions of the Board's existing regulations (Regulation K and Regulation LL) to make them compatible with the proposed rating scale.

The Board received 16 comments on the proposal from supervised firms, trade associations, industry consultants, and individuals. In addition, Federal Reserve staff held several meetings on the proposal with members of the public and obtained supplementary information from certain commenters. Summaries of these meetings are available on the Board's public website.

Most commenters generally supported the proposal to develop a new rating system that would be aligned with the Federal Reserve's LFI supervisory program. However, many commenters also expressed concerns regarding specific aspects of the proposal, including the applicability and implementation of the proposed LFI rating system and its underlying components, the lack of a standalone composite rating, the ratings scale, and the consequences of ratings assigned under the rating system.

Separately, the Board invited comment on two other proposals closely related to the proposed LFI rating system. The first proposal addressed proposed guidance on supervisory expectations for boards of directors, which set forth attributes of an effective board of directors of LFIs,7 and the second proposal addressed an LFI's management of business lines and independent risk management and controls.8 The Board continues to consider comments on these proposals, and thus, is not adopting either proposal at this time.

The final rating system adopts the core elements of the proposed LFI rating system, with certain modifications to address commenter concerns. Consistent with the proposal, a banking organization will be assigned three component ratings: Capital Planning and Positions; Liquidity Risk Management and Positions; and Governance and Controls. In addition, although the final LFI rating system retains a four-category, non-numeric rating scale, it identifies the top two categories as “Broadly Meets Expectations” and Conditionally Meets Expectations” to align with the definitions of those categories.

In the proposal, the LFI rating system would have applied to bank holding companies, non-insurance, non-commercial savings and loan holding companies, and U.S. IHCs of foreign banking organizations with $50 billion or more in total consolidated assets. The Board received several comments regarding the applicability of the LFI rating system. For example, one commenter suggested that the Board should use risk-based factors instead of asset size to determine which firms are subject to the LFI rating system. Another commenter suggested that the $50 billion threshold should be raised.

In addition to the comments received, the Board has taken into consideration that since the proposal, section 401 of the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA) amended section 165 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) to modify the $50 billion minimum asset threshold for general application of enhanced prudential standards.9 Effective immediately on the date of its enactment, bank holding companies with total consolidated assets equal to or greater than $50 billion and less than $100 billion were no longer subject to these standards.10

In consideration of the comments received and the statutory changes under EGRRCPA, the final LFI rating system is being adopted for bank holding companies and, non-insurance and non-commercial savings and loan holding companies with total consolidated assets of $100 billion or more, and for U.S. IHCs of foreign banking organizations established under Regulation YY with total consolidated assets of $50 billion or more.11 The decision to increase the asset threshold to $100 billion for bank holding companies and non-insurance, non-commercial SLHCs is consistent with the minimum threshold for enhanced prudential standards established by EGRRCPA as well as the Board's intention to tailor certain of its regulations for domestic firms to implement EGRRCPA.12 The Board has retained the asset threshold of $50 billion for U.S. IHCs of foreign banking organizations as it continues to consider appropriate tailoring of its regulations for FBOs in light of EGRRCPA; however, the Board may adjust this asset threshold in the future if necessary.

Bank holding companies with total consolidated assets of at least $50 billion but less than $100 billion will continue to be evaluated subject to the RFI rating system. The Board is currently reviewing existing supervisory guidance with respect to these firms to determine whether it is appropriate to make revisions to further distinguish supervisory expectations for firms with total consolidated assets of less than $100 billion.

The proposed LFI rating system would not have applied to SLHCs that are predominantly engaged in insurance or commercial activities. The Board continues to consider the appropriate regulatory regime for these firms. As such, the Board will continue to rate these SLHCs on an indicative basis under the RFI rating system as it considers further the appropriate manner to assign supervisory ratings to such firms on a permanent basis.13

Under the proposal, the initial set of LFI ratings would have been assigned starting in 2018. Several commenters provided views regarding the timing and implementation of the final LFI rating system. For instance, commenters suggested that Federal Reserve delay implementation of the LFI rating system for firms with assets of less than $250 billion until the completion of regulatory reforms. Other commenters requested that the Board coordinate the implementation of the final LFI rating system with the related guidance setting forth attributes of effective boards and expectations for the management of business lines and independent risk management and controls, and the Federal Reserve provide more clarity regarding the implementation of the guidance.14 Another commenter requested that the Federal Reserve run a pilot program before implementing the final LFI rating system.

In light of the changes to the application of enhanced prudential standards under EGRRCPA, the Board is currently considering ways to tailor the regulatory and supervisory framework for firms that are not in the LISCC portfolio. Accordingly, in order to conduct that review and seek public comment on any proposed revisions to the Board's regulations, the Federal Reserve will continue to use the RFI rating system for ratings in 2019 for holding companies with assets of $100 billion or more and U.S. intermediate holding companies of foreign banking organizations that are not subject to the LISCC framework. The Federal Reserve will assign ratings using the final LFI rating system beginning in early 2020.15

For bank holding companies and U.S. IHCs of foreign banking organizations subject to the LISCC framework, the Federal Reserve will begin assigning ratings using the final LFI rating system in early 2019. In early 2019, LISCC firms will receive all three component ratings under the LFI rating system; following the initial rating assignment, updates to individual rating components may be assigned and communicated to the firm on a rolling basis, but at least annually.

The Board believes that it is important to have the LFI rating system become effective soon in order to align the supervisory rating system with the Board's current consolidated supervisory framework for large financial institutions. This alignment will enhance the clarity of the Board's supervisory program, as both the Board's supervisory assessment of a firm and its related assignment of the firm's ratings will directly relate with the three core areas of focus in the consolidated supervisory framework: Capital, liquidity, and governance and controls. For example, supervisory assessments of a firm's capital and liquidity can be prominently reflected in the ratings assigned under the LFI rating system, whereas such assessments are less easily communicated within the structure of the RFI rating system. To ensure that ratings are assigned in a consistent and fair manner, the Federal Reserve is implementing staff training and will undertake a multi-level review and vetting before ratings are assigned.

As noted above, the Board invited comment on two sets of guidance that related to the governance and controls component rating—the first established principles regarding effective boards of directors focused on the performance of a board's core responsibilities, and the second set forth core principles of effective senior management, the management of business lines, and independent risk management and controls for large financial institutions. The Board continues to consider comments on both proposals, and thus, is not adopting either set of guidance at this time. Given that the guidance establishing principles regarding effective boards of directors is not finalized, the Federal Reserve intends to rely primarily on principles set forth in SR letter 12-17/CA letter 12-14 and safety and soundness to assess the effectiveness of a firm's board of directors. Given that the management of business lines and independent risk management and controls guidance is not finalized, the Federal Reserve will rely on existing risk management guidance to assess the effectiveness of a firm's management of business lines and independent risk management and controls.16

Commenters requested that the Federal Reserve rely to a greater extent on the supervisory evaluations conducted by other regulators, including both domestic and foreign supervisors. Coordination with other domestic regulators and foreign supervisory authorities is a critical component of the LFI supervisory program. Federal Reserve staff meets regularly with counterparts at domestic and foreign regulatory agencies that have primary supervisory responsibility with respect to a banking organization or its subsidiaries, or its foreign bank parent, in order to leverage work and ensure effective coordination. In assigning LFI component ratings under the final LFI rating system, the Federal Reserve will continue to rely to the fullest extent possible on applicable information and assessments developed by other relevant supervisors and functional regulators.

The proposed LFI rating system would have applied to U.S. IHCs of foreign banking organizations. Some commenters requested that the Board delay application of the LFI rating system to U.S. IHCs until the Board sought comment on governance and controls guidance designed specifically for U.S. IHCs. Commenters requested clarification on how the assignment of LFI ratings to U.S. IHCs would interact with other ratings assigned to the U.S. operations of foreign banking organizations (the combined U.S. operations assessment) and the ROCA rating for U.S. branches and agencies.

Under the principle of national treatment, the Federal Reserve generally applies standards to the U.S. operations of a foreign banking organization consistent with those that apply to similarly situated U.S. banking organizations. The U.S. operations of a foreign banking organization are subject to regulatory standards set forth in Regulation YY, and expectations related to capital planning and positions, liquidity risk management and positions, and governance and controls, that are parallel to those that apply to a U.S. bank holding company. Applying the final LFI rating system to U.S. IHCs of foreign banking organizations would be consistent with national treatment and the Board's approach to regulating and supervising foreign banking organizations.

As commenters note, the Board did not apply the guidance setting forth attributes of effective boards to U.S. IHCs, in recognition of the fact that a U.S. IHC is a subsidiary of a foreign banking organization. U.S. IHCs will not be subject to examinations solely focused on effectiveness of the U.S. IHC's board of directors.17 Rather, the Federal Reserve will indirectly assess the effectiveness of a U.S. IHC's board by considering whether weaknesses or deficiencies that are identified within the organization while conducting other supervisory work may be evidence of, or resulting from, governance-related oversight deficiencies. For example, governance-related oversight deficiencies could be noted in the context of a significant risk management or control weakness that is identified during an examination of capital planning or business line management.

The Board will continue to evaluate the U.S. branches of foreign banks under the ROCA system, and assign a single component rating to the foreign banking organization's U.S. operations. As noted in the preamble to the proposal, the Board is considering adjustments to the ratings for U.S. branches and the U.S. operations to better align with the LFI framework.

Commenters also requested clarity in how the LFI rating would impact the “well managed” status of a foreign banking organization that is a financial holding company. Under current law, a foreign banking organization that is a financial holding company must be well capitalized and must have a satisfactory composite rating of its U.S. branch and agency operations and a satisfactory rating of its U.S. combined operations, if one is given. As with the rating currently assigned to a U.S. IHC under the RFI system, the LFI rating assigned to the U.S. IHC would be an input into the rating of the combined U.S. operations of a foreign bank.

Under the proposed LFI rating system, the Federal Reserve would have evaluated and assigned ratings for the following three components: Capital Planning and Positions; Liquidity Risk Management and Positions; and Governance and Controls. The final LFI rating system adopts these component categories as proposed.

As proposed, the Capital Planning and Positions rating would have encompassed assessments of (i) the effectiveness of the governance and planning processes used by a firm to determine the amount of capital necessary to cover risks and exposures, and to support activities through a range of conditions; and (ii) the sufficiency of a firm's capital positions to comply with applicable regulatory requirements and to support the firm's ability to continue to serve as a financial intermediary through a range of conditions.

Several commenters sought clarification regarding the relationship between a firm's compliance with regulatory capital requirements and a firm's Capital Planning and Positions rating. In addition, some commenters asserted that receipt of a non-objection to a capital plan should result in (or create the presumption of) a firm receiving a “Satisfactory” rating for the Capital Planning and Positions component under the LFI rating system.

