| Page Range | 61309-61507 | |
| FR Document |
| Page and Subject | |
|---|---|
| 83 FR 61505 - Blocking Property of Certain Persons Contributing to the Situation in Nicaragua | |
| 83 FR 61503 - Delegation of Authorities Under Section 1757 of the National Defense Authorization Act for Fiscal Year 2019 | |
| 83 FR 61379 - Sunshine Act Meeting | |
| 83 FR 61393 - Sunshine Act Meetings | |
| 83 FR 61320 - Schedules of Controlled Substances: Placement of Furanyl Fentanyl, 4-Fluoroisobutyryl Fentanyl, Acryl Fentanyl, Tetrahydrofuranyl Fentanyl, and Ocfentanil in Schedule I | |
| 83 FR 61374 - Submission for OMB Review; Comment Request | |
| 83 FR 61323 - Regulated Navigation Area; Upper Mississippi River, Sabula Railroad Bridge, Mile Marker 535, Sabula, IA | |
| 83 FR 61377 - Agency Information Collection Activities: Submission for OMB Review; Comment Request | |
| 83 FR 61383 - Agency Information Collection Activities: Submission for OMB Review; Comment Request | |
| 83 FR 61399 - Petition for Exemption; Summary of Petition Received; Beverly Hills Aerials, LLC | |
| 83 FR 61400 - Petition for Exemption; Summary of Petition Received; Overwatch Aero, LLC | |
| 83 FR 61379 - Notice of Agreements Filed | |
| 83 FR 61380 - Change in Bank Control Notices; Acquisitions of Shares of a Bank or Bank Holding Company | |
| 83 FR 61376 - Agency Information Collection Activities: Submission for OMB Review; Comment Request | |
| 83 FR 61378 - Agency Information Collection Activities: Submission for OMB Review; Comment Request | |
| 83 FR 61382 - Common Formats for Patient Safety Data Collection | |
| 83 FR 61395 - Privacy Act of 1974; System of Records | |
| 83 FR 61398 - 30-Day Notice of Proposed Information Collection: Nonimmigrant Treaty Trader/Investor Application | |
| 83 FR 61394 - Membership of the National Endowment for the Arts Senior Executive Service Performance Review Board | |
| 83 FR 61379 - Notice of Request for Comment on the Annual Report for Fiscal Year 2018 and Three-Year Plan | |
| 83 FR 61380 - Agency Information Collection Activities; Proposed Collection; Comment Request; Extension | |
| 83 FR 61393 - Proposed Extension of Information Collection; Ground Control for Surface Coal Mines and Surface Work Areas of Underground Coal Mines | |
| 83 FR 61387 - Recommendations for Dual 510(k) and Clinical Laboratory Improvement Amendments Waiver by Application Studies; Draft Guidance for Industry and Food and Drug Administration Staff; Availability | |
| 83 FR 61391 - Select Updates for Recommendations for Clinical Laboratory Improvement Amendments of 1988 Waiver Applications for Manufacturers of In Vitro Diagnostic Devices; Draft Guidance for Industry and Food and Drug Administration Staff; Availability | |
| 83 FR 61385 - Prescription Drug User Fee Act of 2017; Electronic Submissions and Data Standards; Announcement of Public Meeting; Request for Comments | |
| 83 FR 61373 - Submission for OMB Review; Comment Request | |
| 83 FR 61375 - Endangered Species; File Nos. 19641-01, 20340-05, 20347-03, 20528-02, and 22671 | |
| 83 FR 61318 - Technical Corrections to the Vessel Repair Unit Regulations | |
| 83 FR 61388 - Product-Specific Guidances; Draft and Revised Draft Guidances for Industry; Availability | |
| 83 FR 61401 - Agency Information Collection Activities; Submission for OMB Review; Comment Request; Voluntary Chemist Certification Program Applications, Notices, and Records | |
| 83 FR 61402 - Agency Information Collection Activities; Submission for OMB Review; Comment Request; Multiple Tax and Trade Bureau Information Collection Requests | |
| 83 FR 61400 - Agency Information Collection Activities; Submission for OMB Review; Comment Request; Multiple FinCEN Information Collection Requests | |
| 83 FR 61385 - Notice of Allotment Percentages to States for Child Welfare Services State Grants; CFDA Number: 93.645 | |
| 83 FR 61342 - Title I-Improving the Academic Achievement of the Disadvantaged; Education of Migratory Children | |
| 83 FR 61326 - Air Plan Approval; California; South Coast Air Quality Management District | |
| 83 FR 61398 - 30-Day Notice of Proposed Information Collection: Iraqi Citizens and Nationals Employed by U.S. Federal Contractors and Grantees | |
| 83 FR 61328 - Approval of Air Quality Implementation Plans; Puerto Rico; Infrastructure Requirements for the 1997 and 2008 Ozone, 1997 and 2006 Fine Particulate Matter and 2008 Lead NAAQS; Transport Provisions | |
| 83 FR 61346 - Clean Air Plans; 2008 8-Hour Ozone Nonattainment Area Requirements; San Joaquin Valley, California | |
| 83 FR 61336 - Airworthiness Directives; Bombardier, Inc., Airplanes | |
| 83 FR 61358 - Regulation of Business Data Services for Rate-of-Return Local Exchange Carriers; Business Data Services in an Internet Protocol Environment; Special Access for Price Cap Local Exchange Carriers | |
| 83 FR 61365 - VA Acquisition Regulation: Environment, Energy and Water Efficiency, Renewable Energy Technologies, Occupational Safety, and Drug-Free Workplace; Protection of Privacy and Freedom of Information; Other Socioeconomic Programs; and Contract Modifications | |
| 83 FR 61379 - Intent To Conduct a Detailed Economic Impact Analysis | |
| 83 FR 61309 - Revision of Delegations of Authority | |
| 83 FR 61338 - Implementation of Amended Section 203(a)(1)(B) of the Federal Power Act | |
| 83 FR 61330 - Form 325 Data Collection; Modernization of Media Regulation Initiative | |
| 83 FR 61462 - Nondiscrimination on the Basis of Sex in Education Programs or Activities Receiving Federal Financial Assistance | |
| 83 FR 61408 - Prudential Standards for Large Bank Holding Companies and Savings and Loan Holding Companies |
In the printed version of the
National Oceanic and Atmospheric Administration
Federal Energy Regulatory Commission
Agency for Healthcare Research and Quality
Centers for Medicare & Medicaid Services
Children and Families Administration
Food and Drug Administration
Coast Guard
U.S. Customs and Border Protection
Drug Enforcement Administration
Mine Safety and Health Administration
National Endowment for the Arts
Federal Aviation Administration
Consult the Reader Aids section at the end of this issue for phone numbers, online resources, finding aids, and notice of recently enacted public laws.
To subscribe to the Federal Register Table of Contents electronic mailing list, go to https://public.govdelivery.com/accounts/USGPOOFR/subscriber/new, enter your e-mail address, then follow the instructions to join, leave, or manage your subscription.
Office of the Secretary, USDA.
Final rule.
The Secretary of Agriculture is authorized to delegate functions, powers, and duties as the Secretary deems appropriate. This document amends the existing delegations of authority by adding and modifying certain delegations, as explained in the Supplementary Information section below.
Melissa McClellan, Office of the General Counsel, (202) 720-5565,
This rule makes several changes to the United States Department of Agriculture's (USDA) delegations of authority in 7 CFR part 2 by adding new delegations and modifying existing delegations.
Throughout part 2, this rule revises references to “Departmental Management” to read “Departmental Administration” to reflect the renaming of the former Departmental Management mission area, which reports to the Assistant Secretary for Administration.
In addition, the rule revises the delegations in part 2 to reflect the reorganization of the former Office of Procurement and Property Management (OPPM). The Director of the new Office of Contracting and Procurement (OCP) will receive the delegations of authority related to contracting and procurement activities formerly delegated by the Assistant Secretary of Administration to the Director of OPPM. The delegations of authority concerning real and personal property, fleet, and materials management that were formerly delegated by the Assistant Secretary for Administration to the Director of OPPM are now delegated to the Director of the newly established Office of Property and Fleet Management.
The rule further revises the delegations of authority to the Chief Information Officer (CIO) and to the Director of the Office of the Executive Secretariat (OES) at § 2.97 to reflect that the authority to “Administer the Departmental records, forms, reports and Directives Management Programs” has been transferred from OCIO to OES.
Throughout part 2, this rule changes the name of the “Office of Homeland Security and Emergency Coordination” to the “Office of Homeland Security,” and makes changes to the delegations of authority to the Director of OHS, including transferring responsibility for USDA response efforts under the Oil Pollution Act of 1990 from OHS to the Office of Property and Fleet Management.
Pursuant to Secretary's Memorandum 1076-018, this rule establishes new delegations of authority for the Chief Operating Officer of the Farm Production and Conservation (FPAC) Business Center to reflect the consolidation of management support functions for the agencies of the FPAC mission area. The rule also revokes certain delegations of authority to the Administrator of the Farm Service Agency (FSA) that have been transferred to the FPAC Business Center as part of this consolidation of functions.
Similarly, the rule establishes new delegations for the Chief Operating Officer of the Rural Development (RD) Business Center to reflect the consolidation of management support functions for the RD agencies, and revokes certain delegations of authority to the Administrators of the Rural Utilities Service (RUS), Rural Business-Cooperative Service (RBS), and Rural Housing Service (RHS) related to environmental laws that have been transferred to the RD Business Center. In addition, the rule revokes the published delegation of authority to the RHS Administrator to collect, service and liquidate RHS loans, and redelegates these loan servicing functions for the RHS single family housing loan programs to the RD Business Center. The Assistant to the Secretary for RD also may transfer loan servicing for other RHS programs (
The management support functions for the agencies comprising the Research, Education, and Economics (REE) mission area have long been consolidated in an Administrative and Financial Management office organizationally located in the Agricultural Research Service (ARS). This rules updates the existing delegation to the Administrator of ARS to add information technology services to the management support services that the business center in ARS provides to all REE agencies on a reimbursable basis.
Similarly, the management support functions for the agencies in the Marketing and Regulatory Programs mission area have long been consolidated in a business center residing in the Animal and Plant Health Inspection Service (APHIS). This rule updates the existing delegation of authority to the Administrator of APHIS to add information technology services to the consolidated management support functions provided by APHIS to AMS on a reimbursable basis.
This rule further revises the delegations of authority to the Chief Information Officer to reflect that each mission area, rather than each agency, has one Chief Information Officer.
The rule also revises the delegations to recognize the establishment of the Office of Partnerships and Public Engagement (OPPE), which now oversees the Office of Advocacy and Outreach (OAO), the Office of Tribal
This rule also revises the delegations of authority to reflect the elimination of the Grain Inspection, Packers, and Stockyards Administration (GIPSA) as a stand-alone agency, and the transfer of the former GIPSA delegations to the AMS Administrator. This rule further transfers to the AMS Administrator the responsibility to administer the U.S. Warehouse Act (7 U.S.C. 241-273), which was formerly delegated to the FSA Administrator. The rule further consolidates commodity procurement across the Department by transferring delegations related to international commodity procurement from the Under Secretary of FPAC and the FSA Administrator to the Under Secretary for Marketing and Regulatory Programs and the AMS Administrator.
Pursuant to 7 U.S.C. 7653, the Office of Pest Management Policy (OPMP) represents the Department in fulfilling responsibilities related to management of pesticides under the Food Quality Protection Act of 1996, the Federal Insecticide, Fungicide, and Rodenticide Act, and the Federal Food, Drug and Cosmetic Act and other applicable laws, and leads and coordinates the Department's pest management and biotechnology efforts. Prior to the 2017 reorganization of the Department, OPMP was located in ARS, and there were no published delegations of authority to the OPMP Director. This rule reflects the realignment of OPMP within the Office of the Chief Economist (OCE), and establishes a new section of delegations by the Chief Economist to the Director of OPMP at § 2.75. In addition, the rule removes the outdated delegations to the Under Secretary for REE at § 2.21(a)(1)(iii), to the Administrator of ARS at § 2.65(a)(1), and to the Director of the National Institute of Food and Agriculture at § 2.66(a)(115).
This rule further revises the delegations of authority to reflect the realignment of the climate, environmental markets, and energy policy functions of OCE. The new position of Director of the Office of Energy and Environmental Policy (OEEP) will oversee the Office of Energy Policy and New Uses, the Office of Environmental Markets, and the Climate Change Program Office, and will coordinate policy analysis, long-range planning, research priority setting, and response strategies for addressing energy development and environmental policy. To effect this change, the delegations formerly located at § 2.74, related to the Climate Change Program Office, and at § 2.75, related to the Office of Environmental Markets, are now consolidated under the delegations of authority to the Director of OEEP at § 2.73.
This rule also revises the delegations to the Chief Financial Officer (CFO) by adding a new delegation to settle claims that are not otherwise provided for under 31 U.S.C. 3702(a) or another provision of law. Congress granted this claims settlement authority to the Director of the Office of Management and Budget in 31 U.S.C. 3702(a)(4), and the Director further delegated the authority to each Executive Branch agency.
Pursuant to the new delegation at § 2.28(a)(30), the CFO now has the authority to resolve contract claims that are not ratifiable, including as described in the Federal Acquisition Regulation at 48 CFR 1.602-3(d).
This rules also makes the following miscellaneous revisions to the delegations. The authority to collect, summarize, and publish data on the production, distribution, and stocks of sugar is transferred from the Under Secretary for Marketing and Regulatory Programs and AMS Administrator to the Under Secretary for FPAC and FSA Administrator to reflect the current operation of these activities. The delegation of authority to the Under Secretary for FPAC related to defense and emergency preparedness is revised to eliminate references to “foreign agricultural intelligence and other foreign agricultural matters,” which are covered by an existing delegation to the Under Secretary for Trade and Foreign Agricultural Affairs. Finally, the delegations of authority to the Under Secretary for Marketing and Regulatory Programs and the Administrator of AMS have been revised to include updated citations to the Agricultural Marketing Act of 1946.
This rule relates to internal agency management. Accordingly, pursuant to 5 U.S.C. 553, notice of proposed rulemaking and opportunity for comment are not required, and this rule may be made effective less than 30 days after publication in the
Authority delegations (Government agencies).
Accordingly, as discussed in the preamble, 7 CFR part 2 is amended as follows:
7 U.S.C. 6912(a)(1); 5 U.S.C. 301; Reorganization Plan No. 2 of 1953, 3 CFR 1949-1953 Comp., p. 1024.
The work of the Department is under the supervision and control of the Secretary who is assisted by the following general officers: The Deputy Secretary, the Under Secretary for Farm Production and Conservation; the Under Secretary for Food, Nutrition, and Consumer Services, the Under Secretary for Food Safety; the Under Secretary for Marketing and Regulatory Programs; the Under Secretary for Natural Resources and Environment; the Under Secretary for Research, Education, and Economics; the Under Secretary for Trade and Foreign Agricultural Affairs; the Assistant Secretary for Administration; the Assistant Secretary for Civil Rights; the Assistant Secretary for Congressional Relations; the Assistant to the Secretary for Rural Development; the Chief Economist; the Chief Financial Officer; the Chief Information Officer; the General Counsel; the Inspector General; the Judicial Officer; the Director, National Appeals Division; the Director, Office of Budget and Program Analysis; the Director, Office of Communications; the Director, Office of Partnerships and Public Engagement; the Director, Office of Tribal Relations; and the Director, Office of Small and Disadvantaged Business Utilization.
The addition and revisions read as follows:
(a) * * *
(1) * * *
(xvii) Collect, summarize, and publish data on the production, distribution, and stocks of sugar.
(3) * * *
(iv) * * *
(G) The Emergency Conservation Program and the Emergency Watershed Protection Program under sections 401-405 of the Agricultural Credit Act of 1978, 16 U.S.C. 2201-2205.
(6) * * *
(i) Administer responsibilities and functions assigned under the Defense Production Act of 1950 (50 U.S.C. App. 2061
The revisions and additions read as follows:
(a) * * *
(1) * * *
(i) Exercise the functions of the Secretary of Agriculture contained in the Agricultural Marketing Act of 1946, as amended (7 U.S.C. 1621
(viii) * * *
(X) Beef Research and Information Act, as amended (7 U.S.C. 2901-2918), except as delegated to the Under Secretary for Trade and Foreign Agricultural Affairs in §§ 2.26(a)(1)(xiv) and (a)(3)(x);
(xiv) Administer the U.S. Warehouse Act, as amended (7 U.S.C. 241-273), and perform compliance examinations for Agricultural Marketing Services programs.
(xv) Administer commodity procurement and supply, transportation (other than from point of export, except for movement to trust territories or possessions), handling, payment, and related services in connection with programs under titles II and III of Public Law 480 (7 U.S.C. 1691, 1701,
The revision reads as follows:
(a) * * *
(8) * * *
(iii) Administer the Classified Network, Controlled Unclassified Information, and Insider Threat programs of the Department (E.O. 13587; E.O. 13556 and 32 CFR part 2002).
The addition reads as follows:
(a) * * *
(30) Settle claims not otherwise provided for under 31 U.S.C. 3702(a) or another provision of law.
(a) * * *
(16)
(a)
(1) Related to Advocacy and Outreach:
(i) Ensure that small farms and ranches, beginning farmers or ranchers, and socially disadvantaged farmers or ranchers have access to, and equitable participation in, programs and services of the Department pursuant to section 226B(c) of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 6934(c)).
(ii) Oversee the Advisory Committee for Beginning Farmers and Ranchers.
(iii) Oversee the operations of the Office of Small Farms Coordination.
(iv) Administer section 2501 of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 2279), except for authorities related to the Census of Agriculture and economic studies in subsection (h) of that section.
(v) Oversee the Minority Farmer Advisory Committee pursuant to section 14008 of FCEA (7 U.S.C. 2279 note).
(vi) Administer the low-income migrant and seasonal farmworker grants program under section 2281 of the Food, Agriculture, Conservation, and Trade Act of 1990 (42 U.S.C. 5177a).
(vii) Consult with appropriate entities regarding integration of farmworker interests into Department programs, including assisting farmworkers in becoming agricultural producers or landowners, and research, program improvements, and agricultural education opportunities for low-income and migrant seasonal farmworkers.
(viii) Administer the grants program under section 14204 of FCEA (7 U.S.C. 2008q-1) to improve the supply, stability, safety, and training of the agricultural labor force.
(ix) Administer and coordinate a USDA outreach program in collaboration with USDA agencies.
(x) Administer section 2501A of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 2279-1), including the authority to coordinate Department policy for the issuance of receipts under subsection (e) of that section.
(xi) Provide strategic planning and performance measurement, coordinate outreach activities, monitor goals and objectives, and evaluate programs, of Department programs and activities involving small farms or ranches and beginning or socially disadvantaged farmers or ranchers.
(xii) Administer the USDA/1994 Land Grant Institutions (Tribal Colleges) Programs.
(xiii) Administer the USDA/1890 Liaison Officer Program.
(xiv) Administer the Hispanic Serving Institutions National Program, including through the use of cooperative agreements under 7 U.S.C. 3318(b).
(xv) Serve as a lead agency in carrying out student internship programs (7 U.S.C. 2279c).
(xvi) Coordinate outreach to Asian Americans and Pacific Islanders.
(2) Related to Indian tribes:
(i) Serve as the Department's primary point of contact for tribal issues.
(ii) Advise the Secretary on policies related to Indian tribes.
(iii) Serve as the official with principal responsibility for the implementation of Executive Order 13175, “Consultation and Coordination with Indian Tribal Governments,” including the provision of Department-wide guidance and oversight regarding tribal consultation, coordination, and collaboration.
(iv) Coordinate the Department's programs involving assistance to American Indians and Alaska Natives.
(v) Enter into cooperative agreements to improve the coordination and effectiveness of Federal programs, services, and actions affecting rural areas (7 U.S.C. 2204b(b)(4)); and to provide outreach and technical assistance to socially disadvantaged farmers and ranchers and veteran farmers and ranchers (7 U.S.C. 2279(a)(3)).
(3) Oversee the Military Veterans Agricultural Liaison (7 U.S.C. 6919).
(4) Oversee the Center for Faith-Based and Neighborhood Partnerships.
(5) Oversee the Women in Agriculture Initiative.
(6) With the exception of competitive grant programs administered by the National Institute of Food and Agriculture, or any youth employment opportunity programs such as Pathways or Job Corp, serve as the Department lead for strategic planning and coordinating youth outreach activities of USDA agencies' programs (including, but not limited to, 4-H; Science, Technology, Engineering and Math (STEM) programs; information and cyber technology student programs, Future Farmers of America (FFA) activities; summer high school internships; and youth gardening programs); development of program evaluation metrics and consistent messaging for youth outreach activities; and monitoring goals and objectives.
(b) [Reserved]
(a) Delegations. Pursuant to § 2.16(a), subject to the reservations in § 2.16(b)(1), the following delegations of authority are made by the Under Secretary for Farm Production and Conservation to the Chief Operating Officer, Farm Production and Conservation Programs Business Center:
(1) Provide to the Farm Service Agency, Natural Resources Conservation Service, and Risk Management Agency management support services including information technology, financial management, human resources, procurement, property management, and related business and administrative processes.
(2) Administer responsibilities and functions assigned under the Defense Production Act of 1950 (50 U.S.C. App. 2061
(3) Conduct fiscal, accounting and claims functions relating to CCC programs for which the Foreign Agricultural Service has been delegated authority under § 2.601 and, in conjunction with other agencies of the U.S. Government, develop and formulate agreements to reschedule amounts due from foreign countries.
(4) Administer Section 15353(a) of the Food, Conservation, and Energy Act of 2008, Public Law 110-246 relating to information reporting for Commodity Credit Corporation transactions.
(5) Coordinate and prevent duplication of aerial photographic work of the Department, including:
(i) Clearing photography projects;
(ii) Assigning symbols for new aerial photography, maintaining symbol records, and furnishing symbol books;
(iii) Recording departmental aerial photography flow and coordinating the
(iv) Promoting interchange of technical information and techniques to develop lower costs and better quality;
(v) Representing the Department on committees, task forces, work groups, and other similar groups concerned with aerial photography acquisition and reproduction;
(vi) Providing a Chairperson for the Photography Sales Committee of the Department;
(vii) Coordinating development, preparation, and issuance of specifications for aerial photography for the Department;
(viii) Coordinating and performing procurement, inspection, and application of specifications for USDA aerial photography;
(ix) Maintaining library and files of USDA aerial film and retrieving and supplying reproductions on request.
(b) [Reserved]
The addition reads as follows:
(a) * * *
(19) Collect, summarize, and publish data on the production, distribution, and stocks of sugar.
(a)
(2) With respect to land and facilities under the authority of the Assistant to the Secretary for Rural Development, exercise the functions delegated to the Secretary by Executive Order 12580, 3 CFR, 1987 Comp., p. 193, under the following provisions of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (“the Act”), as amended:
(i) Sections 104(a), (b), and (c)(4) of the Act (42 U.S.C. 9604(a), (b), and (c)(4)), with respect to removal and remedial actions in the event of release or threatened release of a hazardous substance, pollutant, or contaminant into the environment;
(ii) Sections 104(e)-(h) of the Act (42 U.S.C. 9604(e)-(h)), with respect to information gathering and access requests and orders; compliance with Federal health and safety standards and wage and labor standards applicable to covered work; and emergency procurement powers;
(iii) Section 104(i)(11) of the Act (42 U.S.C. 9604(i)(11)), with respect to the reduction of exposure to significant risk to human health;
(iv) Section 104(j) of the Act (42 U.S.C. 9604(j)), with respect to the acquisition of real property and interests in real property required to conduct a remedial action;
(v) The first two sentences of section 105(d) of the Act (42 U.S.C. 9605(d)), with respect to petitions for preliminary assessment of a release or threatened release;
(vi) Section 105(f) of the Act (42 U.S.C. 9605(f)), with respect to consideration of the availability of qualified minority firms in awarding contracts, but excluding that portion of section 105(f) pertaining to the annual report to Congress;
(vii) Section 109 of the Act (42 U.S.C. 9609), with respect to the assessment of civil penalties for violations of section 122 of the Act (42 U.S.C. 9622), and the granting of awards to individuals providing information;
(viii) Section 111(f) of the Act (42 U.S.C. 9611(f)), with respect to the designation of officials who may obligate money in the Hazardous Substances Superfund;
(ix) Section 113(k) of the Act (42 U.S.C. 9613(k)), with respect to establishing an administrative record upon which to base the selection of a response action and identifying and notifying potentially responsible parties;
(x) Section 116(a) of the Act (42 U.S.C. 9616(a)), with respect to preliminary assessment and site inspection of facilities;
(xi) Sections 117(a) and (c) of the Act (42 U.S.C. 9617(a) and (c)), with respect to public participation in the preparation of any plan for remedial action and explanation of variances from the final remedial action plan for any remedial action or enforcement action, including any settlement or consent decree entered into;
(xii) Section 119 of the Act (42 U.S.C. 9119), with respect to indemnifying response action contractors;
(xiii) Section 121 of the Act (42 U.S.C. 9621), with respect to cleanup standards; and
(xiv) Section 122 of the Act (42 U.S.C. 9622), with respect to settlements, but excluding section 122(b)(1) of the Act (42 U.S.C. 9622(b)(1)), related to mixed funding agreements.
(3) With respect to facilities and activities under the authority of the Assistant to the Secretary for Rural Development, exercise the authority of the Secretary of Agriculture pursuant to section 1-102 related to compliance with applicable pollution control standards and section 1-601 of Executive Order 12088, 3 CFR, 1978 Comp., p. 243, to enter into an inter-agency agreement with the United States Environmental Protection Agency, or an administrative consent order or a consent judgment in an appropriate State, interstate, or local agency, containing a plan and schedule to achieve and maintain compliance with applicable pollution control standards established pursuant to the following:
(i) Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act, as further amended by the Hazardous and Solid Waste Amendments, and the Federal Facility Compliance Act (42 U.S.C. 6901
(ii) Federal Water Pollution Prevention and Control Act, as amended (33 U.S.C. 1251
(iii) Safe Drinking Water Act, as amended (42 U.S.C. 300f
(iv) Clean Air Act, as amended (42 U.S.C. 7401
(v) Noise Control Act of 1972, as amended (42 U.S.C. 4901
(vi) Toxic Substances Control Act, as amended (15 U.S.C. 2601
(vii) Federal Insecticide, Fungicide, and Rodenticide Act, as amended (7 U.S.C. 136
(viii) Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986 (42 U.S.C. 9601
(4) Collect, service, and liquidate single family housing loans made, insured, or guaranteed by the Rural Housing Service.
(b) [Reserved.]
The revision reads as follows:
(a) * * *
(59) * * * As used herein, the term management support services includes budget, finance, personnel, information technology, procurement, property management, communications, paperwork management, and related administrative services.
(a)
(10)
(ii) Provide liaison with other Federal agencies, through the Office of Science and Technology Policy, regarding climate change issues.
(iii) Inform the Department of scientific developments and policy issues relating to the effects of climate change on agriculture and forestry, including broader issues that affect the impact of climate change on the farms and forests of the United States.
(iv) Recommend to the Chief Economist alternative courses of action with which to respond to such scientific developments and policy issues.
(v) Ensure that recognition of the potential for climate change is fully integrated into the research, planning, and decisionmaking processes of the Department.
(vi) Coordinate global climate change studies.
(vii) Coordinate the participation of the Department in interagency climate-related activities.
(viii) Consult with the National Academy of Sciences and private, academic, State, and local groups with respect to climate research and related activities.
(ix) Represent the Department to the Office of Science and Technology Policy on issues related to climate change.
(x) Represent the Department on the Intergovernmental Panel on Climate Change.
(xi) Review all Department budget items relating to climate change issues, including specifically the research budget to be submitted by the Secretary to the Office of Management and Budget.
(11)
(a)
(1) Coordinate USDA policy relative to the Federal Insecticide, Fungicide, and Rodenticide Act, as amended (7 U.S.C. 136,
(2) [Reserved]
(b) [Reserved]
The revision and additions read as follows:
(a) * * *
(1) Exercise the functions of the Secretary of Agriculture contained in the Agricultural Marketing Act of 1946, as amended (7 U.S.C. 1621
(16) Administer the United States Grain Standards Act, as amended (7 U.S.C. 71-87h).
(17) Administer the Packers and Stockyards Act, 1921, as amended and supplemented.
(18) Enforce provisions of the Consumer Credit Protection Act (15 U.S.C. 1601-1665, 1681-1681t), with respect to any activities subject to the Packers and Stockyards Act, 1921, as amended and supplemented.
(19) Exercise the functions of the Secretary of Agriculture contained in section 1324 of the Food Security Act of 1985 (7 U.S.C. 1631).
(20) Administer responsibilities and functions assigned to the Secretary in section 11006 of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 228 note), with respect to the Packers and Stockyards Act, 1921.
(21) Administer the U. S. Warehouse Act, as amended (7 U.S.C. 241-273), and perform compliance examinations for Agricultural Marketing Services programs.
(22) Administer commodity procurement and supply, transportation (other than from point of export, except for movement to trust territories or possessions), handling, payment, and related services in connection with programs under titles II and III of Public Law 480 (7 U.S.C. 1691, 1701,
(a) * * *
(24) Provide management support services for the Agricultural Marketing Service, as agreed upon by the agencies, with authority to take actions required by law or regulation. As used herein, the
(a)
(1) Promulgate policies, standards, techniques, and procedures, and represent the Department, in the following:
(i) Utilization, value analysis, construction, maintenance, and disposition of real and personal property, including control of space assignments.
(ii) Motor vehicle and aircraft fleet and other vehicular transportation.
(iii) Transportation of things (traffic management).
(iv) Prevention, control, and abatement of pollution with respect to Federal facilities and activities under the control of the Department (Executive Order 12088, “Federal Compliance With Pollution Control Standards,” 3 CFR, 1978 Comp., p. 243).
(v) Development and implementation of sustainable operations actions including establishing and achieving greenhouse gas emission reduction goals, reducing energy intensity, increasing renewable energy use, increasing water efficiency, reducing petroleum use and increasing alternative fuel use, increasing recycling and waste diversion, preventing pollution, reducing use of toxic chemicals, procuring sustainable products and services, achieving sustainable principles for new and existing buildings, promoting electronic stewardship, and continuing environmental management system use. Maintain liaison with the Office of the Federal Environmental Executive, the Council on Environmental Quality, the Office of Management and Budget (OMB), the Department of Energy, and other Government agencies in these matters.
(vi) Implementation of a program for the Federal procurement of biobased products and of a voluntary “USDA Certified Biobased product” labeling program (7 U.S.C. 8102).
(vii) Entering into cooperative agreements to further research programs in the food and agricultural sciences, related to establishing and implementing Federal biobased procurement and voluntary biobased labeling programs (7 U.S.C. 3318).
(2) Exercise the following special authorities:
(i) Maintain custody and permit appropriate use of the official seal of the Department.
(ii) Establish policy for the use of the official flags of the Secretary and the Department.
(iii) Coordinate collection and disposition of personal property of historical significance.
(iv) Make information returns to the Internal Revenue Service as prescribed by 26 U.S.C. 6050M and by 26 CFR 1.6050M-1 and such other Treasury regulations, guidelines or procedures as may be issued by the Internal Revenue Service in accordance with 26 U.S.C. 6050M. This includes making such verifications or certifications as may be required by 26 CFR 1.6050M-1 and making the election allowed by 26 CFR 1.6050M-1(d)(5)(1).
(v) Represent the Department in working with the Government Accountability Office (GAO), the General Services Administration, OMB, and other organizations or agencies on matters related to assigned responsibilities.
(vi) Redelegate, as appropriate, the authority in paragraphs (a)(4) and (a)(6) of this section to agency Property Officials or other qualified agency officials with no power of further redelegation.
(3) Transfer excess research equipment to eligible educational institutions or certain non-profit organizations for the conduct of technical and scientific education and research activities under section 11(i) of the Stevenson-Wydler Technology Innovation Act of 1980 (15 U.S.C. 3710(i)) (7 CFR part 2812).
(4) Promulgate policy and obtain and furnish Federal excess personal property in accordance with section 923 of Public Law 104-127 (7 U.S.C. 2206a), to support research, educational, technical and scientific activities or for related programs, to:
(i) Any 1994 Institutions (as defined in section 532 of the Equity in Educational Land-Grant Status Act of 1994 (Pub. L. 103-382; 7 U.S.C. 301 note)).
(ii) Any Institutions eligible to receive funds under the Act of August 30, 1890 (7 U.S.C. 321,
(iii) Any Hispanic-serving Institutions (as defined in section 316(b) of the Higher Education Act of 1965 (20 U.S.C. 1059c(b)).
(5) Make available to organizations excess or surplus computers or other technical equipment of the Department for the purpose of distribution to cities, towns, or local government entities in rural areas (7 U.S.C. 2206b).
(6) Issue regulations and directives to implement or supplement the Federal Property Management Regulations (41 CFR chapter 101) and the Federal Management Regulation (41 CFR chapter 102).
(7) Related to compliance with environmental laws and sustainable operating requirements.
(i) Serve as Departmental Administration Member and Executive Secretary of the USDA Sustainable Operations Council.
(ii) Represent USDA in consulting or working with the EPA, the Council on Environmental Quality, the Domestic Policy Council, and others to develop policies relating to hazardous materials management and Federal facilities compliance with applicable pollution control laws.
(iii) Monitor, review, evaluate, and oversee hazardous materials management program activities and compliance Department-wide.
(iv) Monitor, review, evaluate, and oversee USDA agency expenditures for hazardous materials management program accomplishments.
(v) Represent USDA on the National Response Team and exercise responsibility for USDA response efforts for hazardous substance releases and oil spills pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended (42 U.S.C. 9601,
(vi) Approve disbursements from the New World Mine Response and Restoration Account, approve the New World Mine Response and Restoration Plan, and make quarterly reports to Congress under Sections 502(d) and (f) of Title V of the Department of the Interior and Related Agencies Appropriations Act of 1998, Public Law 105-83.
(vii) Ensure that the Hazardous Materials Management Program Department-wide is accomplished with regard to, and in compliance with, Executive Order 12898, “Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations,” 3 CFR, 1994 Comp., p. 859.
(viii) Take such action as may be necessary, with the affected agency head and with the concurrence of the General Counsel, including issuance of administrative orders and agreements with any person to perform any response action under sections 106(a) and 122 (except subsection (b)(1)) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended (42 U.S.C. 9606(a), 9622), pursuant to sections 4(c)(3) and 4(d)(3) of Executive Order 12580, “Superfund Implementation,” 3 CFR, 1987 Comp., p. 193, as amended by Executive Order 13016, “Amendment to Executive Order No. 12580,” 3 CFR, 1996 Comp., p. 214.
(ix) Represent USDA on the EPA Brownfields Federal Partnership and coordinate USDA support for Brownfields redevelopment and establish policy and guidance for the implementation of the June 2003 amendment to Executive Order 12580, “Superfund Implementation,” 3 CFR, 1987 Comp., p. 193 (Executive Order 13308, “Further Amendment to Executive Order 12580, As Amended, Superfund Implementation,” 3 CFR, 2003 Comp., p. 239).
(8) Exercise responsibility for USDA response efforts when a spill of national significance is declared under the Oil Pollution Act of 1990, as determined by the Assistant Secretary for Administration.
(b) [Reserved]
(a) * * *
(21) Related to occupational safety and health:
(i) Establish Departmentwide safety and health policy and provide leadership in the development, coordination, and implementation of related standards, techniques, and procedures, and represent the Department in complying with laws, Executive Orders and other policy and procedural issuances and related to occupational safety and health and workers' compensation programs within the Department.
(ii) Represent the Department in all rulemaking, advisory, or legislative capacities on any groups, committees, or Governmentwide activities that affect the USDA Occupational Safety and Health Management Program.
(iii) Determine and provide Departmentwide technical services and regional staff support for the safety and health programs.
(iv) Administer the computerized management information systems for the collection, processing, and dissemination of data related to the Department's occupational safety and health programs.
(v) Administer the Department's Occupational Health and Preventive Medicine Program, as well as design and operate employee assistance and workers' compensation activities.
(vi) Provide education and training on a Departmentwide basis for safety and health-related issues and develop resource and operational manuals.
(22) Redelegate, as appropriate, any authority delegated under paragraphs (a)(1) through (21) of this section to general officers of the Department and heads of Departmental agencies, provided that the Director, Office of Human Resources Management retains the authority to make final decisions in any human resources matter so redelegated.
(a)
(1) Exercise full Departmentwide contracting and procurement authority.
(2) Promulgate policies, standards, techniques, and procedures, and represent the Department, in the following:
(i) Acquisition, including, but not limited to, the procurement of supplies, services, equipment, and construction.
(ii) Socioeconomic programs relating to contracting.
(iii) Selection, standardization, and simplification of program delivery processes utilizing contracts.
(iv) Acquisition and leasing of real and personal property.
(v) Implementation of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (42 U.S.C. 4601,
(vi) Implementation of the policies and procedures set forth in OMB Circular No. A-76, Performance of Commercial Activities.
(3) Exercise the following special authorities:
(i) The Director, Office of Contracting and Procurement, is designated as the Departmental Debarring Officer and authorized to perform the functions of 48 CFR part 9, subpart 9.4 related to procurement activities, except for commodity acquisitions on behalf of the Commodity Credit Corporation (7 CFR part 1407), with authority to redelegate suspension and debarment authority for contracts awarded under the School Lunch and Surplus Removal Programs (42 U.S.C. 1755 and 7 U.S.C. 612c).
(ii) Promulgate regulations for the management of contracting and procurement for information technology and telecommunication equipment, software, services, maintenance and related supplies.
(iii) Represent the Department in working with the Government Accountability Office (GAO), the General Services Administration, OMB, and other organizations or agencies on matters related to assigned responsibilities.
(iv) Conduct liaison with the Office of Federal Register (1 CFR part 16) including the making of required certifications pursuant to 1 CFR part 18.
(4) Exercise authority under the Department's Chief Acquisition Officer (the Assistant Secretary for
(i) Ensure that OMB Circular No. A-109 is effectively implemented in the Department and that the management objectives of the Circular are realized.
(ii) Review the program management of each major system acquisition, excluding information technology.
(iii) Designate the program manager for each major system acquisition, excluding information technology.
(iv) Designate any Departmental acquisition, excluding information technology, as a major system acquisition under OMB Circular No. A-109.
(5) Pursuant to Executive Order 12931, “Federal Procurement Reform,” and 41 U.S.C. 1702(c), serve as the Senior Procurement Executive for the Department with responsibility for the following:
(i) Prescribing and publishing Departmental acquisition policies, advisories, regulations, and procedures.
(ii) Taking any necessary actions consistent with policies, regulations, and procedures, with respect to purchases, contracts, leases, agreements, and other transactions.
(iii) Appointing contracting officers.
(iv) Establishing clear lines and limitations of contracting authority through written delegations of authority.
(v) Approving any Departmental and component agency procurement systems and processes.
(vi) Managing and enhancing career development of the Department's acquisition workforce.
(vii) Participating in the development of Governmentwide procurement policies, regulations and standards, and determining specific areas where Governmentwide performance standards should be established and applied.
(viii) Developing unique Departmental standards as required.
(ix) Overseeing the development of procurement goals, guidelines, and innovation.
(x) Measuring and evaluating procurement office performance against stated goals.
(xi) Advising the Assistant Secretary for Administration whether procurement goals are being achieved.
(xii) Prescribing standards for agency Senior Contracting Officials.
(xiii) Redelegating, suspending, or revoking, as appropriate, the authority in paragraph (a)(5)(i) of this section to agency Senior Contracting Officials or other qualified agency officials with no power of further redelegation.
(xiv) Redelegating, suspending, or revoking, as appropriate, the authorities in paragraphs (a)(5)(ii), (iii), (iv), (vi), and (vii) of this section to agency Senior Contracting Officials or other qualified agency officials with the power of further redelegation.
(6) Represent the Department in establishing standards for acquisition transactions within the electronic data interchange environment.
(7) Designate the Departmental Task Order Ombudsman pursuant to 41 U.S.C. 253j.
(8) Serve as Departmental Remedy Coordination Official pursuant to 41 U.S.C. 255 to determine whether payment to any contractor should be reduced or suspended based on substantial evidence that the request of the contractor for advance, partial, or progress payment is based on fraud.
(9) Review and approve exemptions for USDA contracts, subcontracts, grants, agreements, and loans from the requirements of the Clean Air Act, as amended (42 U.S.C. 7401,
(10) Issue regulations and directives to implement or supplement the Federal Acquisition Regulations (48 CFR chapter 1 and 4).
(12) Pursuant to the Office of Federal Procurement Policy Act (Act), as amended (41 U.S.C. 401,
(i) Reviewing the procurement activities of the Department.
(ii) Developing new initiatives to increase full and open competition.
(iii) Developing goals and plans and recommending actions to increase competition.
(iv) Challenging conditions unnecessarily restricting competition in the acquisition of supplies and services.
(v) Promoting the acquisition of commercial items.
(vi) Designating an Advocate for Competition for each procuring activity within the Department.
(13) In coordination with the Chief Financial Officer, implement the debarment authorities in section 14211 of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 2209j), in connection with procurement activities.
(14) Provide services, including procurement of supplies, services, and equipment, with authority to take actions required by law or regulation to perform such services for:
(i) The Secretary of Agriculture.
(ii) The general officers of the Department, except the Inspector General.
(iii) Any other offices or agencies of the Department as may be agreed, including as a Working Capital Fund activity.
(b) [Reserved]
The revision reads as follows:
(b) * * *
(iv) Administer the Classified Network, Controlled Unclassified Information, and Insider Threat programs of the Department (E.O. 13587; E.O. 13556 and 32 CFR part 2002).
(a) * * *
(3) Administer the Departmental records, forms, reports and directives management programs.
(a)
(1) Ensure that small farms and ranches, beginning farmers or ranchers, and socially disadvantaged farmers or ranchers have access to, and equitable participation in, programs and services of the Department pursuant to section 226B(c) of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 6934(c)).
(2) Oversee the Advisory Committee for Beginning Farmers and Ranchers.
(3) Oversee the operations of the Office of Small Farms Coordination.
(4) Administer section 2501 of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 2279), except for authorities related to the Census of Agriculture and economic studies in subsection (h) of that section.
(5) Oversee the Minority Farmer Advisory Committee pursuant to section 14008 of FCEA (7 U.S.C. 2279 note).
(6) Administer the low-income migrant and seasonal farmworker grants program under section 2281 of the Food, Agriculture, Conservation, and Trade Act of 1990 (42 U.S.C. 5177a).
(7) Consult with appropriate entities regarding integration of farmworker interests into Department programs, including assisting farmworkers in becoming agricultural producers or landowners, and research, program improvements, and agricultural education opportunities for low-income and migrant seasonal farmworkers.
(8) Administer the grants program under section 14204 of FCEA (7 U.S.C. 2008q-1) to improve the supply, stability, safety, and training of the agricultural labor force.
(9) Administer and coordinate a USDA outreach program in collaboration with USDA agencies.
(10) Administer section 2501A of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 2279-1), including the authority to coordinate Department policy for the issuance of receipts under subsection (e) of that section.
(11) Provide strategic planning and performance measurement, coordinate outreach activities, monitor goals and objectives, and evaluate programs, of Department programs and activities involving small farms or ranches and beginning or socially disadvantaged farmers or ranchers.
(12) Administer the USDA/1994 Land Grant Institutions (Tribal Colleges) Programs.
(13) Administer the USDA/1890 Liaison Officer Program.
(14) Administer the Hispanic Serving Institutions National Program, including through the use of cooperative agreements under 7 U.S.C. 3318(b).
(15) Serve as a lead agency in carrying out student internship programs (7 U.S.C. 2279c).
(16) Coordinate outreach to Asian-Americans and Pacific Islanders.
(b) [Reserved]
(a)
(1) Serve as the Department's primary point of contact for tribal issues.
(2) Advise the Secretary on policies related to Indian tribes.
(3) Serve as the official with principal responsibility for the implementation of Executive Order 13175, “Consultation and Coordination with Indian Tribal Governments,” including the provision of Department-wide guidance and oversight regarding tribal consultation, coordination, and collaboration.
(4) Coordinate the Department's programs involving assistance to American Indians and Alaska Natives.
(5) Enter into cooperative agreements to improve the coordination and effectiveness of Federal programs, services, and actions affecting rural areas (7 U.S.C. 2204b(b)(4)); and to provide outreach and technical assistance to socially disadvantaged farmers and ranchers and veteran farmers and ranchers (7 U.S.C. 2279(a)(3)).
(b) [Reserved]
U.S. Customs and Border Protection, Department of Homeland Security.
Final rule; technical amendment.
This document amends the U.S. Customs and Border Protection (CBP) regulations to update provisions relating to the declaration, entry and dutiable status of repair expenditures made abroad for certain vessels to reflect the port of New Orleans, Louisiana as the only Vessel Repair Unit (VRU) location. The amendment will improve the efficiency of vessel repair entry processing, ensure the proper assessment and collection of duties, and make the regulations more transparent.
The final rule is effective November 29, 2018.
Donna Dedeaux, Branch Chief, Cargo and Conveyance Security, at
Under section 466, Tariff Act of 1930, as amended (19 U.S.C. 1466), purchases for or repairs made to certain vessels while they are outside the United States are subject to declaration, entry and payment of ad valorem duty. These requirements are effective upon the first arrival of the affected vessel in any port of the United States. The vessels subject to these requirements include those documented under U.S. law for the foreign or coastwise trades, as well as those which were previously documented under the laws of some foreign nation or are undocumented at the time that the foreign shipyard repairs are performed, but which exhibit an intent to engage in those trades.
The regulations implementing 19 U.S.C. 1466 are found in § 4.14 of the CBP regulations (19 CFR 4.14). Section 4.14 provides that when a vessel subject to the vessel repair statute first arrives into the United States or Puerto Rico following a foreign voyage, the owner, master, or authorized agent, or vessel operator must submit a vessel repair entry and declaration on CBP Form 226
Of the three VRUs listed in § 4.14(g), only the New Orleans location is currently operational. Over the years, there has been a steady decrease in the number of vessel repair entries filed. Based on the small volume of entries being received at the VRU locations in New York and San Francisco and due to CBP's staffing needs, in 2003-2004, CBP informally streamlined VRU operations so that such operations would be performed only at the port of New Orleans VRU. As a result of common practice, the trade generally submits its vessel repair entries directly to the New Orleans VRU.
According to section 553 of the Administrative Procedure Act (APA) (5 U.S.C. 553), rulemaking generally requires prior notice and comment, and a 30-day delayed effective date, subject to specified exceptions. Pursuant to 5 U.S.C. 553(a)(2), matters relating to agency management or personnel are excepted from the requirements of section 553. Additionally, as provided in 5 U.S.C. 553(b)(3)(A), the prior notice and comment and delayed effective date requirements do not apply when agencies promulgate rules concerning agency organization, procedure, or practice.
This rule does not require prior notice and comment because it relates to agency management and agency organization, procedures, or practice. As explained above, the rule merely updates the regulations to reflect the informal streamlining of VRU operations in 2003-2004, so that all vessel repair entries are processed by the New Orleans VRU. As a result of common practice, the trade generally submits its vessel repair entries are now submitted directly to the New Orleans VRU. CBP forwards any such entries received in New York or San Francisco to the New Orleans VRU for processing. Accordingly, this rule does not affect the substantive rights or interests of the public, but merely conforms the regulations to existing agency management and agency procedures and organization. This rule also makes other minor wording changes for clarity and includes a technical update to the regulations to reflect a name change in the referenced office within CBP Headquarters.
Executive Orders 13563 and 12866 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 as a “significant regulatory action,” under section 3(f) of Executive Order 12866. Accordingly, OMB has not reviewed this regulation. This regulation updates CBP's VRU regulations, eliminating costs of processing vessel repair entries that must be forwarded to the New Orleans VRU. Thus, DHS considers this a deregulatory action under Executive Order 13771.
This rule amends an outdated regulation by removing obsolete provisions to reflect the streamlining of VRU operations. Of the three VRUs listed in § 4.14(g), only the New Orleans location is currently operational. Although, as a result of common practice, the trade generally submits its vessel repair entries directly to the New Orleans VRU for processing, some entries are submitted to the other locations listed in the regulations. Vessel Repair Entries are filed on paper and submitted via postal mail and each entry can be hundreds of pages long. Historically, misdirected entries have been forwarded in hard copy to the New Orleans VRU. This rule eliminates the small costs in processing vessel repair entries that may be initially submitted to the other locations that CBP must then forward to the New Orleans, Louisiana VRU. CBP believes the monetized cost savings of the rule to be insignificant due to the small number of vessel repair entries received each year, an average of 540, of which some are not already submitted to the New Orleans VRU. This rule will make the procedures for processing vessel repair entries more efficient for both CBP and the affected population, with zero additional costs.
Because this document is not subject to the notice and public procedure requirements of 5 U.S.C. 553, it is not subject to the provisions of the Regulatory Flexibility Act (5 U.S.C. 601
This document is being issued in accordance with 19 CFR 0.2(a), which provides that the authority of the Secretary of the Treasury with respect to CBP regulations that are not related to customs revenue functions was transferred to the Secretary of Homeland Security pursuant to Section 403(l) of the Homeland Security Act of 2002. Accordingly, this final rule to amend such regulations may be signed by the Secretary of Homeland Security (or his or her delegate).
Customs duties and inspection, Entry procedures, Repairs, Reporting and recordkeeping requirements, Vessels.
For the reasons stated in the preamble, part 4 of the CBP regulations (19 CFR part 4) is amended as set forth below.
5 U.S.C. 301; 19 U.S.C. 66, 1431, 1433, 1434, 1624, 2071 note; 46 U.S.C. 501, 60105.
Section 4.14 also issued under 19 U.S.C. 1466, 1498; 31 U.S.C. 9701.
The revisions read as follows:
(c)
(d)
(e)
(f)
* * * The VRU may grant one 30-day extension of time to submit final cost evidence if a satisfactory written explanation of the need for an extension is received before the expiration of the original 90-day submission period. * * * Questions as to whether an extension should be granted may be referred to the Cargo Security, Carriers & Restricted Merchandise Branch, Office of Trade in CBP Headquarters by the VRU. Any request for an extension beyond a 30-day grant issued by the VRU must be submitted through that unit to the Cargo Security, Carriers & Restricted Merchandise Branch, Office of Trade, CBP Headquarters. * * *
(g)
(i)
(2)
(4)
Drug Enforcement Administration, Department of Justice.
Final order.
With the issuance of this final order, the Acting Administrator of the Drug Enforcement Administration maintains the placement of the substances furanyl fentanyl [
Effective November 29, 2018.