The final LFI rating system adopts the description of the Capital Planning and Positions component rating used in the proposal. A firm's capital rating under the LFI rating system will reflect a broad assessment of the firm's capital planning and positions, based on horizontal reviews and firm-specific supervisory work focused on capital planning and positions. In consolidating supervisory findings into a comprehensive assessment of a firm's capital planning and positions, the Federal Reserve will take into account the materiality of a firm's outstanding and newly identified supervisory issues.

A firm's compliance with minimum regulatory capital requirements will be considered in assigning the firm's Capital Planning and Positions component rating; however, the Federal Reserve may determine that a firm does not meet expectations regarding its capital position in light of its idiosyncratic activities and risks, even if the firm meets minimum regulatory capital requirements. Any findings from supervisory stress testing, such as CCAR or similar activities, will represent inputs into the Capital Planning and Positions component rating. However, with respect to any firm that may be subject to a qualitative review of its capital planning practices, there is no automatic link between the results of that review and the firm's capital rating.

Some commenters argued that the Board should discontinue its practice of publicly objecting or not-objecting to a firm's capital plan. Last year, the Board exempted firms with less than $250 billion in assets and less than $75 billion in nonbank assets from the CCAR qualitative assessment, and in the recent stress capital buffer proposal, the Board sought comments on potential changes to the CCAR qualitative assessment.18 The Board is currently in the process of evaluating these comments.

In addition, commenters noted that the Board should clarify that the final LFI rating system does not create any new qualitative standards for capital planning, and others requested that the Board separately seek comment on the capital planning expectations included in SR letters 15-18 and 15-19. Consistent with the commenters' request, the Board confirms that the final LFI rating system does not create any new capital planning expectations applicable to LFIs. When the Board adopted SR letters 15-18 and 15-19, it did not seek comment on those letters, as they largely consolidated the Federal Reserve's existing capital planning guidance in one place. To the extent the Board considers adjustments to those letters in the future, the Board will take commenters' views into account.

As proposed, the Liquidity Risk Management and Positions component rating would have encompassed assessments of (i) the effectiveness of a firm's governance and risk management processes used to determine the amount of liquidity necessary to cover risks and exposures, and to support activities through a range of conditions; and (ii) the sufficiency of a firm's liquidity positions to comply with applicable regulatory requirements and to support the firm's ongoing obligations through a range of conditions.

Several commenters requested that the Board clarify how the liquidity rating would be assigned and clarify the linkage between a firm's rating and its compliance with the minimum liquidity requirements. The final ratings system adopts the description of the Liquidity Risk Management and Positions component rating used in the proposal without change. In assessing the liquidity risk management and position of a banking organization, the Federal Reserve evaluates each firm's risk management practices by reviewing the processes that firms use to identify, measure, monitor, and manage liquidity risk and make funding decisions, and evaluating the firm's compliance with the liquidity risk management requirements of Regulation YY. The Federal Reserve evaluates a firm's liquidity positions against applicable regulatory requirements, and assesses the firm's ability to support its obligations through other means, such as its funding concentrations. A firm's liquidity rating will reflect the materiality of issues identified through the supervisory process.

In addition, commenters requested additional detail on the relationship between the Liquidity Risk Management and Positions rating of a LISCC firm and its performance in the Comprehensive Liquidity Assessment Review (CLAR). As for all component ratings, horizontal and firm-specific examination work conducted under the LISCC liquidity program, which is inclusive of the horizontal work covered under the CLAR, will represent a material input into a firm's liquidity rating. Unlike CCAR, the LISCC liquidity program's assessment does not result in an objection or non-objection ; rather, it results in supervisory findings communicated to the firm, which may include “matters requiring attention” and “matters requiring immediate attention,” as applicable.

The proposed Governance and Controls component rating would have evaluated the effectiveness of a firm's (i) board of directors,19 (ii) management of business lines and independent risk management and controls,20 and (iii) recovery planning (for domestic LISCC firms only).21

This component rating would have included consideration of a firm's compliance practices. One commenter suggested that the rating take into account only compliance matters that would have a material impact on a firm's financial and operational strength and resiliency. The Board expects all firms to comply fully with applicable laws and regulations, including those related to consumer protection. In assigning a supervisory rating, the Board will take into account the materiality of outstanding and identified supervisory issues, including the extent to which a matter would have a material impact on a firm's financial and operational strength and resiliency.

The proposed Governance and Controls component rating would have included a consideration of recovery planning for domestic LISCC firms, given the heightened risks that LISCC firms present to financial stability. One commenter suggested that the governance and controls rating not include recovery planning for domestic LISCC firms, because related supervisory expectations are already reflected in other aspects of the LFI rating system. The final LFI rating system maintains consideration of recovery planning in assessing the governance and controls of a LISCC firm, as effective recovery planning practices are central to ensuring that a LISCC firm has sufficient financial and operational strength to continue operations through a range of conditions.

The Board requested comment on whether resolution planning should also be a component of, or otherwise factored into, the LFI rating system. Several commenters argued against inclusion of resolution planning, stating, for example, that adding a separate component rating for resolution planning would be duplicative in light the current public deficiency findings under the resolution plan rule. One commenter supported the inclusion of resolution planning in the LFI rating system.

The Board has determined not to include a separate component rating for a firm's resolution planning as part of the final LFI rating system. The Board will continue to consider whether the LFI rating system should be modified in the future to include an assessment of the sufficiency of a firm's resolution planning efforts.

Under the proposed LFI rating system, ratings would have been assigned based on a four-point scale, with the following categories: Satisfactory/Satisfactory Watch, Deficient-1, and Deficient-2. One commenter expressed concern that the reduction in the number of ratings categories from five, as in the current RFI framework, to four, would result in the new rating framework being less flexible and nuanced, and lead to inadvertent rating downgrades.

A four-category rating scale is intended to increase the usability of the scale—under the RFI rating system, the highest rating of “1” and the lowest rating of “5” were rarely used when rating LFIs. Further, the “Conditionally Meets Expectations” rating category enables the Federal Reserve to identify certain material issues at a firm and provide a firm with notice and the ability to fix those issues before the firm experiences regulatory consequences as a result of the ratings downgrade.

The final LFI rating system adopts a similar four-category scale, but uses different terminology to improve the descriptiveness of the rating categories. Specifically, the final rating categories are: Broadly Meets Expectations, Conditionally Meets Expectations, Deficient-1, and Deficient-2. The final LFI rating system also clarifies the definitions within each category to provide additional guidance to examiners and provide transparency to firms about the calibration of each category.

Several commenters also expressed the need for the use of additional quantitative measures improve transparency and consistency in how ratings are derived. The Federal Reserve will continue to use quantitative measures, together with supervisory judgment, to inform a comprehensive assessment of a firm's Capital, Liquidity, and Governance and Controls.

In the proposal, the highest rating category was “Satisfactory.” A “Satisfactory” rating would have indicated that a firm is considered safe and sound and broadly meets supervisory expectations.

The final LFI rating system renames the rating category as “Broadly Meets Expectations,” to align more closely with the underlying definition of the rating category.22 As with the proposal, the final ratings definition for “Broadly Meets Expectations” provides that a firm may have supervisory issues requiring corrective action; however, these issues are unlikely to present a threat to the firm's ability to maintain safe-and-sound operations through a range of conditions.

Two commenters suggested that the rating scale should include a higher rating above the “Satisfactory” designation, similar to the “Strong” rating utilized with the RFI, CAMELS, and other supervisory rating systems. The final LFI rating system does not include a “Strong” rating, which may suggest that the Federal Reserve expects firms to exceed, not simply meet, supervisory expectations. In addition, a “Strong” rating would not enhance or clarify supervisory communications, as a “Strong” rating would have no supervisory consequences.23

One commenter stated that the rule should clarify the circumstances under which MRAs or MRIAs would trigger a downgrade from the “Satisfactory” rating. As noted above, in consolidating supervisory findings into a comprehensive assessment in each category, the Board will take into account the materiality of a firm's outstanding and newly identified supervisory issues. While a given ratings assessment will depend on the circumstances, the LFI rating scale is designed to clarify the relationship between supervisory issues and deficiencies, and a firm's progress in remediation and mitigation efforts.

In the proposed LFI rating system, the second highest rating category was “Satisfactory Watch.” This rating would have indicated that a firm was generally considered safe and sound; however, certain issues were sufficiently material that, if not resolved in a timely manner in the normal course of business, they would put the firm's prospects for remaining safe and sound through a range of conditions at risk. As noted in the proposal, the “Satisfactory Watch” rating was intended to be consistent with the Federal Reserve's practice of providing notice to firms that they are likely to be downgraded if identified weaknesses are not resolved in a timely manner.

The preamble to the proposal noted that the “Satisfactory Watch” rating was not intended to be used for a prolonged period; rather, firms would have had a specified timeframe to fully resolve issues leading to that rating (as is the case with all supervisory issues), but generally no longer than 18 months. Several commenters noted that many supervisory issues take longer than 18 months to resolve, and that resolution of certain issues requires substantial infrastructure investment and changes in processes and controls. As such, these commenters argued that the specified remediation timeframes in the “Satisfactory Watch” rating should be based on the specific facts and circumstances of the supervisory issue(s) in question, rather than limited to an 18-month period. These commenters also argued that a firm should not be downgraded provided the firm makes good faith efforts to remediate the issues and progress is made.

As in the proposal, the final ratings framework states that the Federal Reserve does not intend for a firm to be rated “Conditionally Meets Expectations” for a prolonged period. However, unlike the proposal, the final ratings framework does not establish a fixed timeline for how long a firm can be rated “Conditionally Meets Expectations.” Instead, the final ratings framework reflects an understanding that timelines will be issues-specific, noting that the Federal Reserve will work with the firm to develop an appropriate timeframe during which the firm would be expected to resolve each supervisory issue leading to the “Conditionally Meets Expectations” rating. Further, the final ratings framework reflects an understanding that completion and validation of remediation activities for selected supervisory issues—such as those involving information technology modifications—will require an extended time horizon. In all instances, appropriate and effective risk mitigation techniques must be utilized in the interim to maintain safe-and-sound operations under a range of conditions until remediation activities are completed, validated, and fully operational.