Kathy L. Federico, Regulatory Drafting and Policy Section, Diversion Control Division, Drug Enforcement Administration; Mailing Address: 8701 Morrissette Drive, Springfield, Virginia 22152; Telephone: (202) 598-6812.
Section 201(d)(1) of the Controlled Substances Act (CSA) (21 U.S.C.
On May 15, 2018, the Secretary-General of the United Nations advised the Secretary of State of the United States, that during the 61st session of the Commission on Narcotic Drugs, furanyl fentanyl, 4-fluoroisobutyryl fentanyl, acryl fentanyl, tetrahydrofuranyl fentanyl, and ocfentanil were added to Schedule I of the Single Convention on Narcotic Drugs (1961). This letter was prompted by a decision at the 61st session of the Commission on Narcotic Drugs in March 2018 to schedule furanyl fentanyl, 4-fluoroisobutyryl fentanyl, acryl fentanyl, tetrahydrofuranyl fentanyl, and ocfentanil under Schedule I of the Single Convention on Narcotic Drugs. As a signatory Member State to the Single Convention on Narcotic Drugs, the United States is obligated to control furanyl fentanyl, 4-fluoroisobutyryl fentanyl, acryl fentanyl, tetrahydrofuranyl fentanyl, and ocfentanil under its national drug control legislation, the CSA, in the schedule deemed most appropriate to carry out its international obligations. 21 U.S.C. 811(d)(1).
On November 29, 2016, May 3, 2017, July 14, 2017, October 26, 2017, and February 1, 2018, furanyl fentanyl (81 FR 85873), 4-fluoroisobutyryl fentanyl (82 FR 20544), acryl fentanyl (82 FR 32453), tetrahydrofuranyl fentanyl (82 FR 49504), and ocfentanil (83 FR 4580), respectively, were temporarily placed in schedule I of the CSA upon finding they pose an imminent hazard to the public safety. Furanyl fentanyl, 4-fluoroisobutyryl fentanyl, acryl fentanyl, tetrahydrofuranyl fentanyl, and ocfentanil share pharmacological profiles similar to morphine, fentanyl, and other synthetic opioids. Law enforcement and public health reports demonstrate the illicit use and distribution of these substances, which are available on the internet. Furanyl fentanyl, 4-fluoroisobutyryl fentanyl, acryl fentanyl, tetrahydrofuranyl fentanyl, and ocfentanil are all abused for their opioid-like effects. Evidence suggests the pattern of abuse of these substances parallels that of heroin and prescription opioid analgesics. Because furanyl fentanyl, 4-fluoroisobutyryl fentanyl, acryl fentanyl, tetrahydrofuranyl fentanyl, and ocfentanil can be obtained through illicit sources, information on their purity and potency are unknown; thus these substances pose a significant adverse health risk to the users.
Similar to morphine and fentanyl, furanyl fentanyl, 4-fluoroisobutyryl fentanyl, acryl fentanyl, tetrahydrofuranyl fentanyl, and ocfentanil act as µ-opioid receptor agonists. Data obtained from preclinical studies (
Since 2015, furanyl fentanyl has been encountered by law enforcement and public health officials and the adverse health effects and outcomes are demonstrated by fatal overdose cases. At the time of the temporary scheduling action for furanyl fentanyl in 2016, there were at least 128 confirmed fatalities associated with the misuse and/or abuse of furanyl fentanyl in the United States. According to the National Forensic Laboratory Information System (NFLIS
The DEA is not aware of any claims or any medical or scientific literature suggesting that furanyl fentanyl, 4-fluoroisobutyryl fentanyl, acryl fentanyl, tetrahydrofuranyl fentanyl, and ocfentanil have a currently accepted medical use in treatment in the United States. In addition, the Department of Health and Human Services (HHS) advised DEA, by letters dated July 8, 2016, January 17, 2017, May 2, 2017, July 14, 2017, and November 8, 2017, that there were no investigational new drug applications or approved new drug applications for furanyl fentanyl, 4-fluoroisobutyryl fentanyl, acryl fentanyl, tetrahydrofuranyl fentanyl, and ocfentanil, respectively.
The DEA requested that HHS conduct a scientific and medical evaluation and
In order to meet the United States' obligations under the Single Convention on Narcotic Drugs (1961) and because furanyl fentanyl, 4-fluoroisobutyryl fentanyl, acryl fentanyl, tetrahydrofuranyl fentanyl, and ocfentanil have no currently accepted medical use in treatment in the United States, the Acting Administrator of the Drug Enforcement Administration has determined that these substances should remain in schedule I of the Controlled Substances Act.
Furanyl fentanyl, 4-fluoroisobutyryl fentanyl, acryl fentanyl, tetrahydrofuranyl fentanyl, and ocfentanil have been controlled as schedule I controlled substances since November 29, 2016, May 3, 2017, July 14, 2017, October 26, 2017, and February 1, 2018, respectively. With publication of this final order, furanyl fentanyl, 4-fluoroisobutyryl fentanyl, acryl fentanyl, tetrahydrofuranyl fentanyl, and ocfentanil remain subject to the CSA's schedule I regulatory controls and administrative, civil, and criminal sanctions applicable to the manufacture, distribution, importation, exportation, engagement in research, and conduct of instructional activities with, and possession of schedule I controlled substances including the following:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
This action is not a significant regulatory action as defined by Executive Order 12866 (Regulatory Planning and Review), section 3(f), and the principles reaffirmed in Executive Order 13563 (Improving Regulation and Regulatory Review), and, accordingly, this action has not been reviewed by the Office of Management and Budget (OMB).
This order is not an Executive Order 13771 regulatory action.
This action meets the applicable standards set forth in sections 3(a) and
This action does not have federalism implications warranting the application of Executive Order 13132. This action does not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.
This action does not have tribal implications warranting the application of Executive Order 13175. The action does not have substantial direct effects on one or more Indian tribes, on the relationship between the Federal government and Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes.
The CSA provides for an expedited scheduling action where control is required by the United States obligations under international treaties, conventions, or protocols. 21 U.S.C. 811(d)(1). If control is required pursuant to such international treaty, convention, or protocol, the Attorney General must issue an order controlling such drug under the schedule he deems most appropriate to carry out such obligations, without regard to the findings or procedures otherwise required for scheduling actions.
To the extent that 21 U.S.C. 811(d)(1) directs that if control is required by the United States obligations under international treaties, conventions, or protocols in effect on October 27, 1970, scheduling actions shall be issued by order (as compared to scheduling pursuant to 21 U.S.C. 811(a) by rule), the DEA believes that the notice and comment requirements of section 553 of the Administrative Procedure Act (APA), 5 U.S.C. 553, do not apply to this scheduling action. In the alternative, even if this action does constitute “rule making” under 5 U.S.C. 551(5), this action is exempt from the notice and comment requirements of 5 U.S.C. 553 pursuant to 21 U.S.C. 553(a)(1) as an action involving a foreign affairs function of the United States given that this action is being done in accordance with 21 U.S.C. 811(d)(1)'s requirement that the United States comply with its obligations under the specified international agreements.
The Regulatory Flexibility Act (RFA) (5 U.S.C. 601-612) applies to rules that are subject to notice and comment under section 553(b) of the APA or any other law. As explained above, the CSA exempts this final order from notice and comment. Consequently, the RFA does not apply to this action.
This action does not impose a new collection of information requirement under the Paperwork Reduction Act of 1995. 44 U.S.C. 3501-3521. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number.
This action is not a major rule as defined by the Congressional Review Act (CRA), 5 U.S.C. 804. This order will not result in: “an annual effect on the economy of $100,000,000 or more; a major increase in costs or prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions; or significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based enterprises to compete with foreign based enterprises in domestic and export markets.” However, pursuant to the CRA, the DEA has submitted a copy of this final order to both Houses of Congress and to the Comptroller General.
Administrative practice and procedure, Drug traffic control, Reporting and recordkeeping requirements.
For the reasons set out above, the DEA amends 21 CFR part 1308 as follows:
21 U.S.C. 811, 812, 871(b), 956(b), unless otherwise noted.
The revision and additions to read as follows:
(b) * * *
(4) Acryl fentanyl (
(33) 4-Fluoroisobutyryl fentanyl (
(34) Furanyl fentanyl (
(49) Ocfentanil (
(61) Tetrahydrofuranyl fentanyl (
Coast Guard, DHS.
Temporary final rule.
The Coast Guard established a temporary regulated navigation area for certain navigable waters of the
This rule is effective from November 29, 2018 through November 30, 2018.
To view documents mentioned in this preamble as being available in the docket, go to
If you have questions on this rule, call or email Lieutenant Commander Kody Stitz, Sector Upper Mississippi River Prevention Department U.S. Coast Guard; telephone 314-269-2568, email
On September 16, 2018, a vessel allided with the Sabula Railroad Drawbridge and immediate action was needed to respond to the potential hazards associated with emergency bridge repairs. On September 28, 2018, the Coast Guard published a temporary final rule; request for comments titled Regulated Navigation Area; Upper Mississippi River, Sabula Railroad Drawbridge, Mile Marker 535, Sabula, IA (83 FR 48954). There we stated why we issued the temporary final rule, and invited comments on our proposed regulatory action related to the operational restrictions in the regulated navigation area (RNA). During the comment period that ended on October 15, 2018, we received two comments.
Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the
The Coast Guard is issuing this rule under authority in 33 U.S.C. 1231. The Eighth District Commander has determined that potential hazards associated with emergency bridge repairs following an allision will be a safety concern for vessels transiting southbound through the right descending span, also known as Iowa span, of the Sabula Railroad Drawbridge. This rule is necessary to protect persons, vessels, and the marine environment on the navigable waters of the Upper Mississippi River while the bridge is being repaired. The duration of this rule is intended to cover the period of emergency repairs.
As noted above, we received two comments on our temporary final rule published on September 28, 2018. One comment was unrelated to the substance of the rule, and one comment was not in favor of the rule. The commenter not in favor of the rule disagreed that any navigation should be allowed through the right descending bank span, also known as the Iowa span, of the Sabula Railroad Drawbridge at mile marker (MM) 535 until the rest pier repairs were “substantial[ly] complet[ed].” The commenter stated that the Coast Guard failed to engage with Canadian Pacific Railway engineers to evaluate safety concerns, and expressed general dissatisfaction that the Coast Guard's risk analysis was not fairly balanced against the elevated risks to the bridge pier or potential impact to railroad traffic.
The Coast Guard respectfully disagrees. As a preliminary matter, our rule does provide for a prohibition of southbound navigation under the Iowa span under certain conditions. Moreover, because the emergency repairs are necessary only for the rest pier, rather than the actual bridge support piers, a total closure of waterway traffic may not be necessary under all conditions. The Coast Guard inspected the initial damage to the rest pier, and has been engaged with the bridge owner, the repair contractor, and vessel operators since the initial incident on September 16, 2018. Other than requesting a total closure of the Iowa span and expressing disagreement with the Coast Guard's rule generally, Canadian Pacific Railway did not present any facts, data, or engineering analysis to the Coast Guard to support why a total closure is necessary, or propose alternate vessel operating requirements. Although the repairs have been substantially completed, Canadian Pacific Railway engineers may contact the Sector Upper Mississippi River at any time with further information. There are no changes in regulatory text of this rule from the temporary final rule.
This rule establishes a temporary regulated navigation area from September 21, 2018 through November 30, 2018, or until the emergency bridge repairs are completed, whichever occurs first. The regulated area covers all navigable waters of the Upper Mississippi River under the right descending bank span, also known as the Iowa span, of the Sabula Railroad Drawbridge at mile marker (MM) 535. This rule applies only to southbound vessel transits through the RNA, and depending on the water flow as measured from Lock and Dam 12, this regulation either prohibits transit or establishes operating requirements unless a deviation is authorized by the Captain of the Port Sector Upper Mississippi River or a designated representative.
When the water flow rate as measured from Lock and Dam 12 is 100kcfs or greater, vessels are prohibited from transiting southbound through the RNA unless authorized by the Captain of the Port Sector Upper Mississippi River (COTP) or a designated representative. When the water flow rate as measured from Lock and Dam 12 is less than 100kcfs, vessels may transit southbound through the RNA only if navigating at their slowest safe speed and avoiding contact with any part of the Sabula Railroad Drawbridge and the unprotected rest pier located on the right descending side of the Sabula Railroad Drawbridge.
When the water flow rate as measured from Lock and Dam 12 is less than 100kcfs, vessels engaged in towing may transit southbound through the RNA only if the size of the tow does not exceed 15 barges, the towing vessel possesses a minimum of 250 horsepower per loaded barge in the tow, and the towing vessel uses an assist vessel of at least 1,000 horsepower when pushing three or more barges. If an assist vessel is required by this rule,
The COTP or a designated representative may review, on a case-by-case basis, alternatives to the minimum operating or towing requirements set forth in this rule and may approve a deviation from these requirements should they provide an equivalent level of safety. The COTP or a designated representative may determine, on a case-by-case basis, that although the conditions triggering the RNA may be met, the current potential hazards do not require that each requirement of the RNA be enforced and that only certain of the above-prescribed restrictions are necessary under the circumstances. The COTP or a designated representative may consider environmental factors, the water flow rate at Lock and Dam 12, mitigating safety factors, and the completion progress of the bridge repairs among other factors. The COTP or a designated representative will broadcast notice of such determination and any subsequent changes. Notice that these vessel operational conditions are anticipated to be put into effect, or are in effect, will be given by Broadcast Notice to Mariners, Local Notices to Mariners, Marine Safety Information Broadcasts, and/or actual notice, as appropriate.
We developed this rule after considering numerous statutes and Executive orders related to rulemaking. Below we summarize our analyses based on a number of these statutes and Executive orders, and we discuss First Amendment rights of protestors.
Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. Executive Order 13771 directs agencies to control regulatory costs through a budgeting process. This rule has not been designated a “significant regulatory action,” under Executive Order 12866. Accordingly, this rule has not been reviewed by the Office of Management and Budget (OMB), and pursuant to OMB guidance it is exempt from the requirements of Executive Order 13771.
This regulatory action determination is based on the limited applicability of the rule, the availability of an alternate route, and the ability of the COTP to issue a deviation from the requirements of this rule or suspend enforcement of this rule on a case-by-case basis. This rule only affects southbound vessel transits through the RNA; northbound vessels may transit the RNA at any time without restrictions. In addition, the regulated area only covers the navigable waters under the span of the Sabula Railroad Drawbridge that was damaged in the allision, the right descending span, or Iowa span, of the bridge. Vessels may transit north or southbound through the left descending span, or Illinois span, at any time without restriction. Finally, this rule allows vessels to seek permission to transit through the RNA and/or deviate from the operating requirements, and also allows the COTP to suspend enforcement of particular provisions of the RNA under appropriate circumstances.
The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.
While some owners or operators of vessels intending to transit the temporary regulated navigation area may be small entities, for the reasons stated in section V.A above, this rule will not have a significant economic impact on any vessel owner or operator.
Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed in the
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
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
The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to contact the person listed in the
Harbors, Marine safety, Navigation (water), Reporting and recordkeeping requirements, Security measures, Waterways.
For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:
33 U.S.C. 1231; 50 U.S.C. 191; 33 CFR 1.05-1, 6.04-1, 6.04-6, and 160.5; Department of Homeland Security Delegation No. 0170.1.
(a)
(b)
(c)
(d)
(2) When the water flow rate as measured from Lock and Dam 12 is less than 100 kcfs, vessels may transit southbound through the RNA only under the following conditions:
(i) Vessels shall operate at their slowest safe speed.
(ii) Vessels avoid contacting any part of the Sabula Railroad Drawbridge and the unprotected rest pier located on the right descending side of the Sabula Railroad Drawbridge.
(3) When the water flow rate as measured from Lock and Dam 12 is less than 100 kcfs, vessels engaged in towing may transit southbound through the RNA only under the following conditions:
(i) The size of the tow does not exceed 15 barges; and
(ii) The towing vessel possesses a minimum of 250 horsepower per loaded barge in tow, and
(iii) When pushing more than two barges, an assist vessel of at least 1,000 horsepower must be utilized.
(A) Prior to entering the RNA, the assist tow vessel and the primary tow vessel shall discuss a plan to transit through the bridge, and
(B) Both the primary and assist towing vessel shall be capable of continuous two way voice communication while transiting through the bridge.
(4) If an assist vessel is required under this section, before entering the RNA:
(i) The assist vessel and the tow vessel shall discuss a plan to transit through the bridge, and
(ii) Both the assist vessel and the towing vessel shall be capable of continuous two-way voice communication while transiting through the bridge.
(5) The COTP or a designated representative may review, on a case-by-case basis, alternatives to the minimum operating or towing requirements and conditions set forth in paragraphs (d)(2)-(d)(4) of this section and may approve a deviation to these requirements and conditions should they provide an equivalent level of safety.
(6) The COTP or a designated representative may determine, on a case-by-case basis, that although the conditions triggering the RNA may be met, the current potential hazards do not require that each requirement of the RNA be enforced and that only certain of the above-prescribed restrictions are necessary under the circumstances. The COTP or a designated representative may consider environmental factors, the water flow rate at Lock and Dam 12, mitigating safety factors, and the completion progress of bridge the repairs among other factors. The COTP or a designated representative shall broadcast such notice of such determination and any changes under the provisions of paragraph (e).
(e)
Environmental Protection Agency (EPA).
Final rule.
The Environmental Protection Agency (EPA) is taking final action to approve a revision to the South Coast Air Quality Management District (SCAQMD) portion of the California State Implementation Plan (SIP). This revision concerns emissions of volatile organic compounds (VOCs) from architectural coatings. We are approving a local rule that regulates these emission sources under the Clean Air Act (CAA or the Act).
This rule will be effective on December 31, 2018.
The EPA has established a docket for this action under Docket ID No. EPA-R09-OAR-2016-0711. All documents in the docket are listed on
Arnold Lazarus, EPA Region IX, (415) 972 3024,
Throughout this document, “we,” “us” and “our” refer to the EPA.
On August 8, 2018 (83 FR 39017), the EPA proposed to approve the following rule into the California SIP.
The EPA proposed to approve this rule, except for two sentences that were withdrawn from the submission at the request of the SCAQMD. We proposed to approve this rule because we determined that it complies with the relevant CAA requirements. Our proposed action contains more information on the rule and our evaluation.
The EPA's proposed action provided a 30-day public comment period. During this period, we received four anonymous comments. These comments addressed the Cross State Air Pollution Rule, California wildfires, and science policy. None of the comments addressed Rule 1113 or were germane to our evaluation of Rule 1113.
No comments were submitted that change our assessment of the rule as described in our proposed action. Therefore, as authorized in section 110(k)(3) of the Act, the EPA is fully approving this rule into the California SIP, with the exception of the two sentences withdrawn by the District.
In this rule, the EPA is finalizing regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, the EPA is finalizing the incorporation by reference of the SCAQMD rule described in the amendments to 40 CFR part 52 set forth below. The EPA has made, and will continue to make, these documents available through
Under the Clean Air Act, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, the EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. Accordingly, this action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:
• Is not a significant regulatory action subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);
• Is not an Executive Order 13771 (82 FR 9339, February 2, 2017) regulatory action because SIP approvals are exempted under Executive Order 12866;
• Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501
• Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601
• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);
• Does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);
• Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);
• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);
• Is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the Clean Air Act; and
• Does not provide the EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).
In addition, the SIP is not approved to apply on any Indian reservation land or in any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).
The Congressional Review Act, 5 U.S.C. 801
Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of
Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Ozone, Particulate matter, Reporting and recordkeeping requirements, Volatile organic compounds.
Part 52, Chapter I, Title 40 of the Code of Federal Regulations is amended as follows:
42 U.S.C. 7401
(c) * * *
(404) * * *
(i) * * *
(A) * * *
(
(488) * * *
(i) * * *
(D) South Coast Air Quality Management District.
(
Environmental Protection Agency (EPA).
Final rule.
The Environmental Protection Agency (EPA) is approving State Implementation Plan (SIP) revision submittals from the Commonwealth of Puerto Rico to address the interstate transport of air pollution that may interfere with attainment and maintenance of the National Ambient Air Quality Standards (NAAQS). In this action, EPA is approving Puerto Rico's submissions pertaining to the 1997 and 2008 ozone, 1997 and 2006 fine particulate matter (PM
This rule is effective on December 31, 2018.
EPA has established a docket for this action under Docket ID No. EPA-R02-OAR-2016-0060. All documents in the docket are listed on the
Kenneth Fradkin, Air Programs Branch, Environmental Protection Agency, 290 Broadway, 25th Floor, New York, New York 10007-1866, (212) 637-3702, or by email at
On July 18, 1997, the Environmental Protection Agency (EPA) promulgated a revised National Ambient Air Quality Standards (NAAQS) for ozone (62 FR 38856) and a new NAAQS for fine particle matter (PM
On October 17, 2006 (71 FR 61144), effective December 18, 2006, EPA revised the 24-hour average PM
On March 27, 2008 (73 FR 16436) EPA strengthened its NAAQS for ground-level ozone, revising the 8-hour primary ozone standard to 0.075 ppm. EPA also strengthened the secondary 8-hour ozone standard to the level of 0.075 ppm making it identical to the revised primary standard.
On November 12, 2008 (73 FR 66964), EPA promulgated a revised NAAQS for lead. The Agency revised the level of the primary lead standard from 1.5 µg/m
Pursuant to section 110(a)(1) of the Clean Air Act (CAA), states are required to submit SIPs meeting the applicable requirements of section 110(a)(2) within three years after promulgation of a new or revised NAAQS or within such shorter period as EPA may prescribe. Section 110(a)(2) requires states to address basic SIP elements such as requirements for monitoring, basic program requirements, and legal authority that are designed to assure attainment and maintenance of the NAAQS. Section 110(a) imposes the obligation upon states to make a SIP submission to EPA for a new or revised NAAQS, but the contents of that submission may vary depending upon the facts and circumstances. In particular, the data and analytical tools available at the time the state develops and submits the SIP for a new or revised NAAQS affect the content of the submission. The content of such SIP submission may also vary depending upon what provisions the state's existing SIP already contains.
More specifically, section 110(a)(1) provides the procedural and timing requirements for SIPs. Section 110(a)(2)
The Commonwealth of Puerto Rico's Environmental Quality Board (PREQB) submitted five SIP revisions to satisfy the requirements of section 110(a)(2) of the CAA for the 1997 and 2008 ozone, 1997 and 2006 PM
On February 19, 2016
In response to EPA's proposed approval of Puerto Rico's SIP revision, a comment was received from one interested party. The comment and EPA's response were included in EPA's September 13, 2016 final rule referenced in the previous section.
EPA is approving Puerto Rico's infrastructure submittals dated November 29, 2006, January 22, 2013 and January 31, 2013, and supplemented April 16, 2015 and February 1, 2016, for the 1997 ozone and PM
A detailed analysis of EPA's review and rationale for approving and disapproving elements of the infrastructure SIP submittals as addressing these CAA requirements may be found in the February 19, 2016 proposed rulemaking action (81 FR 8455) and Technical Support Document (TSD) which are available on line at
Under the CAA, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:
• Is not a significant regulatory action subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);
• Is not an Executive Order 13771 (82 FR 9339, February 2, 2017) regulatory action because SIP approvals are exempted under Executive Order 12866;
• Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501
• Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601
• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);
• Does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);
• Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);
• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);
• Is not subject to requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the Clean Air Act; and
• Does not provide the EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).
In addition, the SIP is not approved to apply on any Indian reservation land or in any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).
The Congressional Review Act, 5 U.S.C. 801
Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United
Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Lead, Nitrogen dioxide, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur oxides, Volatile organic compounds.
42 U.S.C. 7401
For the reasons set forth in the preamble, the Environmental Protection Agency amends part 52 of chapter I, title 40 of the Code of Federal Regulations as follows:
42 U.S.C. 7401
(a)
(b)
(c)
Federal Communications Commission
Final rule.
In this document, the Federal Communications Commission eliminates the annual FCC Form 325 filing requirement for cable television systems as part of its Modernization of Media Regulation Initiative. As set forth below, the Commission finds that marketplace, operational, and technological changes have overtaken the utility of FCC Form 325, rendering it increasingly obsolete, and that much of the information collected by the form can be obtained from alternative sources. Thus, the Commission concludes that eliminating Form 325 will advance the Commission's goal of reducing outdated regulations and unnecessary regulatory burdens that can impede competition and innovation in media markets.
Effective November 29, 2018.
Federal Communications Commission, 445 12th Street SW, Room TW-C305, Washington, DC 20554.
Jamile Kadre,
This is a summary of the Commission's
1. With this
2. Form 325 collects operational information from various cable television systems nationwide, including data about subscriber numbers, equipment information, plant information, frequency and signal distribution information, and programming information. The form is required to be filed annually by: (1) All cable systems with 20,000 or more subscribers (which account for the vast majority of cable subscribers); and (2) a random sampling of smaller cable systems with fewer than 20,000 subscribers. Each December, the Commission sends a notification to each operator required to file Form 325 and instructs the operator to file the form electronically via the FCC's Cable Operations and Licensing System (COALS) within 60 days from the date of the letter.
3. In the
5. With this
6. In light of substantial changes that have taken place in the MVPD marketplace and in the way that cable systems operate, we find that the information collected by Form 325 is far less relevant today than it was when the Commission last considered, and elected to retain, the form in 1999. As NCTA states, Form 325, with its questions about analog operations and system-based organization, does not reflect the technical realities of present-day cable service where “individual systems are no longer representative of today's cable network structure due to the use of fiber interconnects and the elimination of numerous standalone headends.” Importantly, the last time the Commission voted to retain Form 325 in 1999, the cable industry was less than a decade removed from the passage of the Telecommunications Act of 1996 (1996 Act) and the Cable Television Consumer Protection and Competition Act of 1992 (1992 Cable Act)—a time during which the Commission had recently implemented, or was still in the process of implementing, the regulatory mandates of those statutes. It was a time when the MVPD industry—and the prominence of cable operators as video providers—looked very different than it does today. Cable operators at the time accounted for approximately 82 percent of total MVPD subscribers (as compared to roughly 55 percent today) and today's online video streaming services did not yet exist. Accordingly, the Commission noted at the time that Form 325 could be useful for monitoring forthcoming changes in the cable industry, including the introduction of digital cable services. Similarly, the Commission believed that the form could prove useful in collecting information regarding the transition from analog to digital television broadcast signals. Now, the 1996 Act and the 1992 Cable Act are more than 20 years behind us. The digital television transition for full-power broadcast stations occurred over nine years ago and the transition from analog to digital cable service is now almost universal. According to one recent estimate, approximately 97 percent of cable subscribers currently have digital cable service. Therefore, it is clear that many of the expected changes to the cable industry that Form 325 was designed to monitor have already taken place.
7. While we acknowledge that Form 325 may have been useful at one time, and that the data collected by the form have been used by the Commission on various occasions through the years, we find that it has become progressively less useful to, and less used by, the Commission over time and has now reached a point where its limited usefulness can no longer justify its retention. When the Commission elected not to eliminate the form nearly 20 years ago, it envisioned various uses for which the data collected by Form 325 might be useful to the Commission in the future. Today, however, there is little evidence that the information collected by Form 325 continues to be essential for the purposes it once served or could have served. For instance, the Commission found in 1999 that cable modem and set-top box data collected by Form 325 could be useful for “assess[ing] technical capabilities of cable systems and the future of the industry” and that information on channel lineups could be used to “determine the impact of our must-carry and retransmission consent” rules. Similarly, Public Knowledge contends that Form 325 provides information useful to the Commission in fulfilling its obligations under Section 629 to promote the competitive availability of navigation devices. However, recent Commission rulemakings related to Section 629 and retransmission consent relied on third-party sources of data rather than Form 325 to inform their analysis.
8. Indeed, recent instances where the Commission has cited Form 325 data in rulemaking proceedings are extremely limited, and in those instances where it has been cited, it is not clear that the data cited was critical to any major decision or that it was available exclusively via Form 325. For instance, in the most recent example, the Commission cited Form 325 data in a single footnote of an order to estimate the number of low power television (LPTV) and Class A stations carried on cable systems pursuant to mandatory carriage—data which would continue to be available in public inspection files—and one party in that proceeding directly questioned the accuracy of the Commission's estimate. In another example, the Commission used information collected via Form 325 about the number of deployed set-top boxes to affirm a conclusion that applying IP closed captioning rules only to devices with built-in screens would exclude a common means by which consumers view programming. Beyond these examples, the Commission has
9. In addition, although the Commission has been statutorily required to produce an annual report to Congress on “the status of competition in the market for the delivery of video programming,” rather than use the data from Form 325, the Commission has routinely opened a dedicated proceeding and issued a Public Notice to solicit information to compile the report. As Verizon notes, the two most recent annual video competition reports did not cite to Form 325 at all, relying instead on third-party sources for such statistics as subscribers to cable services and the number of homes passed. Indeed, when the Commission sought to rely on the Form 325 data for more substantial use in its
10. In addition to being little used today, we note that the Form 325 data are subject to certain inherent constraints that render them less than ideal and limit the purposes for which they can be used, such as the fact that Form 325 data do not correspond to common geographic units such as census blocks, counties, or DMAs and the Commission “has no reliable method for converting the geographic area of a cable system to such units. As noted above, Form 325 data have not been collected universally across the entire cable industry since the 1990s, and Form 325 is not filed by many of the smallest cable systems, a fact that may render it somewhat less useful for purposes of assessing the latter segment of the cable industry in particular. For example, in determining the carriage of in-state broadcast stations on cable systems for congressionally mandated reports pursuant to the Satellite Television Extension and Localism Act of 2010 (STELA) and the STELA Reauthorization Act of 2014 (STELAR), the Commission noted that many rural counties of interest for purposes of the required reports may be served by cable systems not subject to the Form 325 filing requirement. Given the diminishing relevance of, and alternative sources for, the Form 325 data, any attempt to expand the data collection among the smallest cable systems in order to make the collection more comprehensive would likely entail significant burdens for those systems least able to bear them in exchange for little, if any, offsetting benefit. Moreover, in addition to not being filed by many of the smallest cable systems, Form 325 is not filed by non-cable video providers either (
11. As mentioned above, the Commission has increasingly been turning to public and third-party sources of data to help guide its policymaking. In this regard, we note that information on subscribers, equipment, physical plant, frequency and signal distribution, or programming, such as that currently collected via Form 325, is available through alternative sources. For instance, although Public Knowledge asserts that the data collected via Form 325 provide valuable information on the broadband industry, the Commission noted in the
12. Of course, even after eliminating the Form 325 filing requirement, the Commission retains the ability to obtain data on an as-needed basis. For example, the Commission regularly seeks detailed market-by-market information from applicants in transactions involving MVPDs or internet service providers regarding homes passed, numbers of subscribers, services provided, and competitors faced, among other things. The Commission often seeks similar
13. In short, we believe the information available through all of these alternative sources is sufficiently reliable that we can confidently eliminate Form 325. We therefore disagree with Public Knowledge's assertions that information collected in rulemakings and other proceedings cannot be considered a sufficiently reliable alternative to Form 325 data because firms are not compelled to disclose the information and are not subject to a certification of accuracy. First, we note that there is an expectation that parties submitting comments or data in Commission proceedings will not provide false or misleading information to the Commission, and even if a party provides information that arguably could be seen as biased or one-sided in some way, respondents in Commission proceedings have an opportunity to set the record straight by highlighting such bias for the Commission or submitting their own contrary analyses. Moreover, we note that making false statements to the United States government is punishable by law; therefore, many of the other federal filings mentioned above likely would be at least as reliable and accurate as Form 325 filings, and thus could serve a cross-check function similar to that which Public Knowledge asserts Form 325 data fulfill.
14. In addition, we find that other publicly available sources, including those mentioned above, are likely to be more useful than the information collected by Form 325 in keeping the public informed about the cable industry. Such sources generally present a more up-to-date picture of the industry than Form 325 data, which are currently withheld from the public for three years due to competitive concerns. Furthermore, we note that no commenters in this proceeding state that they are currently using, or have recently used, the Form 325 data for any purpose, which is not surprising given the datedness of the information and the abundance of other sources available. Lastly, although Public Knowledge correctly notes that proprietary information from commercial sources can be expensive and subject to restrictive licensing terms, the Commission analyzes such sources in producing video competition reports and other documents available to the public, and many alternatives to Form 325 data are available to and have been used by commenters in Commission proceedings.
15. While we agree with Public Knowledge that the Commission has a responsibility—and Congress and the public have an interest—in remaining informed about the nature and evolution of the cable industry, we find today that Form 325 does not remain necessary to fulfilling that responsibility.
16. According to commenters, Form 325 is a significant burden to cable operators. ACA, NCTA, and Verizon report substantial time spent on these forms, in excess of Commission estimates. According to NCTA, even if the Commission's two-hour estimate for completion of a Form 325 reflected operators' experience, larger operators “would still need to devote 10 weeks' worth of employee time” to complete the required forms. ACA points to “several reasons for this lengthy timeframe,” including that the form requires gathering of information that is not used in the typical course of business and collaboration among employees who do not typically interface. According to ACA, such a burden is particularly challenging for smaller operators with fewer resources at their disposal. NCTA also asserts that, “[d]epending on internal workload and resources, some operators must hire contract workers to input data.” In addition, both NCTA and ACA point to the need for operators to retain outside counsel “to ensure that sensitive Form 325 data is provided confidential treatment.” While commenters did not provide estimates of the monetary costs associated with completing and filing Form 325, the limited utility of the data collected therein cannot justify the number of hours expended by operators with limited resources in completing Form 325. Further, even the Commission's lower estimate of two hours to complete a Form 325 for each PSID represents a burden that likely outweighs the limited usefulness of Form 325 data today. Finally, we note that the Form 325 data collection also places significant burdens on Commission staff to collect, compile, and maintain the data.
17. In the
18. In sum, we find that the Form 325 is outdated and imposes significant burdens on both cable operators and Commission staff. Because this filing requirement no longer provides sufficient offsetting benefits to justify its retention, we find that its elimination is in the public interest.
19.
20. As required by the Regulatory Flexibility Act of 1980, as amended (RFA), an Initial Regulatory Flexibility Analysis (IRFA) was incorporated in the
21. The
22. No comments were filed in direct response to the IRFA.
23. Pursuant to the Small Business Jobs Act of 2010, which amended the RFA, the Commission is required to respond to any comments filed by the Chief Counsel for Advocacy of the SBA and to provide a detailed statement of any change made to the proposed rules as a result of those comments. The Chief Counsel did not file any comments in response to this proceeding.
24. The RFA directs agencies to provide a description of and, where feasible, an estimate of the number of small entities that will be affected by the rules adopted. The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. A “small business concern” is one which: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the SBA. The final rules adopted herein affect small television and radio broadcast stations and small entities that operate daily newspapers. A description of these small entities, as well as an estimate of the number of such small entities, is provided below.
25.
26.
27. The
28. The RFA requires an agency to describe any significant alternatives that it has considered in reaching its approach, which may include the following four alternatives (among others): (1) The establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance or reporting requirements under the rule for small entities; (3) the use of performance, rather than design, standards; and (4) an exemption from coverage of the rule, or any part thereof, for small entities.
29. In this proceeding, the Commission has three chief alternatives available for Form 325—eliminate the form, modernize and streamline it, or retain it. The Commission finds that marketplace, operational, and technological changes have overtaken Form 325 and rendered it increasingly obsolete, as reflected by the Commission's limited use of Form 325 data and reliance on alternative sources of data that offer the accuracy, timeliness, and ongoing availability that the Commission once looked to Form 325 to provide. The Commission finds further that eliminating the form will benefit small entities by reducing the burden and costs of compliance. Thus, the
30. The Commission will send a copy of the
31. None.
32. Accordingly,
33.
34.
35.
36.
For the reasons discussed in the preamble, the Federal Communications Commission amends 47 CFR parts 0, 1, and 76 of title 47 as follows:
Sec. 5, 48 Stat. 1068, as amended; 47 U.S.C. 155, 225, unless otherwise noted.
47 U.S.C. 151, 154(i), 155, 157, 160, 201, 225, 227, 303, 309, 332, 1403, 1404, 1451, 1452, and 1455, unless otherwise noted.
(e)
47 U.S.C. 151, 152, 153, 154, 301, 302, 302a, 303, 303a, 307, 308, 309, 312, 315, 317, 325, 338, 339, 340, 341, 503, 521, 522, 531, 532, 534, 535, 536, 537, 543, 544, 544a, 545, 548, 549, 552, 554, 556, 558, 560, 561, 571, 572, 573.
Federal Aviation Administration (FAA), DOT.
Notice of proposed rulemaking (NPRM).
We propose to adopt a new airworthiness directive (AD) for certain Bombardier, Inc., Model BD-100-1A10 airplanes. This proposed AD was prompted by a report that certain split ball bearings used in main landing gear (MLG) side brace actuator assemblies are manufactured from material that does not meet the required material properties. This proposed AD would require an inspection of the left and right MLG side brace actuator assembly and, if necessary, replacement of the split ball bearing. We are proposing this AD to address the unsafe condition on these products.
We must receive comments on this proposed AD by January 14, 2019.
You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:
•
•
•
•
For service information identified in this NPRM, contact Bombardier, Inc., 400 Côte-Vertu Road West, Dorval, Québec H4S 1Y9, Canada; telephone 514-855-5000; fax 514-855-7401; email
You may examine the AD docket on the internet at
Darren Gassetto, Aerospace Engineer, Mechanical Systems and Admin Services Section, FAA, New York ACO Branch, 1600 Stewart Avenue, Suite 410, Westbury, NY 11590; telephone 516-228-7323; fax 516-794-5531; email
We invite you to send any written relevant data, views, or arguments about this proposal. Send your comments to an address listed under the
We will post all comments we receive, without change, to
Transport Canada Civil Aviation (TCCA), which is the aviation authority for Canada, has issued Canadian AD CF-2018-20, dated July 27, 2018 (referred to after this as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for certain Bombardier, Inc., Model BD-100-1A10 airplanes. The MCAI states:
The landing gear supplier has informed Bombardier Aerospace about a quality escape involving Main Landing Gear (MLG) side brace actuators that have been assembled using non-conforming split ball bearings. The affected bearings are manufactured from material that does not meet the required material properties. If not corrected, this condition can result in potentially asymmetric MLG gear extension or retraction and subsequent gear collapse during landing.
This AD mandates verification of the installed MLG side brace actuator assemblies and replacement of the affected parts.
You may examine the MCAI in the AD docket on the internet at
Bombardier, Inc., has issued Service Bulletin 100-32-30, dated December 18, 2017, and Service Bulletin 350-32-006, dated December 18, 2017. The service information describes procedures to perform an inspection of the left and right MLG side brace actuator assembly to verify the serial number and replacement of the split ball bearing. These documents are distinct since they apply to airplanes in different configurations. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the
This product has been approved by the aviation authority of another country, and is approved for operation in the United States. Pursuant to our bilateral agreement with the State of Design Authority, we have been notified of the unsafe condition described in the MCAI and service information referenced above. We are proposing this AD because we evaluated all the relevant information and determined
This proposed AD would require accomplishing the actions specified in the service information described previously.
We estimate that this proposed AD affects 468 airplanes of U.S. registry. We estimate the following costs to comply with this proposed AD:
We estimate the following costs to do any necessary on-condition actions that would be required based on the results of the required inspection. We have no way of determining the number of aircraft that might need this on-condition actions:
According to the manufacturer, some or all of the costs of this proposed AD may be covered under warranty, thereby reducing the cost impact on affected individuals. We do not control warranty coverage for affected individuals. As a result, we have included all known costs in our cost estimate.
Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. Subtitle VII: Aviation Programs, describes in more detail the scope of the Agency's authority.
We are issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701: “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action.
This proposed AD is issued in accordance with authority delegated by the Executive Director, Aircraft Certification Service, as authorized by FAA Order 8000.51C. In accordance with that order, issuance of ADs is normally a function of the Compliance and Airworthiness Division, but during this transition period, the Executive Director has delegated the authority to issue ADs applicable to transport category airplanes to the Director of the System Oversight Division.
We determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government.
For the reasons discussed above, I certify this proposed regulation:
1. Is not a “significant regulatory action” under Executive Order 12866;
2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979);
3. Will not affect intrastate aviation in Alaska; and
4. Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.
Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety.
Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows:
49 U.S.C. 106(g), 40113, 44701.
We must receive comments by January 14, 2019.
None.
This AD applies to Bombardier, Inc., Model BD-100-1A10 airplanes, certificated in any category, serial numbers 20003 through 20500 and 20501 through 20665 inclusive.
Air Transport Association (ATA) of America Code 32, Landing gear.
This AD was prompted by a report that certain split ball bearings used in main landing gear (MLG) side brace actuator assemblies are manufactured from material that does not meet the required material properties. We are issuing this AD to address these non-conforming split ball bearings, which, if not corrected, can result in potentially asymmetric MLG extension or retraction and consequent collapse of the MLG during landing.
Comply with this AD within the compliance times specified, unless already done.
At the applicable time specified in figure 1 to paragraphs (g) and (h) of this AD: Perform an inspection to verify the serial number of the left and right MLG side brace actuator assembly P/N 40310-103, in accordance with paragraphs 2.A. and 2.B. of the Accomplishment Instructions of Bombardier Service Bulletin 100-32-30, dated December 18, 2017; or perform an inspection to verify the serial number of the left and right MLG side brace actuator assembly P/N 2-8554-2, in accordance with paragraphs 2.A. and 2.B. of the Accomplishment Instructions of Bombardier Service Bulletin 350-32-006, dated December 18, 2017; as applicable.
If, during the inspection specified in paragraph (g) of this AD, the serial number of the part installed is listed in table 1 of paragraph 2.B. of the Accomplishment Instructions of Bombardier Service Bulletin 100-32-30, dated December 18, 2017; or table 1 of paragraph 2.B. of the Accomplishment Instructions of Bombardier Service Bulletin 350-32-006, dated December 18, 2017; as applicable: at the applicable time specified in figure 1 to paragraphs (g) and (h) of this AD replace the split ball bearing P/N 104467672, in accordance with paragraph 2.C. of the Accomplishment Instructions of Bombardier Service Bulletin 100-32-30, dated December 18, 2017; or paragraph 2.C. of the Accomplishment Instructions of Bombardier Service Bulletin 350-32-006, dated December 18, 2017, as applicable. If the serial number of the installed part is not listed in table 1 of paragraph 2.B. of the Accomplishment Instructions of Bombardier Service Bulletin 100-32-30, dated December 18, 2017; or table 1 of paragraph 2.B. of the Accomplishment Instructions of Bombardier Service Bulletin 350-32-006, dated December 18, 2017; as applicable, no further action is required by this paragraph.
As of the effective date of this AD, no person may install on any Bombardier, Inc., Model BD-100-1A10 airplane, any MLG side brace actuator assembly on with a serial number listed in table 1 of paragraph 2.B. of the Accomplishment Instructions of Bombardier Service Bulletin 100-32-30, dated December 18, 2017; or table 1 of paragraph 2.B. of the Accomplishment Instructions of Bombardier Service Bulletin 350-32-006, dated December 18, 2017; as applicable, unless the split ball bearing P/N 104467672 has been previously replaced as specified in paragraph (h) of this AD.
The following provisions also apply to this AD:
(1)
(2)
(1) Refer to Mandatory Continuing Airworthiness Information (MCAI) Canadian AD CF-2018-20, dated July 27, 2018, for related information. This MCAI may be found in the AD docket on the internet at
(2) For more information about this AD, contact Darren Gassetto, Aerospace Engineer, Mechanical Systems and Admin Services Section, FAA, New York ACO Branch, 1600 Stewart Avenue, Suite 410, Westbury, NY 11590; telephone 516-228-7323; fax 516-794-5531; email
(3) For service information identified in this AD, contact Bombardier, Inc., 400 Côte-Vertu Road West, Dorval, Québec H4S 1Y9, Canada; telephone 514-855-5000; fax 514-855-7401; email
Federal Energy Regulatory Commission, Department of Energy.
Notice of proposed rulemaking.
Pursuant to “An Act to amend section 203 of the Federal Power Act” (Act), the Federal Energy Regulatory Commission (Commission) proposes to revise its regulations relating to mergers or consolidations by a public utility.
Comments are due December 31, 2018.
Comments, identified by docket number, may be filed electronically at
1. On September 28, 2018, “An Act to amend section 203 of the Federal Power Act” (Act) was signed into law. Section 1 of the Act amended section 203(a)(1)(B) to provide that no public utility shall, without first having secured an order of the Commission authorizing it to do so, merge or consolidate, directly or indirectly, its facilities subject to the jurisdiction of the Commission, or any part thereof, with the facilities of any other person, or any part thereof, that are subject to the jurisdiction of the Commission and have a value in excess of $10 million, by any means whatsoever. Section 3 of the Act provides that the amendment to section 203(a)(1)(B) shall take effect 180 days after the date of enactment of the Act. The primary effect of this amendment is to establish a $10 million threshold on transactions that will be subject to the Commission's review and authorization under section 203(a)(1)(B).
2. In section 2 of the Act, Congress amended section 203(a) to add section (a)(7) to require notification for certain transactions. Section 203(a)(7) provides that, not later than 180 days after the date of the enactment of section 203(a)(7), the Commission shall promulgate a rule requiring any public utility that is seeking to merge or consolidate, directly or indirectly, its facilities subject to the jurisdiction of the Commission, or any part thereof, with those of any other person, to notify the Commission of such transactions not later than 30 days after the date on which the transaction is consummated if: (1) The facilities, or any part thereof, to be acquired are of a value in excess of $1 million; and (2) such public utility is not required to secure a Commission order under amended section 203(a)(1)(B). The Commission's proposed implementation of the above changes is discussed below.
3. The Commission proposes two changes to part 33 of its regulations to bring them into conformance with the Act. First, the Commission proposes to revise § 33.1(a)(1)(ii) to provide that part 33 will apply to any public utility seeking authorization under section 203 to merge or consolidate, directly or indirectly, its facilities subject to the jurisdiction of the Commission, or any part thereof, with the facilities of any other person, or any part thereof, that are subject to the jurisdiction of the Commission and have a value in excess of $10 million, by any means whatsoever.
4. Second, the Commission proposes to require public utilities whose transactions are subject to section 203(a)(7) to file notification of such transactions with the Commission. Specifically, the Commission proposes that any public utility that is seeking to merge or consolidate, directly or indirectly, its facilities subject to the jurisdiction of the Commission, or any part thereof, with those of any other person must notify the Commission of such transaction not later than 30 days after the date on which the transaction is consummated if: (1) The facilities, or any part thereof, to be acquired are of a value in excess of $1 million; and (2) such public utility is not required to secure an order of the Commission under section 203(a)(1)(B).
5. In this notification filing, the Commission proposes that public utilities subject to section 203(a)(7) file the following information: (1) The exact name of the public utility and its principal business address; and (2) a narrative description of the transaction, including the identity of all parties involved in the transaction and all jurisdictional facilities associated with or affected by the transaction, the location of such jurisdictional facilities involved in the transaction, the date on which the transaction was consummated, the consideration for the transaction, and the effect of the transaction on the ownership and control of such jurisdictional facilities.
6. New section 203(a)(7)(B) requires that, “[i]n establishing any notification requirement under subparagraph (A), the Commission shall, to the maximum extent practicable, minimize the paperwork burden resulting from the collection of information.” We believe that the information to be included in the proposed notification filing represents a substantial reduction in paperwork from the full filing requirements under part 33 for applications for transactions that are required to secure an order from the Commission under amended section 203(a)(1)(B). Public utilities subject to section 203(a)(7) were previously required to submit complete applications with all relevant information required by part 33. The information to be included in the proposed notification filing represents only a small fraction of the information contemplated in part 33.
7. Further, the information the Commission proposes to require in the notification filing will allow the Commission to monitor the merger or consolidation of facilities subject to its jurisdiction. Although the transactions contemplated pursuant to section 203(a)(7) are unlikely to present concerns under the Commission's public interest analysis and public utilities entering into these transactions are not required to secure an order of the Commission under amended section 203(a)(1)(B), the information the Commission proposes to require in the notification filing will allow the
8. We propose that the notification filing should be filed in the first docket for section 203 filings of the fiscal year (FY). For example, all notification filings made in FY2019 would be filed in Docket No. EC19-1-000; all notification filings for FY2020 would be filed in Docket No. EC20-1-000, etc. We believe that this approach would allow the Commission to track the transactions that fall under section 203(a)(7).
9. Lastly, the Commission clarifies that, except for mergers or consolidations that are valued at $10 million or less, the Commission will not change its interpretation of the transactions that are subject to the jurisdiction of the Commission under the “merge or consolidate” clause of section 203(a)(1)(B). That is, the Commission interprets the amendment by Congress to section 203(a)(1)(B) as establishing a $10 million threshold, but not removing the Commission's jurisdiction to review transactions with a higher value that involve a public utility's acquisition of facilities from non-public utilities
10. The collection of information contained in this Notice of Proposed Rulemaking is subject to review by the Office of Management and Budget (OMB) under section 3507(d) of the Paperwork Reduction Act (PRA).
11. The revisions to the Commission's regulations proposed in this NOPR would bring the regulations in conformance with the amendments to section 203 enacted by Congress. The first revision would implement Congress' amendment to section 203(a)(1)(B), which provides that a public utility must seek authorization to merge or consolidate, directly or indirectly, its facilities subject to the jurisdiction of the Commission, or any part thereof, with the facilities of any other person, or any part thereof, that are subject to the jurisdiction of the Commission and have a value in excess of $10 million, by any means whatsoever. In addition, the Commission proposes to add § 33.12 to its regulations to implement the directive in new section 203(a)(7) that the Commission require a notification filing for mergers or consolidations by a public utility if the facilities to be acquired have a value in excess of $1 million and such public utility is not required to secure Commission authorization under amended section 203(a)(1)(B). The Commission anticipates that the revisions, once effective, would reduce regulatory burdens. The Commission will submit the proposed reporting requirements to OMB for its review and approval under section 3507(d) of the PRA.
12. While the Commission expects that the regulatory revisions proposed herein will reduce the burdens on affected entities, the Commission nonetheless solicits public comments regarding the accuracy of the burden and cost estimates below.
13. Internal review: The Commission has reviewed the proposed changes and has determined that the changes are necessary.
14. Burden Estimate
15. One of the Commission's overarching goals is to promote competition in wholesale power markets, and it has determined that effective competition, as opposed to traditional forms of price regulation, can best protect ratepayer interests. By entering into a certain transaction, a public utility may gain an increased incentive and ability to exercise market power that can be to the detriment of effective competition and customers. As a result, the Commission must review all jurisdictional dispositions, mergers, and acquisitions to evaluate that transaction's effect on competition. The Commission also evaluates whether such transactions have an effect on rates and regulation and whether they result in cross-subsidization. The Commission implements the filing requirements associated with this review in the
16. This NOPR is limited to implementing amended FPA section 203(a)(1)(B) and proposing a notification requirement for certain other transactions, both of which together represent a reduction in the filing requirements for public utilities under section 203. The Commission proposes this rule by mandate of Congress.
17. Interested persons may obtain information on the reporting requirements by contacting the following: Federal Energy Regulatory Commission, 888 First Street NE, Washington, DC 20426 [Attention: Ellen Brown, Office of the Executive Director] Email:
18. Comments concerning the collection of information and the associated burden estimate(s) may also be sent to: Office of Information and Regulatory Affairs, Office of Management and Budget, 725 17th Street NW, Washington, DC 20503 [Attention: Desk Officer for the Federal Energy Regulatory Commission]. Due to security concerns, comments should be sent electronically to the following email address:
19. The Commission is required to prepare an Environmental Assessment or an Environmental Impact Statement for any action that may have a significant adverse effect on the human environment.
20. The Regulatory Flexibility Act of 1980 (RFA)
21. The SBA size standards for electric utilities is based on the number of employees, including affiliates. Under SBA's standards, some transmission owners will fall under the following category and associated size threshold: electric bulk power transmission and control, at 500 employees.
22. The Commission estimates that 26 respondents could file notification filings over the course of a year, with an estimated burden of 1 hour per response, at an estimated cost of $79.00 per respondent. The Commission believes that none of the filers will be small. Therefore, the Commission certifies that this proposed rule will not have a significant economic impact on small entities.
23. The Commission invites interested persons to submit comments on the matters and issues proposed in this document to be adopted, including any related matters or alternative proposals that commenters may wish to discuss. Comments are due December 31, 2018. Comments must refer to Docket No. RM19-4-000, and must include the commenter's name, the organization they represent, if applicable, and their address in their comments.
24. The Commission encourages comments to be filed electronically via the eFiling link on the Commission's website at
25. Commenters that are not able to file comments electronically must send an original of their comments to: Federal Energy Regulatory Commission, Secretary of the Commission, 888 First Street NE, Washington, DC 20426.
26. All comments will be placed in the Commission's public files and may be viewed, printed, or downloaded remotely as described in the Document Availability section below. Commenters on this proposal are not required to serve copies of their comments on other commenters.
27. In addition to publishing the full text of this document in the
28. From the Commission's Home Page on the internet, this information is available on eLibrary. The full text of this document is available on eLibrary in PDF and Microsoft Word format for viewing, printing, and/or downloading. To access this document in eLibrary, type the docket number excluding the last three digits of this document in the docket number field.
29. User assistance is available for eLibrary and the Commission's website during normal business hours from the Commission's Online Support at 202-502-6652 (toll free at 1-866-208-3676) or email at
Electric utilities, Reporting and recordkeeping requirements, Securities.
By direction of the Commission. Commissioner McIntyre is not voting on this order.
In consideration of the foregoing, the Commission proposes to amend part 33, chapter I, title 18,
16 U.S.C. 791a-825r, 2601-2645; 31 U.S.C. 9701; 41 U.S.C. 7101-7352
(a) * * *
(1) * * *
(ii) Merge or consolidate, directly or indirectly, its facilities subject to the jurisdiction of the Commission, or any part thereof, with the facilities of any other person, or any part thereof, that are subject to the jurisdiction of the Commission and have a value in excess of $10 million, by any means whatsoever;
(a) Any public utility that is seeking to merge or consolidate, directly or indirectly, its facilities subject to the jurisdiction of the Commission, or any part thereof, with those of any other person, shall notify the Commission of such transaction not later than 30 days after the date on which the transaction is consummated if:
(1) The facilities, or any part thereof, to be acquired are of a value in excess of $1 million; and
(2) Such public utility is not required to secure an order of the Commission under section 203(a)(1)(B) of the Federal Power Act.
(b) Such notification shall consist of the following information:
(1) The exact name of the public utility and its principal business address; and
(2) A narrative description of the transaction, including the identity of all parties involved in the transaction and all jurisdictional facilities associated with or affected by the transaction, the location of such jurisdictional facilities involved in the transaction, the date on which the transaction was consummated, the consideration for the transaction, and the effect of the transaction on the ownership and control of such jurisdictional facilities.
Office of Elementary and Secondary Education, Department of Education.
Notice of proposed rulemaking.
The Department proposes to modify the current requirements related to the responsibilities of State educational agency (SEA) recipients of funds under title I, part C, of the Elementary and Secondary Education Act of 1965, as amended (ESEA), to conduct annual prospective re-interviews to confirm the eligibility of children under the Migrant Education Program (MEP). Based on input from MEP stakeholders, we propose to clarify who constitutes an independent re-interviewer, and to reduce the costs and burden of prospective re-interviews conducted by independent re-interviewers, while maintaining adequate quality control measures to safeguard the integrity of program eligibility determinations.
We must receive your comments on or before January 28, 2019.
Submit your comments through the Federal eRulemaking Portal or via postal mail, commercial delivery, or hand delivery. We will not accept comments submitted by fax or by email or those submitted after the comment period. To ensure that we do not receive duplicate copies, please submit your comments only once. In addition, please include the Docket ID at the top of your comments.
•
•
Patricia Meyertholen, U.S. Department of Education, 400 Maryland Avenue SW, Room 3E315, Washington, DC 20202. Telephone: (202) 260-1394. Email:
If you use a telecommunications device for the deaf (TDD) or a text telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1-800-877-8339.
Catalog of Federal Domestic Assistance (CFDA) Number: 84.011.
We invite you to assist us in complying with the specific
During and after the comment period, you may inspect all public comments about these proposed regulations by accessing
The Secretary proposes to amend the regulations in 34 CFR 200.89(b)(2), which pertain to an SEA's responsibilities for conducting annual prospective re-interviews for children determined to be eligible for the MEP, as part of the SEA's quality control system.
Final requirements for prospective re-interviewing were published in the
Prospective re-interviewing is required in order to provide a quality control on the accuracy of an SEA's current-year eligibility determinations (
The 2008 requirements stemmed from the Department's concerns about the accuracy and consistency of the processes SEAs had used to determine the eligibility of migratory children and the counts of children eligible for services that SEAs reported to the Department, which were examined in 2004 by the Office of Elementary and Secondary Education and the Office of Inspector General. The examination uncovered widespread errors in program eligibility determinations. In most cases, the errors seemed attributable to the poor training of State and local personnel responsible for determining eligibility, weak quality control procedures for reviewing child eligibility determinations, and a lack of uniformity in the implementation of the MEP eligibility requirements.
Although the accuracy and integrity of program eligibility determinations has vastly improved since 2008, we believe prospective re-interviews remain an essential part of an SEA's quality control system. Maintaining adequate quality control in eligibility determinations is essential to ensuring that MEP-funded services are provided to children who meet the program eligibility criteria, and that the level and quality of those services is not diluted by the delivery of services to children who are not eligible to receive them. In addition, the number of eligible migratory children, as reported by SEAs, is a key factor in determining the amount of MEP funds awarded to SEAs.
We are proposing these amendments to clarify for SEAs that individuals conducting annual prospective re-interviews must be individuals who were not involved in the initial eligibility determination being reviewed, as a quality control measure. This proposed change would codify the method the Department has previously recommended to SEAs through guidance and technical assistance, and is largely consistent with SEAs' current practices. To avoid confusion, the proposed regulations also replace the reference to “current-year” eligibility determinations with the term “current performance reporting period (September 1 to August 31).” A performance reporting period, sometimes referred to as a child count year, is a more specific timeframe: September 1 through August 31. This modification to the regulatory language is consistent with the Department's technical assistance and guidance on prospective re-interviewing, as well as SEAs' current re-interviewing practices. By adding these clarifications to the regulations, we intend to make this information as transparent and accessible as possible.
We also propose to modify the requirement that SEAs use independent re-interviewers at least once every three years. Instead, the regulations would require the use of independent re-interviewers at least once within the first three full performance reporting periods (September 1 through August 31) following the effective date of a major statutory or regulatory change, as determined by the Secretary, that impacts program eligibility, in order to test eligibility determinations made based on the changed eligibility criteria. The entire sample of eligibility determinations to be tested by independent re-interviewers would be drawn from children determined to be eligible after the major statutory or regulatory change takes effect. This change would reduce the frequency of the required use of independent re-interviewers because after using independent re-interviewers at least once within the first three full performance reporting periods following a major statutory or regulatory change, SEAs would not be required to use independent re-interviewers again until an additional major statutory or
In accordance with Executive Order 13777, “Enforcing the Regulatory Reform Agenda,” the Department requested input from the public and identified stakeholders on existing program regulations. As part of that effort, on June 1, 2017, OESE staff contacted two of the largest national organizations representing State MEP directors to request input on whether, in their area of expertise, there are regulations that are unnecessary or in need of revision, and whether there are regulations that are particularly important for the Department to keep in place. In response to this outreach, we received responses from one organization, as well as MEP staff in one SEA. Their proposed alternatives to the current prospective re-interviewing requirements included modifying the timing, reducing the frequency, or reducing the number of re-interviews that SEAs are required to complete.
On June 22, 2017, the Department published in the
In addition, we have received input during ongoing consultation with State MEP directors on possible modifications to the prospective re-interviewing requirements. Most recently, we received input during a November 14, 2017, meeting with the MEP Coordination Work Group, a group of nine State MEP directors who represent State MEP directors in nine U.S. geographic regions.
Under Executive Order 12866, it must be determined whether this regulatory action is “significant” and, therefore, subject to the requirements of the Executive order and subject to review by the Office of Management and Budget (OMB). Section 3(f) of Executive Order 12866 defines a “significant regulatory action” as an action likely to result in a rule that may—
(1) Have an annual effect on the economy of $100 million or more, or adversely affect a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or Tribal governments or communities in a material way (also referred to as an “economically significant” rule);
(2) Create serious inconsistency or otherwise interfere with an action taken or planned by another agency;
(3) Materially alter the budgetary impacts of entitlement grants, user fees, or loan programs or the rights and obligations of recipients thereof; or
(4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles stated in the Executive order.
This proposed regulatory action is not a significant regulatory action subject to review by OMB under section 3(f) of Executive Order 12866.
Under Executive Order 13771, for each new regulation that the Department proposes for notice and comment or otherwise promulgates that is a significant regulatory action under Executive Order 12866 and that imposes total costs greater than zero, it must identify two deregulatory actions. For Fiscal Year 2019, any new incremental costs associated with a new regulation must be fully offset by the elimination of existing costs through deregulatory actions. The proposed regulations are not a significant regulatory action. Therefore, the requirements of Executive Order 13771 do not apply.
We have also reviewed these regulations under Executive Order 13563, which supplements and explicitly reaffirms the principles, structures, and definitions governing regulatory review established in Executive Order 12866. To the extent permitted by law, Executive Order 13563 requires that an agency—
(1) Propose or adopt regulations only upon a reasoned determination that their benefits justify their costs (recognizing that some benefits and costs are difficult to quantify);
(2) Tailor its regulations to impose the least burden on society, consistent with obtaining regulatory objectives and taking into account—among other things and to the extent practicable—the costs of cumulative regulations;
(3) In choosing among alternative regulatory approaches, select those approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity);
(4) To the extent feasible, specify performance objectives, rather than the behavior or manner of compliance a regulated entity must adopt; and
(5) Identify and assess available alternatives to direct regulation, including economic incentives—such as user fees or marketable permits—to encourage the desired behavior, or provide information that enables the public to make choices.
Executive Order 13563 also requires an agency “to use the best available techniques to quantify anticipated present and future benefits and costs as accurately as possible.” The Office of Information and Regulatory Affairs of OMB has emphasized that these techniques may include “identifying changing future compliance costs that might result from technological innovation or anticipated behavioral changes.”
We are issuing these proposed regulations only on a reasoned determination that their benefits would justify their costs. In choosing among alternative regulatory approaches, we selected those approaches that would maximize net benefits. Based on the analysis that follows, the Department believes that these proposed regulations are consistent with the principles in Executive Order 13563.
We also have determined that this regulatory action would not unduly interfere with State, local, and Tribal governments in the exercise of their governmental functions.
In accordance with the Executive orders, the Department has assessed the potential costs and benefits, both quantitative and qualitative, of this regulatory action. The potential costs associated with this regulatory action are those resulting from statutory requirements and those regulatory requirements that we have determined to be necessary for administering the Department's programs and activities.
We anticipate that the proposed changes to these regulations will reduce the cost and burden associated with prospective re-interviewing, specifically the use of independent re-interviewers, for some SEAs. While we believe that SEAs will be required to conduct independent re-interviews less frequently under the proposed regulations than they are required to currently, we cannot predict when statutory changes will occur. Under the current and proposed regulations, to qualify as “independent,” the interviewers must be neither SEA nor local operating agency staff members working to administer or operate the State MEP nor any other persons who worked on the initial eligibility determinations being tested. Although there is no Federal requirement for SEAs to use a specific funding mechanism to support independent re-interviewers, such as a contract, or to use out-of-State personnel who require travel costs, several SEAs have chosen to use such methods and personnel for independent re-interviews. For those SEAs that have chosen to use more costly methods for independent re-interviews, we anticipate that the reduced frequency of independent re-interviews will result in reduced cost and burden. Further, we do not believe that burden will be affected by the proposed change to clarify that annual prospective re-interviews must not be conducted by individuals who were involved in the initial eligibility determination being reviewed, as this is consistent with the current practices of most SEAs.
Elsewhere in this section under
Executive Order 12866 and the Presidential memorandum “Plain Language in Government Writing” require each agency to write regulations that are easy to understand.
The Secretary invites comments on how to make these proposed regulations easier to understand, including answers to questions such as the following:
• Are the requirements in the proposed regulations clearly stated?
• Do the proposed regulations contain technical terms or other wording that interferes with their clarity?
• Does the format of the proposed regulations (grouping and order of sections, use of headings, paragraphing, etc.) aid or reduce their clarity?
• Would the proposed regulations be easier to understand if we divided them into more (but shorter) sections? (A “section” is preceded by the symbol “§ ” and a numbered heading; for example, § 200.89.)
• Could the description of the proposed regulations in the
• What else could we do to make the proposed regulations easier to understand?
To send any comments that concern how the Department could make these proposed regulations easier to understand, see the instructions in the
The Secretary certifies that these proposed regulations would not have a significant economic impact on a substantial number of small entities. Because these proposed regulations would affect only States and State agencies, the proposed regulations would not have an impact on small entities. State and State agencies are not defined as “small entities” in the Regulatory Flexibility Act.
As part of its continuing effort to reduce paperwork and respondent burden, the Department provides the general public and Federal agencies with an opportunity to comment on proposed and continuing collections of information in accordance with the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3506(c)(2)(A)). This helps ensure that the public understands the Department's collection instructions, respondents can provide the requested data in the desired format, reporting burden (time and financial resources) is minimized, collection instruments are clearly understood, and the Department can properly assess the impact of collection requirements on respondents.
These proposed regulations contain information collection requirements that are approved by OMB under OMB control number 1810-0662; these proposed regulations do not affect the currently approved data collection.
A Federal agency may not conduct or sponsor a collection of information unless OMB approves the collection under the PRA and the corresponding information collection instrument displays a currently valid OMB control number. Notwithstanding any other provision of law, no person is required to comply with, or is subject to penalty for failure to comply with, a collection of information if the collection instrument does not display a currently valid OMB control number.
Section 200.89(b)(2) contains an information collection requirement. This information collection has been approved by OMB Control Number 1810-0662. The currently approved collection includes cost and burden estimates based on annual prospective re-interviewing which do not vary based on the specific personnel used for re-interviews, including independent re-interviewers. As SEAs would still be required to conduct prospective re-interviews on an annual basis under the proposed regulations, our cost and burden estimates are unchanged.
We estimate a standard number of hours to conduct re-interviews—including multiple attempts to locate the family and travel to their location (2 hours/child), analyze the findings (1 hour/child), and summarize findings for annual reporting (2 hours/SEA). We estimate costs based on a standard hourly rate for staff conducting re-interviews ($10/hour) and a higher standard hourly rate for staff responsible for analysis and reporting ($25/hour). Some SEAs have elected to use more costly resources and methods when conducting independent re-interviews, such as contracts with private organizations and out-of-State personnel. Since these are not Federal requirements, under the PRA, any increased costs associated with these resources and methods were not factored into the cost and burden estimates in the currently approved collection, and, accordingly, any decreased costs associated with these resources and methods that would result from their less frequent use under the proposed regulations also do not affect the cost and burden estimates. Thus, the burden estimated in the approved information collection remains unchanged.
This program is subject to Executive Order 12372 and the regulations in 34 CFR part 79. One of the objectives of the Executive order is to foster an intergovernmental partnership and a strengthened federalism. The Executive order relies on processes developed by State and local governments for coordination and review of proposed Federal financial assistance.
This document provides early notification of our specific plans and actions for this program.
Executive Order 13132 requires us to ensure meaningful and timely input by State and local elected officials in the development of regulatory policies that have federalism implications. “Federalism implications” means substantial direct effects on the States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of government. The proposed regulations in § 200.89(b) may have federalism implications. We encourage State and local elected officials to review and provide comments on these proposed regulations.
You may also access documents of the Department published in the
Education of disadvantaged, Elementary and secondary education, Grant programs-education, Indians-education, Infants and children, Juvenile delinquency, Migrant labor, Private schools, Reporting and recordkeeping requirements.
For the reasons discussed in the preamble, the Secretary proposes to amend part 200 of title 34 of the Code of Federal Regulations as follows:
20 U.S.C. 6301 through 6576, unless otherwise noted.
The revisions and addition read as follows:
(b) * * *
(2)
(i) Use one or more independent re-interviewers (
(3)
Environmental Protection Agency (EPA).
Proposed rule.
The Environmental Protection Agency (EPA) is proposing to approve portions of two state implementation plan (SIP) revisions submitted by the State of California to meet Clean Air Act (CAA or “the Act”) requirements for the 2008 8-hour ozone national ambient air quality standards (NAAQS or “standards”) in the San Joaquin Valley, California, ozone nonattainment area. First, the EPA is proposing to approve the portion of the “2016 Ozone Plan for the 2008 8-Hour Ozone Standard” (“2016 Ozone Plan”) that addresses the requirement for a base year emissions inventory. Second, the EPA is proposing to approve the portions of the “2018
Written comments must arrive on or before December 31, 2018.
Submit your comments, identified by Docket ID No. EPA-R09-OAR-2018-0535 at
Laura Lawrence, EPA Region IX, (415) 972-3407,
Throughout this document, “we,” “us” and “our” refer to the EPA.
Ground-level ozone pollution is formed from the reaction of volatile organic compounds (VOC) and oxides of nitrogen (NO
Scientific evidence indicates that adverse public health effects occur following exposure to elevated levels of ozone, particularly in children and adults with lung disease. Breathing air containing ozone can reduce lung function and inflame airways, which can increase respiratory symptoms and aggravate asthma or other lung diseases.
Under section 109 of the CAA, the EPA promulgates NAAQS for pervasive air pollutants, such as ozone. The EPA has previously promulgated NAAQS for ozone in 1979 and 1997.
Following promulgation of a new or revised NAAQS, the EPA is required under CAA section 107(d) to designate areas throughout the country as attaining or not attaining the NAAQS. The EPA classifies ozone nonattainment areas under CAA section 181 according to the severity of the ozone pollution problem, with classifications ranging from Marginal to Extreme. State planning and emissions control requirements for ozone are determined, in part, by the nonattainment area's classification. The EPA designated the San Joaquin Valley as nonattainment for the 2008 ozone standards on May 21, 2012, and classified the area as Extreme.
Under the CAA, after the EPA designates areas as nonattainment for a NAAQS, states with nonattainment areas are required to submit SIP revisions. For areas classified Moderate and above, these revisions must provide for, among other things, attainment of the NAAQS within certain prescribed periods that vary depending on the severity of nonattainment. Areas classified as Extreme must attain the NAAQS within 20 years of the effective date of the nonattainment designation.
In California, the California Air Resources Board (CARB or “State”) is the state agency responsible for the adoption and submission to the EPA of California SIPs and SIP revisions, and it has broad authority to establish emissions standards and other requirements for state-wide sources of emissions. Under California law, local and regional air pollution control districts in California are responsible for the regulation of regional/local sources such as stationary sources, and are generally responsible for the development of regional air quality plans. In the San Joaquin Valley, the San Joaquin Valley Air Pollution Control District (SJVAPCD or “District”) develops and adopts air quality
The San Joaquin Valley nonattainment area for the 2008 ozone standards consists of San Joaquin, Stanislaus, Merced, Madera, Fresno, Tulare, and Kings counties, and the western portion of Kern County. The San Joaquin Valley nonattainment area stretches over 250 miles from north to south, averages a width of 80 miles, and encompasses over 23,000 square miles. It is partially enclosed by the Coast Mountain range to the west, the Tehachapi Mountains to the south, and the Sierra Nevada range to the east.
The population of the San Joaquin Valley in 2015 was estimated to be nearly 4.2 million people and is projected to increase by 25.3 percent in 2030 to over 5.2 million people.
States must implement the 2008 ozone standards under Title 1, part D of the CAA, which includes sections 171-179B of subpart 1 (“Nonattainment Areas in General”) and sections 181-185 of subpart 2 (“Additional Provisions for Ozone Nonattainment Areas”). To assist states in developing effective plans to address ozone nonattainment problems, in 2015 the EPA issued a SIP Requirements Rule (SRR) for the 2008 ozone standards (“2008 Ozone SRR”) that addressed implementation of the 2008 standards, including attainment dates, requirements for emissions inventories, attainment and RFP demonstrations, as well as the transition from the 1997 ozone standards to the 2008 ozone standards and associated anti-backsliding requirements.
The EPA's 2008 Ozone SRR was challenged, and on February 16, 2018, the U.S. Court of Appeals for the D.C. Circuit (“D.C. Circuit”) published its decision in
On August 24, 2016, in response to the EPA's designation of the area as nonattainment and classification of the area as Extreme for the 2008 ozone NAAQS, CARB submitted the 2016 Ozone Plan to the EPA as a revision to the California SIP.
The 2016 Ozone Plan submission consists of documents originating from the District (
In response to the court's decision in
In addition to these submissions, CARB sent additional technical information in two technical supplements on October 17, 2018,
CAA sections 110(a)(1) and (2) and 110(l) require a state to provide reasonable public notice and opportunity for public hearing prior to the adoption and submission of a SIP or SIP revision. To meet these procedural requirements, every SIP submission should include evidence that the state provided adequate public notice and an opportunity for a public hearing consistent with the EPA's implementing regulations in 40 CFR 51.102.
The San Joaquin Valley District Board adopted the 2016 Ozone Plan on June 16, 2016, following a public hearing. CARB adopted the 2016 Ozone Plan as a revision to the California SIP on July 21, 2016, following a public hearing. Both the District and CARB have satisfied the applicable statutory and regulatory requirements for reasonable public notice and hearing prior to the adoption and submission of the 2016 Ozone Plan. Therefore, we find that the submission of the 2016 Ozone Plan meets the procedural requirements for public notice and hearing in CAA sections 110(a) and 110(l) and 40 CFR 51.102.
CARB published the 2018 SIP Update for public review on September 21, 2018, and adopted the document as a revision to the California SIP following a public hearing on October 25, 2018. As noted above, CARB has not yet submitted the final version of the 2018 SIP Update to the EPA, but we expect to find that CARB has satisfied the applicable statutory and regulatory requirements for reasonable public notice and hearing prior to the adoption of the 2018 SIP Update. Therefore, once we receive the final version, we expect to conclude that the submission of the 2018 SIP Update also meets the procedural requirements for public notice and hearing in CAA sections 110(a) and 110(l) and 40 CFR 51.102.
CAA section 172(c)(3) requires that each nonattainment plan SIP submission include a “comprehensive, accurate, current inventory of actual emissions from all sources of the relevant pollutant or pollutants in [the] area.” The accounting required by this section provides a “base year” inventory that serves as the starting point for attainment demonstration air quality modeling, for assessing RFP, and for determining the need for additional SIP control measures. EPA regulations require that the inventory year be consistent with the baseline year for the RFP demonstration, which is the most recent calendar year for which a complete triennial inventory is required to be submitted to the EPA under the Air Emissions Reporting Requirements.
Future baseline emissions inventories must reflect the most recent population, employment, travel and congestion estimates for the area.
The EPA has issued guidance on the development of base year and future year emissions inventories for ozone and other pollutants.
The 2016 Ozone Plan includes a 2012 base year emissions inventory based on actual emissions, to meet the requirements of CAA sections 172(c)(3) and 182(a)(1). The 2018 SIP Update does not include a new base year emissions inventory with actual emissions; rather, for purposes of updating the RFP demonstration, the transportation conformity motor vehicle emission budgets, and the contingency measure calculations, CARB used the 2012 base year inventory from the 2016 Ozone Plan to create new emissions inventory projections for the 2011 RFP baseline year and for RFP milestone years. These new projections are included in the 2018 SIP Update. CARB also submitted a “San Joaquin Valley Emission Projection Technical Clarification” to clarify how it calculated the projected inventories in this submission.
The 2016 Ozone Plan includes a 2012 base year emissions inventory for the San Joaquin Valley nonattainment area, based on actual emissions, to fulfill the requirements in CAA sections 172(c)(3) and 182(a)(1). The inventory includes VOC and NO
A description of base year emissions inventory development can be found in the 2016 Ozone Plan, chapter 3.11 through 3.11.2. The complete emissions inventory and documentation are found in Appendix B (“Emissions Inventory”).
VOC and NO
Area sources consist of widespread and numerous smaller emission sources, such as small permitted facilities and households.
The mobile sources category can be divided into two major subcategories: “on-road” and “off-road” mobile sources. On-road mobile sources include light-duty automobiles, light-, medium-, and heavy-duty trucks, and motorcycles. Off-road mobile sources include aircraft, locomotives, construction equipment, mobile equipment, and recreational vehicles.
The emissions inventories for the San Joaquin Valley 2008 ozone nonattainment area in the 2016 Ozone Plan were developed jointly by CARB and the District. Data were provided by CARB, the California Department of Transportation, the Department of Motor Vehicles, the Department of Pesticide regulation, the California Energy Commission and regional transportation agencies to develop mobile and area-wide source emission estimates. The emission estimates reflect reported emissions for point sources, whereas estimates for mobile and area sources are based on projections obtained through use of emissions models and methodologies along with actual activity data for 2012 (
CARB provided emission estimates for stationary nonagricultural diesel engines, agricultural irrigation pumps, laundering (dry cleaning), degreasing (solvents), oil and gas production, and gasoline dispensing facilities.
Area sources are categories such as consumer products, pesticides/fertilizers, fireplaces, farming operations, and other emissions which occur over a wide geographic area. Emissions for these categories were estimated by both CARB and the District using various models and methodologies.
CARB developed the emissions inventory for mobile sources, both on-road and off-road. CARB estimated on-road mobile sources emissions, which include passenger vehicles, buses, and trucks, using CARB's EMFAC2014 model.
Table 1 provides a summary, by major source categories, for the 2012 base year VOC and NO
In response to the
As in the 2016 Ozone Plan, the projected inventories in the 2018 SIP Update include NO
The State and District developed point and stationary source VOC and NO
Tables 2 and 3 provide summaries, by major source categories, for VOC and NO
With respect to future year projections, the EPA will approve a state plan that takes emissions reduction credit for a control measure only where the EPA has approved the measure as part of the SIP. Thus, to take credit for the emissions reductions from newly-adopted or amended District rules for stationary sources, the related rules must be approved by the EPA into the SIP. Table 1 in the technical support document (TSD) accompanying this rulemaking shows District rules that were incorporated in the future year inventories, along with information on EPA approval of these rules. In recent years, the EPA has taken action to approve CARB mobile source regulations into the California SIP.
We have reviewed the base year emissions inventory in the 2016 Ozone Plan and the RFP baseline and milestone year inventories in the 2018 SIP Update for the San Joaquin Valley 2008 ozone nonattainment area for consistency with CAA requirements and EPA guidance. First, as required by EPA regulation, we note that the inventories include estimates for VOC and NO
Therefore, the EPA is proposing to approve the 2012 emissions inventory as meeting the requirements for a base year inventory set forth in CAA section 182(a)(1) and 40 CFR 51.1115. Regarding the requirement in the 2008 Ozone SRR that the base year inventory be consistent with the baseline year for the RFP demonstration, we note that 2012 is the year of the base year inventory, while the RFP demonstration is based on a 2011 baseline year. However, as noted above, the 2011 emissions inventory is backcast from the 2012 base year inventory, and therefore is based on the same data. Therefore, we find that selection of 2012 as the base year for the emissions inventory is consistent with the 2011 baseline year for the RFP demonstration for this nonattainment area as required by 40 CFR 51.1115(a).
The 2018 SIP Update starts with 2011 as the baseline year and shows future baseline emissions inventories out to 2032. The EPA is proposing to find these inventories appropriate for use in developing the RFP demonstration (section III.B below), motor vehicle emissions budgets (section III.C below), and the contingency measure element for the San Joaquin Valley for the 2008 ozone standards (section III.D below).
Requirements for RFP for ozone nonattainment areas are specified in CAA sections 172(c)(2), 182(b)(1), and 182(c)(2)(B). CAA section 172(c)(2) requires that plans for nonattainment areas provide for RFP, which is defined as such annual incremental reductions in emissions of the relevant air pollutant as are required under part D (“Plan Requirements for Nonattainment Areas”) or may reasonably be required by the EPA for the purpose of ensuring attainment of the applicable NAAQS by the applicable date. CAA section 182(b)(1) specifically requires that ozone nonattainment areas that are classified as Moderate or above demonstrate a 15 percent reduction in VOC between the years of 1990 and 1996. The EPA has typically referred to section 182(b)(1) as the Rate of Progress (ROP) requirement. For ozone nonattainment areas classified as Serious or higher, section 182(c)(2)(B) requires reductions averaged over each consecutive 3-year period, beginning 6 years after the baseline year until the attainment date, of at least 3 percent of baseline emissions per year. The provisions in CAA section 182(c)(2)(B)(ii) allow an amount less than 3 percent of such baseline emissions each year if the state demonstrates to the EPA that the plan includes all measures that can feasibly be implemented in the area in light of technological achievability.
In the 2008 Ozone SRR, the EPA provided that areas classified Moderate or higher will have met the ROP requirements of CAA section 182(b)(1) if the area has a fully approved 15 percent ROP plan for the 1-hour or 1997 8-hour ozone standards, provided the boundaries of the ozone nonattainment areas are the same.
Except as specifically provided in CAA section 182(b)(1)(C), emissions reductions from all SIP-approved, federally promulgated, or otherwise SIP-creditable measures that occur after the baseline year are creditable for purposes of demonstrating that the RFP targets are met. Because the EPA has determined that the passage of time has caused the effect of certain exclusions to be de minimis, the RFP demonstration is no longer required to calculate and specifically exclude reductions from measures related to motor vehicle exhaust or evaporative emissions promulgated by January 1, 1990; regulations concerning Reid vapor pressure promulgated by November 15, 1990; measures to correct previous RACT requirements; and, measures required to correct previous inspection and maintenance (I/M) programs.
The 2008 Ozone SRR requires the RFP baseline year to be the most recent calendar year for which a complete triennial inventory was required to be submitted to the EPA. For the purposes of developing RFP demonstrations for the 2008 ozone standards, the applicable triennial inventory year is 2011. As discussed previously, the 2008 Ozone SRR provided states with the opportunity to use an alternative baseline year for RFP but that particular aspect of the 2008 Ozone SRR was vacated by the D.C. Circuit in the
The 2018 SIP Update replaces the RFP portion of the 2016 Ozone Plan and includes updated emissions estimates for the baseline, milestone and attainment years, and an updated RFP demonstration relying on a 2011 baseline year.
The updated RFP demonstration calculates future year VOC targets from the 2011 baseline, consistent with CAA 182(c)(2)(B)(i), which requires reductions of “at least 3 percent of baseline emissions each year.” The updated RFP demonstration in the 2018 SIP Update substitutes NO
As discussed in section III.A above, we are proposing to find that the baseline and RFP milestone year emissions inventories are acceptable for use in the RFP demonstration. We have reviewed the calculations in table VIII-2 of the 2018 SIP Update and presented in table 4 above, and find that the State has used an appropriate calculation method to demonstrate RFP. For these reasons, we have determined that the State has demonstrated RFP in each milestone year and the attainment year, consistent with applicable CAA requirements and EPA guidance. We therefore propose to approve the RFP demonstrations under sections
Section 176(c) of the CAA requires federal actions in nonattainment and maintenance areas to conform to the SIP's goals of eliminating or reducing the severity and number of violations of the NAAQS and achieving timely attainment of the standards. Conformity to the SIP's goals means that such actions will not: (1) Cause or contribute to violations of a NAAQS, (2) worsen the severity of an existing violation, or (3) delay timely attainment of any NAAQS or any interim milestone.
Actions involving Federal Highway Administration (FHWA) or Federal Transit Administration (FTA) funding or approval are subject to the EPA's transportation conformity rule, codified at 40 CFR part 93, subpart A. Under this rule, MPOs in nonattainment and maintenance areas coordinate with state and local air quality and transportation agencies, the EPA, the FHWA, and the FTA to demonstrate that an area's regional transportation plans and transportation improvement programs conform to the applicable SIP. This demonstration is typically done by showing that estimated emissions from existing and planned highway and transit systems are less than or equal to the motor vehicle emissions budgets (MVEBs or “budgets”) contained in all control strategy SIPs. Budgets are generally established for specific years and specific pollutants or precursors. Ozone plans should identify budgets for on-road emissions of ozone precursors (NO
For budgets to be approvable, they must meet, at a minimum, the EPA's adequacy criteria (40 CFR 93.118(e)(4)). To meet these requirements, the budgets must be consistent with the attainment and RFP requirements and reflect all of the motor vehicle control measures contained in the attainment and RFP demonstrations.
The EPA's process for determining adequacy of a budget consists of three basic steps: (1) Providing public notification of a SIP submission; (2) providing the public the opportunity to comment on the budget during a public comment period; and, (3) making a finding of adequacy or inadequacy.
The 2016 Ozone Plan included sub-regional (
The budgets in the 2018 SIP Update were calculated using updated vehicle miles traveled (VMT) estimates from the 2018 Regional Transportation Plans from the San Joaquin Valley Metropolitan Transportation Planning agencies and EMFAC2014, CARB's latest approved version of the EMFAC model for estimating emissions from on-road vehicles operating in California, and reflect average summer weekday emissions consistent with the RFP milestone years and the 2031 attainment year for the 2008 ozone NAAQS. The budgets also include a safety margin for some years and some counties. The conformity budgets for NO
We have evaluated the submitted budgets in the 2018 SIP Update against our adequacy criteria in 40 CFR 93.118(e)(4) as part of our review of the budgets' approvability (see section III in the EPA's TSD for this proposal) and will complete the adequacy review concurrent with our final action on the ozone plan. The EPA is not required under its transportation conformity rule to find budgets adequate prior to proposing approval of them.
The EPA has previously determined that the budgets in 2016 Ozone Plan are adequate for use for transportation conformity purposes. On February 23, 2017, the EPA announced the availability of the 2016 Ozone Plan and budgets, which were available for a 30-day public comment period that ended on March 27, 2017.
In today's notice, the EPA is proposing to approve the 2020, 2023, 2026, 2029 and 2031 budgets in the 2018 SIP Update for transportation conformity purposes. The EPA has determined through its review of the submitted 2018 SIP Update that these budgets are consistent with emission control measures in the SIP, reasonable further progress and attainment for the 2008 ozone NAAQS. For the reasons discussed in section III.B of this proposed rule, we are proposing to approve the RFP demonstration in the 2018 SIP Update. To supplement the information in the 2018 SIP Update, CARB provided an additional technical supplement
The EPA has previously proposed to approve the attainment demonstration in 2016 Ozone Plan and associated 2031 budgets.
The 2018 SIP Update budgets as shown in table 5, are consistent with the RFP demonstration and attainment demonstration, are clearly identified and precisely quantified, and meet all other applicable statutory and regulatory requirements, including the adequacy criteria in 40 CFR 93.118(e)(4) and (5). For these reasons, the EPA proposes to approve the budgets in table 5. We provide a more detailed discussion in section III of the EPA's TSD, which can be found in the docket for today's action. If we finalize approval of the budgets in the 2018 SIP Update, as proposed, then they will replace the budgets from the 2016 Ozone Plan that we previously found adequate for use in conformity determinations by transportation agencies in the San Joaquin Valley.
Under the CAA, ozone nonattainment areas classified under subpart 2 as Serious or above must include in their SIPs contingency measures consistent with sections 172(c)(9) and 182(c)(9). Contingency measures are additional controls or measures to be implemented in the event the area fails to make RFP or to attain the NAAQS by the attainment date. The SIP should contain trigger mechanisms for the contingency measures, specify a schedule for implementation, and indicate that the measure will be implemented without significant further action by the state or the EPA.
Neither the CAA nor the EPA's implementing regulations establish a specific amount of emissions reductions that implementation of contingency measures must achieve, but the 2008 Ozone SRR reiterates the EPA's guidance recommendation that contingency measures should provide for emissions reductions approximately equivalent to one year's worth of RFP, thus amounting to reductions of 3 percent of the baseline emissions inventory for the nonattainment area.
It has been the EPA's longstanding interpretation of section 172(c)(9) that states may rely on existing federal measures (
The EPA has approved numerous nonattainment area plan SIP submissions under this interpretation,
The District and CARB adopted the 2016 Ozone Plan prior to the
In the 2018 SIP Update, CARB revises the RFP demonstration for the 2008 ozone standards for the San Joaquin Valley nonattainment area and recalculates the extent of surplus emission reductions (
The new contingency measure, referred to as the “Enhanced Enforcement Activities Program,” is described in chapter X (“Contingency Measures”), section C of the 2018 SIP Update. In short, under the Enhanced Enforcement Activities Program, within 60 days of a determination by the EPA that the San Joaquin Valley nonattainment area failed to meet an RFP milestone or to attain the 2008 ozone NAAQS by the applicable attainment date, the CARB Executive Officer would direct enhanced enforcement activities in San Joaquin Valley consistent with the findings and recommendations in a report (referred to as the Enhanced Enforcement Report) that is to be prepared and published within 60 days of the triggering event. In the 2018 SIP Update, CARB indicates that the Enhanced Enforcement Report will, among other things, describe the compliance status of stationary and mobile sources in the area, determine the probable cause of the failure of RFP or attainment, and specify the type and quantity of additional enforcement resources that will be directed to the area. Lastly, through its resolution of adoption of the 2018 SIP Update, CARB added a menu of specific enforcement activity measures, one or more of which must be identified in the Enhanced Enforcement Report and implemented within 60 days of a triggering event.
In chapter X (“Contingency Measures”) of the 2018 SIP Update, CARB indicates that compliance with the contingency measure requirements of the CAA necessitates that individual air districts adopt a local contingency measure or measures to complement CARB's Enhanced Enforcement Activities Program measure. To address the contingency measure requirement for the 2008 ozone standards in the San Joaquin Valley nonattainment area, the District has committed to adopt and submit a contingency measure to CARB within 11 months of the EPA's final conditional approval of the contingency measure element of the 2016 Ozone Plan, as supplemented by the relevant portions of the 2018 SIP Update.
We have evaluated the contingency measure provisions in the 2016 Ozone Plan, the 2018 SIP Update, and the commitments by the District and CARB to adopt and submit a district contingency measure within one year of the EPA's final action and have concluded that, collectively, these materials provide the basis for us to propose conditional approval of the 2016 Ozone Plan and the relevant portions of 2018 Update.
First, we find that CARB's Enhanced Enforcement Activities Program measure and the revision to the architectural coatings rule (once adopted) represent additional controls or measures to be implemented in the event San Joaquin Valley fails to make RFP or to attain the NAAQS by the applicable attainment date. We also find that CARB's Enhanced Enforcement Activities Program contains, and the revised architectural coatings rule will contain, triggering mechanisms and schedules for implementation for the additional measures. Furthermore, the contingency measures are designed to be implemented without significant further action by the State or the EPA.
As noted above, neither the CAA nor the EPA's implementing regulations for the ozone NAAQS establish a specific amount of emissions reductions that implementation of contingency measures must achieve, but we generally expect that contingency measures should provide for emissions reductions approximately equivalent to one year's worth of RFP, which, for ozone, amounts to reductions of 3 percent of the baseline emissions inventory for the nonattainment area. For the 2008 ozone standards in the San Joaquin Valley nonattainment area, one year's worth of RFP is approximately 11.4 tpd of VOC or NO
The 2018 SIP Update does not include a specific estimate of the emissions reductions that would be achieved by the Enhanced Enforcement Activities program. We recognize the difficulty in calculating such an estimate given the nature of the measure and the range of enforcement actions that could be taken, but we believe that the enhanced enforcement program would achieve emissions reductions above and beyond those that would otherwise be achieved. The District's intended contingency measure,
Considered together, as described above, the two contingency measures can be quantified to achieve approximately 1 tpd of VOC emissions reductions. Thus the contingency measures, considered in isolation, can be quantified to achieve far less than one year's worth of RFP (11.4 tpd of VOC or NO
In this case, “surplus” refers to emissions reductions over and above the reductions necessary to demonstrate RFP in San Joaquin Valley for the 2008 ozone standards. More specifically, table VIII-2 in the 2018 SIP Update identifies surplus NO
For attainment contingency measure purposes, we view the emissions reductions from the two contingency measures in the context of the expected reduction in emissions within the San Joaquin Valley nonattainment area for the 2008 ozone NAAQS in the year following the attainment year (relative to those occurring in the attainment year). Based on the emission inventories in the Appendix A to the 2018 SIP Update, we note that overall regional emissions are expected to be approximately 1 tpd of NO
For the above reasons, we propose to conditionally approve the contingency measure element of the 2016 Ozone Plan, as modified by the 2018 SIP Update, and supplemented by the commitments by the District and CARB to adopt and submit an additional contingency measure, as meeting the contingency measure requirements of CAA sections 172(c)(9) and 182(c)(9). Our proposed approval is conditional because it relies upon a commitment to adopt a specific enforceable contingency measure. Conditional approvals are authorized under CAA section 110(k)(4) of the CAA.
For the reasons discussed above, under CAA section 110(k)(3), the EPA is proposing to approve as a revision to the California SIP the following portions of the San Joaquin Valley 2016 Ozone Plan
• Base year emissions inventory as meeting the requirements of CAA
The EPA is also proposing to approve as a revision to the California SIP the following portions of the 2018 SIP Update to the California State Implementation Plan, adopted by CARB on October 25, 2018:
• RFP demonstration as meeting the requirements of CAA sections 172(c)(2), 182(b)(1), and 182(c)(2)(B), and 40 CFR 51.1110(a)(2)(ii); and
• Motor vehicle emissions budgets for the RFP milestone years of 2020, 2023, 2026, 2029, and the attainment year of 2031 (see table 5, above) because they are consistent with the RFP demonstration proposed for approval herein and the attainment demonstration previously proposed for approval and meet the other criteria in 40 CFR 93.118(e).
Lastly, we are proposing to conditionally approve the contingency measure element of the 2016 Ozone Plan, as modified by the 2018 SIP Update, as meeting the requirements of CAA sections 172(c)(9) and 182(c)(9) based on commitments by CARB and the District to supplement the element through submission of a SIP revision within 1 year of final conditional approval action that will include a revised District architectural coatings rule.
The EPA is soliciting public comments on the proposed actions listed above, our rationales for the proposed actions, and any other pertinent matters related to the issues discussed in this document. We will accept comments from the public on this proposal for the next 30 days and will consider comments before taking final action.
Under the Clean Air Act, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, the EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. Accordingly, this proposed action merely proposes to approve state plans and an air district rule as meeting federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this proposed action:
• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);
• Is not an Executive Order 13771 (82 FR 9339, February 2, 2017) regulatory action because SIP approvals are exempted under Executive Order 12866;
• Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501
• Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601
• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);
• Does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);
• Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);
• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);
• Is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the Clean Air Act; and
• Does not provide the EPA with the discretionary authority to address disproportionate human health or environmental effects with practical, appropriate, and legally permissible methods under Executive Order 12898 (59 FR 7629, February 16, 1994).
In addition, the SIP is not approved to apply on any Indian reservation land or in any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the proposed rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).
Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Nitrogen dioxide, Ozone, Reporting and recordkeeping requirements, Volatile organic compounds.
42 U.S.C. 7401
Federal Communications Commission.
Proposed rule.
The Commission seeks comment on proposals to eliminate ex ante pricing regulation for price cap incumbent LECs' provision of TDM and other transport business data services. The Commission also seeks comment on the conditions under which ex ante pricing regulations should be eliminated for lower capacity TDM transport business data services offerings by rate-of-return carriers opting in to the Commission's new light-touch regulatory framework. With these steps, the Commission continues its ongoing efforts to modernize regulations for the dynamic and evolving business data services market.
Comments are due on or before January 14, 2019. Reply comments are due on or before February 12, 2019.
Federal Communications Commission, 445 12th St. SW, Washington, DC 20554.
Justin Faulb, Wireline Competition Bureau, Pricing Policy Division, at 202-418-1589 or via email at
This is a summary of the Commission's Second Further Notice of Proposed Rulemaking, and Further Notice of Proposed Rulemaking, released October 24, 2018. A full-text copy may be obtained at the following internet address:
1. In light of the Eighth Circuit Court's recent decision upholding the bulk of the Commission's price cap
2. For the better part of the last two decades, in response to increasing competition for TDM transport in areas of the country served by price cap carriers, the Commission has consistently worked to modify and streamline regulation of such services. Most TDM transport offered by price cap carriers has been subject to some form of pricing flexibility as a result of the Commission's 1999
3. In the
4. On appeal, the Eighth Circuit Court largely affirmed the
5. The current record includes “strong evidence of substantial competition” in price cap TDM transport markets. In addition to showing that there is “widespread deployment of competitive transport networks” in price cap areas, the record also indicates that transport services are “typically higher volume services . . . which can more easily justify competitive investment and deployment.”
6. In light of the current record of substantial competition and competitive pressure on TDM transport services in price cap areas, we now propose to eliminate nationwide ex ante pricing regulation of price cap carriers' TDM transport services and seek comment on our proposal. Specifically, we propose granting price cap carriers forbearance pursuant to section 10 of the Communications Act of 1934, as amended (the Act) from section 203 tariffing requirements for their TDM transport business data services and other transport special access service offerings. Consistent with the transition adopted in the
7. We propose that during this transition, tariffing for these transport services will be permissive—the Commission will accept new tariffs and revisions to existing tariffs for the affected services. Apart from the rate freeze noted above, carriers will no longer be required to comply with price cap regulation for these services, and once the rules proposed in this Second Further Notice are effective, carriers that wish to continue filing tariffs under the permissive detariffing regime would be free to modify such tariffs to reflect the new regulatory structure outlined in this Second Further Notice for the affected services. We propose allowing price cap carriers to remove the relevant portions of their tariffs for the affected services at any time during the transition, and for the rate freeze to no longer apply to services that are not tariffed. We propose that once the transition ends, no price cap carrier may file or maintain any interstate tariffs for affected business data services. We seek comment on these proposals.
8. We also seek comment on our analysis of the TDM transport market for price cap carriers. To what extent does the Commission's competitive analysis in the
9. We seek comment on whether we should consider any alternatives to removing ex ante pricing regulation for TDM transport offered by price cap carriers to better align our regulation with the dynamic and evolving nature of the business data services market. Should we, for example, adopt a competitive market test to measure the competitiveness of TDM transport offerings in areas served by price cap carriers? If so, how should such a test be structured? Should such a test assess competition using the counties served by price cap carriers as the relevant geographic market, as we do with the competitive market test for price cap carriers' lower capacity TDM end user channel terminations? Alternatively, should we use the same competitive market test for TDM transport offerings of price cap carriers as we do for lower capacity TDM end user channel terminations offered by price cap carriers? If we adopt a competitive market test for TDM transport offered by price cap carriers, how should we implement the results of such a test? Should we adopt similar transition provisions as those we adopted for the competitive market test for end user channel terminations in the
10. We invite interested parties to submit any additional data or information regarding the state of competition for TDM transport services in price cap areas. Are there more current data available on the state of competition for TDM transport services that could enhance our analysis of this market? Are there any other ways of measuring or estimating competition for TDM transport in areas served by price cap carriers that have not already been used by the Commission? Are there other types of data that could represent a proxy for competition in the TDM transport market in areas served by price cap carriers? While the data in the
11. We also seek comment on providing a path to eliminating ex ante pricing regulation of lower capacity (
12. The Commission has long recognized transport is more competitive than end user channel terminations and required a different competitive showing for reduced pricing regulation. Given that we are proposing to eliminate ex ante pricing regulation of TDM transport services in price cap areas, we also seek further comment on whether, and under what circumstances, we should remove ex ante pricing regulation for electing carriers' lower capacity TDM transport. We previously declined to remove ex ante pricing regulation of TDM transport services because the record lacks data sufficient to justify such a step. We invite commenters to provide or identify data that would justify further pricing deregulation of electing carriers' lower capacity TDM transport.
13. If there are such data, should we use that data to adopt a competitive market test for determining whether to relieve electing carriers' lower capacity TDM transport of ex ante pricing regulation in a particular study area? Were we to adopt a competitive market test for electing carriers' lower capacity TDM transport, how should it be structured? Should such a test largely mirror the structure of the current electing carrier competitive market test for lower capacity TDM end user channel terminations?
14. If we adopt a competitive market test for lower capacity TDM transport offered by electing carriers, how should we implement the results of such a test? Should we adopt similar transition provisions as those we adopt for the competitive market test for electing carriers' lower capacity TDM end user channel terminations? Are there any reasons to structure the transition differently?
15. In the alternative, we seek comment on whether we should remove ex ante pricing regulations for lower capacity TDM transport offered by electing carriers nationwide. Is there data available that would show nationwide competition sufficient to remove ex ante pricing regulation? How would we analyze the data given the variability of competition in areas served by electing rate-of-return carriers? Is there evidence of competition for lower capacity TDM transport in these areas consistent with the competition the Commission determined was present in price cap areas nationwide?