One commenter recommended that the “Satisfactory Watch” rating should be permanent, rather than temporary, while another argued that the “Satisfactory Watch” rating should be used infrequently. The final LFI rating system acknowledges there are circumstances when a firm may be rated “Conditionally Meets Expectations” for a longer period of time if, for instance, the firm is close to completing resolution of the supervisory issues leading to the “Conditionally Meets Expectations” rating, but new issues may be identified that, taken alone, would be consistent with a “Conditionally Meets Expectations” rating. In this event, the firm may continue to be rated “Conditionally Meets Expectations,” provided the new issues do not reflect a pattern of deeper or prolonged capital planning or position weaknesses consistent with a “Deficient” rating.

The proposal would have provided that “Satisfactory Watch” would be appropriate when a firm could resolve the issue in a timely manner in the normal course of business. Commenters requested clarification on expectations regarding “normal course of business.” The final LFI rating system clarifies that “normal course of business” means that a firm has the ability to resolve these issues through measures that do not require a material change to the firm's business model or financial profile, or its governance, risk management, or internal control structures or practices.

Several commenters also argued that a firm rated “Deficient” should be upgraded to the “Satisfactory Watch” rating if the firm has remediated identified deficiencies but a validation process had not yet been completed. As indicated in the Deficient-1 section below, the final LFI framework indicates that a firm previously rated “Deficient” may be upgraded to “Conditionally Meets Expectations” if the firm's remediation and mitigation activities are sufficiently advanced so that its prospects for remaining safe and sound are no longer at significant risk, even if the firm has outstanding supervisory issues or is subject to an active enforcement action.

In the proposal, the third rating category was “Deficient-1,” which would have indicated that, although the firm's current condition is not considered to be materially threatened, there were financial and/or operational deficiencies that put its prospects for remaining safe and sound through a range of conditions at significant risk. The final ratings framework maintains the name of the third rating category.

Under the proposed LFI rating system, a firm that received a rating of “Deficient-1” or “Deficient-2” in any component rating would not be considered “well managed” for purposes of the Bank Holding Company Act (BHC Act).24 Several commenters suggested that the “well managed” determination should be made on the basis of an assessment of the firm as a whole, rather than the automatic consequence of any one component rating. One commenter argued that the separate, standalone composite rating should form the sole basis for determining a firm's “well managed” status.

Conditioning a firm's “well managed” status on all three rating categories reflects the judgment that a banking organization is not in satisfactory condition overall unless it is considered sound in each of the key areas of capital, liquidity, and governance and controls. Each rating category includes assessments of key aspects of a firm's practices and capabilities, including management, that are necessary to operate in a safe-and-sound manner. A “Deficient” rating in any of the components reflects the supervisory conclusion that financial or operational deficiencies have placed the firm's safety and soundness at significant risk, which would not warrant a firm being deemed “well managed.” Accordingly, the final LFI rating system maintains the proposed approach to determining whether a firm is “well managed.”

Under current law, a firm must receive a “Satisfactory” risk management and composite rating in order to qualify as “well managed.” Several commenters argued that the proposed rating scale would introduce a more rigid standard compared with the RFI rating system, potentially making LFIs less likely to be considered “well managed.” In the Board's view, any rigidity is balanced by the introduction of the “Conditionally Meets Expectations” rating, which provides notice to firms that they are likely to be downgraded if identified weaknesses are not resolved in a timely manner.

The proposal noted that a “Deficient-1” component rating would often be an indication that the firm should be subject to either an informal or formal enforcement action, and may also result in the designation of the firm as being in “troubled condition.” 25 Several commenters requested clarity under what circumstances a “Deficient-1” rating would result in “troubled condition” status or a formal enforcement action.

Consistent with commenters' views, the final LFI rating system reflects that there is no presumption that a firm rated “Deficient-1” would be deemed to be in “troubled condition.” Whether a firm rated “Deficient-1” receives a “troubled condition” designation will be determined by the facts and circumstances at that firm. However, firms rated “Deficient-1” due to financial weaknesses in either capital or liquidity would be more likely to be deemed in “troubled condition” than firms rated “Deficient-1” due solely to issues of governance or controls.

While a commenter asked that a “Deficient-1” rating be an automatic bar to new or expansionary activity, others suggested that firms rated “Deficient-1” not be subject to any restrictions on growth. Consistent with the proposal, receiving a “Deficient-1” rating under the final LFI rating system would result in automatic consequences for a firm's “well managed” status, which would limit the firm's ability to engage in new or expansionary nonbanking activities. Further, as with the proposal, a “Deficient-1” rating in the final LFI rating system could be a barrier for a firm seeking the Federal Reserve's approval of a proposal to engage in new or expansionary activities, unless the firm can demonstrate that (i) it is making meaningful, sustained progress in resolving identified deficiencies and issues; (ii) the proposed new or expansionary activities would not present a risk of exacerbating current deficiencies or issues or lead to new concerns; and (iii) the proposed activities would not distract the firm from remediating current deficiencies or issues.

A “Deficient-2” rating indicates that financial and/or operational deficiencies materially threaten the firm's safety and soundness, or have already put the firm in an unsafe and unsound condition. The proposal noted that a firm with a “Deficient-2” component rating would be required to immediately (i) implement comprehensive corrective measures sufficient to restore and maintain appropriate capital planning capabilities and adequate capital positions; and (ii) demonstrate the sufficiency, credibility and readiness of contingency planning in the event of further deterioration of the firm's financial or operational strength or resiliency. It also noted that there is a strong presumption that a firm rated “Deficient-2” will be subject to a formal enforcement action by the Federal Reserve, and that the Federal Reserve would be unlikely to approve a proposal from a firm to engage in new or expansionary activities.

The final LFI rating system adopts the “Deficient-2” ratings category without change.

The proposed LFI rating system described the areas of assessment under each component rating, but would not have assigned separate subcomponents for each area of assessment. A few commenters recommended that each of the three component ratings include subcomponent ratings, as used in the RFI rating system. These commenters argued that subcomponent ratings aid supervisory staff to consistently apply the component rating across institutions, and allow firms to more easily identify, communicate, and correct deficiencies across the organization.

Communicating a single rating in each component is intended to reinforce the Board's view that the strength of a firm's capital and liquidity position is integrated with the effectiveness the firm's capital planning and liquidity risk management, respectively, and the strength of a firm's risk management depends on the effectiveness of the board oversight. In developing the rating, the Federal Reserve will rely on firm-specific and horizontal examination work. Throughout the year, and in connection with its rating, firms will receive feedback relating to the supervisory activities that inform the ratings, which will provide firms with specific feedback relating to the elements of the rating.

Several commenters asserted that the LFI rating system should include a separate, standalone composite rating in addition to the three component ratings. These commenters asserted that a composite rating would provide a fuller view of the health of each institution.

Unlike other supervisory rating systems, including the RFI rating system, the Federal Reserve will not assign a standalone composite rating under the LFI rating system. As noted in the proposal, assigning a standalone composite rating is not necessary because the three component ratings are designed to clearly communicate supervisory assessments and associated consequences for each of the core areas (capital, liquidity, and governance and controls). Further, the components identify those core areas that are necessary and critical to a firm's strength and resilience. It is unlikely that the assignment of a standalone composite rating would convey new or additional information regarding these supervisory assessments not already communicated by the three component ratings, and a standalone composite rating could dilute the clarity and impact of the component ratings. As such, the final LFI rating system does not include a separate standalone composite rating.

In accordance with the Federal Reserve's regulations governing confidential supervisory information,26 ratings assigned under the proposed LFI rating system would have been communicated by the Federal Reserve to the firm but not disclosed publicly. One commenter requested that LFI rating components be publicly disclosed, as the public would benefit from additional supervisory disclosure regarding individual firms. The Board has traditionally maintained the confidentiality of supervisory ratings in order to preserve candor in communication between supervised institutions and the Board. For this reason, in accordance with the Federal Reserve's regulations governing confidential supervisory information, ratings assigned under the LFI rating system will be communicated by the Federal Reserve to the firm, but individual ratings will not be disclosed publicly. The Federal Reserve will continue to think broadly in considering ways to enhance transparency across its processes and communications in support of improved supervisory approaches and outcomes.

In addition, some commenters indicated that there should be a more effective process for firms to challenge and seek review of supervisory findings, such as additional opportunities to respond to adverse findings by examiners, and meetings with the Federal Reserve. The Federal Reserve is committed to engaging in ongoing dialogue with banking organizations regarding supervisory findings to ensure that firms understand supervisory expectations and that the Federal Reserve understands the way that firms think about their business and risks. The Board also is committed to maintaining an effective independent appellate process to allow institutions to seek review of material supervisory determinations. The Board recently issued a proposal that is out for comment and is currently considering comments on that proposal.27

References to holding company ratings are included in a number of the Federal Reserve's existing regulations. In certain cases, the regulations are narrowly constructed such that they contemplate only the assignment of a standalone composite rating using a numerical rating scale. This is consistent with the current RFI rating system but is not compatible with the LFI rating system. Three provisions in the Federal Reserve's existing regulations are written in this manner, including two in Regulation K and one in Regulation LL.

In Regulation K, § 211.2(z) includes a definition of “well managed” which, in part, requires a bank holding company to have received a composite rating of 1 or 2 at its most recent examination or review; and § 211.9(a)(2) requires an investor (which by definition can be a bank holding company) to have received a composite rating of at least 2 at its most recent examination in order to make investments under the general consent or limited general consent procedures contained in § 211.9(b) and (c).

In Regulation LL, § 238.54(a)(1) restricts savings and loan holding companies from commencing certain activities without the Federal Reserve's prior approval unless the company received a composite rating of 1 or 2 at its most recent examination.

To ensure that the Federal Reserve's regulations are consistent and compatible with all aspects of both the RFI rating system as well as the LFI rating system, the Federal Reserve is amending those three regulatory provisions so that they will apply to entities which receive numerical composite ratings as well as to entities which do not receive numerical composite ratings (including firms subject to the LFI rating system).28 To satisfy the requirements of those provisions, firms that do not receive numerical composite ratings will have to be considered satisfactory under the LFI rating system. To be considered satisfactory, a firm would have to be rated “Broadly Meets Expectations” or “Conditionally Meets Expectations” for each component of the LFI rating system; a firm which is rated “Deficient-1” or lower for any component would not be considered satisfactory. This standard applies to any provision contained in the Federal Reserve's regulations, which requires or refers to a firm having a satisfactory composite rating.

As compared to the RFI rating system, the proposed LFI rating system did not include an explicit assessment of a banking organization's ability to protect depository institutions from the activities of non-depository or capital market subsidiaries. The commenter suggested the Board revise the proposal to recognize the importance of this concept.

In response to the commenter, the final LFI rating system acknowledges that a banking organization is expected to ensure that the consolidated organization, including its critical operations and banking offices, remains safe and sound through a range of potentially stressful conditions.

The final LFI rating system includes several structural changes from the RFI rating system. The following table provides a broad comparison between the two rating systems.