16. We also seek comment on AT&T's recommendation that we base our decisions on data specific to electing carriers and their operating territories. We recognize that a large data collection would be a burden on rate-of-return carriers' limited resources, and we want to avoid imposing unnecessary regulatory burdens on them. We therefore request that commenters provide or identify additional data or other information relevant to the status of competition for lower capacity TDM transport in the study areas served by the rate-of-return carriers eligible to elect incentive regulation, including data on transport competition and competitive fiber deployment. Are there existing data collections that could be used as a proxy for the presence of lower capacity TDM transport competition in areas served by rate-of-return carriers eligible to elect incentive regulation? For example, in the
17. In the FNPRMs, we propose changes to, and seek comment on, the appropriate regulatory treatment of TDM transport business data services (BDS) offerings offered by both price cap carriers and rate-of-return carriers that receive fixed universal service support and elect incentive regulation. In the FNPRMs, the Commission proposes to remove ex ante pricing regulation from TDM transport business data services offered by price cap carriers and seeks comment on doing so for rate-of-return carriers.
18. The legal basis for any action that may be taken pursuant to the FNPRMs is contained in sections 1, 4(i), 10, and 201(b) of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 160, and 201(b).
19. The RFA directs agencies to provide a description of, and where feasible, an estimate of the number of small entities that may be affected by the proposed rules and by the rule revisions on which the FNPRMs seek comment, if adopted. The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” In addition, the term “small business” has the same meaning as the term “small-business concern” under the Small Business Act. A “small-business concern” is one which: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the SBA.
20.
21. Next, the type of small entity described as a “small organization” is generally “any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.” Nationwide, as of August 2016, there were approximately 356,494 small organizations based on registration and tax data filed by nonprofits with the Internal Revenue Service (IRS).
22. Finally, the small entity described as a “small governmental jurisdiction” is defined generally as “governments of cities, towns, townships, villages, school districts, or special districts, with a population of less than fifty thousand.” U.S. Census Bureau data from the 2012 Census of Governments indicates that there were 90,056 local governmental jurisdictions consisting of general purpose governments and special purpose governments in the United States. Of this number there were 37,132 general purpose governments (county, municipal and town or township) with populations of less than 50,000 and 12,184 special purpose governments (independent school districts and special districts) with populations of less than 50,000. The 2012 U.S. Census Bureau data for most types of governments in the local government category shows that the majority of these governments have populations of less than 50,000. Based on these data we estimate that at least 49,316 local government jurisdictions fall in the category of “small governmental jurisdictions.”
23.
24.
25.
26.
27. We have included small incumbent LECs in this present RFA analysis. As noted above, a “small business” under the RFA is one that, inter alia, meets the pertinent small business size standard (
28.
29.
30.
31.
32.
33.
34. The Commission's own data—available in its Universal Licensing System—indicate that, as of October 25, 2016, there are 280 Cellular licensees that will be affected by our actions today. The Commission does not know how many of these licensees are small, as the Commission does not collect that information for these types of entities. Similarly, according to internally developed Commission data, 413 carriers reported that they were engaged in the provision of wireless telephony, including cellular service, Personal Communications Service, and Specialized Mobile Radio Telephony services. Of this total, an estimated 261 have 1,500 or fewer employees, and 152 have more than 1,500 employees. Thus, using available data, we estimate that the majority of wireless firms can be considered small.
35.
36.
37. Because section 706 requires us to monitor the deployment of broadband using any technology, we anticipate that some broadband service providers may not provide telephone service. Accordingly, we describe below other types of firms that may provide broadband services, including cable companies, MDS providers, and utilities, among others.
38.
39.
40.
41.
42. The FNPRMs propose changes to, and seek comment on, the Commission's regulatory treatment of lower capacity TDM transport business data services offered by price cap and certain rate-of-return carriers. The objective of the proposed modifications is to reduce the unnecessary regulatory burdens and inflexibility of BDS regulation for both price cap and for rate-of-return carriers, which are for the most part small businesses, when competition justifies reduced regulation. These proposed rule modifications would provide additional incentives for competitive entry, network investment and the migration to IP-based network technologies and services.
43. Specifically, the FNPRMs propose to eliminate ex ante pricing regulation and tariffing requirements for price cap carriers' TDM transport BDS. This will eliminate reporting, recordkeeping, and other compliance requirements for any price cap carrier. They also seek comment on whether to remove ex ante pricing regulation and tariffing requirements of TDM transport services offered by rate-of-return carriers that received fixed universal service support and elect incentive regulation. This change would impact the reporting, recordkeeping, and other compliance requirements for these rate-of-return carriers, nearly all of which are small entities.
44. The RFA requires an agency to describe any significant alternatives that it has considered in reaching its proposed approach, which may include the following four alternatives (among others): (1) The establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance and reporting requirements under the rules for such small entities; (3) the use of performance rather than design standards; and (4) an exemption from coverage of the rule, or any part thereof, for such small entities.
45. The rule changes proposed by the FNPRMs would reduce the economic impact of the Commission's rules on price cap carriers and rate-of-return carriers that elect incentive regulation in the following ways. The Second Further Notice of Proposed Rulemaking proposes to free price cap carriers from ex ante pricing regulation for their TDM transport offerings, including the requirement to tariff their TDM transport services. The Further Notice of Proposed Rulemaking seeks comment on whether the Commission should do the same for TDM transport offered by rate-of-return carriers that received fixed universal support, or if the Commission should adopt a competitive market test for these carriers' TDM transport services. These rule changes would represent alternatives to the Commission's current rules that would significantly minimize the economic impact of those rules on price cap carriers and electing rate-of-return carriers. Finally, we seek comment as to any additional economic burden incurred by small entities that may result from the rule changes proposed in the FNPRMs.
46. None.
47.
Filings can be sent by hand or messenger delivery, by commercial overnight courier, or by first-class or overnight U.S. Postal Service mail. All filings must be addressed to the Commission's Secretary: Office of the Secretary, Federal Communications Commission.
All hand-delivered or messenger-delivered paper filings for the Commission's Secretary must be delivered to FCC Headquarters at 445 12th St. SW, Room TW-A325, Washington, DC 20554. The filing hours are 8:00 a.m. to 7:00 p.m. All hand deliveries must be held together with rubber bands or fasteners. Any envelopes and boxes must be disposed of
Commercial overnight mail (other than U.S. Postal Service Express Mail and Priority Mail) must be sent to 9050 Junction Drive, Annapolis Junction, MD 20701.
U.S. Postal Service first-class, Express, and Priority mail must be addressed to 445 12th Street SW, Washington DC 20554.
48. This proceeding shall be treated as a “permit-but-disclose” proceeding in accordance with the Commission's
49.
50.
51.
52.
Communications common carriers, Radio, Reporting and recordkeeping requirements, Telegraph, Telephone.
Communications common carriers, Reporting and recordkeeping requirements, Telephone.
The Federal Communications Commission seeks comment on a proposal to amend 47 CFR parts 61 and 69, as follows:
47 U.S.C. 151, 154(i), 154(j), 201-205, 403, unless otherwise noted.
(a)(3) Transport services as defined in § 69.801 of this chapter;
47 U.S.C. 154, 201, 202, 203, 205, 218, 220, 254, 403.
(a) Price cap local exchange carrier transport and end user channel terminations in markets deemed competitive and in grandfathered markets for a price cap carrier that was granted Phase II pricing flexibility prior to June 2017 are granted the following regulatory relief:
(1) Elimination of the rate structure requirements in subpart B of this part;
(2) Elimination of price cap regulation; and
(3) Elimination of tariffing requirements as specified in § 61.201 of this chapter.
Department of Veterans Affairs.
Proposed rule.
The Department of Veterans Affairs (VA) is proposing to amend and update its VA Acquisition Regulation (VAAR) in phased increments to revise or remove any policy superseded by changes in the Federal Acquisition Regulation (FAR), to remove procedural guidance that is internal to VA into the VA Acquisition Manual (VAAM), and to incorporate any new agency specific regulations or policies. These changes seek to streamline and align the VAAR with the FAR and remove outdated and duplicative requirements and reduce burden on contractors. The VAAM incorporates portions of the removed VAAR as well as other internal agency acquisition policy. VA will rewrite certain parts of the VAAR and VAAM, and as VAAR parts are rewritten, we will publish them in the
Comments must be received on or before January 28, 2019 to be
Written comments may be submitted through
Mr. Rafael N. Taylor, Senior Procurement Analyst, Procurement Policy and Warrant Management Services, 003A2A, 425 I Street NW, Washington, DC 20001, (202) 382-2787. (This is not a toll-free number.)
This rulemaking is issued under the authority of the Office of Federal Procurement Policy Act, which provides the authority for an agency head to issue agency acquisition regulations that implement or supplement the FAR.
VA is proposing to revise the VAAR to add new policy or regulatory requirements and to remove any redundant guidance and guidance that is applicable only to VA's internal operating processes or procedures. Codified acquisition regulations may be amended and revised only through rulemaking. All amendments, revisions, and removals have been reviewed and concurred with by VA's Integrated Product Team of agency stakeholders.
The VAAR uses the regulatory structure and arrangement of the FAR and headings and subject areas are consistent with FAR content. The VAAR is divided into subchapters, parts (each of which covers a separate aspect of acquisition), subparts, and sections.
The Office of Federal Procurement Policy Act, as codified in 41 U.S.C. 1707, provides the authority for the Federal Acquisition Regulation and for the issuance of agency acquisition regulations consistent with the FAR.
When Federal agencies acquire supplies and services using appropriated funds, the purchase is governed by the FAR, set forth at Title 48 Code of Federal Regulations (CFR), chapter 1, parts 1 through 53, and the agency regulations that implement and supplement the FAR. The VAAR is set forth at Title 48 CFR, chapter 8, parts 801 to 873.
VA proposes to make the following changes to the VAAR in this phase of its revision and streamlining initiative. For procedural guidance cited below that is proposed to be deleted from the VAAR, each section cited for removal has been considered for inclusion in VA's internal agency operating procedures in accordance with FAR 1.301(a)(2). Similarly, delegations of authorities that are removed from the VAAR will be included in the VAAM as internal departmental guidance. The VAAM is being created in parallel with these revisions to the VAAR and is not subject to the rulemaking process as they are internal VA procedures and guidance. The VAAM will not be finalized until corresponding VAAR parts are finalized, and therefore the VAAM is not yet available on line.
In the table in section 801.106, this proposed rule would renumber section 852.236-88 to read 852.243-70 against OMB Control Number 2900-0422.
We propose to add part 823, Environment, Energy and Water Efficiency, Renewable Energy Technologies, Occupational Safety, and Drug-Free Workplace. The authorities cited for this part are: 40 U.S.C. 121(c), which grants the authority for the head of each executive agency to issue orders and directives that the agency head considers necessary to carry out the regulations; 41 U.S.C. 1702, which addresses the acquisition planning and management responsibilities of Chief Acquisition Officers and Senior Procurement Executives, to include implementation of unique procurement policies, regulations and standards of the executive agency; and 48 CFR 1.301-1.304, which authorizes agencies to issue acquisition regulations that implement or supplement the FAR.
Under subpart 823.1, Sustainable Acquisition Policy, we propose to add 823.103-70, Policy, to give contracting officers the option to include an evaluation factor for an offeror's Sustainable Action Plan when acquiring sustainable products and services. This section would also require offerors to provide their Sustainable Action Plan in their technical proposals when required by the solicitation.
We propose to add 823.103-71, Solicitation provision, which prescribes use of a new provision at 852.823-70, Instruction to Offerors—Sustainable Acquisition Plan, when the contracting officer requires an offeror to submit a Sustainable Action Plan with its proposal.
We propose to add 823.103-72, Contract file, to require the contracting officer to place the contractor's final Sustainable Acquisition Plan, if one is required, into the official contract file.
In subpart 823.3, Hazardous Material Identification and Material Safety Data, we propose to add 823.300, Scope of subpart, and 823.303-70, Contract clause, to prescribe the use of clause 852.223-71, Safety and Health, for use in administering safety and health requirements in solicitations and contracts for research, development, or test projects; transportation of hazardous materials; and construction.
We propose to amend the authority citation for this part to include 5 U.S.C. 552a, the statute governing use and maintenance of records on individuals, conditions of disclosure, and the authority for agencies to promulgate rules governing such records; 41 U.S.C. 1121(c), which speaks to the authority of an executive agency under another law to prescribe policies, regulations, procedures, and forms for procurement; 41 U.S.C. 1702, which addresses the acquisition planning and management responsibilities of Chief Acquisition Officers and Senior Procurement Executives, to include implementation of unique procurement policies, regulations and standards of the executive agency. The authorities cited for this part are 5 U.S.C. 552a; 40 U.S.C. 121(c), which grants the authority for the head of each executive agency to issue orders and directives that the agency head considers necessary to carry out the regulations; 41 U.S.C. 1121(c); 41 U.S.C. 1702; 38 CFR 1.550-1.562, and 1.575-1.584, which contain
We propose to revise 824.102, General, to add the title of the sections of 38 CFR chapter 1 (1.575 through 1.584), that addresses VA's implementation of the Privacy Act of 1974 (Safeguarding Personal Information in Department of Veterans Affairs Records).
We propose to add 824.103, Procedures, to implement the procedures in FAR 24.103, by citing specific VA Handbooks in solicitations and contracts that require the design, development, or operation of a system of records; and by requiring the contracting officer to include in Statements of Work and Performance Work Statements procedures to follow in the event of a PII breach. This section also calls for Government surveillance plans for contracts that require the design, development, or operation of a system of records to include monitoring of the contractor's adherence to the Privacy Act and PII regulations.
We propose to revise 824.203, Policy, to designate the first sentence as paragraph (a), to update the CFR reference for rules implementing the Freedom of Information Act (FOIA), and to add paragraph (b) to advise the public that the VA FOIA Service Office handles all FOIA requests, and to provide the centralized website and a link to the list of FOIA contacts where FOIA requests can be submitted electronically.
We propose to add part 826, Other Socioeconomic Programs, with a single subpart 826.2, Disaster or Emergency Assistance Activities. The authorities cited for this part are 38 U.S.C. 8127-8128, under which the Secretary may establish goals for awarding to Service-Disabled Veteran-Small Businesses and Veteran-Owned Small-Businesses; 40 U.S.C. 121(c), which grants the authority for the head of each executive agency to issue orders and directives that the agency head considers necessary to carry out the regulations; 41 U.S.C. 1702, which addresses the acquisition planning and management responsibilities of Chief Acquisition Officers and Senior Procurement Executives, to include implementation of unique procurement policies, regulations and standards of the executive agency; 38 CFR 1.550-1.562, and 1.575-1.584, which contain the rules followed by VA in processing requests for records under the Freedom of Information Act; and 48 CFR 1.301-1.304, which authorizes agencies to issue acquisition regulations that implement or supplement the FAR.
We propose to add 826.202-1, Local area set-aside, to require the contracting officer to determine whether a local area set-aside should be further restricted to verified Service-Disabled Veteran-Owned Small Businesses (SDVOSB) or Veteran-Owned Small Businesses (VOSB), because, while the FAR allows further restriction to socioeconomic programs in FAR part 19, it does not mention the VA specific requirements under 38 U.S.C. 8127 and 8128.
We propose to add 826.202-2, Evaluation preference, which would require that, to the extent market research does not support an SDVOSB or VOSB set-aside, the contracting officer shall consider including evaluation factors in accordance with 815.304, and the evaluation criteria clause 852.215-70, Service-Disabled Veteran-Owned and Veteran-Owned Small Business Evaluation Factors, prescribed at 815.304-71(a).
We propose to add part 843, Contract Modifications, with a single subpart 843.2, Change Orders. The authorities cited for this part are 40 U.S.C. 121(c), which grants the authority for the head of each executive agency to issue orders and directives that the agency head considers necessary to carry out the regulations; 41 U.S.C. 1121(c)(3), which grants the authority of an executive agency under another law to prescribe policies, regulations, procedures, and forms for procurement; 41 U.S.C. 1702, which addresses the acquisition planning and management responsibilities of Chief Acquisition Officers and Senior Procurement Executives, to include implementation of unique procurement policies, regulations and standards of the executive agency; and 48 CFR 1.301-1.304, which authorizes agencies to issue acquisition regulations that implement or supplement the FAR.
We propose to add 843.204-70, Definitization of unpriced change orders, to provide policy on price ceilings, definitization schedules, submission of a definitization proposal, required file documentation, limitations on obligations before definitization, and determining allowable profit depending on costs incurred during contract performance before negotiation of the final price.
We propose to add 843.205, Contract clauses, which would provide contracting officers with guidance for establishing the number of days (up to 60 days), the contractor may be granted to assert its right to an equitable adjustment within the Changes clause. This section would also provide direction to use clause 52.216-24, Limitation of Government Liability, in unpriced change orders estimated to exceed $5 million.
We propose to add 843.205-70, Contract changes—supplement, which prescribes the use of the clause 852.243-70, Construction Contract Changes—Supplement, (formerly numbered 852.236-88), which has been revised and proposed to be moved to this part from VAAR 836.578.
In subpart 852.2, Text of Provisions and Clauses, we propose to add provision 852.223-70, Instructions to Offerors—Sustainable Acquisition Plan, for use when the contracting officer decides to include an evaluation factor for an offeror's Sustainable Action Plan when acquiring sustainable products and services in accordance with 823.103-72, Solicitation provision.
We propose to add clause 852.223-71, Safety and Health, which cites several references requiring contractors to comply with all Federal, State, and local laws and regulations applicable to the work being performed in accordance with 823.303-70, Contract clause.
We propose to amend clause 852.236-88, Contract Changes—Supplement, by renumbering it as 852.243-70, and retitling it as Construction Contract Changes—Supplement. It would clarify the basis for allowing overhead and profit under change orders on construction contracts, add definitization schedule requirements, and reinforce the need for the contractor's timely response with a proposal to definitize the change order. This clause is prescribed in 843.205-70, Contract changes—supplement.
Title 48, Federal Acquisition Regulations System, chapter 8, Department of Veterans Affairs, of the Code of Federal Regulations, as
Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits of reducing costs, of harmonizing rules, and of promoting flexibility. E.O. 12866, Regulatory Planning and Review, defines “significant regulatory action” to mean any regulatory action that is likely to result in a rule that may: “(1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal Governments or communities; (2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in this Executive order.”
VA has examined the economic, interagency, budgetary, legal, and policy implications of this regulatory action, and it has been determined this rule is not a significant regulatory action under E.O. 12866.
VA's impact analysis can be found as a supporting document at
The Paperwork Reduction Act of 1995 (at 44 U.S.C. 3507) requires that VA consider the impact of paperwork and other information collection burdens imposed on the public. Under 44 U.S.C. 3507(a), an agency may not collect or sponsor the collection of information, nor may it impose an information collection requirement unless it displays a currently valid Office of Management and Budget (OMB) control number. See also 5 CFR 1320.8(b)(3)(vi).
The proposed actions in this rule result in the proposed redesignation of the existing approved OMB collection number and the associated burden as a result of one clause we propose to both retitle and renumber.
This proposed rule would impose the following amended information collection requirement to one of the existing information collection approval numbers associated with this proposed rule. Although this action contains provisions constituting collections of information at 48 CFR at 48 CFR 836.578 and 852.236-88, under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501-3521), no new proposed collections of information are associated with this clause. The information collection requirements for 852.236-88, which is currently prescribed by 836.578, is currently approved by OMB and has been assigned OMB control number 2900-0422. This information collection will be submitted to OMB to revise the title, redesignate the collection and renumber the one clause currently numbered as section 852.236-88, Contract Changes—Supplement. Accordingly, if approved, the clause would reflect the new designation and revised title as set forth in the preamble and the amendatory language of this proposed rule to read: 852.243-70, Construction Contract Changes—Supplement, as prescribed by 843.205-70, Contract changes—supplement, under the associated OMB control number 2900-0422. The reference to the old number—852.236-88, would accordingly be removed. There is no change in the information collection burden that is associated with this proposed request. As required by the Paperwork Reduction Act of 1995 (at 44 U.S.C. 3507(d)), VA will submit these information collection amendments to OMB for its review. Notice of OMB approval for this information collection will be published in a future notice from the Office of Information and Regulatory Affairs at
This proposed rule would not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-612. This proposed rule would generally be small business neutral. The overall impact of the proposed rule would be of benefit to small businesses owned by Veterans or service-disabled Veterans as the VAAR is being updated to remove extraneous procedural information that applies only to VA's internal operating procedures. VA estimates no cost impact to individual business would result from these rule updates. On this basis, this proposed rule would not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-612. Therefore, under 5 U.S.C. 605(b), this regulatory action is exempt from the initial and final regulatory flexibility analysis requirements of sections 603 and 604.
The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in the expenditure by State, local, and tribal Governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This proposed rule will have no such effect on State, local, and tribal Governments or on the private sector.
Administrative practice and procedure, Government procurement, Reporting and recordkeeping requirements.
Air pollution control, Drug abuse, Energy conservation, Government procurement, Hazardous substances, Recycling, Water pollution control.
Freedom of information, Government procurement, Privacy.
Disaster assistance, Government procurement, Indians.
Government procurement, Reporting and recordkeeping requirements.
Government procurement.
Government procurement, Reporting and recordkeeping requirements.
The Secretary of Veterans Affairs approved this document and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs. Robert L. Wilkie, Secretary, Department of Veterans Affairs, approved this document on November 15, 2018, for publication.
For the reasons set out in the preamble, VA is proposing to amend 48 CFR parts 801, 824, 836 and 852 and adding parts 823, 826, and 843 as follows:
40 U.S.C. 121(c); 41 U.S.C. 1121; 41 U.S.C. 1303; 41 U.S.C. 1702; and 48 CFR 1.301-1.304.
40 U.S.C. 121(c); 41 U.S.C. 1702 and 48 CFR 1.301-1.304.
(a) For new contracts and orders above the micro-purchase threshold, VA contracting officers may insert a solicitation provision to include an evaluation factor for an offeror's Sustainable Acquisition Plan when acquiring sustainable products and services. Such contracts and orders include, but are not limited to: Office supplies; construction, renovation or repair; building operations and maintenance; landscaping services; pest management; electronic equipment, including leasing; fleet maintenance; janitorial services; laundry services; cafeteria operations; and meetings and conference services.
(b) When required in the solicitation, offerors shall include a Sustainable Acquisition Plan in their technical proposal addressing the sustainable products and services for delivery under the resulting contract.
When the contracting officer requires a Sustainable Acquisition Plan in accordance with 823.103-70, Policy, the contracting officer shall insert the provision at 852.823-70, Instruction to Offerors—Sustainable Acquisition Plan, in solicitations above the micro-purchase threshold.
When one is required, the contracting officer shall place the contractor's final Sustainable Acquisition Plan into the contract file (Electronic Contract Management System (eCMS)).
This subpart provides a contract clause for use in administering safety and health requirements.
Contracting officers shall insert clause 852.223-71, Safety and Health, in solicitations and contracts that involve hazardous materials or hazardous operations for the following types of requirements:
(1) Research, development, or test projects.
(2) Transportation of hazardous materials.
(3) Construction.
5 U.S.C. 552a; 40 U.S.C. 121(c); 41 U.S.C. 1121(c); 41 U.S.C. 1702; 38 CFR 1.550-1.562 and 1.575-1.584; and 48 CFR 1.301-1.304.
VA rules implementing the Privacy Act of 1974 are in 38 CFR 1.575 through 1.584, Safeguarding Personal Information in Department of Veterans Affairs Records.
(c) The contracting officer shall reference the following documents in solicitations and contracts that require the design, development, or operation of a system of records—
(1) VA Handbook 6500.6, Contract Security;
(2) VA Handbook 6508.1, Procedures for Privacy Threshold Analysis and Privacy Impact Assessment;
(3) VA Handbook 6510, VA Identity and Access Management—
(i) The contracting officer will ensure that statements of work or performance work statements that require the design, development, or operation of a system of records include procedures to follow in the event of a PII breach; and
(ii) The contracting officer shall ensure that Government surveillance plans for contracts that require the design, development, or operation of a system of records include monitoring of the contractor's adherence to Privacy Act/PII regulations. The assessing official should document contractor-caused breaches or other incidents related to PII in past performance reports. Such incidents include instances in which the contractor did not adhere to Privacy Act/PII contractual requirements.
(a) VA rules implementing the Freedom of Information Act are in 38 CFR 1.550 through 1.562.
(b) Upon receipt of a request, the contracting officer shall provide the requester with the name of the cognizant VA Freedom of Information Act (FOIA) Service Office. The VA FOIA Service Office (see
38 U.S.C. 8127-8128; 40 U.S.C. 121(c); 41 U.S.C. 1702; 38 CFR 1.550-1.562 and 1.575-1.584; and 48 CFR 1.301-1.304.
(c) The contracting officer shall determine whether a local area set-aside should be further restricted to verified Service-Disabled Veteran-Owned Small Businesses (SDVOSBs) or Veteran-Owned Small Businesses (VOSBs) pursuant to subpart 819.70.
Pursuant to 38 U.S.C. 8128 and if market research does not support an SDVOSB or VOSB set-aside, the contracting officer shall consider including evaluation factors in accordance with 815.304 and the evaluation criteria clause prescribed at 815.304-71(a), 852.215-70, Service-Disabled Veteran-Owned and Veteran-Owned Small Business Evaluation Factors.
40 U.S.C. 121(c); 48 CFR 1.301-1.304.
40 U.S.C. 121(c); 41 U.S.C. 1121(c)(3); 41 U.S.C. 1702 and 48 CFR 1.301-1.304.
(a)
(b)
(c)
(1) The date that is 180 days after issuance of the change order (this date may be extended but may not exceed the date that is 180 days after the contractor submits a definitization proposal); or
(2) The date on which the amount of funds obligated under the change order is equal to more than 50 percent of the not-to-exceed price.
(d)
(e)
(f)
(1) The Government shall not obligate more than 50 percent of the not-to-exceed price before definitization. However, if a contractor submits a definitization proposal before 50 percent of the not-to-exceed price has been obligated by the Government, the limitation on obligations before definitization may be increased to no more than 75 percent of the not-to-exceed cost or price.
(2) Obligations should be consistent with the contractor's authorized and scheduled work performed during the undefinitized period.
(g)
(1) When the final cost or price of an unpriced change order is negotiated after a substantial portion of the required performance has been completed, the head of the contracting activity shall ensure the fee or profit allowed reflects—
(i) Any reduced cost risk to the contractor for costs incurred during contract performance before negotiation of the final cost or price; and
(ii) The contractor's reduced cost risk for costs incurred during performance of the remainder of the contract; and
(iii) The extent to which costs have been incurred prior to definitization of the contract action.
(2) If a substantial portion of the costs have been incurred prior to definitization, the contracting officer may assign a value as low as zero (0) percent, regardless of contract type. The risk assessment shall be documented in the contract file.
As authorized in the introductory text of clauses FAR 52.243-1, Changes—Fixed-Price; FAR 52.243-2, Changes—Cost-Reimbursement; and FAR 52.243-4, Changes, and in the prescription at FAR 43.205(c) for FAR 52.243-3, Changes—Time-and-Materials or Labor-Hours, the contracting officer may vary the period within which a contractor must assert its right to an equitable adjustment but the extended period shall not exceed 60 calendar days.
The contracting officer shall insert the clause at 852.243-70, Construction Contract Changes—Supplement, in solicitations and contracts for construction that are expected to exceed the micro-purchase threshold for construction.
38 U.S.C. 8127-8128, and 8151-8153; 40 U.S.C. 121(c); 41 U.S.C. 1121(c)(3); 41 U.S.C. 1303; 41 U.S.C. 1702; and 48 CFR 1.301-1.304.
As prescribed in 823.103-71, when the Contracting Officer deems a Sustainable Acquisition Plan necessary, the Contracting Officer shall insert the following provision:
Offerors shall include a Sustainable Acquisition Plan in their technical proposals. The plan must describe the approach and quality assurance mechanisms for applying FAR subpart 23.1, Sustainable Acquisition Policy and other Federal laws, regulations and Executive Orders governing sustainable acquisition. The plan shall clearly identify those products and services included in the proposal.
As prescribed by 823.303-70, the Contracting Officer shall insert the following clause:
(a) To help ensure the protection of the life and health of all persons, and to help prevent damage to property, the Contractor shall comply with all Federal, State, and local laws and regulations applicable to the work being performed under this contract. These laws are implemented or enforced by the Environmental Protection Agency (EPA), Occupational Safety and Health Administration (OSHA) and other regulatory/enforcement agencies at the Federal, State, and local levels.
(1) Additionally, the Contractor shall comply with the following regulations when developing and implementing health and safety operating procedures and practices for both personnel and facilities involving the use or handling of hazardous materials and the conduct of research, development, or test projects:
(i) 29 CFR 1910.1030, Bloodborne pathogens; 29 CFR 1910.1450, Occupational exposure to hazardous chemicals in laboratories. These regulations are available at
(ii) Nuclear Regulatory Commission Standards and Regulations, pursuant to the Energy Reorganization Act of 1974 (42 U.S.C. 5801
(2) The following Government guidelines are recommended for developing and implementing health and safety operating procedures and practices for both personnel and facilities:
(i) Biosafety in Microbiological and Biomedical Laboratories, Centers for Disease Control and Prevention (CDC), available at
(ii) Prudent Practices in the Laboratory, National Research Council, National Academy Press, Washington, DC 20001, available at
(b)(1) The Contractor shall maintain an accurate record of, and promptly report to the Contracting Officer, all accidents or incidents resulting in the exposure of persons to toxic substances, hazardous materials or hazardous operations; the injury or death of any person; or damage to property incidental to work performed under the contract resulting from toxic or hazardous materials and resulting in any or all violations for which the Contractor has been cited by any Federal, State or local regulatory/enforcement agency.
(2) The report shall include a copy of the notice of violation and the findings of any inquiry or inspection, and an analysis addressing the impact these violations may have on the work remaining to be performed. The report shall also state the required action(s), if any, to be taken to correct any violation(s) noted by the Federal, State, or local regulatory/enforcement agency and the time frame allowed by the agency to accomplish the necessary corrective action.
(c) If the Contractor fails or refuses to comply with the Federal, State or local regulatory/enforcement agency's directive(s) regarding any violation(s) and prescribed corrective action(s), the Contracting Officer may issue an order stopping all or part of the work until satisfactory corrective action (as approved by the Federal, State, or local regulatory/enforcement agencies) has been taken and documented to the Contracting Officer. No part of the time lost due to any such stop work order shall form the basis for a request for extension or costs or damages by the Contractor.
(d) The Contractor shall insert this clause in each subcontract involving toxic substances, hazardous materials, or hazardous operations. The Contractor is responsible for the compliance of its subcontractors with the provisions of this clause.
As prescribed in 843.205-70, the Contracting Officer shall insert this clause in solicitations and contracts for construction that are expected to exceed the micro-purchase threshold. The Contracting Officer shall fill in the number of days in which a Contractor must assert its right to an equitable adjustment; however, such amount shall not exceed 60 calendar days.
The FAR clauses 52.243-4, Changes; 52.243-5, Changes and Changed Conditions; and 52.236-2, Differing Site Conditions, are supplemented as follows:
(a) Submission of request for equitable adjustment proposals. When directed by the Contracting Officer or requested by the Contractor, the Contractor shall, in accordance with FAR 15.403-5, submit proposals for changes in the work exceeding $500,000 in writing to the Contracting Officer or Administrative Contracting Officer (ACO), and to the resident engineer.
(1) The Contractor must provide an itemized breakdown for changes exceeding the micro-purchase threshold (see FAR 2.101).
(2) The itemized breakdown shall include materials, quantities, unit prices, labor costs (separated into trades), construction equipment, etc. Labor costs shall be identified with specific material placed or operation performed.
(3) Proposals shall be submitted to the Contracting Officer or ACO and the resident engineer as expeditiously as possible, but not later than [fill-in] __calendar days, after receipt of a written change order by the Contracting Officer.
(4) Proposals shall be signed by each subcontractor participating in the change.
(5) The Contracting Officer will consider issuing a settlement by determination to the contract if the Contractor's proposal required by paragraph (3) is not received within 30 calendar days, or if agreement has not been reached.
(b) Paragraphs (a)(1) through (5) and the following apply to proposed contract changes costing $500,000 or less:
(1) As a basis for negotiation, allowances not to exceed 10 percent each for overhead and profit for the party performing the work will be based on the value of labor, material, and equipment required to accomplish the change. As the value of the change increases, a declining scale will be used in negotiating the percentage of overhead and profit. This declining scale will also be used to negotiate the prime Contractor's or upper-tier subcontractor's fee when work is performed by lower-tier subcontractors (to a maximum of three tiers) and will be based on the net increased cost to the prime or upper-tier subcontractor, as applicable. Profit (fee) shall be computed by multiplying the profit percentage by the sum of the direct costs and computed overhead costs. Allowable percentages on changes will not exceed the following:
(i) 10 percent overhead and/or 10 percent profit (fee) on the first $20,000.
(ii) 7.5 percent overhead and/or 7.5 percent profit (fee) on the next $30,000.
(iii) 5 percent overhead and/or 5 percent profit (fee) on a balance over $50,000.
(2) The Contracting Officer will consider issuing a settlement by determination to the contract if the Contractor's proposal required by paragraph (3) is not received within 30 calendar days, or if agreement has not been reached.
(c)(1) Overhead and Contractor's fee percentages shall be considered to include insurance other than mentioned herein, field and office supervisors and assistants, security police, use of small tools, incidental job burdens, and general home office expenses and no separate allowance will be made. Assistants to office supervisors include all clerical, stenographic and general office help. Incidental job burdens include, but are not necessarily limited to, office equipment and supplies, temporary toilets, telephone and conformance to OSHA requirements. Items such as, but not necessarily limited to, review and coordination, estimating and expediting relative to contract changes are associated with field and office supervision and are considered to be included in the Contractor's overhead and/or fee percentage.
(2) Where the Contractor's or subcontractor's portion of a change involves credit items, such items must be deducted prior to adding overhead and profit for the party performing the work. The Contractor's fee is limited to the net increase to Contractor or subcontractors' portions of cost computed in accordance with this clause.
(3) Where a change involves credit items only, a proper measure of the amount of downward adjustment in the contract price is the reasonable cost to the Contractor if it had performed the deleted work. A reasonable allowance for overhead and profit are properly includable as part of the downward adjustment for a deductive change. The amount of such allowance is subject to negotiation.
The Department of Agriculture has submitted the following information collection requirement(s) to OMB for review and clearance under the Paperwork Reduction Act of 1995, Public Law 104-13. Comments are requested regarding (1) whether the collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency's estimate of burden including the validity of the methodology and assumptions used; (3) ways to enhance the quality, utility and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology.
Comments regarding this information collection received by December 31, 2018 will be considered. Written comments should be addressed to: Desk Officer for Agriculture, Office of Information and Regulatory Affairs, Office of Management and Budget (OMB),
An agency may not conduct or sponsor a collection of information unless the collection of information displays a currently valid OMB control number and the agency informs potential persons who are to respond to the collection of information that such persons are not required to respond to the collection of information unless it displays a currently valid OMB control number.
The Department of Agriculture has submitted the following information collection requirement(s) to OMB for review and clearance under the Paperwork Reduction Act of 1995, Public Law 104-13. Comments are requested regarding (1) whether the collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency's estimate of burden including the validity of the methodology and assumptions used; (3) ways to enhance the quality, utility and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques and other forms of information technology.
Comments regarding this information collection received by December 31, 2018 will be considered. Written comments should be addressed to: Desk Officer for Agriculture, Office of Information and Regulatory Affairs, Office of Management and Budget (OMB), New Executive Office Building, 725 17th Street NW, Washington, DC 20503. Commentors are encouraged to submit their comments to OMB via email to:
An agency may not conduct or sponsor a collection of information unless the collection of information displays a currently valid OMB control number and the agency informs potential persons who are to respond to the collection of information that such persons are not required to respond to the collection of information unless it displays a currently valid OMB control number.
The Department of Commerce will submit to the Office of Management and Budget (OMB) for clearance the following proposal for collection of information under the provisions of the Paperwork Reduction Act (44 U.S.C. Chapter 35).
NOAA Fisheries, Southeast Fisheries Science Center, annually collects socioeconomic data from commercial fishermen in the Gulf of Mexico and South Atlantic shrimp fisheries who hold one or more permits for harvesting shrimp from federal waters (U.S. Exclusive Economic Zone). Information about revenues, variable and fixed costs, capital investment and other socioeconomic information is collected from a random sample of permit holders. These data are needed to conduct socioeconomic analyses in support of management of the shrimp fishery and to satisfy legal requirements. The data will be used to assess how fishermen will be impacted by and respond to federal regulation likely to be considered by fishery managers.
This information collection request may be viewed at
Written comments and recommendations for the proposed information collection should be sent within 30 days of publication of this notice to
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Notice; receipt of applications for a permit and permit modifications.
Notice is hereby given that five applicants have applied in due form for a permit or permit modification to take shortnose (
Written, telefaxed, or email comments must be received on or before December 31, 2018.
The permit and permit modification requests and related documents are available for review by selecting “Records Open for Public Comment” from the Features box on the Applications and Permits for Protected Species (APPS) home page,
Written comments on the pertinent application should be submitted to the Chief, Permits and Conservation Division, at the address listed above. Comments may also be submitted by facsimile to (301) 713-0376, or by email to
Those individuals requesting a public hearing should submit a written request to the Chief, Permits and Conservation Division at the address listed above. The request should set forth the specific reasons why a hearing on the application would be appropriate.
Malcolm Mohead (for File Nos. 19641-01, 20347-03, and 22671) or Erin Markin (for File Nos. 20340-05 and 20528-02), (301) 427-8401.
The subject new permit and permit modifications are requested under the authority of the Endangered Species Act of 1973, as amended (ESA; 16 U.S.C. 1531
The applicant also proposes using captive (non-releasable) adult, sub-adult, juvenile, and ELS shortnose and Atlantic sturgeon for objectives related to: Pathology, propagation techniques, anesthesiology, neurology, fish passage, fish behavior, technology (
Bureau of Consumer Financial Protection.
Notice and request for comment.
In accordance with the Paperwork Reduction Act of 1995 (PRA), the Bureau of Consumer Financial Protection (Bureau) is requesting to renew the Office of Management and Budget (OMB) approval for an existing information collection titled, “Mortgage Acts And Practices (Regulation N) 12 CFR 1014.”
Written comments are encouraged and must be received on or before December 31, 2018 to be assured of consideration.
Comments in response to this notice are to be directed towards OMB and to the attention of the OMB Desk Officer for the Bureau of Consumer Financial Protection. You may submit comments, identified by the title of the information collection, OMB Control Number (see below), and docket number (see above), by any of the following methods:
•
•
•
•
In general, all comments received will become public records, including any personal information provided. Sensitive personal information, such as account numbers or Social Security numbers, should not be included.
Documentation prepared in support of this information collection request is available at
Bureau of Consumer Financial Protection.
Notice and request for comment.
In accordance with the Paperwork Reduction Act of 1995 (PRA), the Bureau of Consumer Financial Protection (Bureau) is requesting to renew the Office of Management and Budget (OMB) approval for an existing information collection titled, “Registration of Mortgage Loan Originators (Regulation G).”
Written comments are encouraged and must be received on or before December 31, 2018 to be assured of consideration.
Comments in response to this notice are to be directed towards OMB and to the attention of the OMB Desk Officer for the Bureau of Consumer Financial Protection. You may submit comments, identified by the title of the information collection, OMB Control Number (see below), and docket number (see above), by any of the following methods:
•
•
•
•
In general, all comments received will become public records, including any personal information provided. Sensitive personal information, such as account numbers or Social Security numbers, should not be included.
Documentation prepared in support of this information collection request is available at
Bureau of Consumer Financial Protection.
Notice and request for comment.
In accordance with the Paperwork Reduction Act of 1995 (PRA), the Bureau of Consumer Financial Protection (Bureau) is requesting to renew the Office of Management and Budget (OMB) approval for an existing information collection titled, “Mortgage Assistance Relief Services (Regulation O).”
Written comments are encouraged and must be received on or
Comments in response to this notice are to be directed towards OMB and to the attention of the OMB Desk Officer for the Bureau of Consumer Financial Protection. You may submit comments, identified by the title of the information collection, OMB Control Number (see below), and docket number (see above), by any of the following methods:
•
•
•
•
In general, all comments received will become public records, including any personal information provided. Sensitive personal information, such as account numbers or Social Security numbers, should not be included.
Documentation prepared in support of this information collection request is available at
Bureau of Consumer Financial Protection.
Notice and request for comment.
In accordance with the Paperwork Reduction Act of 1995 (PRA), the Bureau of Consumer Financial Protection (Bureau) is requesting to renew the Office of Management and Budget (OMB) approval for an existing information collection titled, “Consumer Leasing Act (Regulation M) 12 CFR 1013.”
Written comments are encouraged and must be received on or before December 31, 2018 to be assured of consideration.
Comments in response to this notice are to be directed towards OMB and to the attention of the OMB Desk Officer for the Bureau of Consumer Financial Protection. You may submit comments, identified by the title of the information collection, OMB Control Number (see below), and docket number (see above), by any of the following methods:
•
•
•
•
In general, all comments received will become public records, including any personal information provided. Sensitive personal information, such as account numbers or Social Security numbers, should not be included.
Documentation prepared in support of this information collection request is available at
Export-Import Bank.
Notice.
This notice is to inform the public that the Export-Import Bank of the United States has received an application for a $5 billion direct loan to support the export of approximately $4.348 billion in U.S. equipment and services to establish an integrated liquefied natural gas, or LNG, project in Mozambique. The U.S. exports will enable the facility to produce approximately 12.8 million tons per year of liquefied natural gas.
Available information indicates the Mozambique gas producer plans to sell the liquefied natural gas in the Asia-Pacific market (including India, China, Japan, Indonesia, Taiwan, and Thailand), as well as smaller quantities to markets in Europe.
Comments are due December 13, 2018.
Interested parties may submit comments on this transaction by email to
Federal Accounting Standards Advisory Board.
Notice.
Pursuant to 31 U.S.C. 3511(d), the Federal Advisory Committee Act (Pub. L. 92-463), as amended, and the FASAB Rules Of Procedure, as amended in October 2010, notice is hereby given that the Federal Accounting Standards Advisory Board (FASAB) has issued its
The
Respondents are encouraged to comment on the content of the annual report and FASAB's project priorities for the next three years. Written comments are requested by January 23, 2019, and should be sent to
Ms. Wendy M. Payne, Executive Director, 441 G Street NW, Suite 1155, Washington, DC 20548, or call (202) 512-7350.
Federal Advisory Committee Act, Pub. L. 92-463.
Tuesday, December 4, 2018 at 10:00 a.m.
1050 First Street NE, Washington, DC.
This meeting will be closed to the public.
Compliance matters pursuant to 52 U.S.C. 30109.
Matters concerning participation in civil actions or proceedings or arbitration.
Matters relating to internal personnel decisions, or internal rules and practices.
Judith Ingram, Press Officer, Telephone: (202) 694-1220.
The Commission hereby gives notice of the filing of the following agreements under the Shipping Act of 1984. Interested parties may submit comments on the agreements to the Secretary by email at
The notificants listed below have applied under the Change in Bank Control Act (12 U.S.C. 1817(j)) and § 225.41 of the Board's Regulation Y (12 CFR 225.41) to acquire shares of a bank or bank holding company. The factors that are considered in acting on the notices are set forth in paragraph 7 of the Act (12 U.S.C. 1817(j)(7)).
The notices are available for immediate inspection at the Federal Reserve Bank indicated. The notices also will be available for inspection at the offices of the Board of Governors. Interested persons may express their views in writing to the Reserve Bank indicated for that notice or to the offices of the Board of Governors. Comments must be received not later than December 17, 2018.
1.
Federal Trade Commission (“Commission” or “FTC”).
Notice.
The information collection requirements described below will be submitted to the Office of Management and Budget (“OMB”) for review, as required by the Paperwork Reduction Act (“PRA”). The FTC seeks public comments on its proposal to extend for an additional three years the current PRA clearance for information collection requirements contained in its Alternative Fuels Rule (“Rule”). That clearance expires on May 31, 2019.
Comments must be submitted on or before January 28, 2019.
Interested parties may file a comment online or on paper, by following the instructions in the Request for Comment part of the
Requests for additional information or copies of the proposed information requirements for the Alternative Fuels Rule should be directed to Hampton Newsome, Attorney, (202) 326-2889, Division of Enforcement, Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania Avenue NW, Washington, DC 20580.
Under the PRA, 44 U.S.C. 3501-3521, federal agencies must obtain approval from
The Rule, which implements the Energy Policy Act of 1992, Public Law 102-486, and as revised by the Commission's 2013 final amendments,
It is common practice for alternative fuel industry members to determine and monitor fuel ratings in the normal course of their business activities. This is because industry members must know and determine the fuel ratings of their products in order to monitor quality and to decide how to market them. “Burden” for PRA purposes is defined to exclude effort that would be expended regardless of any regulatory requirement. 5 CFR 1320.2(b)(2). Moreover, as originally anticipated when the Rule was promulgated in 1995, many of the information collection requirements and the originally estimated hours were associated with one-time start up tasks of implementing standard systems and processes.
Other factors also limit the burden associated with the Rule. Certification may be a one-time event or require only infrequent revision. Disclosures on electric vehicle fuel dispensing systems may be useable for several years. Nonetheless, there is still some burden associated with posting labels. There also will be some minimal burden associated with new or revised certification of fuel ratings and recordkeeping.
Thus, estimated total burden for non-liquid alternative fuels is 6,000 hours (400 + 2,000 + 3,600).
Labor costs are derived by applying appropriate hourly cost figures to the burden hours described and estimated above. According to Bureau of Labor Statistics data for 2017 (most recent available whole-year information),
Staff believes there are no current start-up costs associated with the Rule, inasmuch as the Rule has been in effect since 1995. Industry members, therefore, have in place the capital equipment and means necessary to determine automotive fuel ratings and comply with the Rule. Industry members, however, incur the cost of procuring fuel dispenser labels to comply with the Rule.
The estimated annual fuel labeling cost, based on estimates of approximately 8,000 fuel dispensers (assumptions: An estimated 20% of 20,000 total fuel retailers need to replace labels in any given year with an approximate five-year life for labels—
Pursuant to Section 3506(c)(2)(A) of the PRA, the FTC invites comments on: (1) Whether the recordkeeping and disclosure requirements are necessary, including whether the information will be practically useful; (2) the accuracy of our burden estimates, including whether the methodology and assumptions used are valid; (3) how to improve the quality, utility, and clarity of the disclosure requirements; and (4) how to minimize the burden of providing the required information to consumers.
You can file a comment online or on paper. For the FTC to consider your comment, we must receive it on or before January 28, 2019. Write “Paperwork Comment: FTC File No. P134200” on your comment. Your comment—including your name and your state—will be placed on the public record of this proceeding, including, to the extent practicable, on the public Commission website, at
Postal mail addressed to the Commission is subject to delay due to heightened security screening. As a result, we encourage you to submit your comments online, or to send them to the Commission by courier or overnight service. To make sure that the Commission considers your online comment, you must file it at
If you file your comment on paper, write “Paperwork Comment: FTC File No. P134200” on your comment and on the envelope, and mail it to the following address: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue NW, Suite CC-5610 (Annex J), Washington, DC 20580, or deliver your comment to the following address: Federal Trade Commission, Office of the Secretary, Constitution Center, 400 7th Street SW, 5th Floor, Suite 5610 (Annex J), Washington, DC 20024. If possible, submit your paper comment to the Commission by courier or overnight service.
Because your comment will be placed on the publicly accessible FTC website at
Comments containing material for which confidential treatment is requested must be filed in paper form, must be clearly labeled “Confidential,” and must comply with FTC Rule 4.9(c). In particular, the written request for confidential treatment that accompanies the comment must include the factual and legal basis for the request, and must identify the specific portions of the comment to be withheld from the public record.
The FTC Act and other laws that the Commission administers permit the collection of public comments to consider and use in this proceeding as appropriate. The Commission will consider all timely and responsive public comments that it receives on or before January 28, 2019. For information on the Commission's privacy policy, including routine uses permitted by the Privacy Act, see
Agency for Healthcare Research and Quality (AHRQ), Department of Health and Human Services (HHS).
Notice of availability—New Common Formats.
As authorized by the Secretary of HHS, AHRQ coordinates the development of common definitions and reporting formats (Common Formats or formats) for reporting on health care quality and patient safety. The purpose of this notice is to announce the availability of
Ongoing public input.
The
Dr. Hamid Jalal, Center for Quality Improvement and Patient Safety, AHRQ, 5600 Fishers Lane, Rockville, MD 20857; Telephone (toll free): (866) 403-3697; Telephone (local): (301) 427-1111; TTY (toll free): (866) 438-7231; TTY (local): (301) 427-1130; Email:
The Patient Safety and Quality Improvement Act of 2005, 42 U.S.C. 299b-21 to 299b-26 (Patient Safety Act), and the related Patient Safety and Quality Improvement Final Rule, 42 CFR part 3 (Patient Safety Rule), published in the
The Patient Safety Act provides for the development of standardized reporting formats using common language and definitions to ensure that health care quality and patient safety data collected by PSOs and other entities are comparable. The Common Formats facilitate aggregation of comparable data at local, PSO, regional and national levels. In addition, the formats are intended to enhance the reporting of information that is standardized both clinically and electronically.
AHRQ has developed Common Formats for three settings of care—acute care hospitals, skilled nursing facilities and community pharmacies—for use by health care providers and PSOs. AHRQ-listed PSOs are required to collect patient safety work product in a standardized manner to the extent practical and appropriate; this is a requirement the PSO can meet by collecting such information using Common Formats. Additionally, providers and other organizations not working with an AHRQ-listed PSO can use the Common Formats in their work to improve quality and safety; however,
Since February 2005, AHRQ has convened the Federal Patient Safety Work Group (PSWG) to assist with developing and maintaining the Common Formats. The PSWG includes major health agencies within HHS as well as the Departments of Defense and Veterans Affairs. The PSWG helps assure the consistency of definitions/formats with those of relevant government agencies. In addition, AHRQ has solicited comments from the private and public sectors regarding proposed versions of the Common Formats through a contract, since 2008, with the National Quality Forum (NQF), which is a non-profit organization focused on health care quality. After receiving comments, the NQF solicits review of the formats by its Common Formats Expert Panel. Subsequently, NQF provides this input to AHRQ who then uses it to refine the formats.
Previously, AHRQ's primary focus with the Common Formats has been to support traditional event reporting. For the Common Formats, it should be noted that AHRQ uses the term “surveillance” to refer to the improved detection of events and calculation of adverse event rates in populations reviewed that will allow for collection of comparable performance data over time and across settings. These formats are designed to provide, through retrospective review of medical records, information that is complementary to that derived from event reporting systems. For more information on AHRQ's efforts measuring patient safety in this area, please go to:
AHRQ announced the availability of the,
Additional information about the Common Formats can be obtained through AHRQ's PSO website:
Centers for Medicare & Medicaid Services, HHS.
Notice.
The Centers for Medicare & Medicaid Services (CMS) is announcing an opportunity for the public to comment on CMS' intention to collect information from the public. Under the Paperwork Reduction Act of 1995 (PRA), federal agencies are required to publish notice in the
Comments on the collection(s) of information must be received by the OMB desk officer by December 31, 2018.
When commenting on the proposed information collections, please reference the document identifier or OMB control number. To be assured consideration, comments and recommendations must be received by the OMB desk officer via one of the following transmissions: OMB, Office of Information and Regulatory Affairs, Attention: CMS Desk Officer, Fax Number: (202) 395-5806
To obtain copies of a supporting statement and any related forms for the proposed collection(s) summarized in this notice, you may make your request using one of following:
1. Access CMS' website address at
2. Email your request, including your address, phone number, OMB number, and CMS document identifier, to
3. Call the Reports Clearance Office at (410) 786-1326.
William Parham at (410) 786-4669.
Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501-3520), federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. The term “collection of information” is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3(c) and includes agency requests or requirements that members of the public submit reports, keep records, or provide information to a third party. Section 3506(c)(2)(A) of the PRA (44 U.S.C. 3506(c)(2)(A)) requires federal agencies to publish a 30-day notice in the
1.
2.
As mandated by Sections 1152-1154 of the Social Security Act, CMS directs the QIO program, which is one of the largest federal programs dedicated to improving health quality for Medicare beneficiaries. QIOs are groups of health quality experts, clinicians, and consumers who work to assist Medicare providers with quality improvement throughout the spectrum of care and to review quality concerns for the protection of beneficiaries and the Medicare Trust Fund. This program is a key component of the U.S. Department of Health and Human Services' (HHS) National Quality Strategy and the CMS Quality Strategy. The work is aligned with the current HHS and CMS administration priorities to empower patients and doctors to make decisions about their health care; usher in a new era of state flexibility and local leadership; support innovative approaches to improve quality, accessibility, and affordability; and improve the CMS customer experience. In the current SOW, 14 QIN-QIOs coordinate the work in 53 U.S. states and territories.
CMS evaluates the quality and effectiveness of the QIO program as authorized in Part B of Title XI of the Social Security Act. CMS created the Independent Evaluation Center (IEC) to provide CMS and its stakeholders with an independent and objective program evaluation of the 11th SOW.
For the program to improve medication safety and prevent adverse drug events (ADEs), QIN-QIOs provide technical assistance to providers, practitioners, organizations offering Medicare Advantage plans under Medicare Part C, and prescription drug sponsors offering drug plans under Part D. ADEs are defined as “injury resulting from medical intervention related to a drug,” and cause the majority of preventable deaths in hospitals. ADEs escalate healthcare costs and utilization, increasing admission and readmission rates, emergency department (ED) visits, and physician visits. ADEs are particularly problematic for older adults who have multiple chronic conditions and interact with many care settings.
Opioid misuse and overdose is a significant cause of ADEs and was declared a public health emergency by the White House in 2017. In 2016, over 14 million Medicare Part D beneficiaries received opioid prescriptions, and many of these beneficiaries received extreme amounts of the drugs. The Medicare population has one of the highest and fastest-growing rates of diagnosed opioid use disorder.
As part of the HHS Opioid Initiative launched in March 2015, CMS developed a multipronged approach to combat misuse and promote programs that support treatment and recovery support services for clinicians, beneficiaries, and families. CMS also worked with HHS and other health agencies to develop a
The QIO program provides technical assistance to reduce ADEs in beneficiaries resulting from polypharmacy, specifically those who use three or more medications including a prescription in a HRM) drug groups. In the 11th SOW, specific interventions include training providers through Learning Action Networks; developing collaborations among local providers across care settings; providing materials and information resources; and helping providers collect data to monitor prescribing practices.
To evaluate the effectiveness of this program, we will use a mixed method evaluation combining secondary data analysis of Medicare claims with a community provider survey. We plan to conduct an online survey of 1,200 community-based pharmacists and physician practices. These participants were selected based on their role in prescribing HRM and treating ADEs.
The proposed survey assesses the extent to which the
The survey will also provide estimates of the attribution of the QIN-QIO program for improving ADE prevention, and reported impact of the QIN-QIO program from the perspective of healthcare providers. The perceived influence on quality improvement efforts will be quantified and, along with econometric modeling methods, will be used to assess program attribution. Estimating attribution is a contract requirement for the IEC and helps provide evidence of impact of the QIN-QIO program. Since current analytical methods do not adequately address the overlap of quality improvement initiatives targeting medication safety and ADE prevention, the IEC developed an innovative approach, combining survey input with modeling, to estimate the relative importance of the QIN-QIO program. The concept is supported at the highest level of administration for Quality Improvement at CMS and has been presented at national conferences and to CMS/CCSQ leadership. The survey data
The information collected through the survey will complement the existing data by helping identify factors associated with ADE outcomes of interest from existing data sets such as Medicare claims. For example, claims data can provide information on whether the number of prescriptions for opioids has decreased, but not what has helped to facilitate the decrease. Subsequent to the 60-day
Children's Bureau, Administration on Children, Youth and Families, Administration for Children and Families, Department of Health and Human Services.
Notice of biennial publication of allotment percentages for States under the Title IV-B subpart 1, Stephanie Tubbs Jones Child Welfare Services Program.
As required by section 423(c) of the Social Security Act, the Department is publishing the allotment percentage for each State under the Title IV-B Subpart 1, Stephanie Tubbs Jones Child Welfare Services Program. Under section 423(a), the allotment percentages are one of the factors used in the computation of the Federal grants awarded under the Program.
The allotment percentages will be effective for Federal Fiscal Years 2020 and 2021.
Daniel Jackson, Grants Fiscal Management Specialist, Office of Grants Management, Office of Administration, Administration for Children and Families, 330 C St. SW, Washington, DC 20201. Telephone: (202) 401-3446. Email:
The allotment percentage for each State is determined on the basis of paragraphs (b) and (c) of section 423 of the Social Security Act. These figures are available on the ACF internet homepage at
Section 423(c) of the Social Security Act (42 U.S.C. 623(c)).
Food and Drug Administration, HHS.
Notice of public meeting; request for comments.
The Food and Drug Administration (FDA or Agency) is announcing the following public meeting entitled “Prescription Drug User Fee Act of 2017; Electronic Submissions and Data Standards.” FDA is also requesting public comments on the subject. The purpose of the meeting and the request for comments is to fulfill FDA's commitment to seek stakeholder input related to data standards and the electronic submission system's past performance, future targets, emerging industry needs, and technology initiatives. FDA will use the information from the public meeting as well as from comments submitted to the docket to provide input into data standards initiatives, the FDA Information Technology (IT) Strategic Plan, and electronic submissions gateway target timeframes.
The public meeting will be held on April 10, 2019, from 9 a.m. to 4 p.m. Submit either electronic or written comments by April 10, 2019. See the
The public meeting will be held at the FDA White Oak Campus, 10903 New Hampshire Ave., Building 31 Conference Center, the Great Room (Rm. 1503, Section A), Silver Spring, MD 20993-0002. Entrance for public meeting participants (non-FDA employees) is through Building 1, where routine security check procedures will be performed. For parking and security information, please refer to
You may submit comments as follows. Please note that late, untimely filed comments will not be considered. Electronic comments must be submitted on or before April 10, 2019. The
Submit electronic comments in the following way:
•
• If you want to submit a comment with confidential information that you do not wish to be made available to the public, submit the comment as a written/paper submission and in the manner detailed (see “Written/Paper Submissions” and “Instructions”).
Submit written/paper submissions as follows:
•
• For written/paper comments submitted to the Dockets Management Staff, FDA will post your comment, as well as any attachments, except for information submitted, marked and identified, as confidential, if submitted as detailed in “Instructions.”
• Confidential Submissions—To submit a comment with confidential information that you do not wish to be made publicly available, submit your comments only as a written/paper submission. You should submit two copies total. One copy will include the information you claim to be confidential with a heading or cover note that states “THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.” The Agency will review this copy, including the claimed confidential information, in its consideration of comments. The second copy, which will have the claimed confidential information redacted/blacked out, will be available for public viewing and posted on
Chenoa Conley, Center for Drug Evaluation and Research, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 51, Rm. 1117, Silver Spring, MD 20993-0002, 301-796-0035,
FDA is committed to achieve the long-term goal of improving the predictability and consistency of the electronic submission process and enhancing transparency and accountability of FDA information technology-related activities. In the PDUFA VI commitment letter, FDA agreed to hold annual public meetings to seek stakeholder input related to electronic submissions and data standards to inform the FDA IT Strategic Plan and published targets. The commitment letter outlines FDA's performance goals and procedures under the PDUFA program for the years 2018 through 2022. The commitment letter can be found at
FDA will consider all comments made at this meeting or received through the docket (see
Registration is free and based on space availability, with priority given to early registrants. Persons interested in attending this public meeting on April 10, 2019, must register by 11:59 p.m. on March 22, 2019, Eastern Time. Early registration is recommended because seating is limited; therefore, FDA may limit the number of participants from each organization. Registrants will receive confirmation when they have been accepted.
If you need special accommodations due to a disability, please contact Chenoa Conley, 301-796-0035, email
Food and Drug Administration, HHS.
Notice of availability.
The Food and Drug Administration (FDA or Agency) is announcing the availability of the draft guidance entitled “Recommendations for Dual 510(k) and Clinical Laboratory Improvement Amendments (CLIA) Waiver by Application Studies.” It describes study designs for generating data that supports both 510(k) clearance and CLIA waiver. Use of the Dual 510(k) and CLIA Waiver by Application pathway is optional; however, FDA believes this pathway is in many instances the least burdensome and fastest approach for manufacturers to obtain a CLIA waiver in addition to 510(k) clearance for new in vitro diagnostic (IVD) devices. FDA believes increased use of this pathway will speed up the process of bringing simple and accurate IVD devices to CLIA waived settings, which will better serve patients and providers. This draft guidance is not final nor is it in effect at this time.
Submit either electronic or written comments on the draft guidance by February 27, 2019 to ensure that the Agency considers your comment on this draft guidance before it begins work on the final version of the guidance.
You may submit comments on any guidance at any time as follows:
Submit electronic comments in the following way:
•
• If you want to submit a comment with confidential information that you do not wish to be made available to the public, submit the comment as a written/paper submission and in the manner detailed (see “Written/Paper Submissions” and “Instructions”).
Submit written/paper submissions as follows:
•
• For written/paper comments submitted to the Dockets Management Staff, FDA will post your comment, as well as any attachments, except for information submitted, marked and identified, as confidential, if submitted as detailed in “Instructions.”
• Confidential Submissions—To submit a comment with confidential information that you do not wish to be made publicly available, submit your comments only as a written/paper submission. You should submit two copies total. One copy will include the information you claim to be confidential with a heading or cover note that states “THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.” The Agency will review this copy, including the claimed confidential information, in its consideration of comments. The second copy, which will have the claimed confidential information redacted/blacked out, will be available for public viewing and posted on
You may submit comments on any guidance at any time (see 21 CFR 10.115(g)(5)).
An electronic copy of the guidance document is available for download
Peter Tobin, Center for Devices and Radiological Health, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 66, Rm. 5657, Silver Spring, MD 20993-0002, 240-402-6169.
Typically, in an application for CLIA waiver (CLIA Waiver by Application) a manufacturer submits evidence to FDA that a previously cleared or approved test, initially categorized as moderate complexity, meets the CLIA statutory criteria for waiver, 42 U.S.C. 263a(d)(3), and requests that FDA categorize the test as waived. This means that historically a CLIA Waiver by Application has followed clearance or approval of an IVD test.
While a premarket notification (510(k)) and CLIA Waiver by Application each include discrete elements not required in the other, both submissions generally include comparison and reproducibility studies. For a 510(k), such studies are often performed by trained operators (
An applicant may choose to conduct a single set of comparison and reproducibility studies with untrained operators to satisfy certain requirements to establish both substantial equivalence under section 513(i) of the FD&C Act (21 U.S.C. 360c(i) for 510(k) clearance and simplicity and insignificant risk of erroneous results under 42 U.S.C. 263a(d)(3) for CLIA waiver. To streamline the review of such data, the Dual 510(k) and CLIA Waiver by Application (Dual Submission) pathway was established as part of the Medical Device User Fee Amendments of 2012 (MDUFA III), allowing the review of both a 510(k) and CLIA Waiver by Application within a single submission with a reduced overall review time compared to sequential submissions.
This draft guidance is being issued consistent with FDA's good guidance practices regulation (21 CFR 10.115). The draft guidance, when finalized, will represent the current thinking of FDA on “Recommendations for Dual 510(k) and CLIA Waiver by Application Studies.” It does not establish any rights for any person and is not binding on FDA or the public. You can use an alternative approach if it satisfies the requirements of the applicable statutes and regulations. This guidance is not subject to Executive Order 12866.
Persons interested in obtaining a copy of the draft guidance may do so by downloading an electronic copy from the internet. A search capability for all Center for Devices and Radiological Health guidance documents is available at
This draft guidance refers to previously approved collections of information. These collections of information are subject to review by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). The collections of information in the following FDA regulations and guidance have been approved by OMB as listed in the following table:
Food and Drug Administration, HHS.
Notice of availability.
The Food and Drug Administration (FDA or Agency) is announcing the availability of additional draft and revised draft product-specific guidances. The guidances provide product-specific recommendations on, among other things, the design of bioequivalence (BE) studies to support abbreviated new drug applications (ANDAs). In the
Submit either electronic or written comments on the draft guidance by January 28, 2019 to ensure that the Agency considers your comment on this draft guidance before it begins work on the final version of the guidance.
You may submit comments on any guidance at any time as follows:
Submit electronic comments in the following way:
•
• If you want to submit a comment with confidential information that you do not wish to be made available to the public, submit the comment as a written/paper submission and in the manner detailed (see “Written/Paper Submissions” and “Instructions”).
Submit written/paper submissions as follows:
•
• For written/paper comments submitted to the Dockets Management Staff, FDA will post your comment, as well as any attachments, except for information submitted, marked and identified, as confidential, if submitted as detailed in “Instructions.”
•
You may submit comments on any guidance at any time (see 21 CFR 10.115(g)(5)).
Submit written requests for single copies of the draft guidances to the Division of Drug Information, Center for Drug Evaluation and Research, Food and Drug Administration, 10001 New Hampshire Ave., Hillandale Building, 4th Floor, Silver Spring, MD 20993-0002. Send one self-addressed adhesive label to assist that office in processing your requests. See the
Wendy Good, Center for Drug Evaluation and Research, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 75, Rm. 4714, Silver Spring, MD 20993-0002, 240-402-1146.
In the
As described in that guidance, FDA adopted this process as a means to develop and disseminate product-specific guidances and provide a meaningful opportunity for the public to consider and comment on those guidances. Under that process, draft guidances are posted on FDA's website and announced periodically in the
FDA is announcing the availability of new draft product-specific guidances for industry for drug products containing the following active ingredients:
FDA is announcing the availability of revised draft product-specific guidances for industry for drug products containing the following active ingredients:
For a complete history of previously published
These draft guidances are being issued consistent with FDA's good guidance practices regulation (21 CFR 10.115). These draft guidances, when finalized, will represent the current thinking of FDA on, among other things, the product-specific design of BE studies to support ANDAs. They do not establish any rights for any person and are not binding on FDA or the public. You can use an alternative approach if it satisfies the requirements of the applicable statutes and regulations. This guidance is not subject to Executive Order 12866.
Persons with access to the internet may obtain the draft guidances at either
Food and Drug Administration, HHS.
Notice of availability.
The Food and Drug Administration (FDA or Agency) is announcing the availability of the draft guidance entitled “Select Updates for Recommendations for Clinical Laboratory Improvement Amendments of 1988 Waiver Applications for Manufacturers of In Vitro Diagnostic Devices.” FDA has developed this draft guidance to implement the 21st Century Cures Act (the Cures Act), which requires FDA to revise “Section V. Demonstrating Insignificant Risk of an Erroneous Result—Accuracy” of the guidance “Recommendations for Clinical Laboratory Improvement Amendments of 1988 (CLIA) Waiver Applications for Manufacturers of In Vitro Diagnostic Devices” (“2008 CLIA Waiver Guidance”) that was issued on January 30, 2008. This draft guidance represents FDA's current thinking regarding “the appropriate use of comparable performance between a waived user and a moderately complex laboratory user to demonstrate accuracy.” The 2008 CLIA Waiver Guidance remains in effect, in its current form, until this draft guidance is finalized, at which time the updates in section III of this draft guidance will supersede the recommendations in section V of the 2008 CLIA Waiver Guidance. This draft guidance is not final nor is it in effect at this time.
Submit either electronic or written comments on the draft guidance by February 27, 2019 to ensure that the Agency considers your comment on this draft guidance before it begins work on the final version of the guidance.
You may submit comments on any guidance at any time as follows:
Submit electronic comments in the following way:
•
• If you want to submit a comment with confidential information that you do not wish to be made available to the public, submit the comment as a written/paper submission and in the manner detailed (see “Written/Paper Submissions” and “Instructions”).
Submit written/paper submissions as follows:
•
• For written/paper comments submitted to the Dockets Management Staff, FDA will post your comment, as well as any attachments, except for information submitted, marked and identified, as confidential, if submitted as detailed in “Instructions.”
• Confidential Submissions—To submit a comment with confidential information that you do not wish to be made publicly available, submit your comments only as a written/paper submission. You should submit two copies total. One copy will include the information you claim to be confidential with a heading or cover note that states “THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.” The Agency will review this copy, including the claimed confidential information, in its consideration of comments. The second copy, which will have the claimed confidential information redacted/blacked out, will be available for public viewing and posted on
You may submit comments on any guidance at any time (see 21 CFR 10.115(g)(5)).
An electronic copy of the guidance document is available for download from the internet. See the
Peter Tobin, Center for Devices and Radiological Health, Food and Drug Administration, 10903 New Hampshire
FDA has developed this draft guidance to implement section 3057 of the Cures Act (Pub. L. 114-255), which requires FDA to revise “Section V. Demonstrating Insignificant Risk of an Erroneous Result—Accuracy” of the guidance “Recommendations for Clinical Laboratory Improvement Amendments of 1988 (CLIA) Waiver Applications for Manufacturers of In Vitro Diagnostic Devices”
FDA will incorporate the final version of this draft guidance into “Section V. Demonstrating Insignificant Risk of an Erroneous Result—Accuracy” of the 2008 CLIA Waiver Guidance. The remainder of the 2008 CLIA Waiver Guidance, with exception of technical edits for consistency with the newly amended section V, will not be substantively changed and will remain in effect.
The Secretary of Health and Human Services has delegated to FDA (69 FR 22849, April 27, 2004) the authority to determine whether particular tests are “simple” and have “an insignificant risk of an erroneous result” under CLIA and thus are eligible for CLIA waiver (42 U.S.C. 263a(d)(3)). The Centers for Medicare & Medicaid Services is responsible for oversight of clinical laboratories, which includes issuing Certificates of Waiver. CLIA requires that clinical laboratories obtain a certificate before accepting materials derived from the human body for laboratory tests (42 U.S.C. 263a(b)).
The 2008 CLIA Waiver Guidance describes recommendations for device manufacturers about study design and analysis for CLIA Waiver by Application to support an FDA determination as to whether the device meets the statutory criteria for waiver (42 U.S.C. 263a(d)(3)).
On November 29, 2017, FDA announced in the
This draft guidance is being issued consistent with FDA's good guidance practices regulation (21 CFR 10.115). The draft guidance, when finalized, will represent the current thinking of FDA on “Select Updates for Recommendations for Clinical Laboratory Improvement Amendments of 1988 Waiver Applications for Manufacturers of In Vitro Diagnostic Devices.” It does not establish any rights for any person and is not binding on FDA or the public. You can use an alternative approach if it satisfies the requirements of the applicable statutes and regulations. This guidance is not subject to Executive Order 12866.
Persons interested in obtaining a copy of the draft guidance may do so by downloading an electronic copy from the internet. A search capability for all Center for Devices and Radiological Health guidance documents is available at
This draft guidance refers to previously approved collections of information. These collections of information are subject to review by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). The collections of information in the following FDA regulations and guidance have been approved by OMB as listed in the following table:
United States International Trade Commission.
December 7, 2018 at 11:00 a.m.
Room 101, 500 E Street SW, Washington, DC 20436, Telephone: (202) 205-2000.
Open to the public.
1. Agendas for future meetings: None.
2. Minutes.
3. Ratification List.
4. Vote on Inv. Nos. 701-TAn14 and 731-TA-1431 (Preliminary) (Magnesium from Israel). The Commission is currently scheduled to complete and file its determinations on December 10, 2018; views of the Commission are currently scheduled to be completed and filed on December 17, 2018.
5. Outstanding action jackets: None.
In accordance with Commission policy, subject matter listed above, not disposed of at the scheduled meeting, may be carried over to the agenda of the following meeting.
By order of the Commission.
United States International Trade Commission.
December 5, 2018 at 11:00 a.m.
Room 101, 500 E Street SW, Washington, DC 20436, Telephone: (202) 205-2000.
Open to the public.
1. Agendas for future meetings: None.
2. Minutes.
3. Ratification List.
4. Vote on Inv. Nos. 701-TA-591 and 731-TA-1399 (Final) (Common Alloy Aluminum Sheet from China). The Commission is currently scheduled to complete and file its determinations and views of the Commission by December 19, 2018.
5. Outstanding action jackets: None.
In accordance with Commission policy, subject matter listed above, not disposed of at the scheduled meeting, may be carried over to the agenda of the following meeting.
By order of the Commission.
United States International Trade Commission.
December 14, 2018 at 11:00 a.m.
Room 101, 500 E Street SW, Washington, DC 20436, Telephone: (202) 205-2000.
Open to the public.
1. Agendas for future meetings: None.
2. Minutes.
3. Ratification List.
4. Vote on Inv. Nos. 701-TA-598 and 600 and 731-TA-1408 and 1410 (Final) (Rubber Bands from China and Thailand). The Commission is currently scheduled to complete and file its determinations and views of the Commission by December 27, 2018.
5. Outstanding action jackets: None.
In accordance with Commission policy, subject matter listed above, not disposed of at the scheduled meeting, may be carried over to the agenda of the following meeting.
By order of the Commission.
United States International Trade Commission.
December 6, 2018 at 9:30 a.m.
Room 101, 500 E Street SW, Washington, DC 20436, Telephone: (202) 205-2000.
Open to the public.
1. Agendas for future meetings: None.
2. Minutes.
3. Ratification List.
4. Vote on Inv. Nos. 701-TA-593-596 and 731-TA-1401-1406 (Final) (Large Diameter Welded Pipe from Canada, China, Greece, India, Korea, and Turkey). The Commission is currently scheduled to complete and file its determinations and views of the Commission by December 20, 2018.
5. Outstanding action jackets: None.
In accordance with Commission policy, subject matter listed above, not disposed of at the scheduled meeting, may be carried over to the agenda of the following meeting.
By order of the Commission.
Mine Safety and Health Administration, Labor.
Request for public comments.
The Department of Labor, as part of its continuing effort to reduce paperwork and respondent burden, conducts a pre-clearance consultation program to provide the general public and Federal agencies with an opportunity to comment on proposed collections of information in accordance with the Paperwork Reduction Act of 1995. This program helps to ensure that requested data can be provided in the desired format, reporting burden (time
All comments must be received on or before January 28, 2019.
Comments concerning the information collection requirements of this notice may be sent by any of the methods listed below.
•
•
•
Sheila McConnell, Director, Office of Standards, Regulations, and Variances, MSHA, at
Each operator of a surface coal mine is required under 30 CFR 77.1000 to establish and follow a ground control plan for highwalls, pits, and spoil banks that is consistent with prudent engineering design and which will ensure safe working conditions. The mine operator is required by section 77.1000-1 to file the ground control plan with the appropriate District Manager. The mining methods employed by the operator are selected to ensure highwall, pit, and spoil bank stability. In the event of a highwall failure or material dislodgment, there may be very little time to escape possible injury; therefore, preventive measures must be taken. Each plan is based on the type of strata expected to be encountered, the height and angle of highwalls and spoil banks, and the equipment to be used at the mine. The plan is used to show how the mine operator will maintain safe working conditions around the highwalls, pits, and spoil banks. Each plan is reviewed by MSHA to ensure that highwalls, pits, and spoil banks are maintained in a safe condition through the use of sound engineering design.
MSHA is soliciting comments concerning the proposed information collection related to Ground Control for Surface Coal Mines and Surface Work Areas of Underground Coal Mines. MSHA is particularly interested in comments that:
• Evaluate whether the collection of information is necessary for the proper performance of the functions of the Agency, including whether the information has practical utility;
• Evaluate the accuracy of MSHA's estimate of the burden of the collection of information, including the validity of the methodology and assumptions used;
• Suggest methods to enhance the quality, utility, and clarity of the information to be collected; and
• Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology,
The information collection request will be available on
The public may also examine publicly available documents at USDOL—Mine Safety and Health Administration, 201 12th Street South, Suite 4E401, Arlington, VA 22202-5452. Sign in at the receptionist's desk on the 4th floor via the East elevator.
Questions about the information collection requirements may be directed to the person listed in the
This request for collection of information contains provisions for Ground Control for Surface Coal Mines and Surface Work Areas of Underground Coal Mines. MSHA has updated the data with respect to the number of respondents, responses, burden hours, and burden costs supporting this information collection request.
Comments submitted in response to this notice will be summarized and included in the request for Office of Management and Budget approval of the information collection request; they will also become a matter of public record.
This notice announces the membership of the National Endowment for the Arts (NEA) Senior Executive Service (SES) Performance Review Board (PRB).
Send comments concerning this notice to: National Endowment for the Arts, 400 7th Street SW, Washington, DC 20506.
Craig McCord Sr. by telephone at (202) 682-5473 or by email at
4314 (c)(1) through (5) of Title 5, U.S.C., requires each agency to establish, in accordance with regulations prescribed by the Office of Personnel Management, one or more SES Performance Review Boards. The Board shall review and evaluate the initial appraisal of a senior executive's performance by the supervisor, along with any response by the senior executive, and make recommendations to the appointing authority relative to the performance of the senior executive.
The following persons have been selected to serve on the Performance Review Board of the National Endowment for the Arts (NEA):
Office of the Director of National Intelligence (ODNI).
Notice of a new system of records.
ODNI provides notice that it is establishing one new Privacy Act system of records at the National Counterintelligence and Security Center (NCSC). This new system of records is titled the NCSC Continuous Evaluation System, also identified as ODNI/NCSC-003. This notice is necessary to inform the public of the existence and character of records that the agency maintains.
Continuous Evaluation (CE) is a personnel security investigative process used to review the continued eligibility of individuals who have been determined eligible for access to classified information or to hold a sensitive position. Individuals subject to CE include current Executive Branch employees, detailees, contractors, and other sponsored individuals who are cleared for access to classified information or to hold a sensitive position. The Departments and Agencies (D/As) that sponsor these individuals for access to classified information or to hold a sensitive position “enroll” the individuals (enrollees) for CE by electronically entering their identifying information into a technical system that carries out the CE capability.
All D/As are required to submit their qualifying populations to CE. D/As may choose to develop a technical CE system of their own, or subscribe to CE services provided by another agency. The ODNI/NCSC will provide CE services to subscribing agencies. The NCSC CE System leverages electronic checks of government and commercial databases and, based on automated business rules, transmits alerts and reports to the enrolling D/A. Datasets queried in the CE process are those that contain security-relevant information,
The NCSC CE System retains the enrollment information (personal identifiers as provided by the enrolling D/A) in order to facilitate ongoing CE checks. The system does not retain the records returned from the electronic database queries beyond the time needed to ensure proper electronic delivery to the enrolling agency. Data necessary to implement CE business rules, to perform program assessments, and to satisfy auditing requirements will be retained.
D/As conducting CE will adhere to the principles articulated in the Security Executive Agent Directive (SEAD) relating to CE (
This System of Records will go into effect on December 31, 2018, unless comments are received that result in a contrary determination.
You may submit comments by any of the following methods:
Director, Information Management Division, Strategy & Engagement, Office of the Director of National Intelligence, at the addresses provided above.
The NCSC CE System implements the requirements of Executive Orders 12968, as amended (Access to Classified Information) and 13467, as amended, (Reforming Processes Related to Suitability for Government Employment, Fitness for Contractor Employees, and Eligibility for Access to Classified National Security Information).
To protect classified and sensitive personnel or law enforcement information covered by this new system of records, the Director of National Intelligence (DNI) is proposing to exempt this system from certain requirements of the Privacy Act where necessary, as permitted by law. Accordingly, as required by the Privacy Act, a proposed rule is being published concurrently with this notice seeking public comment regarding exemptions claimed for this system. By previously established rule, the DNI may exercise derivative exemption authority by preserving the exempt status of records received from providing agencies when the reason for the exemption remains valid. See 32 CFR part 1701.20 (a)(2) (73 FR 16531, 16537).
Continuous Evaluation Records (ODNI/NCSC-003).
The classification of records in this system ranges from UNCLASSIFIED to TOP SECRET.
National Counterintelligence and Security Center, Office of the Director of National Intelligence, Washington, DC 20511.
Assistant Director, Special Security Directorate, ODNI/NCSC, Washington, DC 20511.
The Intelligence Reform and Terrorism Prevention Act of 2004, Public Law 108-458, 118 Stat. 3638 (Dec. 17, 2004); the National Security Act of 1947, as amended, 50 U.S.C. 3023
Records in this system of records are collected for the purpose of electronically comparing enrollee identifying data against specified U.S. Government (financial, law enforcement, terrorism, foreign travel, and clearance status) databases and credit and commercial databases. The comparison serves to identify security-relevant conduct, practices, activities, or incidents that personnel security professionals can use, consistent with the Federal Investigative Standards, to determine an enrollee's continued eligibility for access to classified information or to hold a sensitive position.
Executive Branch employees, detailees, contractors, and other sponsored individuals who have been determined to be eligible for access to classified information or eligible to hold a sensitive position.
This system maintains (i) biographic enrollment data including name, date and place of birth, fingerprints, social security number, gender, current address, other first or last names, prior address(es), personal email address(es) and phone numbers, passport information, employment type (contractor/government) or other status, and; (ii) data returned from or about the automated record checks conducted against current clearance status information and against financial, law enforcement, credit, terrorism, foreign travel, and commercial databases.
Record source categories include government-owned financial, law enforcement, terrorism, foreign travel databases, and current clearance status information, as well as credit and commercial entities, and providers of aggregated public source data.
The following routine uses, which have programmatic, law enforcement, or oversight purposes, apply to this system of records:
(i) Except as noted on Standard Forms 85 and 86 and supplemental forms thereto (questionnaires for employment in, respectively, “non-sensitive” and “national security” positions within the Federal Government), a record that on its face or in conjunction with other information indicates or relates to a violation or potential violation of law, whether civil, criminal, administrative, or regulatory in nature, and whether arising by general statute, particular program statute, regulation, rule, or order issued pursuant thereto, may be disclosed as a routine use to an appropriate federal, state, territorial, tribal, local law enforcement authority, foreign government, or international law enforcement authority, or to an appropriate regulatory body charged with investigating, enforcing, or prosecuting such violations;
(ii) A record from a system of records maintained by the ODNI may be disclosed as a routine use to representatives of another IC entity addressing intelligence equities in the context of a legislative proceding or hearing when ODNI interests are implicated, and the record is relevant and necessary to the matter.
(iii) A record from a system of records maintained by the ODNI may be disclosed as a routine use in a proceeding before a court or adjudicative body when any of the following is a party to litigation or has an interest in such litigation, and the ODNI, Office of General Counsel, determines that use of such records is relevant and necessary to the litigation: The ODNI; any staff of the ODNI in his or her official capacity; any staff of the ODNI in his or her individual capacity where the Department of Justice has agreed to represent the staff or has agreed to provide counsel at government expense; or the United States or another federal agency, where the ODNI, Office of General Counsel, determines that litigation is likely to affect the ODNI;
(iv) A record from this system of records may be disclosed to the Department of Justice when (a) the ODNI, or any component thereof; or (b) any employee of the ODNI in his or her official capacity; or (c) any employee of the ODNI in his or her individual capacity where the Department of Justice has agreed to represent the employee; or (d) the United States, where the ODNI determines that litigation is likely to affect the agency, or any of its components, is a party to litigation or has an interest in such litigation, and the use of such records by the Department of Justice is deemed by the agency to be relevant and necessary to the litigation provided, however, that in each case, the agency determines that disclosure of the records to the Department of Justice is a use of the information contained in the records that is compatible with the purpose for which the records were collected.
(v) A record from a system of records maintained by the ODNI may be disclosed as a routine use to representatives of the Department of Justice and other U.S. Government entities, to the extent necessary to obtain advice on any matter within the official responsibilities of such representatives, and the responsibilities of the ODNI;
(vi) A record from a system of records maintained by the ODNI may be disclosed as a routine use to a federal, state, or local agency or other appropriate entities or individuals from which/whom information may be sought relevant to: A decision concerning the hiring or retention of an employee or other personnel action; the issuing or retention of a security clearance or special access, contract, grant, credential, or other benefit; or the conduct of an authorized investigation or inquiry, to the extent necessary to identify the individual, inform the source of the nature and purpose of the inquiry, and identify the type of information requested;
(vii) A record from a system of records maintained by the ODNI may be disclosed as a routine use to any federal, state, local, tribal, or other public authority, or to a legitimate agency of a foreign government or international authority to the extent the record is relevant and necessary to the other entity's decision regarding the hiring or retention of an employee or other personnel action; the issuing or retention of a security clearance or special access, contract, grant, license, or other benefit; or the conduct of an authorized inquiry or investigation;
(viii) A record from a system of records maintained by the ODNI may be disclosed as a routine use to any agency, for authorized audit operations, and for meeting related reporting requirements, including disclosure to the National Archives and Records Administration for records management inspections and such other purposes conducted under the authority of 44 U.S.C. 2904 and 2906, or successor provisions;
(ix) A record from a system of records maintained by the ODNI may be disclosed as a routine use to contractors, grantees, experts, consultants, or others when access to the record is necessary to perform the function or service for which they have been engaged by the ODNI;
(x) A record from a system of records maintained by the ODNI may be disclosed as a routine use to any federal agency that has provided employee enrollment data to the ODNI for purposes of conducting continuous evaluation when records obtained by ODNI are relevant to the enrolling agency's adjudication of the employee's continued eligibility for access to classified information or to hold a sensitive position.
(xi) A record from a system of records maintained by the ODNI may be disclosed as a routine use to appropriate agencies, entities, and persons when (1) ODNI suspects or has confirmed that there has been a breach of the system of records; (2) ODNI has determined that as a result of the suspected or confirmed breach there is a risk of harm to individuals, ODNI (including its information systems, programs, and operations), the Federal Government, or national security; and (3) the disclosure made to such agencies, entities, and persons is reasonably necessary to assist in connection with the Department's efforts to respond to the suspected or confirmed breach or to prevent, minimize, or remedy such harm.
(xii) A record from a system of records maintained by the ODNI may be disclosed as a routine use to another federal agency or federal entity, when the ODNI determines that information from this system of records is reasonably necessary to assist the recipient agency or entity in (1) responding to a suspected or confirmed breach or (2) preventing, minimizing, or remedying the risk of harm to individuals, the recipient agency or entity (including its information systems, programs, and operations), the Federal Government, or national security, resulting from a suspected or confirmed breach.
(xiii) A record from a system of records maintained by the ODNI may be disclosed as a routine use to a federal, state, local, tribal, territorial, foreign, or multinational agency or entity or to any other appropriate entity or individual for any of the following purposes: To provide notification of a serious terrorist threat for the purpose of guarding against or responding to such threat; to assist in coordination of terrorist threat awareness, assessment, analysis, or response; or to assist the recipient in performing authorized responsibilities relating to terrorism or counterterrorism;
(xiv) A record from a system of records maintained by the ODNI may be disclosed as a routine use for the purpose of conducting or supporting authorized counterintelligence activities as defined by section 3003(3) of the National Security Act of 1947, as amended, to elements of the Intelligence Community, as defined by section 3003(4) of the National Security Act of 1947, as amended; to the head of any federal agency or department; and to selected counterintelligence officers within the Federal Government; and
(xv) A record from a system of records maintained by the ODNI may be disclosed as a routine use to a federal, state, local, tribal, territorial, foreign, or multinational government agency or entity, or to other authorized entities or individuals, but only if such disclosure is undertaken in furtherance of responsibilities conferred by, and in a manner consistent with, the National Security Act of 1947, as amended; the Counterintelligence Enhancement Act of 2002, as amended; Executive Order 12333 or any successor order together with its implementing procedures approved by the Attorney General; and other provisions of law, Executive Order or directive relating to national intelligence, or otherwise applicable to the ODNI. This routine use is not intended to supplant the other routine uses published by the ODNI.
Electronic records are stored in secure file-servers located in government-managed facilities or in government-leased private cloud-based systems.
The records in this system are retrieved by name, social security number, or other unique identifier. Information may be retrieved from this system of records by automated capabilities utilized in the normal course of business. All searches of this system of records are performed by authorized Executive Branch security personnel.
Pursuant to 44 U.S.C. 3303a(d) and 36 CFR Chapter 12, Subchapter B—Records Management, CE records are covered by the National Archives and Records Administration (NARA) General Records Schedule (GRS) 5.6, Security records, Items 170 through 181, and will be retained and disposed of according to those provisions. Biographic data and data about protecting and accessing information will be retained consistent with the Privacy Act of 1974, 5 U.S.C. 552a, and GRS 4.2, Information Access and Protection Records. Records about security data and information systems are listed in GRS 3.2, Information Systems Security Records.
Information in this system is safeguarded in accordance with recommended and/or prescribed administrative, physical, and technical safeguards. Records are maintained in secure government-owned or leased facilities with access limited to authorized personnel. Physical security protections include guards and locked facilities requiring badges and passwords for access. Records are accessed only by current government-authorized personnel whose official duties require access to the records. Electronic authorization and authentication of users is required at all points before any system information can be accessed. Communications are encrypted where required and other safeguards are in place to monitor and audit access, and to detect intrusions. System backup is maintained separately.
As specified below, records in this system have been exempted from certain notification, access, and amendment procedures. A request for access shall be made in writing with the envelope and letter clearly marked “Privacy Act Request.” Requesters shall provide their full name and complete address. The requester must sign the request and have it verified by a notary public. Alternately, the request may be submitted under 28 U.S.C. 1746, certifying the requester's identity and understanding that obtaining a record under false pretenses constitutes a criminal offense. Requests for access to information must be addressed to the Director, Information Management Division, Strategy & Engagement, Office of the Director of National Intelligence, Washington, DC 20511. Regulations governing access to one's records or for appealing an initial determination concerning access to records are contained in the ODNI regulation implementing the Privacy Act, 32 CFR part 1701 (73 FR 16531).
As specified below, records in this system are exempt from certain notification, access, and amendment procedures. Individuals seeking to correct or amend non-exempt records should address their requests to the ODNI at the address and according to the requirements set forth above under the heading “Record Access Procedures.” Regulations governing access to and amendment of one's records or for appealing an initial determination concerning access or
As specified below, records in this system are exempt from certain notification, access, and amendment procedures. Individuals seeking to learn whether this system contains non-exempt information about them should address inquiries to the ODNI at the address and according to the requirements set forth above under the heading “Record Access Procedures.”
The Privacy Act authorizes ODNI to exempt records contained in this system of records from the requirements of subsections (c)(3); (d)(1), (d)(2), (d)(3), (d)(4); (e)(1); (e)(4)(G), (H), (I); and (f) of the Privacy Act pursuant to 5 U.S.C. 552a(k)(1), (k)(2) and (k)(5). In addition, pursuant to published rule, ODNI may derivatively exempt records from other agencies in this system from the requirements of the subsections listed above, as well as subsections (c)(4); (e)(2), (e)(3), (e)(5), (e)(8), (e)(12); and (g) of the Privacy Act consistent with any exemptions claimed under 5 U.S.C. 552a(j) or (k) by the originator of the record, provided the reason for the exemption remains valid and necessary.
The ODNI/NCSC CE Records is a new system of records. No previously published ODNI system of records notice covers any aspect of continuous evaluation.
In accordance with 5 U.S.C. 552(r), the ODNI has provided a report of this new system of records to the Office of Management and Budget and to Congress.
Notice of request for public comment and submission to OMB of proposed collection of information.
The Department of State has submitted the information collection described below to the Office of Management and Budget (OMB) for approval. In accordance with the Paperwork Reduction Act of 1995 we are requesting comments on this collection from all interested individuals and organizations. The purpose of this Notice is to allow 30 days for public comment.
Submit comments directly to the Office of Management and Budget (OMB) up to December 31, 2018.
Direct comments to the Department of State Desk Officer in the Office of Information and Regulatory Affairs at the Office of Management and Budget (OMB). You may submit comments by the following methods:
•
•
Direct requests for additional information regarding the collection listed in this notice, including requests for copies of the proposed collection instrument and supporting documents, to Lea Rivera, PRM/Admissions, 2025 E Street NW, SA-9, 8th Floor, Washington, DC 20522-0908, who may be reached on 202.453.9255 or at
•
•
•
•
•
•
•
•
•
•
•
•
We are soliciting public comments to permit the Department to:
• Evaluate whether the proposed information collection is necessary for the proper functions of the Department.
• Evaluate the accuracy of our estimate of the time and cost burden for this proposed collection, including the validity of the methodology and assumptions used.
• Enhance the quality, utility, and clarity of the information to be collected.
• Minimize the reporting burden on those who are to respond, including the use of automated collection techniques or other forms of information technology.
Please note that comments submitted in response to this Notice are public record. Before including any detailed personal information, you should be aware that your comments as submitted, including your personal information, will be available for public review.
The information requested will be used to verify the employment of Iraqi citizens and nationals for the processing and adjudication of other refugee, asylum, special immigrant visa, and other immigration claims and applications.
The method for the collection of information will be via electronic submission. The format for compiling the information will be the Department of State's myData application. Contracting officers and Grants officers will distribute the DS-7655 by email to contractors, grantees and cooperative agreement partners under their authority. Respondents complete the form, and email it to their Contracting Officers or Grant Officers.
Notice of request for public comment and submission to OMB of proposed collection of information.
The Department of State has submitted the information collection described below to the Office of Management and Budget (OMB) for approval. In accordance with the Paperwork Reduction Act of 1995 we are requesting comments on this collection from all interested individuals and organizations. The
Submit comments directly to the Office of Management and Budget (OMB) up to December 31, 2018.
Direct comments to the Department of State Desk Officer in the Office of Information and Regulatory Affairs at the Office of Management and Budget (OMB). You may submit comments by the following methods:
•
•
•
•
•
•
•
•
•
•
•
•
•
•
We are soliciting public comments to permit the Department to:
• Evaluate whether the proposed information collection is necessary for the proper functions of the Department.
• Evaluate the accuracy of our estimate of the time and cost burden for this proposed collection, including the validity of the methodology and assumptions used.
• Enhance the quality, utility, and clarity of the information to be collected.
• Minimize the reporting burden on those who are to respond, including the use of automated collection techniques or other forms of information technology.
Please note that comments submitted in response to this Notice are public record. Before including any detailed personal information, you should be aware that your comments as submitted, including your personal information, will be available for public review.
Section 101(a)(15)(E) of the Immigration and Nationality Act (INA), 8 U.S.C. 1101(a)(15)(E), includes provisions for the nonimmigrant classification of a national of a country with which the United States maintains an appropriate treaty of commerce and navigation who is coming to the United States to: (i) Carry on substantial trade, including trade in services or technology, principally between the United States and the treaty country; or (ii) develop and direct the operations of an enterprise in which the national has invested, or is actively in the process of investing. Form DS-156E is completed by some applicants seeking E nonimmigrant treaty trader/investor visas to the United States. The Department will use the DS-156E to elicit information necessary to determine a foreign national's visa eligibility for such a visa.
After completing Form DS-160, Online Nonimmigrant Visa Application, applicants will fill out the DS- 156E online, print the form, and submit it in person or via mail.
Federal Aviation Administration (FAA), Department of Transportation (DOT).
Notice.
This notice contains a summary of a petition seeking relief from specified requirements of Federal Aviation Regulations. The purpose of this notice is to improve the public's awareness of, and participation in, the FAA's exemption process. Neither publication of this notice nor the inclusion or omission of information in the summary is intended to affect the legal status of the petition or its final disposition.
Comments on this petition must identify the petition docket number and must be received on or before December 19, 2018.
Send comments identified by docket number FAA-2018-0768 using any of the following methods:
•
•
•
•
Jake Troutman, (202) 683-7788, Office of Rulemaking, Federal Aviation Administration, 800 Independence Avenue SW, Washington, DC 20591.
This notice is published pursuant to 14 CFR 11.85.
Federal Aviation Administration (FAA), Department of Transportation (DOT).
Notice.
This notice contains a summary of a petition seeking relief from specified requirements of Federal Aviation Regulations. The purpose of this notice is to improve the public's awareness of, and participation in, the FAA's exemption process. Neither publication of this notice nor the inclusion or omission of information in the summary is intended to affect the legal status of the petition or its final disposition.
Comments on this petition must identify the petition docket number and must be received on or before December 19, 2018.
Send comments identified by docket number FAA-2018-0857 using any of the following methods:
•
•
•
•
Jake Troutman, (202) 683-7788, Office of Rulemaking, Federal Aviation Administration, 800 Independence Avenue SW, Washington, DC 20591.
This notice is published pursuant to 14 CFR 11.85.
Departmental Offices, U.S. Department of the Treasury.
Notice.
The Department of the Treasury will submit the following information collection requests to the Office of Management and Budget (OMB) for review and clearance in accordance with the Paperwork Reduction Act of 1995, on or after the date of publication of this notice. The public is invited to submit comments on these requests.
Comments should be received on or before December 31, 2018 to be assured of consideration.
Send comments regarding the burden estimate, or any other aspect of the information collection, including suggestions for reducing the burden, to (1) Office of Information and Regulatory Affairs, Office of Management and Budget, Attention: Desk Officer for Treasury, New Executive Office Building, Room 10235, Washington, DC 20503, or email at
Copies of the submissions may be obtained from Jennifer Quintana by emailing
44 U.S.C. 3501
Departmental Offices, U.S. Department of the Treasury.
Notice.
The Department of the Treasury will submit the following information collection requests to the Office of Management and Budget (OMB) for review and clearance in accordance with the Paperwork Reduction Act of 1995, on or after the date of publication of this notice. The public is invited to submit comments on these requests.
Comments should be received on or before December 31, 2018 to be assured of consideration.
Send comments regarding the burden estimate, or any other aspect of the information collection, including suggestions for reducing the burden, to (1) Office of Information and Regulatory Affairs, Office of Management and Budget, Attention: Desk Officer for Treasury, New Executive Office Building, Room 10235, Washington, DC 20503, or email at
Copies of the submissions may be
44 U.S.C. 3501
Departmental Offices, U.S. Department of the Treasury.
Notice.
The Department of the Treasury will submit the following information collection requests to the Office of Management and Budget (OMB) for review and clearance in accordance with the Paperwork Reduction Act of 1995, on or after the date of publication of this notice. The public is invited to submit comments on these requests.
Comments should be received on or before December 31, 2018 to be assured of consideration.
Send comments regarding the burden estimate, or any other aspect of the information collection, including suggestions for reducing the burden, to (1) Office of Information and Regulatory Affairs, Office of Management and Budget, Attention: Desk Officer for Treasury, New Executive Office Building, Room 10235, Washington, DC 20503, or email at
Copies of the submissions may be obtained from Jennifer Quintana by emailing
44 U.S.C. 3501
Board of Governors of the Federal Reserve System (Board).
Proposed rule.
The Board is requesting comment on a proposed rule that would establish risk-based categories for determining prudential standards for large U.S. banking organizations, consistent with section 401 of the Economic Growth, Regulatory Relief, and Consumer Protection Act. The proposal would also amend certain prudential standards, including standards relating to liquidity, risk management, stress testing, and single-counterparty credit limits, to reflect the risk profiles of banking organizations under each proposed category of standards and would apply prudential standards to certain large savings and loan holding companies using the same categories. In addition, the proposal would make corresponding changes to reporting forms. Separately, the Board, the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC, and together with the Board and the OCC, the agencies), are proposing amendments to the agencies' capital and liquidity requirements based on the same categories. The proposal would not apply to foreign banking organizations, including to an intermediate holding company of a foreign banking organization.
Comments must be received on or before January 22, 2019.
You may submit comments, identified by Docket No. R-1627 and RIN 7100-AF20, by any of the following methods:
•
•
•
•
All public comments are available from the Board's website at
Constance Horsley, Deputy Associate Director, (202) 452-5239, Elizabeth MacDonald, Manager, (202) 475-6316, Brian Chernoff, Senior Supervisory Financial Analyst, (202) 452-2952, Matthew McQueeney, Supervisory Financial Analyst, (202) 452-2942, or Hillel Kipnis, Senior Financial Analyst, (202) 452-2924, Division of Banking Supervision and Regulation; or Laurie Schaffer, Associate General Counsel, (202) 452-2272, Asad Kudiya, Counsel, (202) 475-6358, Mary Watkins, Senior Attorney, (202) 452-3722, or Alyssa O'Connor, Attorney, (202) 452-3886, Legal Division. Board of Governors of the Federal Reserve System, 20th and C Streets NW, Washington, DC 20551.
The Board of Governors of the Federal Reserve System (Board) is requesting comment on a proposed rule (the proposal) that would establish a revised framework for determining the prudential standards that apply to large U.S. banking organizations, based on the risk profiles of these firms.
The 2007-2009 financial crisis revealed significant weaknesses in resiliency and risk management in the financial sector, and demonstrated how the failure or distress of large, leveraged, and interconnected financial companies could pose a threat to financial stability. The imprudent risk taking of major financial companies, and their subsequent distress—and in some cases disorderly failure—led to severe consequences for U.S. and global households and businesses.
To address weaknesses in the banking sector that were evident in the financial crisis, the Board has strengthened capital, liquidity, risk management, and other prudential standards for banking organizations. Consistent with section 165 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act),
The standards are tailored based on the size and complexity of a firm. For example, heightened capital requirements apply to firms with $250 billion or more in total consolidated assets or $10 billion or more in on-balance-sheet foreign exposure, including the requirement to calculate regulatory capital requirements using internal models and meet a minimum supplementary leverage ratio requirement.
Post-crisis financial regulations have resulted in substantial gains in resiliency for individual firms and for the financial system as a whole. Notable advances include higher amounts of better quality capital, a robust framework for assessing the capital adequacy of banking organizations under stressful financial and economic conditions, higher buffers of liquid assets and more stable funding profiles, and improvements in resolvability. Firms have also made significant improvements in independent risk identification and management, data infrastructure, and controls. These improvements have helped to build a more resilient financial system that is better positioned to provide American consumers, businesses, and communities access to the credit they need even under challenging economic conditions.