There is no collection of information required by this proposal that would be subject to the Paperwork Reduction Act of 1995, 44 U.S.C. 3501 et seq.

The Regulatory Flexibility Act (RFA), 5 U.S.C. 601 et seq., generally requires that, in connection with a proposed rulemaking, an agency prepare and make available for public comment an initial regulatory flexibility analysis (IRFA). The Board solicited public comment on the LFI rating system in a notice of proposed rulemaking and has since considered the potential impact of this final rule on small entities in accordance with section 604 of the RFA. Based on the Board's analysis, and for the reasons stated below, the Board believes the final rule will not have a significant economic impact on a substantial number of small entities.

The RFA requires an agency to prepare a final regulatory flexibility analysis (FRFA) unless the agency certifies that the rule will not, if promulgated, have a significant economic impact on a substantial number of small entities. The FRFA must contain: (1) A statement of the need for, and objectives of, the rule; (2) a statement of the significant issues raised by the public comments in response to the IRFA, a statement of the agency's assessment of such issues, and a statement of any changes made in the proposed rule as a result of such comments; (3) the response of the agency to any comments filed by the Chief Counsel for Advocacy of the Small Business Administration in response to the proposed rule, and a detailed statement of any changes made to the proposed rule in the final rule as a result of the comments; (4) a description of an estimate of the number of small entities to which the rule will apply or an explanation of why no such estimate is available; (5) a description of the projected reporting, recordkeeping and other compliance requirements of the rule, including an estimate of the classes of small entities which will be subject to the requirement and type of professional skills necessary for preparation of the report or record; and (6) a description of the steps the agency has taken to minimize the economic impact on small entities, including a statement for selecting or rejecting the other significant alternatives to the rule considered by the agency.

The final rule adopts a new holding company rating system for large financial institutions, and amend the Board's Regulations K and LL to ensure the Board's regulations are compatible with all aspects of the LFI rating system, but will not change the operation of those regulations for any entity that is not subject to the LFI rating system. Commenters did not raise any issues in response to the IRFA. In addition, the Chief Counsel for Advocacy of the Small Business Administration did not file any comments in response to the proposed rule.

Under regulations issued by the Small Business Administration (SBA), a “small entity” includes a depository institution, bank holding company, or savings and loan holding company with assets of $550 million or less (small banking organizations). As discussed in the SUPPLEMENTARY INFORMATION, the final rule will apply to all bank holding companies with total consolidated assets of $100 billion or more; all non-insurance, non-commercial savings and loan holding companies with total consolidated assets of $100 billion or more; and U.S. intermediate holding companies of foreign banking organizations with total consolidated assets of $50 billion or more.

Companies that are subject to the final rule therefore substantially exceed the $550 million asset threshold at which a banking entity is considered a “small entity” under SBA regulations. Because the final rule does not apply to any company with assets of $550 million or less, the final rule would not apply to any “small entity” for purposes of the RFA.

There are no projected reporting, recordkeeping, or other compliance requirements associated with the final rule. As discussed above, the final rule does not apply to small entities.

The Board does not believe that the final rule duplicates, overlaps, or conflicts with any other Federal Rules. In addition, the Board does not believe there are significant alternatives to the final rule that have less economic impact on small entities. In light of the foregoing, the Board does not believe the final rule will have a significant economic impact on a substantial number of small entities.

Section 722 of the Gramm-Leach-Bliley Act requires the Board to use plain language in all proposed and final rules published after January 1, 2000. The Board received no comments on these matters and believes that the final rule is written plainly and clearly.

For the reasons stated in the preamble, the Board amends 12 CFR parts 211 and 238 as follows:

The substance of these special conditions has been published in the Federal Register for public comment in several prior instances with no substantive comments received. The FAA therefore finds it unnecessary to delay the effective date and finds that good cause exists for making these special conditions effective upon publication in the Federal Register.

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

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

On March 21, 2017, Garmin applied for a supplemental type certificate to install Garmin G5000 avionics connected to the aircraft-control domain and airline information-services domain in Textron Model 560XL airplanes. This is a twin-engine, turbofan airplane with seating for 12 passengers and two crew members, and a maximum takeoff weight of 20,200 pounds.

Under the provisions of title 14, Code of Federal Regulations (14 CFR) 21.101, Garmin must show that the Textron Model 560XL airplane, as changed, continues to meet the applicable provisions of the regulations listed in Type Certificate No. A22CE, or the applicable regulations in effect on the date of application for the change, except for earlier amendments as agreed upon by the FAA.

If the Administrator finds that the applicable airworthiness regulations (i.e., 14 CFR part 25) do not contain adequate or appropriate safety standards for the Textron Model 560XL airplane because of a novel or unusual design feature, special conditions are prescribed under the provisions of § 21.16.

Special conditions are initially applicable to the model for which they are issued. Should the applicant apply for a supplemental type certificate to modify any other model included on the same type certificate to incorporate the same novel or unusual design feature, these special conditions would also apply to the other model under § 21.101.

In addition to the applicable airworthiness regulations and special conditions, the Textron Model 560XL airplane must comply with the fuel-vent and exhaust-emission requirements of 14 CFR part 34, and the noise-certification requirements of 14 CFR part 36.

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

The Textron Model 560XL airplane, as modified by Garmin, will incorporate the following novel or unusual design features:

Garmin G5000 avionics that allow internal connection to previously isolated data networks, which are connected to systems that perform functions required for the safe operation of the airplane.

The Textron Model 560XL airplane architecture is novel or unusual for commercial transport airplanes because it allows connection to previously isolated data networks connected to systems that perform functions required for the safe operation of the airplane. This data network and design integration creates a potential for unauthorized persons to access the aircraft-control domain and airline information-services domain, and presents security vulnerabilities related to the introduction of computer viruses and worms, user errors, and intentional sabotage of airplane electronic assets (networks, systems, and databases) critical to the safety and maintenance of the airplane.

The existing regulations and guidance material did not anticipate this type of system architecture or electronic access to airplane systems. Furthermore, 14 CFR regulations and the current system-safety assessment policy and techniques do not address potential security vulnerabilities, which could be exploited by unauthorized access to airplane networks and servers. Therefore, these special conditions ensure that the security of airplane systems and networks is not compromised by unauthorized wired or wireless internal access.

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

As discussed above, these special conditions are applicable to the Textron Model 560XL airplane. Should Garmin apply at a later date for a supplemental type certificate to modify any other model included on Type Certificate No. A22CE to incorporate the same novel or unusual design feature, these special conditions would apply to that model as well.

This action affects only certain novel or unusual design features on one model of airplane. It is not a rule of general applicability and affects only the applicant who applied to the FAA for approval of the features on the airplane.

The authority citation for these special conditions is as follows:

Accordingly, pursuant to the authority delegated to me by the Administrator, the following special conditions are issued as part of the type certification basis for Textron Model 560XL airplanes as modified by Garmin, for airplane electronic-system security protection from unauthorized internal access.

1. The applicant must ensure that the design provides isolation from, or airplane electronic-system security protection against, access by unauthorized sources internal to the airplane. The design must prevent inadvertent and malicious changes to, and all adverse impacts upon, airplane equipment, systems, networks, or other assets required for safe flight and operations.

2. The applicant must establish appropriate procedures to allow the operator to ensure that continued airworthiness of the airplane is maintained, including all post-type-certification modifications that may have an impact on the approved electronic-system security safeguards.

The substance of these special conditions has been published in the Federal Register for public comment in several prior instances with no substantive comments received. The FAA therefore finds it unnecessary to delay the effective date and finds that good cause exists for making these special conditions effective upon publication in the Federal Register.

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

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

On March 21, 2017, Garmin applied for a supplemental type certificate to install Garmin G5000 avionics connected to the aircraft-control domain and airline information-services domain in Textron Model 560XL airplanes. This is a twin-engine, turbofan airplane with seating for 12 passengers and two crew members, and a maximum takeoff weight of 20,200 pounds.

Under the provisions of title 14, Code of Federal Regulations (14 CFR) 21.101, Garmin must show that the Textron Model 560XL airplane, as changed, continues to meet the applicable provisions of the regulations listed in Type Certificate No. A22CE, or the applicable regulations in effect on the date of application for the change, except for earlier amendments as agreed upon by the FAA.

If the Administrator finds that the applicable airworthiness regulations (i.e., 14 CFR part 25) do not contain adequate or appropriate safety standards for the Textron Model 560XL airplane because of a novel or unusual design feature, special conditions are prescribed under the provisions of § 21.16.

Special conditions are initially applicable to the model for which they are issued. Should the applicant apply for a supplemental type certificate to modify any other model included on the same type certificate to incorporate the same novel or unusual design feature, these special conditions would also apply to the other model under § 21.101.

In addition to the applicable airworthiness regulations and special conditions, the Textron Model 560XL airplane must comply with the fuel-vent and exhaust-emission requirements of 14 CFR part 34, and the noise-certification requirements of 14 CFR part 36.

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

The Textron Model 560XL airplane, as modified by Garmin, will incorporate the following novel or unusual design features:

Garmin G5000 avionics that allow external connection to previously isolated data networks, which are connected to systems that perform functions required for the safe operation of the airplane.

The Textron Model 560XL airplane architecture and network configuration may allow increased connectivity to and access from external network sources and airline operations and maintenance networks to the airplane control domain and airline information services domain. The airplane control domain and airline information-services domain perform functions required for the safe operation and maintenance of the airplane. Previously, these domains had very limited connectivity with external network sources. This data network and design integration creates a potential for unauthorized persons to access the aircraft-control domain and airline information-services domain, and presents security vulnerabilities related to the introduction of computer viruses and worms, user errors, and intentional sabotage of airplane electronic assets (networks, systems, and databases) critical to the safety and maintenance of the airplane.

The existing regulations and guidance material did not anticipate these types of airplane system architectures. Furthermore, 14 CFR regulations and the current system safety assessment policy and techniques do not address potential security vulnerabilities, which could be exploited by unauthorized access to airplane networks, data buses, and servers. Therefore, these special conditions ensure that the security (i.e., confidentiality, integrity, and availability) of airplane systems is not compromised by unauthorized wired or wireless electronic connections.

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

As discussed above, these special conditions are applicable to the Textron Model 560XL airplane. Should Garmin apply at a later date for a supplemental type certificate to modify any other model included on Type Certificate No. A22CE to incorporate the same novel or unusual design feature, these special conditions would apply to that model as well.

This action affects only certain novel or unusual design features on one model of airplane. It is not a rule of general applicability and affects only the applicant who applied to the FAA for approval of the features on the airplane.