The Board conducts periodic reviews of its rules to update, reduce unnecessary costs associated with, and streamline regulatory requirements based on its experience implementing the rules and consistent with the statutory provisions that motivated the rules. These efforts include assessing the costs and benefits of regulations as well as exploring alternative approaches that achieve regulatory objectives but improve upon the simplicity, transparency, and efficiency of requirements. The proposal is the result of this practice and would reflect amendments made by EGRRCPA to the Dodd-Frank Act regarding the application of enhanced prudential standards for large banking organizations.
Specifically, EGRRCPA raised the $50 billion minimum asset threshold for general application of enhanced prudential standards to $250 billion, and provides the Board with discretion to apply standards to bank holding companies with total consolidated assets of $100 billion or more, but less than $250 billion.
Eighteen months after the date of EGRRCPA's enactment, the threshold is raised to $250 billion.
Section 165 also directs the Board, in prescribing enhanced prudential standards, to differentiate among companies on an individual basis or by category, taking into consideration the same risk-related factors.
The Board is proposing modifications to its rules to further and more consistently differentiate the application of prudential standards to large U.S. banking organizations, consistent with
While the proposal would amend only the Board's enhanced prudential standards rule and certain related regulations, it sets forth a framework that would be used throughout the Board's prudential standards framework for large financial institutions. Concurrently with this proposal, the Board, with the OCC and FDIC, is separately proposing amendments to the capital and liquidity requirements of the agencies, including the regulatory capital rule, LCR rule, and NSFR proposed rule, to introduce the same risk-based categories for tailoring standards (the interagency capital and liquidity proposal). As described in section IV.D of this Supplementary Information section, the Board also intends to propose at a later date similar amendments to its capital plan rule
The proposal would establish four categories of prudential standards for large U.S. banking organizations. For firms with total consolidated assets of $100 billion or more but less than $250 billion and that are not U.S. GSIBs, EGRRCPA provides the Board with greater flexibility in its application of enhanced prudential standards. Section 165 also directs the Board to consider certain risk-based factors for differentiating the application of enhanced prudential standards to bank holding companies. The proposed categories would set forth a framework for determining the application of prudential standards to firms with total consolidated assets of $100 billion or more but less than $250 billion, and for differentiating the standards that apply to all firms subject to prudential standards based on their size, complexity, and other risk-based factors.
Under the proposed approach, the most stringent set of standards (Category I) would apply to U.S. GSIBs. These firms have the potential to pose the greatest risks to U.S. financial stability, and EGRRCPA requires these firms to be subject to enhanced prudential standards. The existing post-financial crisis framework for U.S. GSIBs has resulted in significant gains in resiliency and risk management. The proposal accordingly would maintain the most stringent standards for these firms.
The second set of standards (Category II) would apply to U.S. banking organizations that are very large or have significant international activity. Like Category I, this category would include standards that are based on standards developed by the Basel Committee on Banking Supervision (BCBS) and other standards appropriate to very large or internationally active banking organizations.
The third set of standards (Category III) would apply to bank holding companies that EGRRCPA requires to be subject to enhanced prudential standards, but that do not meet the criteria for Category I or II, and to other firms whose risk profiles warrant the application of similar standards. In particular, these standards would apply to firms with $250 billion or more in total consolidated assets that do not meet the criteria for Category I or II standards. They would also apply to firms with total consolidated assets of $100 billion or more, but less than $250 billion, that meet or exceed specified risk-based indicators. Category III standards would reflect these firms' heightened risk profiles relative to smaller and less complex firms.
The fourth set of standards (Category IV) would apply to banking organizations with total consolidated assets of $100 billion or more that do not meet the thresholds for one of the other categories. These firms generally have greater scale and operational and managerial complexity relative to smaller banking organizations, but less than firms that would be subject to Category I, II, or III standards. In addition, the failure or distress of one or more firms that would be subject to Category IV standards, while not likely to have as significant of an impact on financial stability as the failure or distress of a firm subject to Category I, II or III standards, could nonetheless have a more significant negative effect on economic growth and employment relative to the failure or distress of smaller firms. Category IV standards would accordingly incorporate additional tailoring to reflect the lower risk profile of these firms relative to other firms with $100 billion or more in total consolidated assets. For example, the proposal would maintain liquidity risk management, stress testing, and buffer requirements for these firms, but, commensurate with their size and risk profile, would reduce the required minimum frequency of liquidity stress tests and the granularity of certain liquidity risk management requirements.
Section III of this Supplementary Information section discusses the proposed criteria for determining which category of standards would apply to a firm. Section IV of this Supplementary Information section discusses the standards that would apply under each category. Other than risk management requirements, the proposal would not apply enhanced prudential standards to firms with total consolidated assets less than $100 billion, consistent with EGRRCPA.
The proposal would apply to top-tier U.S. bank holding companies and covered savings and loan holding companies.
As noted above, EGRRCPA amended section 165 of the Dodd-Frank Act to increase the minimum asset thresholds for the application of enhanced prudential standards to bank holding companies. The proposal would revise the Board's enhanced prudential standard rule to reflect the new thresholds for U.S. top-tier bank holding companies. Under the proposal, a bank holding company with less than $100 billion in total consolidated assets would no longer be subject to the capital stress testing and liquidity risk management, liquidity stress testing, and liquidity buffer requirements of the enhanced prudential standards rule, and a bank holding company with less than $50 billion in total consolidated assets would no longer be subject to risk committee requirements. To maintain consistency with the threshold for application of enhanced prudential standards,
It is the view of the Board that any company that owns or controls a depository institution should be held to appropriate capital, liquidity, and risk management standards. As with bank holding companies, the Board's objective is to ensure that a savings and loan holding company and any nondepository subsidiaries are effectively supervised and do not threaten the soundness of the subsidiary depository institutions. Furthermore, the Board's rules require a savings and loan holding company to serve as a source of strength for its subsidiary depository institutions.
To further improve the resiliency of savings and loan holding companies and reduce the risk of future failures of large savings and loan holding companies, as well as to reduce risks to the Deposit Insurance Fund, the proposal would build on the regulatory measures currently in effect for covered savings and loan holding companies. Specifically, the proposal would apply supervisory and company-run stress testing; risk management; liquidity risk management, stress testing, and buffer; and single-counterparty credit limits requirements to covered savings and loan holding companies to the same extent as if they were bank holding companies, based on the same categories as would apply to bank holding companies.
The Board previously has applied certain heightened standards to savings and loan holding companies, pursuant to the Board's statutory authority under HOLA.
Greater parity in the regulation of covered savings and loan holding companies and bank holding companies would be appropriate in light of the significant similarities between the activities and risk profiles of these firms. Large covered savings and loan holding companies engage in many of the same activities, face similar risks, and serve substantially similar economic roles as large bank holding companies.
The financial crisis revealed weaknesses in resiliency and risk management at large banking organizations, including savings and loan holding companies, that supports application of stronger capital, liquidity, and risk management standards and counterparty limits for these firms. For example, Washington Mutual, a savings and loan holding company, had approximately $300 billion in total consolidated assets at the time of failure. After the collapse of Lehman Brothers, Washington Mutual experienced significant deposit outflows and was unable to raise funds to improve its liquidity position.
As described above, the proposal would establish four categories for purposes of determining applicable prudential standards for bank holding companies and covered savings and loan holding companies with total consolidated assets of $100 billion or more. To summarize, these categories would be defined based on the following criteria:
• Category I standards would apply to U.S. GSIBs.
• Category II standards would apply to firms with $700 billion or more in total consolidated assets or $75 billion or more in cross-jurisdictional activity, and that are not subject to Category I standards.
• Category III standards would apply to firms that are not subject to Category I or II standards and that have $250 billion or more in total consolidated assets or $75 billion or more in any of the following indicators: Nonbank assets, weighted short-term wholesale funding, or off-balance-sheet exposures.
• Category IV standards would apply to firms with at least $100 billion in total consolidated assets that do not meet any of the thresholds specified for Categories I through III.
To determine which firms are subject to the most stringent standards under Category I, the proposal would use the existing methodology under the Board's GSIB surcharge rule.
To determine the applicability of the remaining categories of standards, the Board is proposing to differentiate requirements based on a firm's level of specific risk-based indicators.
The proposal would measure size based on a firm's total consolidated assets. The use of an asset size threshold would be consistent with section 165 of the Dodd-Frank Act, as amended by EGRRCPA, which differentiates among firms by asset size for purposes of application of enhanced prudential standards.
The effect of a large banking organization's failure on the economy is likely to be greater than that which occurs when a smaller banking organization fails, even though the two banking organizations might be engaged in similar business lines.
In general, a firm's size also provides a measure of the extent to which customers or counterparties may be exposed to a risk of loss or suffer a disruption in the provision of services if a firm were to experience distress, and the extent to which asset fire sales by a firm could transmit distress to other market participants, given that a larger firm has more assets to sell. In addition, the large size of a banking organization may give rise to challenges that complicate resolution of the firm if it were to fail.
The size of a banking organization can also be an indication of operational and managerial complexity, which can present safety and soundness risks even when a firm is not engaged in complex business lines. A larger banking organization operates on a larger scale, has a broader geographic scope, and generally will have more complex internal operations than a smaller banking organization. These differences can increase the likelihood that an organization has operational or control gaps that would raise its probability of severe stress or default if left unaddressed, as well as the risk that such gaps will go undetected. Strong prudential standards—including relating to capital planning, stress testing, liquidity, risk management, and single-counterparty credit limits—accordingly also help to manage these safety and soundness risks for both bank holding companies and savings and loan holding companies.
The proposal would establish thresholds of $700 billion, $250 billion, and $100 billion in total consolidated assets for Category II, III, and IV requirements, respectively, for firms that are not U.S. GSIBs. A firm with $700 billion or more in total consolidated assets would be subject to Category II requirements, in order to address the substantial risks that can arise from the activities and potential distress of very large firms that are not U.S. GSIBs. Historical examples suggest that a firm of this size should be subject to stringent prudential standards. For example, during the financial crisis, significant losses at Wachovia Corporation, which had $780 billion in total consolidated assets at the time of being acquired in distress, had a destabilizing effect on the financial system. A threshold of $700 billion or more in total consolidated assets would ensure that a firm with a size of similar magnitude would be subject to Category II standards.
A firm with $250 billion or more in total consolidated assets that does not meet the requirements for Category II would be subject to Category III requirements. As discussed above, the failure or distress of a firm of this size would likely have a greater economic and financial stability impact than that of a smaller firm,
A firm with $100 billion or more in total consolidated assets that does not meet the criteria for Categories I, II, or III would be subject to Category IV standards. While the material distress or failure of a firm in this category would likely pose less significant risk to U.S. financial stability, consistent with the considerations and empirical analysis described above, it could still have an amplified negative effect on economic growth, employment, and financial stability relative to the distress or failure of a smaller firm.
Thresholds of these orders of magnitude would reflect observed levels of operational and managerial complexity and operational risk among firms of these sizes. For example, firms with over $700 billion in assets tend to have the broadest array of business lines and a large amount of employees, with significant operational and managerial complexity. Firms with less than $700 billion in assets, but more than $250 billion in assets tend to have less operational complexity than the largest firms, as they tend to focus on select business lines. In addition, these firms tend to have fewer employees and less managerial complexity. Firms with assets of $100 billion or more, but less than $250 billion, tend to be regionally focused or focus on only one or two business lines, with less operational and managerial complexity than larger firms but more than smaller firms.
In addition to size, the proposal would consider a firm's level of cross-jurisdictional activity, weighted short-term wholesale funding, nonbank assets, and off-balance sheet exposure to determine the applicable category of standards. The Board is proposing to apply a uniform threshold of $75 billion for each of these risk-based indicators, based on the degree of concentration this amount would represent for each firm and the proportion of the risk factor among all firms with at least $100 billion in total consolidated assets that would be included by the threshold. In each case, a threshold of $75 billion would represent at least 30 percent and as much as 75 percent of total consolidated assets for firms with between $100 billion and $250 billion in total consolidated assets.
Category II standards would apply to a firm with $100 billion or more in total consolidated assets and $75 billion or more in cross-jurisdictional activity to promote parallel treatment among firms with large global operations. Category III standards would apply to a firm with $100 billion or more in total consolidated assets and at least $75 billion in weighted short-term wholesale funding, nonbank assets, or off-balance sheet exposure.
Cross-jurisdictional activity would be defined as the sum of cross-jurisdictional assets and liabilities, as each is reported on the Banking Organization Systemic Risk Report (FR Y-15). Cross-jurisdictional activity can affect the complexity of a firm and give rise to challenges that may complicate the resolution of such a firm if it were to fail. In particular, foreign operations and cross-border positions add operational complexity in normal times and complicate the ability of a firm to undergo an orderly resolution in times of stress, generating both safety and soundness and financial stability risks. For example, a firm with significant cross-border operations may require more sophisticated management relating to risks of ring-fencing by one or more jurisdictions during stress, which could impede the firm's ability to move resources in one jurisdiction to meet needs in another.
The Board's capital and liquidity regulations currently use total on-balance sheet foreign exposure as a metric to determine the application of certain requirements, such as the requirement to use the internal models-based advanced approaches for calculating risk-based capital rule (advanced approaches capital requirements)
The proposed weighted short-term wholesale funding indicator would track the measure currently reported on the FR Y-15 and be consistent with the calculation used for purposes of the GSIB surcharge rule.
Under the proposal, nonbank assets would be measured as the average amount of equity investments in nonbank subsidiaries.
The level of a firm's investment in nonbank subsidiaries provides a measure of the organization's business and operational complexity. Specifically, banking organizations with significant investments in nonbank subsidiaries are more likely to have complex corporate structures, inter-affiliate transactions, and funding relationships. A firm's complexity is positively correlated with the impact of a banking organization's failure or distress. Because nonbank subsidiaries will not be resolved through the FDIC's receivership process, significant investments in nonbank subsidiaries present heightened resolvability risk.
Nonbank activities may involve a broader range of risks than those associated with purely banking activities, and can increase interconnectedness with other financial firms, requiring sophisticated risk management and governance, including capital planning, stress testing, and liquidity risk management. If not adequately managed, the risks associated with nonbanking activities could present significant safety and soundness concerns and increase financial stability risks. The failure of a nonbank subsidiary could be destabilizing to a banking organization, and cause counterparties and creditors to lose confidence in the firm. Nonbank assets also reflect the degree to which a firm may be engaged in activities through legal entities that are not subject to separate capital requirements or to the direct regulation and supervision applicable to a regulated banking entity.
The proposal would accordingly apply more stringent Category III standards to a firm with a significant level of nonbank assets than the less stringent Category IV standards that would otherwise apply based on the firm's size alone.
Off-balance sheet assets complements the measure of size by taking into consideration financial and banking activities not reflected on a banking organization's balance sheet. Like a firm's size, off-balance sheet exposure provides a measure of the extent to which customers or counterparties may be exposed to a risk of loss or suffer a disruption in the provision of services. In addition, off-balance sheet exposure can lead to significant future draws on capital and liquidity, particularly in times of stress. In the financial crisis, for example, vulnerabilities at individual firms were exacerbated by margin calls on derivative exposures and calls on commitments. These exposures can be a source of safety and soundness risk, as firms with significant off-balance sheet exposure may have to fund these positions in the market in a time of stress, which can put a strain on both capital and liquidity. The nature of these risks for firms of this size and complexity can also lead to financial stability risk, as they can manifest rapidly and with less transparency to other market participants. In addition, because draws on off-balance sheet exposures such as committed credit and liquidity facilities tend to increase in times of stress, they can exacerbate the effects of stress on a banking organization.
Off-balance sheet exposures may also serve as a measure of a banking organization's interconnectedness. Some off-balance sheet exposures, such as derivatives, are concentrated among the largest financial firms.
The proposal would define off-balance sheet exposure consistently with measures currently reported by covered firms, as total exposure, as defined on FR Y-15, minus total consolidated assets, as reported on Consolidated Financial Statements for Holding Companies (FR Y-9C).
An alternative approach for assessing the risk profile and systemic footprint of a banking organization for purposes of
The scoring methodology calculates a GSIB's capital surcharge under two methods.
The Board designed the scoring methodology to provide a single, comprehensive, integrated assessment of a large bank holding company's systemic footprint. Accordingly, the indicators in the scoring methodology measure the extent to which the failure or distress of a bank holding company could pose a threat to financial stability or inflict material damage on the broader economy. The indicators used in the scoring methodology also could be used to help identify banking organizations that have heightened risk profiles and would closely align with the risk-based factors specified in section 165 of the Dodd-Frank Act for applying enhanced prudential standards and differentiating among firms to which the enhanced prudential standards apply.
Under the alternative scoring approach, a banking organization's size and either its method 1 or method 2 score from the scoring methodology would be used to determine which category of standards would apply to the firm. In light of the changes made by EGRRCPA, the Board conducted an analysis of the distribution of method 1 and method 2 scores of bank holding companies and covered savings and loan holding companies with at least $100 billion in total assets.
In selecting the ranges of method 1 or method 2 scores that could define the application of Category II standards, the Board considered the potential of a firm's material distress or failure to disrupt the U.S. financial system or economy. As noted in section III.A of this Supplementary Information section, during the financial crisis, significant losses at Wachovia Corporation, which had $780 billion in total consolidated assets at the time of being acquired in distress, had a destabilizing effect on the financial system. The Board estimated method 1 and method 2 scores for Wachovia Corporation, based on available data, and also calculated the scores of firms with more than $250 billion in total consolidated assets that are not U.S. GSIBs assuming that each had $700 billion in total consolidated assets (the asset size threshold used to define Category II in the Board's main proposal). The Board also considered the outlier method 1 and method 2 scores for firms with more than $250 billion in total consolidated assets that are not U.S. GSIBs.
Based on this analysis, the Board would apply Category II standards to any non-GSIB banking organization with at least $100 billion in total consolidated assets and with a method 1 score between 60 and 80 or a method 2 score between 100 to 150. If the Board adopts a final rule that uses the scoring methodology to establish tailoring thresholds, the Board would set a single score within the listed ranges for application of Category II standards. The Board invites comment on what score within these ranges would be appropriate.
Under the proposal, a bank holding company or covered savings and loan holding company with total consolidated assets of $100 billion or more would be required to determine the category of standards to which it is subject. The proposal would add certain defined terms to the enhanced prudential standards rule and the Board's rule on savings and loan holding companies
Firms that would be subject to the proposal would be required to report size and other risk-based indicators on a quarterly basis. In order to capture significant changes in a firm's risk profile, rather than temporary fluctuations, a category of standards would apply to a firm based on the average levels of each indicator over the preceding four calendar quarters.
U.S. GSIBs are subject to the most stringent prudential standards relative to other firms, which reflects the heightened risks these firms pose to U.S. financial stability. The proposal would make no changes to the requirements applicable to U.S. GSIBs set forth in the enhanced prudential standards rule, except to implement one change, consistent with EGRRCPA, as described below.
With respect to capital, U.S. GSIBs would remain subject to the most stringent capital planning and stress testing requirements, including the qualitative and quantitative assessment of a firm's capital plan through CCAR, annual supervisory stress testing, FR Y-14 reporting requirements, and a requirement to conduct company-run stress tests on an annual basis. The most stringent liquidity requirements would also continue to apply, including liquidity risk management, monthly internal liquidity stress testing, and liquidity buffer requirements under the enhanced prudential standards rule and reporting of certain liquidity data for each business day through the Complex Institution Liquidity Monitoring Report (FR 2052a). In addition, the most stringent single-counterparty credit limits would continue to apply to U.S. GSIBs without change. Under the interagency capital and liquidity proposal, U.S. GSIBs would remain subject to a capital surcharge and enhanced supplementary leverage ratio standards, as well as the LCR requirement and proposed NSFR requirement.
Prior to the enactment of EGRRCPA, section 165 of the Dodd-Frank Act required a bank holding company subject to enhanced prudential standards to conduct semi-annual company-run stress tests.
The failure or distress of firms that would be subject to Category II standards could impose significant costs on the U.S. financial system and
Like Category I, Category II would apply the most stringent capital planning and stress testing requirements set forth in the capital plan and enhanced prudential standards rules. The Board would continue to require a firm subject to Category II standards to submit an annual capital plan, and the Federal Reserve would conduct a qualitative and quantitative assessment of the firm's capital plan.
With respect to single-counterparty credit limits, a U.S. bank holding company with $250 billion or more in total consolidated assets that is not a U.S. GSIB is currently subject to a limit on aggregate net credit exposure to a single counterparty of no more than 25 percent of tier 1 capital.
In the interagency capital and liquidity proposal, the Board, with the other agencies, is proposing to apply capital and liquidity standards to firms subject to Category II that are based on standards developed by the BCBS, subject to notice and comment rulemaking in the United States, and are appropriate for very large or internationally active banking organizations. These standards would include the full LCR and proposed NSFR requirements and advanced approaches capital requirements.
The Board's current regulatory framework generally applies the same prudential standards to all non-GSIB bank holding companies or covered savings and loan holding companies with $250 billion or more in total consolidated assets. For example, advanced approaches capital requirements, the supplementary leverage ratio, and the LCR requirement generally apply to firms with $250 billion or more in total consolidated assets or $10 billion or more in foreign exposure. The proposed framework would further differentiate among firms with $250 billion or more in total consolidated assets, consistent with EGRRCPA.
Category III standards would apply to firms with total consolidated assets of $250 billion or more that do not meet the criteria for Category I or II, as well as to certain firms with less than $250 billion in total consolidated assets, based on their risk profile. As noted above, section 165 of the Dodd-Frank
As discussed in section III of this Supplementary Information section, weighted short-term wholesale funding, nonbank assets, and off-balance sheet exposure are factors that contribute to the systemic risk profile and safety and soundness risk profile of a firm. Each of these factors heightens the need for sophisticated capital planning and more intensive supervisory oversight through CCAR, as well as sophisticated measures to monitor and manage liquidity risk.
The proposal would largely maintain the existing capital planning and stress testing standards under the capital plan and enhanced prudential standards rules for firms that would be subject to Category III standards, but remove the mid-cycle company-run stress testing requirement and require public disclosure of company-run stress test results every other year rather than annually. The proposal would require a firm subject to Category III standards to submit an annual capital plan and be subject to the qualitative and quantitative assessment of its capital plan through CCAR.
In connection with capital planning requirements, these firms would continue to be required to submit confidential data on the existing schedule for FR Y-14 reports. A firm subject to Category III standards would also be required to conduct an internal stress test (and report the results on the FR Y-14A) in connection with its annual capital plan submission. The internal stress tests and the FR Y-14 reports are inputs into the supervisory stress test and the CCAR qualitative assessment. Moreover, the internal stress tests represent an important risk management capability for firms whose size or other risk factors would meet or exceed the Category III thresholds.
The proposal would require firms subject to Category III standards to publicly disclose the results of company-run stress tests only once every two years, rather than annually.
In the interagency capital and liquidity proposal, the Board, with the other agencies, is separately proposing that firms subject to Category III standards would not be subject to advanced approaches capital requirements and the requirement to recognize most elements of AOCI in regulatory capital. Under that proposal, these firms would be subject to U.S. generally applicable risk-based capital requirements, including capital buffers, as well as the U.S. leverage ratio and the supplementary leverage ratio. The capital buffers would include any applicable countercyclical capital buffer requirement.
The proposal would maintain the existing liquidity risk management, monthly internal liquidity stress testing, and liquidity buffer requirements under the enhanced prudential standards rule for firms subject to Category III standards. The liquidity risk management requirements reflect important elements of liquidity risk management in normal and stressed conditions, such as cash flow projections and contingency funding plan requirements. Similarly, internal liquidity stress testing requires a firm to model liquidity inflows and outflows based on its own risk profile, while ensuring that the firm maintains a level of conservatism in its liquidity stress testing.
The proposal would require a firm subject to Category III standards to report daily or monthly FR 2052a liquidity data depending on the firm's level of weighted short-term wholesale funding. Most firms that would be subject to this category currently report monthly FR 2052a data. However, the Board is proposing to require a firm that has $75 billion or more in weighted short-term wholesale funding to submit FR 2052a data for each business day. A heightened reporting frequency would facilitate greater supervisory monitoring based on these firms' heightened liquidity risk exposure. For example, a greater reliance on short-term wholesale funding may indicate more frequent rollover of liabilities and greater volatility in the funding profile of a firm. Because these firms are more prone to sudden swings in their liquidity position, there is a greater need for supervisory monitoring of their liquidity risk.
Similarly, in the interagency capital and liquidity proposal, the Board and the other agencies are proposing to apply tailored LCR and NSFR requirements for firms subject to Category III standards based on whether a firm has $75 billion or more in weighted short-term wholesale funding.
As discussed above, the proposed Category III standards would include the single-counterparty credit limit requirements that currently apply to bank holding companies with $250
Under the proposal, Category IV standards would apply to firms with $100 billion or more in total consolidated assets that do not meet the criteria for Categories I, II, or III. The failure or distress of one or more firms that would be subject to Category IV standards, while not likely to have as great of an impact on financial stability as the failure or distress of a firm subject to Category I, II or III standards, could nonetheless have a more significant negative effect on economic growth and employment relative to the failure or distress of smaller firms.
In addition, these firms generally have greater scale and operational and managerial complexity than smaller firms and, as a result, greater safety and soundness risks. Specifically, these firms operate at a larger scale, have broader geographic scope, and typically have more layers of management than a smaller banking organization. These differences can increase the likelihood that such a firm has operational or control gaps that would raise its probability of severe stress or default if left unaddressed, as well as the risk that such gaps will go undetected. The Category IV standards would help promote the safety and soundness of these firms.
Relative to current requirements under the enhanced prudential standards rule, the proposed Category IV standards would maintain core elements of the liquidity and capital standards, and tailor these requirements to reflect these firms' lower risk profile and lesser degree of complexity relative to other large banking organizations.
Category IV standards would include liquidity risk management, stress testing, and buffer requirements. Effective liquidity risk management helps to ensure a banking organization's ability to meet its obligations and continue operations in times of stress. The financial crisis revealed significant weaknesses in liquidity buffers and liquidity risk management practices throughout the financial system.
The liquidity standards help to ensure that these firms have effective governance and risk management processes to measure and estimate liquidity needs, and sufficient liquidity positions to cover risks and exposures and to support activities through a range of conditions. In particular, internal liquidity stress testing, liquidity buffer, and liquidity risk management requirements help to ensure that a large banking organization is equipped to manage its liquidity risk and to withstand disruptions in funding sources.
Under the proposal, liquidity risk management and liquidity stress testing requirements would be further tailored to better reflect the risk profiles of banking organizations subject to Category IV standards. As a class, firms that would be subject to Category IV standards tend to have more stable funding profiles, as measured by their lower level of weighted short-term wholesale funding, and lesser degrees of liquidity risk and operational complexity associated with size, cross-jurisdictional activity, nonbank assets, and off-balance sheet exposure. Accordingly, the proposal would reduce the frequency of required internal liquidity stress testing to at least quarterly, rather than monthly.
For these same reasons, the proposal would modify certain liquidity risk management requirements under the enhanced prudential standards rule for firms subject to Category IV standards. First, the proposal would require a firm subject to this category of standards to calculate its collateral positions on a monthly basis, rather than a weekly basis as currently required. Firms that would meet the criteria for Category IV standards tend to be less reliant on activities, such as secured funding and borrowing (
The internal liquidity stress testing, liquidity buffer, and liquidity risk management requirements are more tailored to a firm's risk profile and scope of operations than the standardized quantitative limits of the LCR rule. Continuing to apply these tailored liquidity requirements as part of Category IV standards would maintain these firms' risk management and
The proposal would also apply tailored capital standards for firms subject to Category IV standards. Specifically, the proposal would revise the frequency of supervisory stress testing to every other year and eliminate the requirement for firms subject to Category IV standards to conduct and publicly report the results of a company-run stress test. Supervisory stress testing on a two-year cycle would implement section 401(e) of EGRRCPA, taking into account the risk profile of these firms relative to larger, more complex firms. The Board is proposing to maintain existing FR Y-14 reporting requirements for firms subject to Category IV standards in order to provide the Board with the data it needs to conduct supervisory stress testing and inform the Board's ongoing supervision of these firms.
The Board continues to expect these firms to have sound capital positions and capital planning practices. Capital is central to a firm's ability to absorb unexpected losses and continue to lend to creditworthy businesses and consumers. A firm must maintain sufficient levels of capital to support the risks associated with its exposures and activities to be resilient. As a result, a firm's processes for managing and allocating its capital resources are critical to its financial strength and resiliency, and also to the stability and effective functioning of the U.S. financial system. In addition, section 401(e) of EGRRCPA requires the Board to conduct periodic supervisory stress tests of bank holding companies and foreign banking organizations with $100 billion or more, but less than $250 billion, in total consolidated assets.
In April 2018, the Board issued a proposal to apply stress buffer requirements to large bank holding companies.
As part of the capital plan proposal, the Board intends to provide greater flexibility to these firms to develop their annual capital plans. Under this potential approach, Category IV standards would require a firm to include in its capital plans estimates of revenues, losses, reserves, and capital levels based on a forward-looking analysis, taking into account the firm's idiosyncratic risks under a range of conditions, but would not require the firm to submit the results of company-run stress tests on the FR Y-14A. This change would align with the proposed removal of company-run stress testing requirements from Category IV standards under the enhanced prudential standards rule. The Board also intends at a future date to revise its guidance relating to capital planning to align with the proposed categories of standards and to allow more flexibility in how firms subject to Category IV standards perform capital planning.
Currently, firms that meet the proposed criteria for Category IV standards are not subject to the single-counterparty credit limits rule. The proposal would retain this treatment.
Currently, covered savings and loan holding companies are subject to the Board's regulatory capital rule and LCR rule, and would be subject to the proposed NSFR rule, in the same manner as a similarly situated bank holding company. However, unlike bank holding companies of comparable size and risk profile, covered savings and loan holding companies are not otherwise subject to capital planning or supervisory stress testing requirements.
For capital, these standards would include supervisory stress testing and, for Categories II and III, company-run stress testing requirements. Similar to a bank holding company, the scale, managerial and operational complexity, and other risk factors indicated by the scoping criteria for the proposed categories warrant more sophisticated capital planning, more frequent company-run stress testing, and greater supervisory oversight through supervisory stress testing to further the safety and soundness of these firms. To implement the supervisory stress test, the Board is proposing to require covered savings and loan holding companies to report the FR Y-14 report in the same manner as a bank holding company.
HOLA authorizes the Board to issue regulations that the Board determines are necessary and appropriate to carry out the purposes of section 10 of HOLA, including regulations establishing capital requirements.
Currently, with respect to liquidity requirements, covered savings and loan holding companies are subject to the full LCR and proposed NSFR requirements if they have $250 billion or more in assets or $10 billion in on-balance sheet foreign exposure. Covered savings and loan holding companies are subject to the modified LCR and proposed modified NSFR requirements if they have $50 billion or more, but less than $250 billion, in assets and less than $10 billion in foreign exposure.
The proposal would extend the liquidity risk management, stress testing, and buffer requirements to covered savings and loan holding companies. Specifically, a covered savings and loan holding company with total consolidated assets of $100 billion or more would be required to conduct internal stress tests at least monthly (or quarterly, for a firm that would be subject to Category IV standards) to measure its potential liquidity needs across overnight, 30-day, 90-day, and 1-year planning horizons during times of instability in the financial markets, and to hold highly liquid assets sufficient to meet the projected 30-day net stressed cash-flow need under internal stress scenarios. A covered savings and loan holding company with total consolidated assets of $100 billion or more also would be required to meet specified corporate governance requirements around liquidity risk management, to produce cash flow projections over various time horizons, to establish internal limits on certain liquidity metrics, and to maintain a contingency funding plan that identifies potential sources of liquidity strain and alternative sources of funding when usual sources of liquidity are unavailable. These proposed requirements are important to ensure that covered savings and loan holding companies have effective governance and risk management processes to determine the amount of liquidity to cover risks and exposures, and sufficient liquidity to support their activities through a range of conditions.
In addition, under the current framework, the single-counterparty credit limits rule applies to U.S. bank holding companies with $250 billion or more in total consolidated assets (other than U.S. GSIBs), but not to covered savings and loan holding companies. In general, that rule limits aggregate net credit exposure to a single counterparty to no more than 25 percent of tier 1 capital.
As discussed above, the proposal would modify the threshold of $250 billion or more in total consolidated assets for U.S. bank holding companies that are not U.S. GSIBs to align with the new proposed thresholds for application
Sound, enterprise-wide risk management supports the safe and sound operations of banking organizations and reduces the likelihood of their material distress or failure, and thus promotes financial stability. Section 165(h) of the Dodd-Frank Act requires certain publicly traded bank holding companies to establish a risk committee that is “responsible for the oversight of the enterprise-wide risk management practices” and meets other statutory requirements.
Under the current enhanced prudential standards rule, bank holding companies with total consolidated assets of $50 billion or more and publicly traded bank holding companies with total consolidated assets of $10 billion or more, but less than $50 billion, must maintain a risk committee that meets specified requirements. Consistent with EGRRCPA, the proposal would raise these thresholds for the risk committee requirement to apply to bank holding companies but would not change the substance of the risk committee requirement for these firms.
Historically, the Board has assessed the adequacy of bank holding company risk management through the examination process as informed by supervisory guidance; the requirements in section 165(h) supplement, but do not replace, the Board's existing risk management guidance and supervisory expectations.
In addition to the changes for U.S. bank holding companies, the proposal would apply the same risk committee requirements to covered savings and loan holding companies with $50 billion or more in total consolidated assets as would apply to a U.S. bank holding company of the same size. Specifically, all covered savings and loan holding companies with total consolidated assets of $50 billion or more would be required to establish and maintain a board-level risk committee and to employ a chief risk officer with appropriate expertise and stature, among other requirements. These requirements represent important risk management practices for banking organizations of this size to help ensure that the organization is operating in a safe and sound manner. As discussed above, the financial crisis revealed weaknesses in the risk management practices of large banking organizations, including both bank holding companies and savings and loan holding companies. The risk management requirements of the enhanced prudential standards rule were established to address elements of these weaknesses at bank holding companies.
The proposal would also make changes to the Board's implementation of certain definitions in the Dodd-Frank Act. The Dodd-Frank Act directed the Board to define the terms “significant bank holding company” and “significant nonbank financial company,” terms that are used in the credit exposure reports provision in section 165(d)(2).
The proposal would include changes to the reporting panels and requirements of the FR Y-14, FR Y-15, FR 2052a, FR Y-9C, and FR Y-9LP reporting forms.
The proposal would require covered savings and loan holding companies with $100 billion or more in total consolidated assets to report parts of the FR Y-14. As described above, the proposal would require covered savings and loan holding companies with assets of $100 billion or more to participate in supervisory stress tests, with the frequency of supervisory stress testing depending on the category of standards that apply. Accordingly, the proposal would require all covered savings and loan holding companies with $100 billion or more in total consolidated assets to complete the elements of the FR Y-14 report that are used in conducting supervisory stress tests: (1) The FR Y-14M; (2) all schedules of the FR Y-14-Q except for Schedule C—Regulatory Capital Instruments and Schedule D—Regulatory Capital Transitions; and (3) Schedule E—Operational Risk of the FR Y-14A. The proposal would also require covered savings and loan holding companies subject to Category II or III standards to report the FR Y-14A Schedule A—Summary and Schedule F—Business Plan Changes with respect to company run stress testing. As discussed above, covered savings and loan holding companies subject to Category II or Category III standards face heightened risks given their size or level of cross-jurisdictional activity, weighted short-term wholesale funding, nonbank assets, or off-balance sheet exposure. The information from the FR Y-14A Schedules A and F on company-run stress testing would assist supervisors in determining the robustness of company-run stress tests, and thereby help ensure the safety and soundness of covered savings and loan holding companies.
With respect to the FR Y-15, the proposal would add two derived line items on Schedule A to calculate total off-balance sheet exposure, which is one of the indicators used to determine whether a firm with total consolidated assets of $100 billion or more would be subject to Category III standards. New line item M4 (total consolidated assets) would report the total consolidated on-balance sheet assets for the respondent, which is the equivalent to Schedule HC, item 12 (total consolidated assets) on the FR Y-9C. New line item M5 (total off-balance sheet exposures) would be total exposure, as currently defined on the FR Y-15, minus line item M4.
With respect to the FR 2052a report, the proposal would modify the current reporting frequency and granularity to align with the proposed tailoring framework. Specifically, the proposal would require U.S. banking organizations and covered savings and loan holding companies, each with $100 billion or more in total consolidated assets, to report the FR 2052a on a daily basis if they are: (i) Subject to Category I or II standards, or (ii) have $75 billion or more in weighted short-term wholesale funding. This would increase the frequency of reporting for firms subject to Category II standards with less than $700 billion in total consolidated assets and firms subject to Category III standards with $75 billion or more in weighted short-term wholesale funding; both groups of banking organizations currently report the FR 2052a monthly. Reporting of daily liquidity data would facilitate greater supervisory monitoring based on these firms' liquidity risk profile, as indicated by their level of weighted short-term wholesale funding and cross-jurisdictional activity. The proposal also would simplify the FR 2052a reporting thresholds by eliminating the threshold of $10 trillion or more in assets under custody used to identify daily filers, as discussed in section IV.B of this
In addition, consistent with EGRRCPA's changes and the Board's July 2018 statement relating to EGRRCPA, the proposal would revise the reporting forms to provide that bank holding companies with less than $100 billion in total consolidated assets would no longer be required to submit the FR Y-14, FR Y-15 and the FR 2052a, and covered savings and loan holding companies with less than $100 billion in total consolidated assets would no longer be required to submit the FR Y-15 and FR 2052a.
With respect to the FR Y-9C, the proposal would align the instructions and form with the proposed tailoring framework in the interagency capital and liquidity proposal. The proposed revised instructions to the FR Y-9C would clarify that Category III Board-regulated institutions are not included in the proposed definition of “advanced approaches banking organizations” in the interagency capital and liquidity proposal, but would be required to comply with the supplementary leverage ratio and countercyclical capital buffer requirements. The proposed revision to the FR Y-9C would amend line item 45, which concerns the supplementary leverage ratio. Previously, line item 45 was required to be completed by advanced approaches holding companies only. The proposed revised FR Y-9C would require line item 45 to be completed by “advanced approaches banking organizations and Category III Board-regulated institutions.”
Finally, the proposal would require covered savings and loan holding companies with total consolidated assets of $100 billion or more to report total nonbank assets on line item 17, Schedule PC-B of the FR Y-9LP, as this data would be used to determine whether the firm is subject to Category III standards.
As the proposal would not apply to foreign banking organizations, the changes to the FR Y-14, FR Y-15, FR 2052a, FR Y-9C, and FR Y-9LP discussed above would not apply to an intermediate holding company of a foreign banking organization. Therefore, these intermediate holding companies would continue to report these forms as they do currently, and the forms would be amended to reflect this.
In general, the Board expects the proposal would reduce aggregate compliance costs for bank holding companies with $100 billion or more in total consolidated assets, with minimal effects on the safety and soundness of these firms and U.S. financial stability.
First, while the Board expects the proposed changes to capital planning and stress testing requirements to have no material impact on the capital levels of bank holding companies with $100 billion or more in total consolidated assets, for firms that would be subject to Category III or IV standards in particular, the proposal would reduce compliance costs. These firms currently must conduct company-run stress tests on a semi-annual basis. For bank holding companies that would be subject to Category III standards, the proposal would reduce this frequency to every other year.
The proposed changes to liquidity requirements are also expected to reduce compliance costs for firms that would be subject to Category IV standards by reducing the required frequency of internal liquidity stress tests and modifying the liquidity risk management requirements. The Board does not expect these proposed changes to materially affect the liquidity buffer levels held by these firms or these firms' exposure to liquidity risk.
For covered savings and loan holding companies, the proposal would increase compliance costs and also reduce risks to the safety and soundness of these firms. By harmonizing prudential standards across similarly situated large domestic banking organizations, the proposal would also reduce opportunities for regulatory arbitrage. The Board expects the proposed new requirements for covered savings and loan holding companies to meaningfully improve the risk management capabilities of these firms and their resiliency to stress, which furthers their safety and soundness.
A covered savings and loan holding company that is subject to Category II or III standards would be required to conduct company-run stress tests, which would be a new requirement. In connection with the application of supervisory and company-run capital stress testing requirements, the Board is proposing to require covered savings and loan holding companies with total consolidated assets of $100 billion or more to report the FR Y-14 reports. In addition, the proposal would require a covered savings and loan holding company with $100 billion or more to conduct internal liquidity stress testing and maintain a liquidity buffer. While covered savings and loan holding companies would incur costs for conducting internal liquidity stress testing, this requirement would improve the capability of these firms to understand, manage, and plan for liquidity risk exposures across a range of conditions. Depending on its liquidity buffer requirement, a covered savings and loan holding company may need to increase the amount of liquid assets it holds or otherwise adjust its risk profile to reduce estimated net stressed cash-flow needs. Because covered savings and loan holding companies are already subject to the LCR rule, which also requires a firm to maintain a minimum amount of liquid assets to meet net outflows under a stress scenario, covered savings and loan holding companies would generally need to hold only an incremental amount—if any—above the levels already required to comply with the LCR rule.
Section 722 of the Gramm-Leach-Bliley Act (Pub. L. 106-102, 113 Stat. 1338, 1471, 12 U.S.C. 4809) requires the federal banking agencies to use plain language in all proposed and final rules published after January 1, 2000. The Board has sought to present the proposal in a simple and straightforward manner, and invites comment on the use of plain language. For example:
• Has the Board organized the material to suit your needs? If not, how could it present the proposal more clearly?
• Are the requirements in the proposal clearly stated? If not, how could the proposal be more clearly stated?
• Do the regulations contain technical language or jargon that is not clear? If so, which language requires clarification?
• Would a different format (grouping and order of sections, use of headings, paragraphing) make the regulation easier to understand? If so, what changes would achieve that?
• Would more, but shorter, sections be better? If so, which sections should be changed?
• What other changes can the Board incorporate to make the regulation easier to understand?
Certain provisions of the proposed rule contain “collections of information” within the meaning of the Paperwork Reduction Act of 1995 (PRA).
The proposed rule contains reporting requirements subject to the PRA. To implement these requirements, the Board proposes to revise the (1) Complex Institution Liquidity Monitoring Report (FR 2052a; OMB No. 7100-0361), (2) Consolidated Financial Statements for Holding Companies (FR Y-9C; OMB No. 7100-0128), (3) Capital Assessments and Stress Testing (FR Y-14A/Q/M; OMB No. 7100-0341), and (4) Banking Organization Systemic Risk Report (FR Y-15; OMB No. 7100-0352).
Comments are invited on:
(a) Whether the proposed collections of information are necessary for the proper performance of the Board's functions, including whether the information has practical utility;
(b) The accuracy of the estimates of the burden of the proposed information
(c) Ways to enhance the quality, utility, and clarity of the information to be collected;
(d) Ways to minimize the burden of the information collections on respondents, including through the use of automated collection techniques or other forms of information technology; and
(e) Estimates of capital or startup costs and costs of operation, maintenance, and purchase of services to provide information.
All comments will become a matter of public record. Comments on aspects of this proposed rule that may affect reporting, recordkeeping, or disclosure requirements and burden estimates should be sent to Ann E. Misback, Secretary, Board of Governors of the Federal Reserve System, 20th Street and Constitution Avenue NW, Washington, DC 20551. A copy of the comments may also be submitted to the OMB desk officer to the Office of Information and Regulatory Affairs, Office of Management and Budget, New Executive Office Building, Room 10235, 725 17th Street NW, Washington, DC 20503 or by fax to 202-395-6974.
(1)
Financial institution information required by the FR 2052a is collected as part of the Board's supervisory process. Therefore, such information is entitled to confidential treatment under Exemption 8 of the Freedom of Information Act (FOIA).
(2)
With respect to FR Y-9LP, FR Y-9SP, FR Y-ES, and FR Y-9CS, the information collected would generally not be accorded confidential treatment. If confidential treatment is requested by a respondent, the Board will review the request to determine if confidential treatment is appropriate.
With respect to FR Y-9C, Schedule HI's item 7(g) “FDIC deposit insurance assessments,” Schedule HC-P's item 7(a) “Representation and warranty reserves for 1-4 family residential mortgage loans sold to U.S. government agencies and government sponsored agencies,” and Schedule HC-P's item 7(b) “Representation and warranty reserves for 1-4 family residential mortgage loans sold to other parties” are considered confidential. Such treatment is appropriate because the data is not publicly available and the public release of this data is likely to impair the Board's ability to collect necessary information in the future and could cause substantial harm to the competitive position of the respondent. Thus, this information may be kept confidential under exemptions (b)(4) of the Freedom of Information Act, which exempts from disclosure “trade secrets and commercial or financial information obtained from a person and privileged or confidential” (5 U.S.C. 552(b)(4)), and (b)(8) of the Freedom of Information Act, which exempts from disclosure information related to examination, operating, or condition reports prepared by, on behalf of, or for the use of an agency responsible for the regulation or supervision of financial institutions (5 U.S.C. 552(b)(8)).
(2)
1. The FR Y-14A collects quantitative projections of balance sheet, income, losses, and capital across a range of macroeconomic scenarios and qualitative information on methodologies used to develop internal projections of capital across scenarios either annually or semi-annually.
2. The quarterly FR Y-14Q collects granular data on various asset classes, including loans, securities, and trading assets, and PPNR for the reporting period.
3. The monthly FR Y-14M is comprised of three retail portfolio- and loan-level schedules, and one detailed address-matching schedule to supplement two of the portfolio and loan-level schedules.
The data collected through the FR Y-14A/Q/M reports provide the Board with the information and perspective needed to help ensure that large firms have strong, firm-wide risk measurement and management processes supporting their internal assessments of capital adequacy and that their capital resources are sufficient given their business focus, activities, and resulting risk exposures. The annual CCAR exercise complements
The information collected in these reports is collected as part of the Board's supervisory process, and therefore is afforded confidential treatment pursuant to exemption 8 of the Freedom of Information Act (FOIA) (5 U.S.C. 552(b)(8)). In addition, individual respondents may request that certain data be afforded confidential treatment pursuant to exemption 4 of FOIA if the data has not previously been publicly disclosed and the release of the data would likely cause substantial harm to the competitive position of the respondent (5 U.S.C. 552(b)(4)). Determinations of confidentiality based on exemption 4 of FOIA would be made on a case-by-case basis.
(3)
Most of the data collected on the FR Y-15 is made public unless a specific request for confidentiality is submitted by the reporting entity, either on the FR Y-15 or on the form from which the data item is obtained. Such information will be accorded confidential treatment under exemption 4 of the Freedom of Information Act (FOIA)
In accordance with the Regulatory Flexibility Act (RFA), 5 U.S.C. 601
As discussed in the Supplementary Information section, the Board is proposing to adopt amendments to Regulations Y,
Because the proposal is not likely to apply to any company with assets of $550 million or less if adopted in final form, the proposal is not expected to affect any small entity for purposes of the RFA. The Board does not believe that the proposal duplicates, overlaps, or conflicts with any other Federal rules. In light of the foregoing, the Board does not believe that the proposal, if adopted in final form, would have a significant economic impact on a substantial number of small entities supervised. Nonetheless, the Board seeks comment on whether the proposal would impose undue burdens on, or have unintended consequences for, small banking organizations, and whether there are ways such potential burdens or consequences could be minimized in a manner consistent the purpose of the proposal.
Administrative practice and procedure, Banks, Banking, Capital planning, Holding companies, Reporting and recordkeeping requirements, Securities, Stress testing.
Administrative practice and procedure, Banks, Banking, Federal Reserve System, Holding companies, Reporting and recordkeeping requirements, Securities.
Administrative practice and procedure, Holding companies, Nonbank financial companies.
Administrative practice and procedure, Banks, Banking, Capital planning, Federal Reserve System, Holding companies, Reporting and recordkeeping requirements, Securities, Stress testing.
For the reasons stated in the Supplementary Information, Chapter II of title 12 of the Code of Federal Regulations is proposed to be amended as follows:
12 U.S.C. 1817(j)(13), 1818, 1828(o), 1831i, 1831p-1, 1843(c)(8), 1844(b), 1972(1), 3106, 3108, 3310, 3331-3351, 3906, 3907, and 3909; 15 U.S.C. 1681s, 1681w, 6801 and 6805.
(b) * * *
(1) * * *
(i) Any top-tier bank holding company domiciled in the United States with average total consolidated assets of $100 billion or more ($100 billion asset threshold);
(2)
(3)
(c) * * * (1) * * * (i) A bank holding company that meets the $100 billion asset threshold (as measured under paragraph (b) of this section) on or before September 30 of a calendar year must comply with the requirements of this section beginning on January 1 of the next calendar year, unless that time is extended by the Board in writing.
(ii) A bank holding company that meets the $100 billion asset threshold after September 30 of a calendar year must comply with the requirements of this section beginning on January 1 of the second calendar year after the bank holding company meets the $100 billion asset threshold, unless that time is extended by the Board in writing.
(d) * * *
(9)
(i) A Category IV banking organization pursuant to 12 CFR 252.5; or
(ii) A U.S. intermediate holding company subject to this section pursuant to 12 CFR 252.153 that—
(A) Has average total consolidated assets of less than $250 billion; and
(B) Has average total nonbank assets of less than $75 billion.
5 U.S.C. 552, 559; 12 U.S.C. 1462, 1462a, 1463, 1464, 1467, 1467a, 1468, 1813, 1817, 1829e, 1831i, 1972; 15 U.S.C. 78 l.
(v)
(w)
(1) The total exposures of the banking organization, as reported by the banking organization on the FR Y-15 for each of the four most recent calendar quarters, or for the most recent quarter or quarters, as applicable; minus
(2) The total consolidated assets of the banking organization.
(x)
(y)
(z)
(aa)
(1) Incorporated in or organized under the laws of the United States or in any State; and
(2) Not a consolidated subsidiary of a covered savings and loan holding company that is incorporated in or organized under the laws of the United States or in any State.
(bb)
(cc)
(dd)
(ee)
(1) A top-tier savings and loan holding company that is:
(i) A grandfathered unitary savings and loan holding company as defined in section 10(c)(9)(C) of the Home Owners' Loan Act (12 U.S.C. 1461
(ii) As of June 30 of the previous calendar year, derived 50 percent or more of its total consolidated assets or 50 percent of its total revenues on an enterprise-wide basis (as calculated under GAAP) from activities that are not financial in nature under section 4(k) of the Bank Holding Company Act (12 U.S.C. 1842(k));
(2) A top-tier depository institution holding company that is an insurance underwriting company; or
(3)(i) A top-tier depository institution holding company that, as of June 30 of the previous calendar year, held 25 percent or more of its total consolidated assets in subsidiaries that are insurance underwriting companies (other than assets associated with insurance for credit risk); and
(ii) For purposes of paragraph (3)(i) of this definition, the company must calculate its total consolidated assets in accordance with GAAP, or if the company does not calculate its total consolidated assets under GAAP for any regulatory purpose (including compliance with applicable securities laws), the company may estimate its total consolidated assets, subject to review and adjustment by the Board of Governors of the Federal Reserve System.
(ff)
(gg)
(hh)
(ii)
(jj)
(kk)
(ll)
(1) The total exposure of the banking organization, as reported by the banking organization on the FR Y-15; minus
(2) The total consolidated assets of the banking organization for the same calendar quarter.
(mm)
(nn)
(oo)
(pp)
(qq)
(rr)
(ss)
(a)
(b)
(i) $700 billion or more in average total consolidated assets; or
(ii)(A) $75 billion or more in average cross-jurisdictional activity; and
(B) $100 billion or more in average total consolidated assets.
(2) After meeting the criteria in paragraph (b)(1) of this section, a banking organization continues to be a Category II banking organization until the banking organization has:
(i)(A) Less than $700 billion in total consolidated assets for each of the four most recent calendar quarters; and
(B) Less than $75 billion in cross-jurisdictional activity for each of the four most recent calendar quarters; or
(ii) Less than $100 billion in total consolidated assets for each of the four most recent calendar quarters.
(c)
(i) Has (A) $250 billion or more in average total consolidated assets; or
(B) $100 billion or more in average total consolidated assets and at least:
(
(
(
(ii) Is not a Category II banking organization.
(2) After meeting the criteria in paragraph (c)(1) of this section, a banking organization continues to be a Category III banking organization until the banking organization:
(i) Has—
(A) Less than $250 billion in total consolidated assets for each of the four most recent calendar quarters;
(B) Less than $75 billion in total nonbank assets for each of the four most recent calendar quarters;
(C) Less than $75 billion in weighted short-term wholesale funding for each of the four most recent calendar quarters; and
(D) Less than $75 billion in off-balance sheet exposure for each of the four most recent calendar quarters; or
(ii) Has less than $100 billion in total consolidated assets for each of the four most recent calendar quarters; or
(iii) Meets the criteria in paragraph (b)(1) of this section to be a Category II banking organization.
(d)
(i) Is not a Category II banking organization; and
(ii) Is not a Category III banking organization.
(2) After meeting the criteria in paragraph (d)(1) of this section, a banking organization continues to be a Category IV banking organization until the banking organization:
(i) Has less than $100 billion in total consolidated assets for each of the four most recent calendar quarters;
(ii) Meets the criteria in paragraph (b)(1) of this section to be a Category II banking organization; or
(iii) Meets the criteria in paragraph (c)(1) of this section to be a Category III banking organization.
(a)
(b)
(c)
(1) Its reported total consolidated assets on the FR Y-9C are below $50 billion for each of four consecutive calendar quarters; and
(2) It becomes subject to the requirements of subpart N of this part.
(a)
(2)
(i) Policies and procedures establishing risk-management governance, risk-management procedures, and risk-control infrastructure for its global operations; and
(ii) Processes and systems for implementing and monitoring compliance with such policies and procedures, including:
(A) Processes and systems for identifying and reporting risks and risk-
(B) Processes and systems for establishing managerial and employee responsibility for risk management;
(C) Processes and systems for ensuring the independence of the risk-management function; and
(D) Processes and systems to integrate risk management and associated controls with management goals and its compensation structure for its global operations.
(3)
(i) Have a formal, written charter that is approved by the covered savings and loan holding company's board of directors;
(ii) Be an independent committee of the board of directors that has, as its sole and exclusive function, responsibility for the risk-management policies of the covered savings and loan holding company's global operations and oversight of the operation of the company's global risk-management framework;
(iii) Report directly to the covered savings and loan holding company's board of directors;
(iv) Receive and review regular reports on a not less than a quarterly basis from the covered savings and loan holding company's chief risk officer provided pursuant to paragraph (b)(3)(ii) of this section; and
(v) Meet at least quarterly, or more frequently as needed, and fully document and maintain records of its proceedings, including risk-management decisions.
(4)
(i) Include at least one member having experience in identifying, assessing, and managing risk exposures of large, complex financial firms; and
(ii) Be chaired by a director who:
(A) Is not an officer or employee of the covered savings and loan holding company and has not been an officer or employee of the covered savings and loan holding company during the previous three years;
(B) Is not a member of the immediate family, as defined in § 238.31(b)(3), of a person who is, or has been within the last three years, an executive officer of the covered savings and loan holding company, as defined in § 215.2(e)(1) of this chapter; and
(C)(
(
(b)
(2)
(A) The establishment of risk limits on an enterprise-wide basis and the monitoring of compliance with such limits;
(B) The implementation of and ongoing compliance with the policies and procedures set forth in paragraph (a)(2)(i) of this section and the development and implementation of the processes and systems set forth in paragraph (a)(2)(ii) of this section; and
(C) The management of risks and risk controls within the parameters of the company's risk control framework, and monitoring and testing of the company's risk controls.
(ii) The chief risk officer is responsible for reporting risk-management deficiencies and emerging risks to the risk committee and resolving risk-management deficiencies in a timely manner.
(3)
(ii) The chief risk officer must report directly to both the risk committee and chief executive officer of the company.
This subpart applies to covered savings and loan holding companies with total consolidated assets of $100 billion or more. Total consolidated assets of a covered savings and loan holding company are equal to the consolidated assets of the covered savings and loan holding company, as calculated in accordance with § 238.121(b).
(a)
(2)
(b)
(c)
(a)
(2)
(i) Policies and procedures establishing risk-management governance, risk-management procedures, and risk-control infrastructure for its global operations; and
(ii) Processes and systems for implementing and monitoring compliance with such policies and procedures, including:
(A) Processes and systems for identifying and reporting risks and risk-management deficiencies, including regarding emerging risks, and ensuring effective and timely implementation of actions to address emerging risks and risk-management deficiencies for its global operations;
(B) Processes and systems for establishing managerial and employee responsibility for risk management;
(C) Processes and systems for ensuring the independence of the risk-management function; and
(D) Processes and systems to integrate risk management and associated controls with management goals and its compensation structure for its global operations.
(3)
(i) Have a formal, written charter that is approved by the covered savings and loan holding company's board of directors;
(ii) Be an independent committee of the board of directors that has, as its sole and exclusive function, responsibility for the risk-management policies of the covered savings and loan holding company's global operations and oversight of the operation of the covered savings and loan holding company's global risk-management framework;
(iii) Report directly to the covered savings and loan holding company's board of directors;
(iv) Receive and review regular reports on not less than a quarterly basis from the covered savings and loan holding company's chief risk officer provided pursuant to paragraph (b)(3)(ii) of this section; and
(v) Meet at least quarterly, or more frequently as needed, and fully document and maintain records of its proceedings, including risk-management decisions.
(4)
(i) Include at least one member having experience in identifying, assessing, and managing risk exposures of large, complex financial firms; and
(ii) Be chaired by a director who:
(A) Is not an officer or employee of the covered savings and loan holding company and has not been an officer or employee of the covered savings and loan holding company during the previous three years;
(B) Is not a member of the immediate family, as defined in § 238.31(b)(3), of a person who is, or has been within the last three years, an executive officer of the covered savings and loan holding company, as defined in § 215.2(e)(1) of this chapter; and
(C)(
(
(b)
(2)
(A) The establishment of risk limits on an enterprise-wide basis and the monitoring of compliance with such limits;
(B) The implementation of and ongoing compliance with the policies and procedures set forth in paragraph (a)(2)(i) of this section and the development and implementation of the processes and systems set forth in paragraph (a)(2)(ii) of this section; and
(C) The management of risks and risk controls within the parameters of the company's risk control framework, and monitoring and testing of the company's risk controls.
(ii) The chief risk officer is responsible for reporting risk-management deficiencies and emerging risks to the risk committee and resolving risk-management deficiencies in a timely manner.
(3)
(ii) The chief risk officer must report directly to both the risk committee and chief executive officer of the company.
(a)
(i) Approve the acceptable level of liquidity risk that the covered savings and loan holding company may assume in connection with its operating strategies (liquidity risk tolerance) at least annually, taking into account the covered savings and loan holding company's capital structure, risk profile, complexity, activities, and size; and
(ii) Receive and review at least semi-annually information provided by senior management to determine whether the covered savings and loan holding company is operating in
(b)
(c)
(ii) Senior management must oversee the development and implementation of liquidity risk measurement and reporting systems, including those required by this section and § 238.124.
(iii) Senior management must determine at least quarterly whether the covered savings and loan holding company is operating in accordance with such policies and procedures and whether the covered savings and loan holding company is in compliance with this section and § 238.124 (or more often, if changes in market conditions or the liquidity position, risk profile, or financial condition warrant), and establish procedures regarding the preparation of such information.
(2)
(3)
(ii) Senior management must review at least annually significant business lines and products to determine whether any line or product creates or has created any unanticipated liquidity risk, and to determine whether the liquidity risk of each strategy or product is within the company's established liquidity risk tolerance.
(4)
(5)
(6)
(i) Approve the liquidity stress testing practices, methodologies, and assumptions required in § 238.124(a) at least quarterly, and whenever the covered savings and loan holding company materially revises its liquidity stress testing practices, methodologies or assumptions;
(ii) Review the liquidity stress testing results produced under § 238.124(a) at least quarterly;
(iii) Review the independent review of the liquidity stress tests under § 238.123(d) periodically; and
(iv) Approve the size and composition of the liquidity buffer established under § 238.124(b) at least quarterly.
(d)
(2) The independent review function must:
(i) Regularly, but no less frequently than annually, review and evaluate the adequacy and effectiveness of the company's liquidity risk management processes, including its liquidity stress test processes and assumptions;
(ii) Assess whether the company's liquidity risk-management function complies with applicable laws and regulations, and sound business practices; and
(iii) Report material liquidity risk management issues to the board of directors or the risk committee in writing for corrective action, to the extent permitted by applicable law.
(e)
(2) The covered savings and loan holding company must establish a methodology for making cash-flow projections that results in projections that:
(i) Include cash flows arising from contractual maturities, intercompany transactions, new business, funding renewals, customer options, and other potential events that may impact liquidity;
(ii) Include reasonable assumptions regarding the future behavior of assets, liabilities, and off-balance sheet exposures;
(iii) Identify and quantify discrete and cumulative cash flow mismatches over these time periods; and
(iv) Include sufficient detail to reflect the capital structure, risk profile, complexity, currency exposure, activities, and size of the covered savings and loan holding company and include analyses by business line, currency, or legal entity as appropriate.
(3) The covered savings and loan holding company must adequately document its methodology for making cash flow projections and the included assumptions and submit such documentation to the risk committee.
(f)
(2)
(A) Identify liquidity stress events that could have a significant impact on the covered savings and loan holding company's liquidity;
(B) Assess the level and nature of the impact on the covered savings and loan holding company's liquidity that may occur during identified liquidity stress events;
(C) Identify the circumstances in which the covered savings and loan holding company would implement its action plan described in paragraph (f)(2)(ii)(A) of this section, which circumstances must include failure to meet any minimum liquidity requirement imposed by the Board;
(D) Assess available funding sources and needs during the identified liquidity stress events;
(E) Identify alternative funding sources that may be used during the identified liquidity stress events; and
(F) Incorporate information generated by the liquidity stress testing required under § 238.124(a).
(ii)
(A) Include an action plan that clearly describes the strategies the company will use to respond to liquidity shortfalls for identified liquidity stress events, including the methods that the company will use to access alternative funding sources;
(B) Identify a liquidity stress event management team that would execute the action plan described in paragraph (f)(2)(ii)(A) of this section;
(C) Specify the process, responsibilities, and triggers for invoking the contingency funding plan, describe the decision-making process during the identified liquidity stress events, and describe the process for executing contingency measures identified in the action plan; and
(D) Provide a mechanism that ensures effective reporting and communication within the covered savings and loan holding company and with outside parties, including the Board and other relevant supervisors, counterparties, and other stakeholders.
(iii)
(iv)
(A) The components of the contingency funding plan to assess the plan's reliability during liquidity stress events;
(B) The operational elements of the contingency funding plan, including operational simulations to test communications, coordination, and decision-making by relevant management; and
(C) The methods the covered savings and loan holding company will use to access alternative funding sources to determine whether these funding sources will be readily available when needed.
(g)
(A) Concentrations in sources of funding by instrument type, single counterparty, counterparty type, secured and unsecured funding, and as applicable, other forms of liquidity risk;
(B) The amount of liabilities that mature within various time horizons; and
(C) Off-balance sheet exposures and other exposures that could create funding needs during liquidity stress events.
(ii) Each limit established pursuant to paragraph (g)(1) of this section must be consistent with the company's established liquidity risk tolerance and must reflect the company's capital structure, risk profile, complexity, activities, and size.
(2)
(h)
(1)
(i) Calculates all of its collateral positions according to the frequency specified in paragraph (h)(1)(i)(A) and (B) or as directed by the Board, specifying the value of pledged assets relative to the amount of security required under the relevant contracts and the value of unencumbered assets available to be pledged:
(A) If the covered savings and loan holding company is not a Category IV savings and loan holding company, on a weekly basis;
(B) If the covered savings and loan holding company is a Category IV savings and loan holding company, on a monthly basis;
(ii) Monitors the levels of unencumbered assets available to be pledged by legal entity, jurisdiction, and currency exposure;
(iii) Monitors shifts in the covered savings and loan holding company's funding patterns, such as shifts between intraday, overnight, and term pledging of collateral; and
(iv) Tracks operational and timing requirements associated with accessing collateral at its physical location (for example, the custodian or securities settlement system that holds the collateral).
(2)
(3)
(i) Monitor and measure expected daily gross liquidity inflows and outflows;
(ii) Manage and transfer collateral to obtain intraday credit;
(iii) Identify and prioritize time-specific obligations so that the covered savings and loan holding company can meet these obligations as expected and settle less critical obligations as soon as possible;
(iv) Manage the issuance of credit to customers where necessary; and
(v) Consider the amounts of collateral and liquidity needed to meet payment systems obligations when assessing the covered savings and loan holding company's overall liquidity needs.
(a)
(i) The covered savings and loan holding company must take into consideration its balance sheet exposures, off-balance sheet exposures, size, risk profile, complexity, business lines, organizational structure, and other characteristics of the covered savings and loan holding company that affect its liquidity risk profile in conducting its stress test.
(ii) In conducting a liquidity stress test using the scenarios described in paragraphs (a)(3)(i) and (ii) of this section, the covered savings and loan holding company must address the potential direct adverse impact of associated market disruptions on the covered savings and loan holding company and incorporate the potential actions of other market participants experiencing liquidity stresses under the market disruptions that would adversely affect the covered savings and loan holding company.
(2)
(i) If the covered savings and loan holding company is not a Category IV savings and loan holding company, at least monthly; or
(ii) If the covered savings and loan holding company is a Category IV savings and loan holding company, at least quarterly.
(3)
(A) A scenario reflecting adverse market conditions;
(B) A scenario reflecting an idiosyncratic stress event for the covered savings and loan holding company; and
(C) A scenario reflecting combined market and idiosyncratic stresses.
(ii) The covered savings and loan holding company must incorporate additional liquidity stress scenarios into its liquidity stress test, as appropriate, based on its financial condition, size, complexity, risk profile, scope of operations, or activities. The Board may require the covered savings and loan holding company to vary the underlying assumptions and stress scenarios.
(4)
(5)
(ii) Assets used as cash-flow sources during a planning horizon must be diversified by collateral, counterparty, borrowing capacity, and other factors associated with the liquidity risk of the assets.
(iii) A line of credit does not qualify as a cash flow source for purposes of a stress test with a planning horizon of 30 days or less. A line of credit may qualify as a cash flow source for purposes of a stress test with a planning horizon that exceeds 30 days.
(6)
(7)
(ii)
(iii)
(b)
(2)
(3)
(i)
(A) Cash;
(B) Securities issued or guaranteed by the United States, a U.S. government agency, or a U.S. government-sponsored enterprise; or
(C) Any other asset that the covered savings and loan holding company demonstrates to the satisfaction of the Board:
(
(
(
(ii)
(A) Is free of legal, regulatory, contractual, or other restrictions on the ability of such company promptly to liquidate, sell or transfer the asset; and
(B) Is either:
(
(
(iii)
(iv)
For purposes of this subpart, the following definitions apply:
(1) Until December 31, 2019:
(i) With respect to a covered company that has not adopted the current expected credit losses methodology under GAAP, the provision for loan and lease losses as reported on the FR Y-9C (and as would be reported on the FR Y-9C in the current stress test cycle); and
(ii) With respect to a covered company that has adopted the current expected credit losses methodology under GAAP, the provision for loan and lease losses, as would be calculated and reported on the FR Y-9C by a covered company that has not adopted the current expected credit losses methodology under GAAP; and
(2) Beginning January 1, 2020:
(i) With respect to a covered company that has adopted the current expected credit losses methodology under GAAP, the provision for credit losses, as would be reported by the covered company on the FR Y-9C in the current stress test cycle; and,
(ii) With respect to a covered company that has not adopted the current expected credit losses methodology under GAAP, the provision for loan and lease losses as would be reported by the covered company on the FR Y-9C in the current stress test cycle.
(a)
(2)
(b)
(2) A covered savings and loan holding company that becomes a covered company after September 30 of a calendar year must comply with the requirements of this subpart beginning on January 1 of the third calendar year after the covered savings and loan holding company becomes a covered company, unless that time is extended by the Board in writing.
(a)
(2) The analysis will include an assessment of the projected losses, net income, and pro forma capital levels and regulatory capital ratios and other capital ratios for the covered company and use such analytical techniques that the Board determines are appropriate to identify, measure, and monitor risks of the covered company.
(3) In conducting the analyses, the Board will coordinate with the appropriate primary financial regulatory agencies and the Federal Insurance Office, as appropriate.
(b)
(c)
(2) The Board will conduct its analysis of a Category IV savings and loan holding company on a biennial basis and occurring in each year ending in an even number.
(a)
(b)
(1) Ensure that the Board has sufficient information to conduct its analysis under this subpart; and
(2) Project a company's pre-provision net revenue, losses, provision for credit losses, and net income; and pro forma capital levels, regulatory capital ratios, and any other capital ratio specified by the Board under the scenarios described in § 238.132(b).
(c)
(a)
(b)
(2) The Board will notify companies of the date on which it expects to publicly disclose a summary of the Board's analyses pursuant to paragraph (b)(1) of this section at least 14 calendar days prior to the expected disclosure date.
The board of directors and senior management of each covered company must consider the results of the analysis conducted by the Board under this subpart, as appropriate:
(a) As part of the covered company's capital plan and capital planning process, including when making changes to the covered company's capital structure (including the level and composition of capital); and
(b) When assessing the covered company's exposures, concentrations, and risk positions.
(a)
(b)
For purposes of this subpart, the following definitions apply:
(1) A Category II savings and loan holding company; or
(2) A Category III savings and loan holding company.
(1) Until December 31, 2019:
(i) With respect to a covered company that has not adopted the current expected credit losses methodology under GAAP, the provision for loan and lease losses as reported on the FR Y-9C (and as would be reported on the FR Y-9C in the current stress test cycle); and
(ii) With respect to a covered company that has adopted the current expected credit losses methodology under GAAP, the provision for loan and lease losses, as would be calculated and reported on the FR Y-9C by a covered company that has not adopted the current expected credit losses methodology under GAAP; and
(2) Beginning January 1, 2020:
(i) With respect to a covered company that has adopted the current expected credit losses methodology under GAAP, the provision for credit losses, as would be reported by the covered company on the FR Y-9C in the current stress test cycle; and
(ii) With respect to a covered company that has not adopted the current expected credit losses methodology under GAAP, the provision for loan and lease losses as would be reported by the covered company on the FR Y-9C in the current stress test cycle.
(a)
(i) Any Category II savings and loan holding company; and
(ii) Any Category III savings and loan holding company.
(2)
(i) Is not a Category II savings and loan holding company; and
(ii) Is not a Category III savings and loan holding company.
(b)
(2) A covered savings and loan holding company that becomes a covered company after September 30 of a calendar year must comply with the requirements of this subpart beginning on January 1 of the third calendar year after the covered savings and loan holding company becomes a covered company, unless that time is extended by the Board in writing.
(a)
(2)
(ii) A Category III savings and loan holding company must conduct a biennial stress test. The stress test must be conducted by April 5 of each calendar year ending in an even number, based on data as of December 31 of the preceding calendar year, unless the time or the as-of date is extended by the Board in writing.
(b)
(2)
(ii) The Board may require a covered company to include one or more additional components in its adverse and severely adverse scenarios in the stress test required by this section based on the company's financial condition, size, complexity, risk profile, scope of operations, or activities, or risks to the U.S. economy.
(3)
(4)
(ii)
(iii)
(a)
(1) Losses, pre-provision net revenue, provision for credit losses, and net income; and
(2) The potential impact on pro forma regulatory capital levels and pro forma capital ratios (including regulatory capital ratios and any other capital ratios specified by the Board), incorporating the effects of any capital actions over the planning horizon and maintenance of an allowance for credit losses appropriate for credit exposures throughout the planning horizon.
(b)
(1) For the first quarter of the planning horizon, the covered company must take into account its actual capital actions as of the end of that quarter; and
(2) For each of the second through ninth quarters of the planning horizon, the covered company must include in the projections of capital:
(i) Common stock dividends equal to the quarterly average dollar amount of common stock dividends that the company paid in the previous year (that is, the first quarter of the planning horizon and the preceding three calendar quarters) plus common stock dividends attributable to issuances related to expensed employee compensation or in connection with a planned merger or acquisition to the extent that the merger or acquisition is reflected in the covered company's pro forma balance sheet estimates;
(ii) Payments on any other instrument that is eligible for inclusion in the numerator of a regulatory capital ratio equal to the stated dividend, interest, or principal due on such instrument during the quarter;
(iii) An assumption of no redemption or repurchase of any capital instrument that is eligible for inclusion in the numerator of a regulatory capital ratio; and
(iv) An assumption of no issuances of common stock or preferred stock, except for issuances related to expensed employee compensation or in connection with a planned merger or acquisition to the extent that the merger or acquisition is reflected in the covered company's pro forma balance sheet estimates.
(c)
(2)
(3)
(i) As part of the covered company's capital plan and capital planning process, including when making changes to the covered company's capital structure (including the level and composition of capital); and
(ii) When assessing the covered company's exposures, concentrations, and risk positions.
(a)
(b)
(a)
(2)
(b)
(1) A description of the types of risks included in the stress test;
(2) A general description of the methodologies used in the stress test, including those employed to estimate losses, revenues, provision for credit losses, and changes in capital positions over the planning horizon;
(3) Estimates of—
(i) Pre-provision net revenue and other revenue;
(ii) Provision for credit losses, realized losses or gains on available-for-sale and held-to-maturity securities, trading and counterparty losses, and other losses or gains;
(iii) Net income before taxes;
(iv) Loan losses (dollar amount and as a percentage of average portfolio balance) in the aggregate and by subportfolio, including: Domestic closed-end first-lien mortgages; domestic junior lien mortgages and home equity lines of credit; commercial and industrial loans; commercial real estate loans; credit card exposures; other consumer loans; and all other loans; and
(v) Pro forma regulatory capital ratios and any other capital ratios specified by the Board; and
(4) An explanation of the most significant causes for the changes in regulatory capital ratios; and
(5) With respect to any depository institution subsidiary that is subject to stress testing requirements pursuant to 12 U.S.C. 5365(i)(2), as implemented by subpart B of this part, 12 CFR part 46 (OCC), or 12 CFR part 325, subpart C (FDIC), changes over the planning horizon in regulatory capital ratios and any other capital ratios specified by the Board and an explanation of the most significant causes for the changes in regulatory capital ratios.
(c)
(i) Pre-provision net revenue and other revenue;
(ii) Provision for credit losses, realized losses/gains on available-for-sale and held-to-maturity securities, trading and counterparty losses, and other losses or gains;
(iii) Net income before taxes; and
(iv) Loan losses in the aggregate and by subportfolio.
(2) The disclosure of pro forma regulatory capital ratios and any other capital ratios specified by the Board that is required under paragraph (b) of this section must include the beginning value, ending value, and minimum value of each ratio over the planning horizon.
(a)
(2) For purposes of this subpart:
(i)
(A) A Category II savings and loan holding company; or
(B) A Category III savings and loan holding company.
(b)
(2) A covered company is required to calculate its aggregate net credit exposure, gross credit exposure, and net credit exposure to a counterparty using the methods in this subpart.
(c)
(2) A covered company that becomes subject to this subpart after [DATE 60 DAYS AFTER DATE OF PUBLICATION OF THE FINAL RULE IN THE
(d)
Unless defined in this section, terms that are set forth in § 238.2 and used in this subpart have the definitions assigned in § 238.2. For purposes of this subpart:
(a)
(1) With respect to the value of cash, securities, or other eligible collateral transferred by the covered company to a counterparty, the sum of:
(i) The market value of the cash, securities, or other eligible collateral; and
(ii) The product of the market value of the securities or other eligible collateral multiplied by the applicable collateral haircut in Table 1 to § 217.132 of this chapter; and
(2) With respect to cash, securities, or other eligible collateral received by the covered company from a counterparty:
(i) The market value of the cash, securities, or other eligible collateral; minus
(ii) The market value of the securities or other eligible collateral multiplied by the applicable collateral haircut in Table 1 to § 217.132 of this chapter.
(3) Prior to calculating the adjusted market value pursuant to paragraphs (a)(1) and (2) of this section, with regard to a transaction that meets the definition of “repo-style transaction” in § 217.2 of this chapter, the covered company would first multiply the applicable collateral haircuts in Table 1 to § 217.132 of this chapter by the square root of
(b)
(1) Any subsidiary of the company and any other company that is consolidated with the company under applicable accounting standards; or
(2) For a company that is not subject to principles or standards referenced in paragraph (b)(1) of this section, any subsidiary of the company and any other company that would be consolidated with the company, if consolidation would have occurred if such principles or standards had applied.
(c)
(d)
(e)
(1) With respect to a natural person, the natural person, and, if the credit exposure of the covered company to such natural person exceeds 5 percent of the covered company's tier 1 capital, the natural person and members of the person's immediate family collectively;
(2) With respect to any company that is not a subsidiary of the covered
(3) With respect to a State, the State and all of its agencies, instrumentalities, and political subdivisions (including any municipalities) collectively;
(4) With respect to a foreign sovereign entity that is not assigned a zero percent risk weight under the standardized approach in 12 CFR part 217, subpart D, the foreign sovereign entity and all of its agencies and instrumentalities (but not including any political subdivision) collectively; and
(5) With respect to a political subdivision of a foreign sovereign entity such as a state, province, or municipality, any political subdivision of the foreign sovereign entity and all of such political subdivision's agencies and instrumentalities, collectively.
(f)
(g)
(h)
(1) Any extension of credit to the counterparty, including loans, deposits, and lines of credit, but excluding uncommitted lines of credit;
(2) Any repurchase agreement or reverse repurchase agreement with the counterparty;
(3) Any securities lending or securities borrowing transaction with the counterparty;
(4) Any guarantee, acceptance, or letter of credit (including any endorsement, confirmed letter of credit, or standby letter of credit) issued on behalf of the counterparty;
(5) Any purchase of securities issued by or other investment in the counterparty;
(6) Any credit exposure to the counterparty in connection with a derivative transaction between the covered company and the counterparty;
(7) Any credit exposure to the counterparty in connection with a credit derivative or equity derivative between the covered company and a third party, the reference asset of which is an obligation or equity security of, or equity investment in, the counterparty; and
(8) Any transaction that is the functional equivalent of the above, and any other similar transaction that the Board, by regulation or order, determines to be a credit transaction for purposes of this subpart.
(i)
(j)
(k)
(1) Cash on deposit with the covered company or a subsidiary of the covered company (including cash in foreign currency or U.S. dollars held for the covered company by a custodian or trustee, whether inside or outside of the United States);
(2) Debt securities (other than mortgage- or asset-backed securities and resecuritization securities, unless those securities are issued by a U.S. government-sponsored enterprise) that are bank-eligible investments and that are investment grade, except for any debt securities issued by the covered company or any subsidiary of the covered company;
(3) Equity securities that are publicly traded, except for any equity securities issued by the covered company or any subsidiary of the covered company;
(4) Convertible bonds that are publicly traded, except for any convertible bonds issued by the covered company or any subsidiary of the covered company; or
(5) Gold bullion.
(l)
(1) The contract meets the requirements of an eligible guarantee and has been confirmed by the protection purchaser and the protection provider;
(2) Any assignment of the contract has been confirmed by all relevant parties;
(3) If the credit derivative is a credit default swap, the contract includes the following credit events:
(i) Failure to pay any amount due under the terms of the reference exposure, subject to any applicable minimal payment threshold that is consistent with standard market practice and with a grace period that is closely in line with the grace period of the reference exposure; and
(ii) Receivership, insolvency, liquidation, conservatorship, or inability of the reference exposure issuer to pay its debts, or its failure or admission in writing of its inability generally to pay its debts as they become due, and similar events;
(4) The terms and conditions dictating the manner in which the contract is to be settled are incorporated into the contract;
(5) If the contract allows for cash settlement, the contract incorporates a robust valuation process to estimate loss reliably and specifies a reasonable period for obtaining post-credit event valuations of the reference exposure;
(6) If the contract requires the protection purchaser to transfer an exposure to the protection provider at settlement, the terms of at least one of the exposures that is permitted to be transferred under the contract provide that any required consent to transfer may not be unreasonably withheld; and
(7) If the credit derivative is a credit default swap, the contract clearly identifies the parties responsible for determining whether a credit event has occurred, specifies that this determination is not the sole responsibility of the protection provider, and gives the protection purchaser the right to notify the protection provider of the occurrence of a credit event.
(m)
(1) The derivative contract has been confirmed by all relevant parties;
(2) Any assignment of the derivative contract has been confirmed by all relevant parties; and
(3) The terms and conditions dictating the manner in which the derivative contract is to be settled are incorporated into the contract.
(n)
(o)
(p)
(q)
(r)
(1)(i) A bank holding company or an affiliate thereof; a savings and loan holding company; a U.S. intermediate holding company established or designated pursuant to 12 CFR 252.153;
(ii) A depository institution as defined in section 3(c) of the Federal Deposit Insurance Act (12 U.S.C. 1813(c)); an organization that is organized under the laws of a foreign country and that engages directly in the business of banking outside the United States; a federal credit union or state credit union as defined in section 2 of the Federal Credit Union Act (12 U.S.C. 1752(1) and (6)); a national association, state member bank, or state nonmember bank that is not a depository institution; an institution that functions solely in a trust or fiduciary capacity as described in section 2(c)(2)(D) of the Bank Holding Company Act (12 U.S.C. 1841(c)(2)(D)); an industrial loan company, an industrial bank, or other similar institution described in section 2(c)(2)(H) of the Bank Holding Company Act (12 U.S.C. 1841(c)(2)(H));
(iii) An entity that is state-licensed or registered as:
(A) A credit or lending entity, including a finance company; money lender; installment lender; consumer lender or lending company; mortgage lender, broker, or bank; motor vehicle title pledge lender; payday or deferred deposit lender; premium finance company; commercial finance or lending company; or commercial mortgage company; except entities registered or licensed solely on account of financing the entity's direct sales of goods or services to customers;
(B) A money services business, including a check casher; money transmitter; currency dealer or exchange; or money order or traveler's check issuer;
(iv) Any person registered with the Commodity Futures Trading Commission as a swap dealer or major swap participant pursuant to the Commodity Exchange Act of 1936 (7 U.S.C. 1
(v) A securities holding company as defined in section 618 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (12 U.S.C. 1850a); a broker or dealer as defined in sections 3(a)(4) and 3(a)(5) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(4)-(5)); an investment adviser as defined in section 202(a) of the Investment Advisers Act of 1940 (15 U.S.C. 80b-2(a)); an investment company registered with the U.S. Securities and Exchange Commission under the Investment Company Act of 1940 (15 U.S.C. 80a-1
(vi) A private fund as defined in section 202(a) of the Investment Advisers Act of 1940 (15 U.S.C. 80b-2(a)); an entity that would be an investment company under section 3 of the Investment Company Act of 1940 (15 U.S.C. 80a-3) but for section 3(c)(5)(C); or an entity that is deemed not to be an investment company under section 3 of the Investment Company Act of 1940 pursuant to Investment Company Act Rule 3a-7 (17 CFR 270.3a-7) of the U.S. Securities and Exchange Commission;
(vii) A commodity pool, a commodity pool operator, or a commodity trading advisor as defined, respectively, in sections 1a(10), 1a(11), and 1a(12) of the Commodity Exchange Act of 1936 (7 U.S.C. 1a(10), 1a(11), and 1a(12)); a floor broker, a floor trader, or introducing broker as defined, respectively, in sections 1a(22), 1a(23) and 1a(31) of the Commodity Exchange Act of 1936 (7 U.S.C. 1a(22), 1a(23), and 1a(31)); or a futures commission merchant as defined in section 1a(28) of the Commodity Exchange Act of 1936 (7 U.S.C. 1a(28));
(viii) An employee benefit plan as defined in paragraphs (3) and (32) of section 3 of the Employee Retirement Income and Security Act of 1974 (29 U.S.C. 1002);
(ix) An entity that is organized as an insurance company, primarily engaged in writing insurance or reinsuring risks underwritten by insurance companies, or is subject to supervision as such by a State insurance regulator or foreign insurance regulator;
(x) Any designated financial market utility, as defined in section 803 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (12 U.S.C. 5462); and
(xi) An entity that would be a financial entity described in paragraphs (r)(1)(i) through (x) of this section, if it were organized under the laws of the United States or any State thereof; and
(2) Provided that, for purposes of this subpart, “financial entity” does not include any counterparty that is a foreign sovereign entity or multilateral development bank.
(s)
(t)
(u)
(v)
(w)
(x)
(y)
(z)
(aa)
(bb)
(cc)
(dd)
(ee)
(1) The company is consolidated by the other company under applicable accounting standards; or
(2) For a company that is not subject to principles or standards referenced in paragraph (ee)(1) of this definition, consolidation would have occurred if such principles or standards had applied.
(ff)
(gg)
(1) The average of the company's total consolidated assets in the four most recent consecutive quarters as reported quarterly on the FR Y-9C; or
(2) If the company has not filed an FR Y-9C for each of the four most recent consecutive quarters, the average of the company's total consolidated assets, as reported on the company's FR Y-9C, for the most recent quarter or consecutive quarters, as applicable.
(a)
(1) A deposit of the covered company held by the counterparty, loan by a covered company to the counterparty, and lease in which the covered company is the lessor and the counterparty is the lessee, equal to the amount owed by the counterparty to the covered company under the transaction.
(2) A debt security or debt investment held by the covered company that is issued by the counterparty, equal to:
(i) The market value of the securities, for trading and available-for-sale securities; and
(ii) The amortized purchase price of the securities or investments, for securities or investments held to maturity.
(3) An equity security held by the covered company that is issued by the counterparty, equity investment in a counterparty, and other direct investments in a counterparty, equal to the market value.
(4) A securities financing transaction must be valued using any of the methods that the covered company is authorized to use under 12 CFR part 217, subparts D and E to value such transactions:
(i)(A) As calculated for each transaction, in the case of a securities financing transaction between the covered company and the counterparty that is not subject to a bilateral netting agreement or does not meet the definition of “repo-style transaction” in § 217.2 of this chapter; or
(B) As calculated for a netting set, in the case of a securities financing transaction between the covered company and the counterparty that is subject to a bilateral netting agreement with that counterparty and meets the definition of “repo-style transaction” in § 217.2 of this chapter;
(ii) For purposes of paragraph (a)(4)(i) of this section, the covered company must:
(A) Assign a value of zero to any security received from the counterparty that does not meet the definition of “eligible collateral” in § 238.151; and
(B) Include the value of securities that are eligible collateral received by the covered company from the counterparty (including any exempt counterparty), calculated in accordance with paragraphs (a)(4)(i) through (iv) of this section, when calculating its gross credit exposure to the issuer of those securities;
(iii) Notwithstanding paragraphs (a)(4)(i) and (ii) of this section and with respect to each credit transaction, a covered company's gross credit exposure to a collateral issuer under this paragraph (a)(4) is limited to the covered company's gross credit exposure to the counterparty on the credit transaction; and
(iv) In cases where the covered company receives eligible collateral from a counterparty in addition to the cash or securities received from that counterparty, the counterparty may reduce its gross credit exposure to that counterparty in accordance with § 238.154(b).
(5) A committed credit line extended by a covered company to a counterparty, equal to the face amount of the committed credit line.
(6) A guarantee or letter of credit issued by a covered company on behalf of a counterparty, equal to the maximum potential loss to the covered company on the transaction.
(7) A derivative transaction must be valued using any of the methods that the covered company is authorized to use under 12 CFR part 217, subparts D and E to value such transactions:
(i)(A) As calculated for each transaction, in the case of a derivative transaction between the covered company and the counterparty, including an equity derivative but excluding a credit derivative described in paragraph (a)(8) of this section, that is not subject to a qualifying master netting agreement; or
(B) As calculated for a netting set, in the case of a derivative transaction between the covered company and the counterparty, including an equity derivative but excluding a credit derivative described in paragraph (a)(8) of this section, that is subject to a qualifying master netting agreement.
(ii) In cases where a covered company is required to recognize an exposure to an eligible guarantor pursuant to § 238.154(d), the covered company must exclude the relevant derivative transaction when calculating its gross exposure to the original counterparty under this section.
(8) A credit derivative between the covered company and a third party where the covered company is the protection provider and the reference asset is an obligation or debt security of the counterparty, equal to the maximum potential loss to the covered company on the transaction.
(b)
(c)
(a)
(b)
(2) A covered company that reduces its gross credit exposure to a counterparty as required under paragraph (b)(1) of this section must include the adjusted market value of the eligible collateral, when calculating its
(3) Notwithstanding paragraph (b)(2) of this section, a covered company's gross credit exposure to a collateral issuer under this paragraph (b) is limited to:
(i) Its gross credit exposure to the counterparty on the credit transaction, or
(ii) In the case of an exempt counterparty, the gross credit exposure that would have been attributable to that exempt counterparty on the credit transaction if valued in accordance with § 238.153(a).
(c)
(2) A covered company that reduces its gross credit exposure to a counterparty as required under paragraph (c)(1) of this section must include the amount of eligible guarantees when calculating its gross credit exposure to the eligible guarantor.
(3) Notwithstanding paragraph (c)(2) of this section, a covered company's gross credit exposure to an eligible guarantor with respect to an eligible guarantee under this paragraph (c) is limited to:
(i) Its gross credit exposure to the counterparty on the credit transaction prior to recognition of the eligible guarantee, or
(ii) In the case of an exempt counterparty, the gross credit exposure that would have been attributable to that exempt counterparty on the credit transaction prior to recognition of the eligible guarantee if valued in accordance with § 238.153(a).
(d)
(i) In the case of any eligible credit derivative from an eligible guarantor, the notional amount of the eligible credit derivative; or
(ii) In the case of any eligible equity derivative from an eligible guarantor, the gross credit exposure amount to the counterparty (calculated in accordance with § 238.153(a)(7)).
(2)(i) A covered company that reduces its gross credit exposure to a counterparty as provided under paragraph (d)(1) of this section must include, when calculating its net credit exposure to the eligible guarantor, including in instances where the underlying credit transaction would not be subject to the credit limits of § 238.152 (for example, due to an exempt counterparty), either
(A) In the case of any eligible credit derivative from an eligible guarantor, the notional amount of the eligible credit derivative; or
(B) In the case of any eligible equity derivative from an eligible guarantor, the gross credit exposure amount to the counterparty (calculated in accordance with § 238.153(a)(7)).
(ii) Notwithstanding paragraph (d)(2)(i) of this section, in cases where the eligible credit derivative or eligible equity derivative is used to hedge covered positions that are subject to the Board's market risk rule (12 CFR part 217, subpart F) and the counterparty on the hedged transaction is not a financial entity, the amount of credit exposure that a company must recognize to the eligible guarantor is the amount that would be calculated pursuant to § 238.153(a).
(3) Notwithstanding paragraph (d)(2) of this section, a covered company's gross credit exposure to an eligible guarantor with respect to an eligible credit derivative or an eligible equity derivative under this paragraph (d) is limited to:
(i) Its gross credit exposure to the counterparty on the credit transaction prior to recognition of the eligible credit derivative or the eligible equity derivative, or
(ii) In the case of an exempt counterparty, the gross credit exposure that would have been attributable to that exempt counterparty on the credit transaction prior to recognition of the eligible credit derivative or the eligible equity derivative if valued in accordance with § 238.153(a).
(e)
(1) The instrument in which the covered company has a short position is junior to, or pari passu with, the instrument in which the covered company has the long position; and
(2) The instrument in which the covered company has a short position and the instrument in which the covered company has the long position are either both treated as trading or available-for-sale exposures or both treated as held-to-maturity exposures.
(f)
(2) To the extent that the used portion of a credit extension has been secured by eligible collateral, the covered company may reduce its gross credit exposure by the adjusted market value of any eligible collateral received from the counterparty, even if the used portion has not been fully secured by eligible collateral.
(3) To qualify for the reduction in net credit exposure under this paragraph, the credit contract must specify that any used portion of the credit extension must be fully secured by the adjusted market value of any eligible collateral.
(g)
(2) Notwithstanding paragraph (g)(1) of this section, in cases where a covered company has a credit transaction with an exempt counterparty and the covered company has obtained eligible collateral from that exempt counterparty or an eligible guarantee or eligible credit or equity derivative from an eligible guarantor, the covered company must include (for purposes of this subpart) such exposure to the issuer of such eligible collateral or the eligible guarantor, as calculated in accordance with the rules set forth in this section, when calculating its gross credit exposure to that issuer of eligible collateral or eligible guarantor.
(h)
(1) When reducing its gross credit exposure to a counterparty resulting from any credit transaction due to any eligible collateral and calculating its gross credit exposure to an issuer of eligible collateral, pursuant to paragraph (b) of this section, the currency mismatch adjustment approach of § 217.37(c)(3)(ii) of this chapter; and
(2) When reducing its gross credit exposure to a counterparty resulting from any credit transaction due to any
(i)
(1) When reducing its gross credit exposure to a counterparty resulting from any credit transaction due to any eligible collateral or any eligible guarantees, eligible equity derivatives, or eligible credit derivatives from an eligible guarantor, pursuant to paragraphs (b) through (d) of this section, and
(2) In calculating its gross credit exposure to an issuer of eligible collateral, pursuant to paragraph (b) of this section, or to an eligible guarantor, pursuant to paragraphs (c) and (d) of this section; provided that
(3) The eligible collateral, eligible guarantee, eligible equity derivative, or eligible credit derivative subject to paragraph (i)(1) of this section:
(i) Has a shorter maturity than the credit transaction;
(ii) Has an original maturity equal to or greater than one year;
(iii) Has a residual maturity of not less than three months; and
(iv) The adjustment approach is otherwise applicable.
(a)
(i)
(ii)
(2)(i) A covered company must determine whether the amount of its gross credit exposure to an issuer of assets in an SPV, due to an SPV exposure, is equal to or greater than 0.25 percent of the covered company's tier 1 capital using one of the following two methods:
(A) The sum of all of the issuer's assets (with each asset valued in accordance with § 238.153(a)) in the SPV; or
(B) The application of the look-through approach described in paragraph (b) of this section.
(ii) With respect to the determination required under paragraph (a)(2)(i) of this section, a covered company must use the same method to calculate gross credit exposure to each issuer of assets in a particular SPV.
(iii) In making a determination under paragraph (a)(2)(i) of this section, the covered company must consider only the credit exposure to the issuer arising from the covered company's SPV exposure.
(iv) For purposes of this paragraph (a)(2), a covered company that is unable to identify each issuer of assets in an SPV must attribute to a single unknown counterparty the amount of its gross credit exposure to all unidentified issuers and calculate such gross credit exposure using one method in either paragraph (a)(2)(i)(A) or (a)(2)(i)(B) of this section.
(3)(i) If a covered company determines pursuant to paragraph (a)(2) of this section that the amount of its gross credit exposure to an issuer of assets in an SPV is less than 0.25 percent of the covered company's tier 1 capital, the amount of the covered company's gross credit exposure to that issuer may be attributed to either that issuer of assets or the SPV:
(A) If attributed to the issuer of assets, the issuer of assets must be identified as a counterparty, and the gross credit exposure calculated under paragraph (a)(2)(i)(A) of this section to that issuer of assets must be aggregated with any other gross credit exposures (valued in accordance with § 238.153) to that same counterparty; and
(B) If attributed to the SPV, the covered company's gross credit exposure is equal to the covered company's SPV exposure, valued in accordance with § 238.153(a).
(ii) If a covered company determines pursuant to paragraph (a)(2) of this section that the amount of its gross credit exposure to an issuer of assets in an SPV is equal to or greater than 0.25 percent of the covered company's tier 1 capital or the covered company is unable to determine that the amount of the gross credit exposure is less than 0.25 percent of the covered company's tier 1 capital:
(A) The covered company must calculate the amount of its gross credit exposure to the issuer of assets in the SPV using the look-through approach in paragraph (b) of this section;
(B) The issuer of assets in the SPV must be identified as a counterparty, and the gross credit exposure calculated in accordance with paragraph (b) must be aggregated with any other gross credit exposures (valued in accordance with § 238.153) to that same counterparty; and
(C) When applying the look-through approach in paragraph (b) of this section, a covered company that is unable to identify each issuer of assets in an SPV must attribute to a single unknown counterparty the amount of its gross credit exposure, calculated in accordance with paragraph (b) of this section, to all unidentified issuers.
(iii) For purposes of this section, a covered company must aggregate all gross credit exposures to unknown counterparties for all SPVs as if the exposures related to a single unknown counterparty; this single unknown counterparty is subject to the limits of § 238.152 as if it were a single counterparty.
(b)
(1) Where all investors in the SPV rank
(2) Where all investors in the SPV do not rank
(i) The pro rata share of the covered company's investment in the tranche of the SPV; multiplied by
(ii) The lesser of:
(A) The market value of the tranche in which the covered company has invested, except in the case of a debt security that is held to maturity, in which case the tranche must be valued at the amortized purchase price of the securities; and
(B) The value of each underlying asset attributed to the issuer in the SPV, each as calculated pursuant to § 238.153(a).
(c)
(2) The amount of any gross credit exposure that is required to be recognized to a third party under paragraph (c)(1) of this section is equal to the covered company's SPV exposure, up to the maximum contractual obligation of that third party to the SPV, valued in accordance with § 238.153(a). (This gross credit exposure is in addition to the covered company's gross credit exposure to the SPV or the issuers of assets of the SPV, calculated in accordance with paragraphs (a) and (b) of this section.)
(3) A covered company must aggregate the gross credit exposure to a third party recognized in accordance with paragraphs (c)(1) and (2) of this section with its other gross credit exposures to that third party (that are unrelated to the SPV) for purposes of compliance with the limits of § 238.152.
(a)
(2) If, pursuant to an assessment required under paragraph (a)(1) of this section, the covered company determines that one or more of the factors of paragraph (b)(2) or (c)(1) of this section are met with respect to one or more counterparties, or the Board determines pursuant to paragraph (d) of this section that one or more other counterparties of a covered company are economically interdependent or that one or more other counterparties of a covered company are connected by a control relationship, the covered company must aggregate its net credit exposure to the counterparties for all purposes under this subpart, including, but not limited to, § 238.152.
(3) In connection with any request pursuant to paragraph (b)(3) or (c)(2) of this section, the Board may require the covered company to provide additional information.
(b)
(2) A covered company must assess whether the financial distress of one counterparty (counterparty A) would prevent the ability of the other counterparty (counterparty B) to fully and timely repay counterparty B's liabilities and whether the insolvency or default of counterparty A is likely to be associated with the insolvency or default of counterparty B and, therefore, these counterparties are economically interdependent, by evaluating the following:
(i) Whether 50 percent or more of one counterparty's gross revenue is derived from, or gross expenditures are directed to, transactions with the other counterparty;
(ii) Whether counterparty A has fully or partly guaranteed the credit exposure of counterparty B, or is liable by other means, in an amount that is 50 percent or more of the covered company's net credit exposure to counterparty A;
(iii) Whether 25 percent or more of one counterparty's production or output is sold to the other counterparty, which cannot easily be replaced by other customers;
(iv) Whether the expected source of funds to repay the loans of both counterparties is the same and neither counterparty has another independent source of income from which the loans may be serviced and fully repaid;
(v) Whether two or more counterparties rely on the same source for the majority of their funding and, in the event of the common provider's default, an alternative provider cannot be found.
(3)(i) Notwithstanding paragraph (b)(2) of this section, if a covered company determines that one or more of the factors in paragraph (b)(2) is met, the covered company may request in writing a determination from the Board that those counterparties are not economically interdependent and that the covered company is not required to aggregate those counterparties.
(ii) Upon a request by a covered company pursuant to paragraph (b)(3) of this section, the Board may grant temporary relief to the covered company and not require the covered company to aggregate one counterparty with another counterparty provided that the counterparty could promptly modify its business relationships, such as by reducing its reliance on the other counterparty, to address any economic interdependence concerns, and provided that such relief is in the public interest and is consistent with the purpose of this subpart.
(c)
(i) Counterparty A owns, controls, or holds with the power to vote 25 percent or more of any class of voting securities of counterparty B; or
(ii) Counterparty A controls in any manner the election of a majority of the directors, trustees, or general partners (or individuals exercising similar functions) of counterparty B.
(2)(i) Notwithstanding paragraph (c)(1) of this section, if a covered company determines that one or more of the factors in paragraph (c)(1) is met, the covered company may request in writing a determination from the Board that counterparty A does not control counterparty B and that the covered company is not required to aggregate those counterparties.
(ii) Upon a request by a covered company pursuant to paragraph (c)(2) of this section, the Board may grant temporary relief to the covered company and not require the covered company to aggregate counterparty A with counterparty B provided that, taking into account the specific facts and circumstances, such indicia of control does not result in the entities being connected by control relationships for purposes of this subpart, and provided that such relief is in the public interest and is consistent with the purpose of this subpart.