The authority citation for these special conditions is as follows:

Accordingly, pursuant to the authority delegated to me by the Administrator, the following special conditions are issued as part of the type certification basis for Textron Model 560XL airplanes, as modified by Garmin, for airplane electronic-system security protection from unauthorized external access.

1. The applicant must ensure airplane electronic-system security protection from access by unauthorized sources external to the airplane, including those possibly caused by maintenance activity.

2. The applicant must ensure that electronic-system security threats are identified and assessed, and that effective electronic-system security protection strategies are implemented to protect the airplane from all adverse impacts on safety, functionality, and continued airworthiness.

3. The applicant must establish appropriate procedures to allow the operator to ensure that continued airworthiness of the airplane is maintained, including all post-type-certification modifications that may have an impact on the approved electronic-system security safeguards.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. Subtitle I, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it establishes Class E surface airspace and amends Class D airspace at Tyndall AFB, FL, to support IFR operations at this airport.

The FAA published a notice of proposed rulemaking in the Federal Register (83 FR 45861, September 11, 2018) for Docket No. FAA-2018-0741 to establish Class E surface airspace and amend Class D airspace at Tyndall AFB, FL, to support IFR operations at this airport.

Interested parties were invited to participate in this rulemaking effort by submitting written comments on the proposal to the FAA. One comment supporting the action was received. After the comment period closed, two additional comments were received that did not clearly indicate a position in support of the proposal, or in opposition to the proposal.

Class D and E airspace designations are published in Paragraphs 5000 and 6002, respectively, dated August 13, 2018, and effective September 15, 2018, which is incorporated by reference in 14 CFR part 71.1. The Class D and Class E airspace designations listed in this document will be published subsequently in the Order.

This document amends FAA Order 7400.11C, Airspace Designations and Reporting Points, dated August 13, 2018, and effective September 15, 2018. FAA Order 7400.11C is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11C lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

This amendment to Title 14 Code of Federal Regulations (14 CFR) part 71 establishes Class E surface airspace within a 5.4-mile radius of Tyndall AFB, FL, for the safety of aircraft landing and departing the airport when the air traffic control tower is closed.

In addition, the geographic coordinates of the airport in Class D airspace are updated to coincide with the FAA's database.

Finally, the outdated term `Airport/Facility Directory' is replaced with `Chart Supplement' under the Class D description.

These changes are necessary for continued safety and management of IFR operations at this airport.

The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore: (1) Is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that only affects air traffic procedures and air navigation, it is certified that this rule, when promulgated, does not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

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

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

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. Subtitle I, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it amends Class E airspace at Johnson County Airport, Mountain City, TN, and establishes Class E airspace at Elizabethton Municipal, Elizabethton, TN, to support IFR operations at these airports.

The FAA published a notice of proposed rulemaking in the Federal Register (83 FR 47577, September 20, 2018) for Docket No. FAA-2018-0745 to amend Class E airspace at Johnson County Airport, Mountain City, TN, and establish Class E airspace at Elizabethton Municipal, Elizabethton, TN, to support IFR operations at these airports.

Interested parties were invited to participate in this rulemaking effort by submitting written comments on the proposal to the FAA. No comments were received.

Class E airspace designations are published in paragraph 6005, of FAA Order 7400.11C dated August 13, 2018, and effective September 15, 2018, which is incorporated by reference in 14 CFR part 71.1. The Class E airspace designation listed in this document will be published subsequently in the Order.

This document amends FAA Order 7400.11C, Airspace Designations and Reporting Points, dated August 13, 2018, and effective September 15, 2018. FAA Order 7400.11C is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11C lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

This amendment to Title 14 Code of Federal Regulations (14 CFR) part 71 will amend Class E airspace extending upward from 700 feet or more above the surface at Johnson County Airport, Mountain City, TN, by increasing the northeast extension to 14.4 miles (from 10.9 miles), and creating a 14-mile extension southwest of the airport, to accommodate new area navigation (RNAV) global positioning system (GPS) standard instrument approach procedures at the airport.

Additionally, Class E airspace extending upward from 700 feet above the surface is established at Elizabethton Municipal Airport, Elizabethton, TN, within a 9.5-mile radius of the airport, and within 4-miles each side of the 243° bearing from the airport, extending from the 9.5-mile radius to 15-miles southwest of the airport to accommodate RNAV (GPS) standard instrument approach procedures for IFR operations at these airports.

The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore: (1) Is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that only affects air traffic procedures and air navigation, it is certified that this rule, when promulgated, does not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

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

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

Seacoast Inc., on behalf of the bridge owner, Florida Department of Transportation (FDOT), has requested a temporary deviation from the current operating regulation that governs the Caloosahatchee River (SR29/LaBelle) Bridge across the Okeechobee Waterway (Caloosahatchee River), mile 103, at LaBelle, FL. The deviation is necessary to facilitate necessary repairs to the structural integrity of the bridge. The existing bridge is a double-leaf bascule bridge with at vertical clearance in the closed to navigation position of 28 feet under normal water level conditions on the Okeechobee Waterway.

The current operating schedule is set out in 33 CFR 117.317(i)(j). Under this temporary deviation, the bridge will provide single-leaf openings utilizing the current operating schedule. Request for a double-leaf opening requires advance notice by contacting the bridge tender at (813) 228-2191 at least four hours in advance. The vertical clearance of the bridge will be reduced to 26 feet under normal water level conditions on the Okeechobee Waterway to allow for post tensioning of the existing steel floor beams. The Okeechobee Waterway (Caloosahatchee River) is used by a variety of vessels including U.S. government vessels, small commercial vessels, recreational vessels and tugs and barge traffic. The Coast Guard has carefully considered the restrictions with waterway users in publishing this temporary deviation.

Vessels able to pass through the bridge in the closed position may do so at any time. The bridge will not be able to provide a double-leaf opening for emergencies and there is no immediate alternate route for vessels to pass. The Coast Guard will also inform the users of the waterways through our Local and Broadcast Notices to Mariners of the change in operating schedule for the bridge so that vessel operators can arrange their transits to minimize any impact caused by the temporary deviation.

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

The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(3)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because it is impracticable. This safety zone must be established by November 16, 2018 and we lack sufficient time to provide a reasonable comment period and then consider those comments before issuing this rule. The NPRM process would delay the establishment of the safety zone until after the date of the power line pulls and compromise public safety.

Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register. Delaying this rule would be contrary to the public interest because immediate action is necessary to respond to the potential safety hazards associated with power line work, which could pose a risk to the operation and waterways users if the normal vessel traffic were to interfere with the work. Possible hazards include risks of injury or death from near or actual contact among working vessels and mariners traversing through the safety zone.

The Coast Guard is issuing this rule under authority in 33 U.S.C. 1231. The Captain of the Port Marine Safety Unit Pittsburgh (COTP) has determined that potential hazards associated with power line pulls across the Ohio River will be a safety hazard for anyone within a 1.2 mile stretch of the Ohio River. The rule is needed to protect people from power line work which could pose a risk to the operation and waterways users if the normal vessel traffic were to interfere with the work. Possible hazards include risks of injury or death from near or actual contact among working vessels and mariners traversing through the safety zone.

This rule establishes a temporary safety zone from 6 a.m. through 8 p.m. on November 16, 2018 through December 31, 2018. The safety zone will cover all navigable waters of the Ohio River, from mile 28.0 to mile 29.2. The duration of the zone is intended to protect persons, vessels, and the marine environment on these navigable waters before, during, and after the power line pulls. No vessel or person will be permitted to enter the safety zone without obtaining permission from the COTP or a designated representative. A designated representative is a commissioned, warrant, or petty officer of the U.S. Coast Guard assigned to units under the operational control of USCG Marine Safety Unit Pittsburgh. Persons and vessels seeking entry into this safety zone must request permission from the COTP or a designated representative. They may be contacted on VHF-FM Channel 16 or by telephone at (412) 221-0807. Persons and vessels permitted to enter this safety zone must transit at their slowest safe speed and comply with all lawful instructions of the COTP or a designated representative. The COTP or a designated representative will inform the public of the enforcement period for the safety zone as well as any changes in the schedule through Broadcast Notices to Mariners (BNMs), Local Notices to Mariners (LNMs), and/or Marine Safety Information Bulletins (MSIBs) as appropriate.

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

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

The Office of Management and Budget (OMB) has not designated this rule a “significant regulatory action,” under section 3(f) of Executive Order 12866. Accordingly, OMB has not reviewed it. As this rule is not a significant regulatory action, this rule is exempt from the requirements of Executive Order 13771. See OMB's Memorandum “Guidance Implementing Executive Order 13771, Titled `Reducing Regulation and Controlling Regulatory Costs'” (April 5, 2017).

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

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

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

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

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

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

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

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

We have analyzed this rule under Department of Homeland Security Directive 023-01 and Commandant Instruction M16475.1D, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves a safety zone lasting 13 hours on each day that will prohibit entry on a 1.2 mile stretch of the Ohio River. It is categorically excluded from further review under paragraph L60(a) of Appendix A, Table 1 of DHS Instruction Manual 023-01-001-01, Rev. 01. A Record of Environmental Consideration supporting this determination is available in the docket where indicated under ADDRESSES.

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

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

Please refer to our October 4, 2017, proposed rule (82 FR 46197) for a detailed description of previous Federal actions concerning the candy darter. Elsewhere in today's Federal Register, we propose the designation of critical habitat for the candy darter; that proposal also discusses our intent to reestablish populations within the candy darter's historical range under section 10(j) of the Act in a future publication. And we are seeking public input on other potential recovery tools (e.g., safe harbor agreements), through the proposed critical habitat designation public comment period.

Please refer to our October 4, 2017, proposed rule (82 FR 46197) for a summary of species information available to the Service at the time that it was published. Based on information we received during the proposed rule's public comment period, we updated the current condition discussion in the species status assessment (SSA) report to more accurately reflect the current spread level of hybridization, which is the primary threat to the species, in the candy darter's range (Service 2018). The candy darter's current condition is more degraded than we understood when we published the October 4, 2017, proposed listing rule. Consequently, because the species' current condition (i.e., the baseline or starting point for the SSA's future scenario projections) is more degraded, the species' future condition is also likely to be further degraded than we had previously estimated. With this more accurate reflection of the candy darter's current condition, the risk of extinction is greater than we had previously understood, and we have determined that the species does not meet the definition of a threatened species (as proposed). We find that endangered is the appropriate status for the candy darter (see Determination, below).

We also received information during the public comment period that demonstrates a stronger genetic separation between candy darters in the Greenbrier watershed and the Gauley watershed. All the information was incorporated into an updated version of the SSA report, which is available online at https://www.fws.gov/northeast/candydarter.

The Act directs us to determine whether any species is an endangered species or a threatened species because of any factors affecting its continued existence. We completed a comprehensive assessment of the biological status of the candy darter and prepared a report of the assessment (SSA report), which provides a thorough account of the species' overall viability using the conservation biology principles of resiliency, redundancy, and representation (collectively, the “3Rs”). We have used the SSA report's assessment of the candy darter's current and potential future status, based on the factors influencing the species, framed in the context of the 3Rs, and information provided during the public comment period on the October 4, 2017, proposed listing rule to inform our determination of whether the candy darter meets the definition of an endangered or a threatened species (see Determination, below).

Because we have included information below about the candy darter's 3Rs, we further define those terms here. Resiliency means having sufficiently large populations for the species to withstand stochastic events (arising from random factors). We can measure resiliency based on metrics of population health; for example, birth versus death rates and population size, if that information exists. Resilient populations are better able to withstand disturbances such as random fluctuations in birth rates (demographic stochasticity), variations in rainfall (environmental stochasticity), or the effects of human activities. Redundancy means having a sufficient number of populations for the species to withstand catastrophic events (such as a rare destructive natural event or episode involving many populations). Redundancy is about spreading the risk and can be measured through the duplication and distribution of populations across the range of the species. Generally, the greater the number of populations a species has distributed over a larger landscape, the better it can withstand catastrophic events. Representation means having the breadth of genetic makeup for the species to adapt to changing environmental conditions. Representation can be measured through the genetic diversity within and among populations and the ecological diversity (also called environmental variation or diversity) of populations across the species' range. The more representation, or diversity, a species has, the more it is capable of adapting to changes (natural or human caused) in its environment.

In the absence of species-specific genetic and ecological diversity information, we evaluate representation based on the extent and variability of habitat characteristics within the geographical range. We define viability here as the ability of the species to persist in the wild over time and, conversely, to avoid extinction.

Below, we summarize the conclusions of the candy darter's SSA analysis (Service 2018, entire), which can be accessed at Docket FWS-R5-ES-2017-0056 on http://www.regulations.gov and at https://www.fws.gov/northeast/candydarter. The SSA report documents the results of our comprehensive biological status review for the candy darter, including an assessment of the factors influencing its continued existence. The SSA report does not represent a decision by the Service on whether the candy darter should be listed as an endangered or a threatened species under the Act. Rather, the SSA report provides the scientific basis that informs our regulatory decision, which involves the further application of standards within the Act and its implementing regulations and policies. The Act directs us to determine whether any species is an endangered species or a threatened species (i.e., whether it meets the definition of a threatened or endangered species) because of any factors affecting its continued existence. Below, we review the biological condition of the species and its resources and the factors influencing the species and resources to assess the species' overall viability and the risks to that viability.

Historically, the candy darter consisted 35 populations in Virginia and West Virginia distributed across 7 metapopulations in the Bluestone, Lower New River, Upper Gauley, Lower Gauley, and Middle New watersheds in the Appalachian Plateaus physiographic province and the Upper New River and Greenbrier watersheds in the Valley and Ridge physiographic province. See Chapter 3 of the SSA report for more details (Service 2018, pp. 30-31).

Within these two physiographic provinces, the candy darter has been extirpated from almost half of its historical range (17 of 35 (49 percent) known populations, and 2 of 7 (29 percent) known metapopulations), with the extirpations representing a complete loss of resiliency in those populations (or metapopulations). We qualitatively assessed the remaining (extant) populations, placing them in “low,” “moderate,” or “high” categories that represent the populations' potential to rebound after stochastic events. These categories were based on a combination of eight physical habitat, nonnative competition, and candy darter demographic metrics (see Service 2018, pp. 51, 84-102). Of the 18 extant populations, 5 (28 percent) have a current score of high or moderate to high resiliency, 9 (50 percent) have moderate resiliency, and 4 (22 percent) have low or moderate to low resiliency (see table 4 in the SSA report (Service 2018, p, 46). The five populations with higher resiliency constitute three metapopulations (the Upper Gauley in the Appalachian Plateaus physiographic province and the Greenbrier and Middle New in the Valley and Ridge physiographic province); the remaining two extant metapopulations (the Lower Gauley in the Appalachian Plateaus physiographic province and the Upper New River in the Valley and Ridge physiographic province) maintain populations with moderate and low resiliency. Therefore, we conclude the candy darter's populations currently have moderate resiliency because the four out of the five metapopulations have moderate to high resiliency.

This loss of these candy darter populations, which represent the species' genetic, ecological, and niche diversity within its historical range, as well as the fragmentation of extant populations, has compromised the species' ability to repatriate those areas or avoid species-level effects of a catastrophic event. Based on the species' distribution and condition within each of the seven historical metapopulations (one with moderate to high internal redundancy, one with moderate internal redundancy, one with low internal redundancy, two with no internal redundancy, and two that have been extirpated), we conclude, based on the best available data, that the candy darter's current redundancy is low (Service 2018, pp. 26-28, 49-50).

While the candy darter currently maintains representation in both the Appalachian Plateaus and Valley and Ridge physiographic provinces, only a single metapopulation in each province has a moderate to high resiliency score. As related to the species' occupation in a diversity of environmental settings, candy darters have lost representation from lower mainstem rivers and tributaries. While researchers have noted differences in the genetic, physical, behavioral, or developmental characteristics of some stream fish species based on the species' longitudinal position in the watershed (e.g., stream size) (Neville et al. 2006, pp. 911-913), but we have no data indicating candy darters exhibit similar differences based on their particular environmental setting. Although the candy darter retains representation in both the Appalachian Plateaus and Valley and Ridge physiographic provinces, the species has a reduced distribution than it had historically and likely a reduced ability to respond to stochastic and catastrophic events, thereby putting the species at increased risk of extinction from any such events (Service 2018, pp. 50-51). The available genetic data for the candy darter indicate that the Upper and Lower Gauley River metapopulations are different from the Greenbrier metapopulation. While we have no information regarding the evolutionary significance of these genetic differences to either metapopulation, the loss of either metapopulation would represent a loss to the species' genetic diversity. Therefore, we conclude that the species' representation is currently moderate to low (Service 2018, pp. 26-29, 50-51).

The candy darter is currently distributed in five of the historical seven metapopulations. The populations within those metapopulations generally have moderate to low resiliency and redundancy scores. While the candy darter is present in the two physiographic provinces from which it is historically known, the species is not found in lower mainstem rivers and tributaries in which it once existed (Service 2018, Chapter 3). This fact leads us to conclude the candy darter's representation is also moderate to low. Therefore, our analysis under the 3Rs leads us to conclude that the current condition of the candy darter is currently moderate to low.

Based on the candy darter's life history and habitat needs, and in consultation with species' experts from Virginia and West Virginia State and Federal agencies and academic institutions, we identified the potential stressors (negative influences), the contributing sources of those stressors, and conservation measures to address those stressors that are likely to affect the species' current condition and viability (Service 2018, pp. 32-43). We evaluated how these stressors may be currently affecting the species and whether, and to what extent, they would affect the species in the future (Service 2018, pp. 52-66). Water temperature, excessive sedimentation, habitat fragmentation, water chemistry, water flow, and nonnative competition likely influenced the species in the past and contributed to its current condition, and may continue to affect some populations in the future (Service 2018, pp. 44, 46, 52-67). However, habitat stressors are not considered to be a primary source of risk to candy darter viability in the future. Hybridization with the closely related variegate darter (Etheostoma variatum) appears to be having, and will continue to have, the greatest influence on candy darter populations and the candy darter's overall viability within the next 25 years (Service 2018, pp. 52-66). While we acknowledge there is uncertainty regarding some of the scientific data and assumptions used to assess the biological condition of the candy darter, the species' experts generally agreed with the overall methodology for assessing the candy darter's current and projected future condition, and confirmed that the results were reflective of their observations of the candy darter and its habitat.

As mentioned above, the primary stressor to the candy darter is hybridization with the variegate darter (Service 2018, pp. 32-37), a species that is native to the Kanawha River basin below the Kanawha Falls in Fayette County, West Virginia. The Kanawha Falls serve as a natural barrier to fish dispersal from the lower Kanawha River basin (and greater Ohio River basin) upstream into the range of the candy darter in the upper Kanawha River basin. However, in the late 20th century, the variegate darter was introduced, likely by “bait bucket transfer,” into the upper Kanawha basin. Since they were first observed in the upper Kanawha basin in 1982 and 2002, variegate darters have expanded their range approximately 3 to 9 stream miles per year over the course of the last 20 or more years within the range of the candy darter. Genetic studies have demonstrated that where variegate and candy darter ranges now overlap, the two species will hybridize, and consistent, repeated contact will quickly result in “genetic swamping” (the homogenization or replacement of native genotypes) of the endemic candy darter population and eventually its complete replacement by variegate darters or hybrids (Service 2018, pp. 32-37).

We modeled five scenarios to assess the potential viability of the candy darter at a point up to 25 years in the future (Service 2018, pp. 52-66). Two scenarios were focused on habitat change (one positive and the other negative), and three scenarios were focused on variegate darter invasion. However, the habitat change scenarios, by themselves, are not plausible scenarios because variegate darter hybridization is ongoing and highly likely to continue (see chapter 4 and appendix B of the SSA report for additional information). We chose to model all scenarios out to 25 years because we have data to reasonably predict potential habitat and variegate darter changes and their effects on the candy darter within this timeframe.

Under the three most plausible scenarios, those that include the variegate darter invasion, the predicted rate of variegate darter expansion and hybridization remains the same, and at the end of 25 years, the candy darter will likely occur in four isolated populations and maintain little resilience, redundancy, or representation. The effects of significant positive or negative habitat changes do not alter this outcome; however, because variegate darters may be more tolerant of a wider range of habitat conditions, negative habitat changes could selectively benefit variegate darters and increase the rate at which candy darters are extirpated (Service 2018, p. 64).

The candy darter SSA report (Service 2018, entire) contains a more detailed discussion of our evaluation of the biological status of the candy darter and the influences that may affect its continued existence. Our conclusions are based upon the best available scientific and commercial data, including the expert opinion of the species' experts (fishery biologists, aquatic ecologists, and geneticists from State and Federal agencies and academic institutions) and the SSA team members. Please see the SSA report for a complete list of the species experts and peer reviewers and their affiliations.

We received information during the public comment period that concluded we had inaccurately described the current condition of some populations of the candy darter. The current condition of the candy darter populations in five streams in the Upper Gauley watershed is more degraded than we had understood when we proposed the candy darter for listing. We inaccurately stated that “[v]ariegate darters have not yet been detected in the remainder of the candy darter's range (i.e., the Upper Gauley watershed in West Virginia.” Based on comments we received regarding the spread of the variegate darter in the upper Gauley drainage, the risk of hybridization appears imminent and may already be widespread (see Summary of Comments and Recommendations, below). We incorporated this information into an updated version of the SSA report (Service 2018). The risk of extinction is higher (see Determination, below) than we characterized in the proposal to list the candy darter as a threatened species (82 FR 46197; October 4, 2017).

Additionally, we received information during the public comment period that demonstrated that there is greater genetic differentiation between candy darter in the Greenbrier watershed and candy darter in the Gauley watershed (see Summary of Comments and Recommendations, below). We incorporated this information into an updated version of the SSA report (Service 2018).

We reassessed our analysis (after reviewing all public comments), updated the SSA report, and, after evaluating the best available information and the Act's regulation and policies, determined that the candy darter meets the definition of an endangered species, and such designation is more appropriate than that of a threatened species as originally proposed.

In the proposed rule published on October 4, 2017 (82 FR 46197), we requested that all interested parties submit written comments on the proposal by December 4, 2017. We also contacted appropriate Federal and State agencies, scientific experts and organizations, and other interested parties and invited them to comment on the proposal. A newspaper notification inviting general public comment was published in the USA Today on October 10, 2017. We did not receive any requests for a public hearing. All substantive information provided during the comment period has either been incorporated directly into this final determination or is addressed below, as appropriate.

In accordance with our joint policy on peer review published in the Federal Register on July 1, 1994 (59 FR 34270) and our August 22, 2016, memorandum updating and clarifying the role of peer review of listing actions under the Act, we sought the expert opinions of six individuals (and received responses from four) with expertise in darters; fisheries, population, or landscape ecology; genetics and conservation genetics; and/or speciation and conservation biology regarding the SSA report (Service 2018). The purpose of peer review is to ensure that our designation is based on scientifically sound data, assumptions, and analyses. The peer reviewers generally concurred with our methods and conclusions and provided additional information, clarifications, and suggestions to improve the final SSA report. The SSA report and peer reviews can be found on http://www.regulations.gov under Docket No. FWS-R5-ES-2017-0056. The SSA report informed the proposed rule (82 FR 46197; October 4, 2017) and this final rule.

(1) Comment: The West Virginia Division of Natural Resources (WVDNR) and one public commenter stated that given the fact that variegate darter alleles were detected in the Upper Gauley in 2014 the spread of hybrids in the Upper Gauley drainage appears imminent and may already be widespread based on the rapid spread of hybrids in the Greenbrier drainage.

Our Response: After reviewing how we assessed the hybridization metric, one of eight metrics in our candy darter condition model, we concluded that we had previously underestimated the risk of hybridization in the Upper Gauley. Therefore, we have updated the analysis in the SSA report to address this concern. This information was the primary reason we changed our determination from threatened to endangered.

(2) Comment: The WVDNR stated that the Gauley and Greenbrier river populations of candy darter have a high level of genetic differentiation that borders on species-level differentiation. The Greenbrier River population appears to be on a definite “trajectory to extinction.” Loss of candy darter in the Greenbrier river would drastically reduce genetic diversity of the species and leave the Gauley River and Virginia populations separated by substantial geographic distance and two physical barriers (i.e., Summersville and Bluestone dams).

Our Response: The best available genetic information suggests genetic differences exist between these watersheds. We have updated the SSA report to reflect the importance of these genetic differences.

(3) Comment: One commenter provided additional supporting evidence of the genetic differentiation between the Greenbrier and Gauley metapopulations.

Our Response: We incorporated the information into our SSA report.

(4) Comment: One commenter believed that the candy darter has been extirpated from 77.2 its range rather than 49 percent, as we stated in the proposed rule. They also stated that the situation is likely worse than that because three of the four populations in the Upper Gauley that are labeled as “extant candy darter populations” have not been genetically analyzed; if they were genetically analyzed, they may fall into the category of “extant candy darter population with variegate darter alleles.”

Our Response: This final determination relies on the best scientific information available. At this time, we do not have genetic information (or evidence otherwise) to fully evaluate the genetics of the populations in the Gauley; therefore, we do not assume they are candy darter with variegate darter alleles. We we recognize uncertainty in the data and that the situation may be worse than we are aware.

(5) Comment: Three commenters recommended exemptions for activities for the Service to consider in the event that we drafted a species-specific rule under section 4(d) of the Act (“4(d) rule”).

Our Response: The Service has determined that the candy darter meets the definition of an endangered species, and the Act does not allow for the promulgation of a 4(d) rule when a species is listed as endangered.

Section 4 of the Act (16 U.S.C. 1533), and its implementing regulations at 50 CFR part 424, set forth the procedures for adding species to the Federal Lists of Endangered and Threatened Wildlife and Plants. Under section 4(a)(1) of the Act, we may list a species based on (A) The present or threatened destruction, modification, or curtailment of its habitat or range; (B) overutilization for commercial, recreational, scientific, or educational purposes; (C) disease or predation; (D) the inadequacy of existing regulatory mechanisms; or (E) other natural or manmade factors affecting its continued existence.

We have carefully assessed the best scientific and commercial information available regarding the past, present, and future threats to the candy darter. Our analysis of this information indicates that, at the species level, hybridization with variegate darters (Factor E) is the most influential factor affecting the candy darter now and into the future. Excessive sedimentation and increased water temperatures degraded once-suitable habitat (Factor A) and likely caused historical declines of the candy darter. We also analyzed existing regulatory mechanisms (such as the Federal Clean Water Act of 1977 (33 U.S.C. 1251 et seq.), Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1234-1328), West Virginia Water Pollution Control Act (WVSC § 22-11) and the increased implementation of forestry and construction “best management practices” designed to reduce erosion and sedimentation) (Factor D) to reduce or eliminate sedimentation and found that these mechanisms were not sufficient to protect the species from extinction as excessive sedimentation and increased water temperatures continue to affect some of the remaining populations. There may be additional infrastructure projects (e.g., roads, pipeline, etc.) that increase sediment loading within the range of the candy darter as a result of stream crossings or forest clearing for permanent rights of way. Additionally, the current level of habitat fragmentation (Factor A) isolates some populations, which reduces gene flow and limits the potential for the species to colonize or recolonize streams if habitat conditions change. Other factors such as flow alterations and water quality degradation that affect habitat (Factor A), and the stocking of nonnative species that can eat (Factor C) or outcompete (Factor E) the candy darter are not expected to cause species-level effects. In addition, we have no evidence that overutilization (Factor B) or disease (Factor C) is affecting individuals or populations of candy darters.

Active hybridization with variegate darters has occurred or is currently occurring in multiple streams within the Lower New, Lower Gauley, and Greenbrier River watersheds in West Virginia (Service 2018, p. 37). Although variegate darter individuals have not yet been detected in the remainder of the candy darter's range (i.e., the Middle New and Upper New watersheds in Virginia), variegate darter alleles have been detected in two separate locations in the Upper Gauley watershed, indicating that hybridization occurred at one time and currently likely underway. Additionally, the risk is moderately high that variegate darter introductions will continue to occur in these watersheds because if watersheds occupied by variegate darters (and hybrids) are adjacent to candy darter watersheds, the likelihood that variegate darters will be collected as bait and transported into an adjacent candy darter watershed is increased. When this happens, variegate darters ultimately replace most candy darter populations throughout the candy darter's range. The Act defines an endangered species as any species that is “in danger of extinction throughout all or a significant portion of its range.” We find that an endangered species status is appropriate for the candy darter because the species is facing a catastrophic threat from which the risk of extinction is imminent and certain. The introduction of variegate darters is occurring, and the consequence that it will extirpate any local candy darter population that variegate darters come into sustained contact with is imminent and certain across the species' remaining range. As a result of their limited range and/or population size, narrowly endemic species are inherently vulnerable to extinction when subject to elevated threats. The candy darter has a moderately small range, which has only become more restricted, as 77 percent (27 of 35 populations (see SSA report, table 4)) of its range has been lost through historical land use changes and/or has been invaded by the variegate darter. Therefore, we conclude that the current risk of extinction of the candy darter is such that it does not meet the definition of a threatened species under the Act.

The Act defines an endangered species as any species that is “in danger of extinction throughout all or a significant portion of its range” and a threatened species as any species “that is likely to become endangered throughout all or a significant portion of its range within the foreseeable future.” We find that the candy darter is presently in danger of extinction throughout its entire range based on the severity and immediacy of threats currently affecting the species. The overall range has been significantly reduced, and the remaining populations are threatened by hybridization and, to a lesser extent, a combination of other threats, reducing the overall viability of the species. The risk of extinction is high because the remaining populations are isolated and the threat of hybridization is ongoing and increasing. Therefore, on the basis of the best available scientific and commercial data, we are listing the candy darter as endangered in accordance with sections 3(6) and 4(a)(1) of the Act. We find that a threatened species status is not appropriate for the candy darter because of the reasons previously outlined and because the threats, which occur throughout the species' range, are expected to continue to increase, putting the species at risk of extinction now.

Under the Act and our implementing regulations, a species may warrant listing if it is endangered or threatened throughout all or a significant portion of its range. Because we have determined that the candy darter is in danger of extinction throughout its range, we find it unnecessary to proceed to an evaluation of potentially significant portions of the range. Where the best available information allows the Services to determine a status for the species rangewide, that determination should be given conclusive weight because a rangewide determination of status more accurately reflects the species' degree of imperilment and better promotes the purposes of the statute. Under this reading, we should first consider whether listing is appropriate based on a rangewide analysis and proceed to conduct a “significant portion of its range” analysis if, and only if, a species does not qualify for listing as either endangered or threatened according to the “all” language. We note that the court in Desert Survivors v. Department of the Interior, No. 16-cv-01165-JCS, 2018 WL 4053447 (N.D. Cal. Aug. 24, 2018), did not address this issue, and our conclusion is therefore consistent with the opinion in that case.

Conservation measures provided to species listed as endangered or threatened species under the Act include recognition, recovery actions, requirements for Federal protection, and prohibitions against certain practices. Recognition through listing results in public awareness, and conservation by Federal, state, Tribal, and local agencies; private organizations; and individuals. The Act encourages cooperation with the States and requires that recovery actions be carried out for all listed species. The protection required by Federal agencies and the prohibitions against certain activities are discussed, in part, below.

The primary purpose of the Act is the conservation of endangered and threatened species and the ecosystems upon which they depend. The ultimate goal of such conservation efforts is the recovery of these listed species, so that they no longer need the protective measures of the Act. Subsection 4(f) of the Act requires the Service to develop and implement recovery plans for the conservation of endangered and threatened species. The recovery planning process involves the identification of actions that are necessary to halt or reverse the species' decline by addressing the threats to its survival and recovery. The goal of this process is to restore listed species to a point where they are secure, self-sustaining, and functioning components of their ecosystems.

Recovery planning includes the development of a recovery outline shortly after a species is listed and preparation of a draft and final recovery plan. The recovery outline guides the immediate implementation of urgent recovery actions and describes the process to be used to develop a recovery plan. As part of our conservation strategy for the candy darter, which will inform the forthcoming recovery outline and informs the proposed critical habitat rule published elsewhere in today's Federal Register, we identified the need to reestablish candy darter populations within areas of its historical range. Because the candy darter is extirpated from some areas and natural repopulation is not possible without human assistance, use of a 10(j) rule under the Act may be one appropriate tool to achieve this recovery objective. An overview of the process to establish an experimental population under section 10(j) of the Act is described in detail in the proposed critical habitat rule published elsewhere in today's Federal Register. In addition to using the authorities under 10(j) of the Act in areas not currently occupied by the candy darter, the condition of existing candy darter populations may be improved by working with non-Federal landowners through safe harbor agreements, authorized under section 10(a)(1)(A) of the Act. More information about safe harbor agreements can be found online at: https://www.fws.gov/endangered/landowners/safe-harbor-agreements.html. We intend to fully explore all of the appropriate recovery tools for the candy darter with our State, Federal, non-governmental, and private partners.

The recovery plan identifies site-specific management actions that set a trigger for review of whether a species remains endangered or may be reclassified from endangered to threatened (“downlisted”) or removed from the Lists of Endangered and Threatened Wildlife and Plants (“delisted”), and methods for monitoring recovery progress. Recovery plans also establish a framework for agencies to coordinate their recovery efforts and provide estimates of the cost of implementing recovery tasks. Recovery teams (composed of species experts, Federal and State agencies, nongovernmental organizations, and stakeholders) are often established to develop recovery plans. When completed, the recovery outline, draft recovery plan, and the final recovery plan will be available on our website (http://www.fws.gov/endangered) or from the person listed under FOR FURTHER INFORMATION CONTACT.

Implementation of recovery actions generally requires the participation of a broad range of partners, including other Federal agencies, states, Tribes, nongovernmental organizations, businesses, and private landowners. Examples of recovery actions include habitat restoration (e.g., restoration of native vegetation), research, captive propagation and reintroduction, and outreach and education. The recovery of many listed species cannot be accomplished solely on Federal lands because their range may occur primarily or solely on non-Federal lands. Achieving recovery of these species requires cooperative conservation efforts on private, state, and Tribal lands.

Following publication of this final listing rule, funding for recovery actions will be available from a variety of sources, including Federal budgets, state programs, and cost share grants for non-Federal landowners, the academic community, and nongovernmental organizations. In addition, pursuant to section 6 of the Act, the States of Virginia and West Virginia will be eligible for Federal funds to implement management actions that promote the recovery of the candy darter. Information on our grant programs that are available to aid species recovery can be found at: http://www.fws.gov/grants.

Please let us know if you are interested in participating in recovery efforts for the candy darter. Additionally, we invite you to submit any new information on this species whenever it becomes available and any information you may have for recovery planning purposes (see FOR FURTHER INFORMATION CONTACT).

Section 7(a) of the Act requires Federal agencies to evaluate their actions with respect to any species that is listed as an endangered or threatened species and with respect to its critical habitat, if any is designated. Regulations implementing this interagency cooperation provision of the Act are codified at 50 CFR part 402. Section 7(a)(2) of the Act requires Federal agencies to ensure that activities they authorize, fund, or carry out are not likely to jeopardize the continued existence of any endangered or threatened species or destroy or adversely modify its critical habitat. If a Federal action may affect a listed species or its critical habitat, the responsible Federal agency must enter into consultation with the Service.

Federal agency actions within the species' habitat that may require consultation as described in the preceding paragraph include, but are not limited to, management (e.g., captive propagation) and any other landscape-altering activities on Federal lands administered by the U.S. Forest Service (Monongahela and the George Washington and Jefferson National Forests) and the National Park Service; issuance of section 404 Clean Water Act (33 U.S.C. 1251 et seq.) permits by the U.S. Army Corps of Engineers; and construction and maintenance of roads or highways by the Federal Highway Administration.

The Act and its implementing regulations set forth a series of general prohibitions and exceptions that apply to endangered wildlife. The prohibitions of section 9(a)(1) of the Act, codified at 50 CFR 17.21, make it illegal for any person subject to the jurisdiction of the United States to take (which includes harass, harm, pursue, hunt, shoot, wound, kill, trap, capture, or collect; or to attempt any of these) endangered wildlife within the United States or on the high seas. In addition, it is unlawful to import; export; deliver, receive, carry, transport, or ship in interstate or foreign commerce in the course of commercial activity; or sell or offer for sale in interstate or foreign commerce any listed species. It is also illegal to possess, sell, deliver, carry, transport, or ship any such wildlife that has been taken illegally. Certain exceptions apply to employees of the Service, the National Marine Fisheries Service, other Federal land management agencies, and State conservation agencies.

We may issue permits to carry out otherwise prohibited activities involving endangered wildlife under certain circumstances. Regulations governing permits are codified at 50 CFR 17.22. With regard to endangered wildlife, a permit may be issued for the following purposes: For scientific purposes, to enhance the propagation or survival of the species, and for incidental take in connection with otherwise lawful activities. There are also certain statutory exemptions from the prohibitions, which are found in sections 9 and 10 of the Act.

It is our policy, as published in the Federal Register on July 1, 1994 (59 FR 34272), to identify to the maximum extent practicable at the time a species is listed, those activities that would or would not constitute a violation of section 9 of the Act. The intent of this policy is to increase public awareness of the effect of a final listing on proposed and ongoing activities within the range of a listed species. Based on the best available information, the following actions are unlikely to result in a violation of section 9, if these activities are carried out in accordance with existing regulations and permit requirements; this list is not comprehensive:

• Normal agricultural practices, including herbicide and pesticide use, carried out in accordance with any existing regulations and with permit and label requirements.

Based on the best available information, the following activities may potentially result in a violation of section 9 the Act; this list is not comprehensive:

(1) Introduction of variegate darters into suitable candy darter habitat;

(2) Stocking of nonnative species into suitable candy darter habitat;

(3) Destruction or alteration of the habitat of the candy darter (e.g., unpermitted instream dredging, impoundment, water diversion or withdrawal, channelization, discharge of fill material) that impairs essential behaviors such as breeding, feeding, or sheltering, or results in killing or injuring a candy darter; and

(4) Discharges or dumping of toxic chemicals or other pollutants into waters supporting the candy darter that kills or injures individuals, or otherwise impairs essential life-sustaining behaviors such as breeding, feeding, or finding shelter.

Questions regarding whether specific activities would constitute a violation of section 9 of the Act should be directed, as follows:

• In West Virginia, to the West Virginia Ecological Services Field Office (see FOR FURTHER INFORMATION CONTACT); or

• In Virginia, to the Southwestern Virginia Field Office (330 Cummings Street, Abingdon, VA 24210-3208; telephone 276-623-1233).

We have determined that environmental assessments and environmental impact statements, as defined under the authority of the National Environmental Policy Act (NEPA; 42 U.S.C. 4321 et seq.), need not be prepared in connection with listing a species as an endangered or threatened species under the Endangered Species Act. We published a notice outlining our reasons for this determination in the Federal Register on October 25, 1983 (48 FR 49244).

In accordance with the President's memorandum of April 29, 1994 (Government-to-Government Relations with Native American Tribal Governments; 59 FR 22951), Executive Order 13175 (Consultation and Coordination With Indian Tribal Governments), and the Department of the Interior's manual at 512 DM 2, we readily acknowledge our responsibility to communicate meaningfully with recognized Federal Tribes on a government-to-government basis. In accordance with Secretarial Order 3206 of June 5, 1997 (American Indian Tribal Rights, Federal-Tribal Trust Responsibilities, and the Endangered Species Act), we readily acknowledge our responsibilities to work directly with Tribes in developing programs for healthy ecosystems, to acknowledge that tribal lands are not subject to the same controls as Federal public lands, to remain sensitive to Indian culture, and to make information available to tribes. The candy darter does not occur on federally recognized Tribal or Tribal interest lands.

A complete list of references cited in this rulemaking is available on the internet at http://www.regulations.gov and upon request from the West Virginia Ecological Services Field Office (see FOR FURTHER INFORMATION CONTACT).

The primary authors of this final rule are the staff members of the Services' Species Assessment Team, the West Virginia Ecological Services Field Office, and the Southwestern Virginia Ecological Services Field Office.

Accordingly, we amend part 17, subchapter B of chapter I, title 50 of the Code of Federal Regulations, as follows:

NMFS manages the groundfish fishery in the GOA exclusive economic zone according to the Fishery Management Plan for Groundfish of the Gulf of Alaska (FMP) prepared by the North Pacific Fishery Management Council under authority of the Magnuson-Stevens Fishery Conservation and Management Act. Regulations governing fishing by U.S. vessels in accordance with the FMP appear at subpart H of 50 CFR part 600 and 50 CFR part 679.

The 2018 Pacific cod apportionment for catcher/processors using trawl gear in the Central Regulatory Area of the GOA is 253 metric tons (mt) as established by the final 2018 and 2019 harvest specifications for groundfish of the GOA (83 FR 8768, March 1, 2018).

In accordance with § 679.20(d)(2), the Administrator, Alaska Region, NMFS, has determined that the 2018 Pacific cod apportionment for catcher/processors using trawl gear in the Central Regulatory Area of the GOA will be reached. Therefore, NMFS is requiring that Pacific cod by catcher/processors using trawl gear in the Central Regulatory Area of the GOA be treated as prohibited species in accordance with § 679.21(b).

This action responds to the best available information recently obtained from the fishery. The Assistant Administrator for Fisheries, NOAA (AA), finds good cause to waive the requirement to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such requirement is impracticable and contrary to the public interest. This requirement is impracticable and contrary to the public interest as it would prevent NMFS from responding to the most recent fisheries data in a timely fashion and would delay prohibiting the retention of Pacific cod by catcher/processors using trawl gear in the Central Regulatory Area of the GOA. NMFS was unable to publish a notice providing time for public comment because the most recent, relevant data only became available as of November 15, 2018.

The AA also finds good cause to waive the 30-day delay in the effective date of this action under 5 U.S.C. 553(d)(3). This finding is based upon the reasons provided above for waiver of prior notice and opportunity for public comment.

This action is required by § 679.20 and § 679.21 and is exempt from review under Executive Order 12866.