(d)
(1) Economically interdependent for purposes of this subpart, considering the factors in paragraph (b)(2) of this section, as well as any other indicia of economic interdependence that the Board determines in its discretion to be relevant; or
(2) Connected by control relationships for purposes of this subpart, considering the factors in paragraph (c)(1) of this section and whether counterparty A:
(i) Controls the power to vote 25 percent or more of any class of voting securities of Counterparty B pursuant to a voting agreement;
(ii) Has significant influence on the appointment or dismissal of counterparty B's administrative, management, or governing body, or the fact that a majority of members of such body have been appointed solely as a result of the exercise of counterparty A's voting rights; or
(iii) Has the power to exercise a controlling influence over the management or policies of counterparty B.
(e)
(a)
(1) Any direct claim on, and the portion of a claim that is directly and fully guaranteed as to principal and interest by, the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation, only while operating under the conservatorship or receivership of the Federal Housing Finance Agency, and any additional obligation issued by a U.S. government-sponsored entity as determined by the Board;
(2) Intraday credit exposure to a counterparty;
(3) Any trade exposure to a qualifying central counterparty related to the covered company's clearing activity, including potential future exposure arising from transactions cleared by the qualifying central counterparty and pre-funded default fund contributions;
(4) Any credit transaction with the Bank for International Settlements, the International Monetary Fund, the International Bank for Reconstruction and Development, the International Finance Corporation, the International Development Association, the Multilateral Investment Guarantee Agency, or the International Centre for Settlement of Investment Disputes;
(5) Any credit transaction with the European Commission or the European Central Bank; and
(6) Any transaction that the Board exempts if the Board finds that such exemption is in the public interest and is consistent with the purpose of this subpart.
(b)
(c)
(a)
(2) A covered company must report its compliance to the Federal Reserve as of the end of the quarter, unless the Board determines and notifies that company in writing that more frequent reporting is required.
(3) In reporting its compliance, a covered company must calculate and include in its gross credit exposure to an issuer of eligible collateral or eligible guarantor the amounts of eligible collateral, eligible guarantees, eligible equity derivatives, and eligible credit derivatives that were provided to the covered company in connection with credit transactions with exempt counterparties, valued in accordance with and as required by § 238.154(b) through (d) and (g).
(b)
(c)
(2) A covered company may request a special temporary credit exposure limit exemption from the Board. The Board may grant approval for such exemption in cases where the Board determines that such credit transactions are necessary or appropriate to preserve the safety and soundness of the covered company. In acting on a request for an exemption, the Board will consider the following:
(i) A decrease in the covered company's capital stock and surplus;
(ii) The merger of the covered company with another covered company;
(iii) A merger of two counterparties; or
(iv) An unforeseen and abrupt change in the status of a counterparty as a result of which the covered company's credit exposure to the counterparty becomes limited by the requirements of this section; or
(v) Any other factor(s) the Board determines, in its discretion, is appropriate.
(d)
12 U.S.C. 5311.
(b) * * *
(i) * * *
(ii) * * *
(B) A bank holding company or foreign bank subject to the Bank Holding Company Act (BHC Act) (12
For purposes of Title I of the Dodd-Frank Act, the following definitions shall apply:
(a)
(1) Any nonbank financial company supervised by the Board; and
(2) Any other nonbank financial company that had $100 billion or more in total consolidated assets (as determined in accordance with applicable accounting standards) as of the end of its most recently completed fiscal year.
(b)
12 U.S.C. 321-338a, 481-486, 1467a, 1818, 1828, 1831n, 1831o, 1831p-l, 1831w, 1835, 1844(b), 1844(c), 3101
(a) * * *
(b)
Unless otherwise specified, the following definitions apply for purposes of this part:
(1) The total exposures of the banking organization, as reported by the banking organization on the FR Y-15 for each of the four most recent calendar quarters, or for the most recent quarter or quarters, as applicable; minus
(2) The total consolidated assets of the banking organization.
(1) Incorporated in or organized under the laws of the United States or in any State;
(2) Not a consolidated subsidiary of a bank holding company that is incorporated in or organized under the laws of the United States or in any State; and
(3) Is not a U.S. intermediate holding company established or designated by a foreign banking organization.
(1) Its U.S. branches and agencies, if any; and
(2)(i) If the foreign banking organization has established a U.S. intermediate holding company, the U.S. intermediate holding company and the subsidiaries of such U.S. intermediate holding company; or
(ii) If the foreign banking organization has not established a U.S. intermediate holding company, the U.S. subsidiaries of the foreign banking organization (excluding any section 2(h)(2) company,
(1) The total exposure of the banking organization, as reported by the banking organization on the FR Y-15; minus
(2) The total consolidated assets of the banking organization for the same calendar quarter.
(1) Any exchange registered with the U.S. Securities and Exchange Commission as a national securities exchange under section 6 of the Securities Exchange Act of 1934 (15 U.S.C. 78f); or
(2) Any non-U.S.-based securities exchange that:
(i) Is registered with, or approved by, a non-U.S. national securities regulatory authority; and
(ii) Provides a liquid, two-way market for the instrument in question, meaning that there are enough independent bona fide offers to buy and sell so that a sales price reasonably related to the last sales price or current bona fide competitive bid and offer quotations can be determined promptly and a trade can be settled at such price within a reasonable time period conforming with trade custom.
(3) A company can rely on its determination that a particular non-U.S.-based securities exchange provides a liquid two-way market unless the Board determines that the exchange does not provide a liquid two-way market.
(a)
(b)
(2) After meeting the criteria in paragraph (b)(1) of this section, a banking organization continues to be a global systemically important BHC until the banking organization has not been identified as a global systemically important BHC in each of the four most recent calendar quarters.
(c)
(i)(A) Has $700 billion or more in average total consolidated assets; or
(B) Has $75 billion or more in average cross-jurisdictional activity and $100 billion or more in average total consolidated assets; and
(ii) Is not a global systemically important BHC.
(2) After meeting the criteria in paragraph (c)(1) of this section, a banking organization continues to be a Category II banking organization until the banking organization:
(i) Has:
(A) Less than $700 billion in total consolidated assets for each of the four most recent calendar quarters; and
(B) Less than $75 billion in cross-jurisdictional activity for each of the four most recent calendar quarters;
(ii) Has less than $100 billion in total consolidated assets for each of the four most recent calendar quarters; or
(iii) Meets the criteria in paragraph (b)(1) to be a global systemically important BHC.
(d)
(i) Has:
(A) $250 billion or more in average total consolidated assets; or
(B) $100 billion or more in average total consolidated assets and at least:
(
(
(
(ii) Is not a global systemically important BHC; and
(iii) Is not a Category II banking organization.
(2) After meeting the criteria in paragraph (d)(1) of this section, a banking organization continues to be a Category III banking organization until the banking organization:
(i) Has:
(A) Less than $250 billion in total consolidated assets for each of the four most recent calendar quarters;
(B) Less than $75 billion in total nonbank assets for each of the four most recent calendar quarters;
(C) Less than $75 billion in weighted short-term wholesale funding for each of the four most recent calendar quarters; and
(D) Less than $75 billion in off-balance sheet exposure for each of the four most recent calendar quarters; or
(ii) Has less than $100 billion in total consolidated assets for each of the four most recent calendar quarters;
(iii) Meets the criteria in paragraph (b)(1) of this section to be a global systemically important BHC; or
(iv) Meets the criteria in paragraph (c)(1) of this section to be a Category II banking organization.
(e)
(i) Is not global systemically important BHC;
(ii) Is not a Category II banking organization; and
(iii) Is not a Category III banking organization.
(2) After meeting the criteria in paragraph (e)(1), a banking organization continues to be a Category IV banking organization until the banking organization:
(i) Has less than $100 billion in total consolidated assets for each of the four most recent calendar quarters;
(ii) Meets the criteria in paragraph (b)(1) of this section to be a global systemically important BHC;
(iii) Meets the criteria in paragraph (c)(1) of this section to be a Category II banking organization; or
(iv) Meets the criteria in paragraph (d)(1) of this section to be a Category III banking organization.
(a)
(b)
The revisions read as follows:
(c)
(d)
(f)
(g)
(n)
(o)
(p)
(q)
(r)
(s)
(1) Until September 30, 2015, the period beginning on October 1 of a calendar year and ending on September 30 of the following calendar year, and
(2) Beginning October 1, 2015, the period beginning on January 1 of a calendar year and ending on December 31 of that year.
(t)
(a)
(2)
(b)
(2) A state member bank that exceeds the asset threshold for the first time after March 31 of a given year must comply with the requirements of this subpart beginning on January 1 of the second year following that given year, unless that time is extended by the Board in writing.
(3)
(a)
(2)
(i) A state member bank that is a covered company subsidiary must conduct its stress test by January 5, 2015, based on data as of September 30, 2014, unless the time or the as-of date is extended by the Board in writing; and
(ii) A state member bank that is not a covered company subsidiary and a bank holding company must conduct its stress test by March 31, 2015, based on data as of September 30, 2014, unless the time or the as-of date is extended by the Board in writing.
(3)
(i) A state member bank that is a covered company subsidiary must conduct its stress test by April 5 of each calendar year based on data as of December 31 of the preceding calendar year, unless the time or the as-of date is extended by the Board in writing; and
(ii) A state member bank that is not a covered company subsidiary must conduct its stress test by July 31 of each calendar year using financial statement data as of December 31 of the preceding calendar year, unless the time or the as-of date is extended by the Board in writing.
(b)
(2)
(ii) The Board may require a state member bank to include one or more additional components in its adverse and severely adverse scenarios in the stress test required by this section based on the company's financial condition, size, complexity, risk profile, scope of operations, or activities, or risks to the U.S. economy.
(3)
(4)
(ii)
(iii)
The revisions read as follows:
(a)
(b)
(2)
(3)
(a)
(3)
(i) A state member bank that is a covered company subsidiary must report the results of the stress test to the Board by April 5, unless that time is extended by the Board in writing; and
(ii) A state member bank that is not a covered company subsidiary must report the results of the stress test to the Board by July 31, unless that time is extended by the Board in writing.
The revisions read as follows:
(a)
(ii) [Reserved]
(3)
(i) A state member bank that is a covered company subsidiary must publicly disclose a summary of the results of the stress test within 15 calendar days after the Board discloses the results of its supervisory stress test of the covered company pursuant to § 252.46(c), unless that time is extended by the Board in writing; and
(ii) A state member bank that is not a covered company subsidiary must publicly disclose a summary of the results of the stress test in the period beginning on October 15 and ending on October 31, unless that time is extended by the Board in writing.
(4)
(b)
(2)
(i) A description of the types of risks being included in the stress test;
(ii) A summary description of the methodologies used in the stress test;
(iii) Estimates of—
(A) Aggregate losses;
(B) Pre-provision net revenue
(C) Provision for credit losses;
(D) Net income; and
(E) Pro forma regulatory capital ratios and any other capital ratios specified by the Board; and
(iv) An explanation of the most significant causes for the changes in regulatory capital ratios.
(a)
(b)
(c)
(1) Its reported total consolidated assets on the FR Y-9C are below $50 billion for each of four consecutive calendar quarters; and
(2) It becomes subject to the requirements of subpart D of this part.
(a)
(2)
(i) Policies and procedures establishing risk-management governance, risk-management procedures, and risk-control infrastructure for its global operations; and
(ii) Processes and systems for implementing and monitoring compliance with such policies and procedures, including:
(A) Processes and systems for identifying and reporting risks and risk-management deficiencies, including regarding emerging risks, and ensuring effective and timely implementation of actions to address emerging risks and risk-management deficiencies for its global operations;
(B) Processes and systems for establishing managerial and employee responsibility for risk management;
(C) Processes and systems for ensuring the independence of the risk-management function; and
(D) Processes and systems to integrate risk management and associated controls with management goals and its compensation structure for its global operations.
(3)
(i) Have a formal, written charter that is approved by the bank holding company's board of directors;
(ii) Be an independent committee of the board of directors that has, as its sole and exclusive function, responsibility for the risk-management policies of the bank holding company's global operations and oversight of the operation of the bank holding company's global risk-management framework;
(iii) Report directly to the bank holding company's board of directors;
(iv) Receive and review regular reports on not less than a quarterly basis from the bank holding company's chief risk officer provided pursuant to paragraph (b)(3)(ii) of this section; and
(v) Meet at least quarterly, or more frequently as needed, and fully document and maintain records of its proceedings, including risk-management decisions.
(4)
(i) Include at least one member having experience in identifying, assessing, and managing risk exposures of large, complex financial firms; and
(ii) Be chaired by a director who:
(A) Is not an officer or employee of the bank holding company and has not been an officer or employee of the bank holding company during the previous three years;
(B) Is not a member of the immediate family, as defined in § 225.41(b)(3) of this chapter, of a person who is, or has been within the last three years, an executive officer of the bank holding company, as defined in § 215.2(e)(1) of this chapter; and
(C)(
(
(b)
(2)
(A) The establishment of risk limits on an enterprise-wide basis and the
(B) The implementation of and ongoing compliance with the policies and procedures set forth in paragraph (a)(2)(i) of this section and the development and implementation of the processes and systems set forth in paragraph (a)(2)(ii) of this section; and
(C) The management of risks and risk controls within the parameters of the company's risk control framework, and monitoring and testing of the company's risk controls.
(ii) The chief risk officer is responsible for reporting risk-management deficiencies and emerging risks to the risk committee and resolving risk-management deficiencies in a timely manner.
(3)
(ii) The chief risk officer must report directly to both the risk committee and chief executive officer of the company.
This subpart applies to bank holding companies with total consolidated assets of $100 billion or more. Total consolidated assets of a bank holding company are equal to the consolidated assets of the bank holding company, as calculated in accordance with § 252.31(b).
(a)
(2)
(b)
(c)
(d)
A bank holding company with total consolidated assets of $100 billion or more must comply with, and hold capital commensurate with the requirements of, any regulations adopted by the Board relating to capital planning and stress tests, in accordance with the applicability provisions set forth therein.
(a)
(b)
(a)
(c)
(d)
(2) The independent review function must:
(i) Regularly, but no less frequently than annually, review and evaluate the
(ii) Assess whether the company's liquidity risk-management function complies with applicable laws and regulations, and sound business practices; and
(iii) Report material liquidity risk management issues to the board of directors or the risk committee in writing for corrective action, to the extent permitted by applicable law.
(e)
(f)
(2)
(A) Identify liquidity stress events that could have a significant impact on the bank holding company's liquidity;
(B) Assess the level and nature of the impact on the bank holding company's liquidity that may occur during identified liquidity stress events;
(C) Identify the circumstances in which the bank holding company would implement its action plan described in paragraph (f)(2)(ii)(A) of this section, which circumstances must include failure to meet any minimum liquidity requirement imposed by the Board;
(D) Assess available funding sources and needs during the identified liquidity stress events;
(E) Identify alternative funding sources that may be used during the identified liquidity stress events; and
(F) Incorporate information generated by the liquidity stress testing required under § 252.35(a).
(g)
(A) Concentrations in sources of funding by instrument type, single counterparty, counterparty type, secured and unsecured funding, and as applicable, other forms of liquidity risk;
(B) The amount of liabilities that mature within various time horizons; and
(C) Off-balance sheet exposures and other exposures that could create funding needs during liquidity stress events.
(ii) Each limit established pursuant to paragraph (g)(1) of this section must be consistent with the company's established liquidity risk tolerance and must reflect the company's capital structure, risk profile, complexity, activities, and size.
(2)
(h)
(1)
(i) Calculates all of its collateral positions according to the frequency specified in paragraph (h)(1)(i)(A) and (B) or as directed by the Board, specifying the value of pledged assets relative to the amount of security required under the relevant contracts and the value of unencumbered assets available to be pledged;
(A) If the bank holding company is not a Category IV bank holding company, on a weekly basis; or
(B) If the bank holding company is a Category IV bank holding company, on a monthly basis;
(ii) Monitors the levels of unencumbered assets available to be pledged by legal entity, jurisdiction, and currency exposure;
(iii) Monitors shifts in the bank holding company's funding patterns, such as shifts between intraday, overnight, and term pledging of collateral; and
(iv) Tracks operational and timing requirements associated with accessing collateral at its physical location (for example, the custodian or securities settlement system that holds the collateral).
(2)
(3)
(i) Monitor and measure expected daily gross liquidity inflows and outflows;
(ii) Manage and transfer collateral to obtain intraday credit;
(iii) Identify and prioritize time-specific obligations so that the bank holding company can meet these obligations as expected and settle less critical obligations as soon as possible;
(iv) Manage the issuance of credit to customers where necessary; and
(v) Consider the amounts of collateral and liquidity needed to meet payment systems obligations when assessing the bank holding company's overall liquidity needs.
(a)
(2)
(i) If the bank holding company is not a Category IV bank holding company, at least monthly; or
(ii) If the bank holding company is a Category IV bank holding company, at least quarterly.
(7)
(ii)
(b)
(a)
(b)
(c)
(e)
(f)
(1) A bank holding company (other than a foreign banking organization) with average total consolidated assets of $100 billion or more;
(2) A U.S. intermediate holding company subject to this section pursuant to § 252.153; and
(3) A nonbank financial company supervised by the Board.
(m)
(a)
(i) Any bank holding company with average total consolidated assets of $100 billion or more;
(ii) Any U.S. intermediate holding company subject to this section pursuant to § 252.153; and
(iii) Any nonbank financial company supervised by the Board that is made subject to this section pursuant to a rule or order of the Board.
(2)
The revisions and addition read as follows:
(a)
(3) In conducting the analyses, the Board will coordinate with the
(b)
(c)
(2) The Board will conduct its analysis of a Category IV bank holding company on a biennial basis and occurring in each year ending in an even number.
(a)
(b)
(c)
(f)
(g)
(1) A global systemically important BHC;
(2) A Category II bank holding company;
(3) A Category III bank holding company;
(4) A U.S. intermediate holding company subject to this section pursuant to § 252.153; and
(5) A nonbank financial company supervised by the Board.
(n)
(o)
(a)
(i) A global systemically important BHC;
(ii) Any Category II bank holding company;
(iii) Any Category III bank holding company;
(iv) Any U.S. intermediate holding company subject to this section pursuant to § 252.153; and
(v) Any nonbank financial company supervised by the Board that is made subject to this section pursuant to a rule or order of the Board.
(2)
(i) Is not a global systemically important BHC;
(ii) Is not a Category II bank holding company; and
(iii) Is not a Category III bank holding company.
(a) Stress test—(1)
(2)
(ii) A Category III bank holding company must conduct a biennial stress test. The stress test must be conducted by April 5 of each calendar year ending in an even number, based on data as of December 31 of the preceding calendar year, unless the time or the as-of date is extended by the Board in writing.
(b) * * *
(2)
(4) * * *
(ii)
(iii)
(a)
(b)
(2)
(3)
(4)
(ii)
(iii)
(a)
(b)
(c) * * *
(a)
(2) A U.S. intermediate holding company must report the results of the stress test required under § 252.55 to the Board in a manner and form prescribed by the Board. Such results must be submitted by October 5 of the calendar year in which the stress test is performed pursuant to § 252.55, unless that time is extended by the Board in writing.
(a)
(ii) A U.S. intermediate holding company must publicly disclose a summary of the results of the stress test required under § 252.55. This disclosure must occur in the period beginning on October 5 and ending on November 4 of the calendar year in which the stress test is performed pursuant to § 252.55, unless that time is extended by the Board in writing.
(a)
(2) For purposes of this subpart:
(i)
(A) A global systemically important BHC;
(B) A Category II bank holding company;
(C) A Category III bank holding company;
(ii)
(d)
(i) The covered company is not a global systemically important BHC;
(ii) The covered company is not a Category II bank holding company; and
(iii) The covered company is not a Category III bank holding company.
Office for Civil Rights, Department of Education.
Notice of proposed rulemaking.
The Secretary of Education proposes to amend regulations implementing Title IX of the Education Amendments of 1972 (Title IX). The proposed regulations would clarify and modify Title IX regulatory requirements pertaining to the availability of remedies for violations, the effect of Constitutional protections, the designation of a coordinator to address sex discrimination issues, the dissemination of a nondiscrimination policy, the adoption of grievance procedures, and the process to claim a religious exemption. The proposed regulations would also specify how recipient schools and institutions covered by Title IX (hereinafter collectively referred to as recipients or schools) must respond to incidents of sexual harassment consistent with Title IX's prohibition against sex discrimination. The proposed regulations are intended to promote the purpose of Title IX by requiring recipients to address sexual harassment, assisting and protecting victims of sexual harassment and ensuring that due process protections are in place for individuals accused of sexual harassment.
We must receive your comments on or before January 28, 2019.
Submit your comments through the Federal eRulemaking Portal or via postal mail, commercial delivery, or hand delivery. We will not accept comments by fax or by email, or comments submitted after the comment period closes. To ensure that we do not receive duplicate copies, please submit your comments only once. Additionally, please include the Docket ID at the top of your comments.
If you are submitting comments electronically, we strongly encourage you to submit any comments or attachments in Microsoft Word format. If you must submit a comment in Adobe Portable Document Format (PDF), we strongly encourage you to convert the PDF to “print-to-PDF” format, or to use some other commonly-used searchable text format. Please do not submit the PDF in a scanned format. Using a print-to-PDF format allows the U.S. Department of Education (the Department) to electronically search and copy certain portions of your submissions.
The Department's policy is to make all comments received from members of the public available for public viewing in their entirety on the Federal eRulemaking Portal at
Brittany Bull, U.S. Department of Education, 400 Maryland Avenue SW, Room 6E310, Washington, DC 20202. Telephone: (202) 453-7100. You may also email your questions to
If you use a telecommunications device for the deaf (TDD) or a text telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1-800-877-8339.
Based on its extensive review of the critical issues addressed in this rulemaking, the Department has determined that current regulations and guidance do not provide appropriate standards for how recipients must respond to incidents of sexual harassment. To address this concern, we propose regulations addressing sexual harassment under Title IX to better align the Department's regulations with the text and purpose of Title IX and Supreme Court precedent and other case law. This will help to ensure that recipients understand their legal obligations including what conduct is actionable as sexual harassment under Title IX, the conditions that activate a mandatory response by the recipient, and particular requirements that such a response must meet so that recipients protect the rights of their students to access education free from sex discrimination.
In addition to providing recipients with clear legal obligations, the transparency of the proposed regulations will help empower students to hold their schools accountable for failure to meet those obligations. Under the proposed regulations, complainants reporting sexual harassment will have greater control over the process. The Department recognizes that every situation is unique and that individuals react to sexual harassment differently; thus, the proposed regulations help ensure that schools provide complainants with clear options and honor the wishes of the reporting individual about how to respond to the situation, including increased access to supportive measures. Where a reporting complainant elects to file a formal complaint triggering the school's grievance process, the proposed regulations require the school's investigation to be fair and impartial, applying mandatory procedural checks and balances, thus producing more reliable factual outcomes, with the goal of encouraging more students to turn to their schools for support in the wake of sexual harassment.
With regard to sexual harassment, the proposed regulations would:
Define the conduct constituting sexual harassment for Title IX purposes;
Specify the conditions that activate a recipient's obligation to respond to allegations of sexual harassment and impose a general standard for the sufficiency of a recipient's response;
Specify situations that require a recipient to initiate its grievance procedures; and
Establish procedural safeguards that must be incorporated into a recipient's grievance procedures to ensure a fair and reliable factual determination when a recipient investigates and adjudicates a sexual harassment complaint.
In addition, the proposed regulations would: Clarify that in responding to any claim of sex discrimination under Title IX, recipients are not required to deprive an individual of rights that would be otherwise guaranteed under the U.S. Constitution; prohibit the Department's Office for Civil Rights
As further detailed in the
We invite you to assist us in complying with the specific requirements of Executive Orders 12866 and 13563 (explained further below), and their overall goal of reducing the regulatory burden that might result from these proposed regulations. Please let us know of any further ways that we may reduce potential costs or increase potential benefits, while preserving the effective and efficient administration of the Department's programs and activities.
During and after the comment period, you may inspect all public comments about these proposed regulations by accessing
Title IX prohibits discrimination on the basis of sex in education programs and activities that receive federal financial assistance.
The Department's predecessor, the Department of Health, Education and Welfare (HEW), promulgated implementing regulations under Title IX effective in 1975.
When the current regulations were issued in 1975, the federal courts had not yet addressed recipients' Title IX obligations to address sexual harassment as a form of sex discrimination. The Supreme Court subsequently elaborated on the scope of Title IX, ruling that money damages are available for private actions under Title IX based on sexual harassment by a teacher against a student,
In the four decades since HEW issued the 1975 rule, no Title IX regulations have been promulgated to address sexual harassment as a form of sex discrimination; instead, the Department has addressed this subject through a series of guidance documents.
Beginning in mid-2017, the Department started to examine how schools and colleges were applying Title IX to sexual harassment under then-applicable guidance. The Department conducted listening sessions and discussions with stakeholders expressing a variety of positions for and against the status quo, including advocates for survivors of sexual violence; advocates for accused students; organizations representing schools and colleges; attorneys representing survivors, the accused, and institutions; Title IX Coordinators and other school and college administrators; child and sex abuse prosecutors;
The Department learned that schools and colleges were uncertain about whether the Department's guidance was or was not legally binding. To the extent that guidance was viewed as mandatory, the obligations set forth in previous guidance were issued without the benefit of notice and comment that would have permitted the public and all stakeholders to comment on the feasibility and effectiveness of the guidance. Several of the prescriptions set forth in previous guidance (for example, compulsory use by all schools and colleges of the preponderance of the evidence standard and prohibition of mediation in Title IX sexual assault cases) generated particular criticism and controversy.
Other criticisms of the previous guidance included that those guidance documents pressured schools and colleges to forgo robust due process protections;
After personally engaging with numerous stakeholders including sexual violence survivors, students accused of campus sexual assault, and school and college attorneys and administrators, the Secretary of Education delivered a speech in September 2017
On September 22, 2017, the Department rescinded previous guidance documents that had never had
Both the legislative process and notice-and-comment rulemaking are transparent, participatory processes that afford the opportunity for input from a diversity of viewpoints. That range of views is critical because this area implicates competing values, including privacy, safety, the functioning of the academic community, and the integrity of the educational process for both the victim and the accused, as well as the fundamental fairness of the disciplinary process. . . . In addition, adherence to a rule-of-law standard would have resulted in procedures with greater legitimacy and buy-in from the universities subject to the resulting rules.
While implementing regulations under Title IX since 1975 have required schools to provide for a “prompt and equitable” grievance process to resolve complaints of sex discrimination by the school, the Department's guidance (both the guidance documents rescinded in 2017 and the ones remaining) fails to provide the clarity, permanence, and prudence of regulation properly informed by public participation in the full rulemaking process. Under the system created by the Department's guidance, hundreds of students have filed complaints with OCR alleging their school failed to provide a prompt or equitable process in response to a report of sexual harassment,
The Department recognizes that despite well-intentioned efforts by school districts, colleges and universities, advocacy organizations, and the Department itself, sexual harassment continues to present serious problems across the nation's campuses. The lack of clear regulatory standards has contributed to processes that have not been fair to all parties involved, that have lacked appropriate procedural protections, and that have undermined confidence in the reliability of the outcomes of investigations of sexual harassment allegations. Such deficiencies harm complainants, respondents, and recipients alike.
The framework created under these proposed regulations stems from the Department's commitment to the rule of law and the Department's recognition that it has statutory authority under 20 U.S.C. 1682 to issue regulations that effectuate Title IX's provisions—to protect all students from sex discrimination (here, in the form of sexual harassment) that jeopardizes equal access to education. The proposed regulations would help ensure that the obligations imposed on recipients fall within the scope of the civil rights law that Congress created and, where persuasive, align with relevant case law. Thus, the proposed regulations set forth clear standards that trigger a recipient's obligation to respond to sexual harassment, including defining the conduct that rises to the level of Title IX as conduct serious enough to jeopardize a person's equal access to the recipient's education program or activity, and confining a recipient's Title IX obligations to sexual harassment of which it has actual knowledge.
Within those clarified standards triggering a recipient's Title IX obligations, the proposed regulations instruct recipients to take certain steps that, in the Department's judgment based on extensive interaction with stakeholders, will foster educational environments where all students and employees know that every school must respond appropriately to sexual harassment. The proposed regulations provide that complainants experiencing sexual harassment may report allegations to their school and expect their school to respond in a manner that is not clearly unreasonable and incentivize recipients to give various supportive measures to complainants to restore or preserve the individual's equal access to education as a way of demonstrating that the recipient's response to the complainant's report was not deliberately indifferent.
The proposed regulations require schools to investigate and adjudicate formal complaints of sexual harassment, and to treat complainants and respondents equally, giving each a meaningful opportunity to participate in the investigation and requiring the recipient to apply substantive and procedural safeguards that provide a predictable, consistent, impartial process for both parties and increase the likelihood that the recipient will reach a determination regarding the respondent's responsibility based on objective standards and relevant facts and evidence. By separating a recipient's obligation to
Rather than proceeding sequentially, we group and discuss the proposed amendments under the substantive or procedural issues to which they pertain. We do not address proposed regulatory changes that are technical or otherwise minor in effect.
In discussing the proposed regulations, we first address how recipients must respond to sexual harassment and the procedures for resolving formal complaints of sexual harassment. Under the response provisions, we address: Adoption of standards from Title IX Supreme Court
The proposed regulations also seek to clarify existing Title IX regulations in other areas beyond sexual harassment. Specifically, we state that OCR shall not deem necessary the payment of money damages to remedy violations under part 106 (proposed § 106.3(a)). We address the intersection among Title IX regulations, constitutional rights, student privacy rights, and Title VII of the Civil Rights Act of 1964 (proposed § 106.6). We clarify the provisions governing the designation of a Title IX Coordinator (proposed § 106.8). And we clarify that a recipient that qualifies for the religious exemption under Title IX can claim its exemption without seeking written assurance of the exemption from the Department (proposed § 106.12).
We propose definitions for “sexual harassment” and “actual knowledge” in § 106.30. The Department defines “sexual harassment” to mean either an employee of the recipient conditioning the provision of an aid, benefit, or service of the recipient on an individual's participation in unwelcome sexual conduct; or unwelcome conduct on the basis of sex that is so severe, pervasive, and objectively offensive that it effectively denies a person equal access to the recipient's education program or activity; or sexual assault as defined in 34 CFR 668.46(a), implementing the Jeanne Clery Disclosure of Campus Security Policy and Campus Crime Statistics Act (Clery Act). We define “actual knowledge” as notice of sexual harassment or allegations of sexual harassment to a recipient's Title IX Coordinator or any official of the recipient who has authority to institute corrective measures on behalf of the recipient, or to a teacher in the elementary and secondary context with regard to student-on-student harassment. The proposed definition of “actual knowledge” also states that imputation of knowledge based solely on respondeat superior or constructive notice is insufficient to constitute actual knowledge, that the standard is not met when the only official of the recipient with actual knowledge is also the respondent, and that the mere ability or obligation to report sexual harassment does not qualify an employee, even if that employee is an official, as one who has authority to institute corrective measures on behalf of the recipient.
First, the Court has held that Title IX governs misconduct by recipients, not by third parties such as teachers and students. As the Court noted in
Second, because Congress enacted Title IX under its Spending Clause authority, the obligations it imposes on recipients are in the nature of a contract.
Third, the text of Title IX prohibits only discrimination that has the effect of denying access to the recipient's educational program or activities.
And finally, the Court reasoned in
As a matter of policy, the Department believes that these same principles
Similarly, proposed § 106.44(a) adopts the
For recipients that are elementary and secondary schools, with respect to student-on-student sexual harassment, proposed § 106.30 states that actual knowledge can also come from notice to a teacher. The Department recognizes that the Supreme Court has not held definitively that teachers are “appropriate officials with the authority to take corrective action” with respect to student-on-student sexual harassment; however, in the elementary and secondary school setting where school administrators and teachers are more likely to act
The definition in proposed § 106.30 also states that the mere ability or obligation to report sexual harassment does not qualify an employee, even if that employee is an official, as one who has authority to institute corrective measures on behalf of the recipient.
Further, a recipient's actual knowledge must be regarding conduct of the type proscribed under Title IX. The Department intends that the proposed definition of sexual harassment be consistent with the text of Title IX and with the Court's decisions in
Proposed § 106.44(a) also reflects the statutory provision that a recipient is only responsible for responding to conduct that occurs within its “education program or activity.”
In determining whether a sexual harassment incident occurred within a recipient's program or activity, courts have examined factors such as whether the conduct occurred in a location or in a context where the recipient owned the premises; exercised oversight, supervision, or discipline; or funded, sponsored, promoted, or endorsed the event or circumstance.
Importantly, nothing in the proposed regulations would prevent a recipient from initiating a student conduct proceeding or offering supportive measures to students who report sexual harassment that occurs outside the recipient's education program or activity (or as to conduct that harms a person located outside the United States, such as a student participating in a study abroad program). Notably, there may be circumstances where the harassment occurs in a recipient's program or activity, but the recipient's response obligation is not triggered because the complainant was not participating in, or even attempting to participate in, the education programs or activities provided by that recipient.
The Department wishes to emphasize that when determining how to respond to sexual harassment, recipients have flexibility to employ age-appropriate methods, exercise common sense and good judgment, and take into account the needs of the parties involved. Finally, the Department wishes to clarify that Title IX's “education program or activity” language should not be conflated with Clery Act geography; these are distinct jurisdictional schemes, though they may overlap in certain situations.
Once it has been established that a recipient has actual knowledge of sexual harassment in its education program or activity, it becomes necessary to evaluate the recipient's response. Although the Department is not required to adopt the deliberate indifference standard articulated by the Court, we are persuaded by the policy rationales relied on by it and believe it's the best policy approach. As the Court reasoned in
The Department acknowledges that proposed § 106.44(a) would adopt standards that depart from those set forth in prior guidance and OCR enforcement of Title IX. The Department's guidance and enforcement practices have taken the position that constructive notice—as opposed to actual notice—triggered a recipient's duty to respond to sexual harassment; that recipients had a duty to respond to a broader range of sex-based misconduct than the sexual harassment defined in the proposed regulation; and that recipients' response to sexual harassment should be judged under a reasonableness standard, rather than under the deliberate indifference
Based on its consideration of the text and purpose of Title IX, of the reasoning underlying the Court's decisions in
The deliberate indifference standard set forth in
We also propose adding paragraph (b)(2), stating that when a recipient has actual knowledge of reports by multiple complainants of conduct by the same respondent that could constitute sexual harassment, the Title IX Coordinator must file a formal complaint; if the Title IX Coordinator files a formal complaint in response to such allegations, and the recipient follows procedures (including implementing any appropriate remedy where required) consistent with § 106.45 in response to the formal complaint, the recipient's response to the reports is not deliberately indifferent.
In addition, we propose adding paragraph (b)(3), which states that, for institutions of higher education, in the absence of a formal complaint, a recipient is not deliberately indifferent when it implements supportive measures designed to effectively restore or preserve access to the recipient's education program or activity. We further proposed that the recipient must also at the same time give written notice to the complainant stating that the complainant can choose to file a formal complaint at a later time despite having declined to file a formal complaint at the time the supportive measures are offered.
We propose adding paragraph (b)(4), which states that where paragraphs (b)(1) through (3) are not implicated, a recipient with actual knowledge of sexual harassment in its education program or activity against a person in the United States must, consistent with paragraph (a), respond in a manner that is not deliberately indifferent. A recipient is deliberately indifferent only if its response to sexual harassment is clearly unreasonable in light of the known circumstances.
Proposed § 106.30 defines “complainant” as an individual who has reported being the victim of conduct that could constitute sexual harassment, or on whose behalf the Title IX Coordinator has filed a formal complaint. Additionally, for purposes of this proposed paragraph, the person to whom the individual has reported must be the Title IX Coordinator or another person to whom notice of sexual harassment results in the recipient's actual knowledge under § 106.30.
Proposed § 106.30 defines “respondent” as an individual who has been reported to be the perpetrator of conduct that could constitute sexual harassment.
Proposed § 106.30 defines “supportive measures” as non-disciplinary, non-punitive individualized services offered as appropriate, as reasonably available, and without fee or charge, to the complainant or the respondent before or after the filing of a formal complaint or where no formal complaint has been filed. Section 106.30 goes on to explain that such measures are designed to restore or preserve access to the recipient's education program or activity, without unreasonably burdening the other party; protect the safety of all parties and the recipient's educational environment; and deter sexual harassment. Supportive measures may include counseling, extensions of deadlines or other course-related adjustments, modifications of work or class schedules, campus escort services, mutual restrictions on contact between the parties, changes in work or housing locations, leaves of absence, increased security and monitoring of certain areas of the campus, and other similar measures. Section 106.30 also states that the recipient must maintain as confidential any supportive measures provided to the complainant or respondent, to the extent that maintaining such confidentiality would
Finally, we propose adding § 106.44(b)(5), which explains that the Assistant Secretary will not deem a recipient's determination regarding responsibility to be evidence of deliberate indifference by the recipient merely because the Assistant Secretary would have reached a different determination based on an independent weighing of the evidence.
Proposed § 106.44(b)(4) states that even if none of the safe harbor situations is present, the recipient's response to sexual harassment must still meet the general requirement in § 106.44(a) to not be deliberately indifferent, which means the recipient's response must not be clearly unreasonable in light of the known circumstances. Section 106.44(b)(1)-(3) explains what deliberate indifference means in three specific contexts. Section 106.44(b)(4) clarifies that when those three situations are not implicated, the general deliberate indifference standard specific in § 106.44(a) applies to a recipient with actual knowledge of sexual harassment in an education program or activity of the recipient against a person in the United States that effectively denies an individual equal access to the recipient's education program or activity.
To define the respective parties involved in a recipient's grievance procedures, proposed § 106.30 defines “complainant” as one who has reported being the victim of sexually harassing conduct. To be considered a “complainant,” such a report must be made to the recipient's Title IX Coordinator or other official to whom notice of sexual harassment results in the recipient having actual knowledge as described in § 106.30. This clarifies when a recipient must view a person as a complainant for purposes of offering supportive measures, investigating a formal complaint, and any other response necessary to meet the recipient's obligation to not be deliberately indifferent. Proposed § 106.30 defines “respondent” as an individual who has been the subject of a report of sexual harassment.
Consistent with feedback from many stakeholders, the Department recognizes that often the most effective measures a recipient can take to support its students in the aftermath of an alleged incident of sexual harassment are outside the grievance process and involve working with the affected individuals to provide reasonable supportive measures that increase the likelihood that they will be able to continue their education in a safe, supportive environment.
Also consistent with feedback from stakeholders on the issue of supportive measures and to provide needed clarity, we (1) propose to define them as non-disciplinary, non-punitive individualized services offered as appropriate, as reasonably available, and without fee or charge, to the complainant or the respondent before or after the filing of a formal complaint or where no formal complaint has been filed; (2) propose to specify, in the definition, that the recipient must maintain as confidential any supportive measures provided to the complainant or respondent, to the extent that maintaining such confidentiality would not impair the ability of the institution to provide the supportive measures; and (3) further specify that such measures are designed to restore or preserve access to the recipient's education program or activity, without
We also specify in the proposed definition that the recipient's Title IX Coordinator is responsible for coordinating effective implementation of supportive measures. Many supportive measures involve implementation through various offices or departments within a school; when supportive measures are part of a school's response to a Title IX sexual harassment report or formal complaint, the Title IX Coordinator must serve as the point of contact for the affected students to ensure that the supportive measures are effectively implemented so that the burden of navigating paperwork or other policy requirements within the recipient's own system does not fall on the student receiving the supportive measure. For example, where a mutual no-contact order has been imposed as a supportive measure, the affected complainant and respondent should know to contact the Title IX Coordinator with questions about how to interpret or enforce the no-contact order; as a further example, where a student receives an academic course adjustment as a supportive measure, the Title IX Coordinator is responsible for communicating with other offices within the school as needed to ensure that the adjustment occurs as intended and without fee or charge to the student. As another example, if counseling services are provided as a supportive measure, the Title IX Coordinator should help coordinate the service and ensure the sessions occur without fee or charge. Proposed § 106.44(b)(5) would provide that the Assistant Secretary will not deem a recipient's determination regarding responsibility that results from the implementation of its grievance procedures to be evidence of deliberate indifference by the recipient merely because the Assistant Secretary would have reached a different determination based on an independent weighing of the evidence. During a complaint investigation or compliance review, OCR's role is not to conduct a de novo review of the recipient's investigation and determination of responsibility for a particular respondent. Rather, OCR's role is to determine whether a recipient has complied with Title IX and its implementing regulations. Thus, OCR will not find a recipient to have violated Title IX or this part solely because OCR may have weighed the evidence differently in a given case. The Department believes it is important to include this provision in the regulations to provide notice and transparency to recipients about OCR's role and standard of review in enforcing Title IX. This provision does not, however, preclude OCR from requiring a recipient's determination of responsibility to be set aside if the recipient did not comply with proposed § 106.45.
• Treat complainants and respondents equitably; an equitable resolution must include remedies for the complainant where a finding of responsibility against the respondent has been made, with such remedies designed to restore or preserve access to the recipient's education program or activity, and due process protections for the respondent before any disciplinary sanctions are imposed;
• Require an investigation of the allegations and an objective evaluation of all relevant evidence—including both inculpatory and exculpatory evidence—and provide that credibility determinations may not be based on a person's status as a complainant, respondent, or witness;
• Require that any individual designated by a recipient as a coordinator, investigator, or decision-maker not have a conflict of interest or bias for or against complainants or respondents generally or an individual complainant or respondent; and that a recipient ensure that coordinators, investigators, and decision-makers receive training on the definition of sexual harassment and how to conduct an investigation and grievance process—including hearings, if applicable—that protect the safety of students, ensure due process protections for all parties, and promote accountability; and that any materials used to train coordinators, investigators, or decision-makers not rely on sex stereotypes and instead promote impartial investigations and adjudications of sexual harassment;
• Include a presumption that the respondent is not responsible for the alleged conduct until a determination regarding responsibility is made at the conclusion of the grievance process;
• Include reasonably prompt timeframes for completion of the grievance process, including reasonably prompt timeframes for filing and resolving appeals if the recipient offers an appeal, and including a process that allows for the temporary delay of the grievance process or the limited extension of timeframes for good cause with written notice to the complainant and the respondent of the delay or extension, and the reasons for the action; good cause may include considerations such as the absence of the parties or witnesses, concurrent law enforcement activity, or the need for language assistance or accommodation of disabilities;
• Describe the range of possible sanctions and remedies that the recipient may implement following any determination of responsibility;
• Describe the standard of evidence to be used to determine responsibility;
• Include the procedures and permissible bases for the complainant and respondent to appeal if the recipient offers an appeal; and
• Describe the range of supportive measures available to complainants and respondents.
Proposed § 106.45(b)(1)(i) would require that grievance procedures treat complainants and respondents equitably, echoing the existing requirement in 34 CFR 106.8 that a recipient's grievance procedures provide for “prompt and equitable resolution” of complaints. Stakeholders have urged the Department to protect the interests of both the complainant and the respondent, and to ensure that recipients' procedures treat both parties equitably and fairly throughout the process, including incorporating the protections described throughout proposed § 106.45(b). A fair and equitable grievance process benefits all parties because they are more likely to trust in, engage with, and rely upon the process as legitimate. The Department recognizes that some recipients are state actors with responsibilities to provide protections to students and employees under the Fourteenth Amendment's Due Process Clause. Other recipients are private institutions that do not have constitutional obligations to their students and employees. The due process protections provided under these proposed regulations aim to effectuate the objectives of Title IX by creating consistent, fair, objective grievance processes that make the process equitable for both parties and are more likely to generate reliable outcomes. When presented with an allegation of sexual harassment the recipient must respond in a manner that is not deliberately indifferent, but to evaluate what constitutes an appropriate response, the recipient must first reach factual determinations about the allegations at issue. This requires the recipient to employ a grievance process that rests on fundamental notions of fairness and due process protections so that findings of responsibility rest on facts and evidence. Only when an outcome is the product of a predictable, fair process that gives both parties meaningful opportunity to participate will the recipient be in a position to determine what remedies and/or disciplinary sanctions are warranted. When a recipient establishes an equitable process with due process protections and implements it consistently, its findings will be viewed with more confidence by the parties and the public.
Although both complainants and respondents have a common interest in a fair process, they also have distinct interests that are recognized in paragraph (b)(1)(i). For example, paragraph (b)(1)(i) explains that equitable grievance procedures will provide remedies for the complainant as appropriate and due process protections for the respondent before any disciplinary action is taken. Because a grievance process could result in a determination that the respondent sexually harassed the complainant, and because the resulting sanctions against the respondent could include a complete loss of access to the education program or activity of the recipient, an equitable grievance procedure will only reach such a conclusion following a process that seriously considers any contrary arguments or evidence the respondent might have, including by providing the respondent with all of the specific due process protections
Proposed § 106.45(b)(1)(ii) requires that a recipient investigate a complaint and that grievance procedures include an objective evaluation of the evidence. Stakeholders have raised concerns that recipients sometimes ignore evidence that does not fit with a predetermined outcome, and that investigators and decision-makers have inappropriately discounted testimony based on whether it comes from the complainant or the respondent. Paragraph (b)(1)(ii) responds to these concerns by requiring the recipient to conduct an investigation and objectively evaluate all evidence, and by prohibiting the recipient from basing its evaluation of testimony on the person's status as a complainant, respondent, or witness.
Proposed § 106.45(b)(1)(iii) would address the problems that have arisen for complainants and respondents as a result of coordinators, investigators, and decision-makers making decisions based on bias by requiring recipients to fill such positions with individuals free from bias or conflicts of interest. This proposed provision generally tracks the language in the Clery Act regulations at 34 CFR 668.46(k)(3)(i)(C) and would apply to all recipients subject to Title IX. Paragraph (b)(1)(iii) would also require that coordinators, investigators, and decision-makers receive training on (1) the definition of sexual harassment and (2) how to conduct the investigation and grievance process in a way that protects student safety, due process, and accountability. This proposed provision generally tracks the language in the Clery Act regulations at 34 CFR 668.46(k)(2)(ii) and would apply to all recipients subject to Title IX. The Department believes that such training will help ensure that those individuals responsible for implementing the recipient's grievance procedures are appropriately informed at the elementary and secondary education level as well as the postsecondary education level. Recipients would also be required to use training materials that promote impartial investigations and adjudications and that do not rely on sex stereotypes, so as to avoid training that would cause the grievance process to favor one side or the other or bias outcomes in favor of complainants or respondents. Recipients would continue to have the discretion to use their own employees to investigate and/or adjudicate matters under Title IX or to hire outside individuals to fulfill these responsibilities.
Proposed § 106.45(b)(1)(iv) would require that a recipient's grievance procedures establish a presumption that the respondent is not responsible for the alleged conduct until a determination regarding responsibility is made at the conclusion of the grievance process. This requirement is added to ensure impartiality by the recipient until a determination is made. The requirement also bolsters other provisions in the proposed regulation that place the burden of proof on the recipient, rather than on the parties; indicate that supportive measures are “non-disciplinary” and “non-punitive” (implying that the recipient may not punish an accused person prior to a determination regarding responsibility); and impose due process protections throughout the grievance process. Finally, pending the finding of facts sufficient for the recipient to make a determination regarding responsibility, the requirement mitigates the stigma and reputational harm that accompany an allegation of sexual misconduct. A fundamental notion of a fair proceeding is that a legal system does not prejudge a person's guilt or liability.
The proposed regulations recognize that the time that it takes to complete the grievance process will vary depending on, among others things, the complexity of the investigation, and that prompt resolution of the grievance process is important to both complainants and respondents. Proposed paragraph (b)(1)(v) would require recipients to designate reasonably prompt timeframes for the grievance process, including for appeals if the recipient offers an appeal, but also provide that timeframes may be extended for good cause with written notice to the parties and an explanation for the delay. This proposed provision generally tracks the language in the Clery Act regulations at 34 CFR 668.46(k)(3)(i)(A), which the Department believes is important to include for all recipients subject to Title IX. Some recipients felt pressure in light of prior Department guidance to resolve the grievance process within 60 days regardless of the particulars of the situation, and in some instances, this resulted in hurried investigations and adjudications, which sacrificed accuracy and fairness for speed. Proposed paragraph (b)(1)(v) specifies examples of possible reasons for such a delay, such as absence of the parties or witnesses, concurrent law enforcement activity, or the need for language assistance or accommodation of disabilities. For example, if a concurrent law enforcement investigation has uncovered evidence that the police plan to release on a specific timeframe and that evidence would likely be material to determining responsibility, a recipient could reasonably extend the timeframe of the grievance process in order to allow that evidence to be included in the final determination of responsibility. Any reason for a delay must be justified by good cause and communicated by written notice to the complainant and the respondent of the delay or extension and the reasons for the action; delays caused solely by administrative needs are insufficient to satisfy this standard. Moreover, recipients must meet their legal obligation to provide timely auxiliary aids and services and reasonable accommodations under Title II of the ADA, Section 504, and Title VI of the Civil Rights Act of 1964, and should reasonably consider other services such as meaningful access to language assistance.
It is important for individuals to have a clear understanding of the recipients' policies and procedures related to sexual harassment, including the consequences of being found responsible for sexual harassment, and the procedures the recipient will use to make such a determination; otherwise, the parties may not have a full and fair opportunity to present evidence and arguments in favor of their side, and the accuracy and impartiality of the process could suffer as a result. Proposed paragraphs (b)(1)(vi) through (ix) would require that the parties be informed of the possible sanctions and remedies that may be implemented following the determination of responsibility, the standard of evidence to be used during the grievance process, the procedures and permissible bases for appeals if the recipient offers an appeal, and the range of supportive measures available to complainants and respondents. These proposed provisions generally track the language in the Clery Act regulations at 34 CFR 668.46(k)(1) and would apply to all recipients subject to Title IX. The Department believes that requiring a recipient to notify the parties of these matters in advance is equally important at the elementary and secondary education level as it is at the postsecondary education level to ensure the parties are fully informed.
• Ensure that the burden of proof and the burden of gathering evidence sufficient to reach a determination regarding responsibility rest on the recipient and not on the parties;
• Provide equal opportunity for the parties to present witnesses and other inculpatory and exculpatory evidence;
• Not restrict the ability of either party to discuss the allegations under investigation or to gather and present relevant evidence;
• Provide the parties with the same opportunities to have others present during any grievance proceeding, including the opportunity to be accompanied to any related meeting or proceeding by the advisor of their choice, and not limit the choice of advisor or presence for either the complainant or respondent in any meeting or grievance proceeding; however, the recipient may establish restrictions regarding the extent to which the advisor may participate in the proceedings, as long as the restrictions apply equally to both parties;
• Provide to the party whose participation is invited or expected written notice of the date, time, location, participants, and purpose of all hearings, investigative interviews, or other meetings with a party, with sufficient time for the party to prepare to participate;
• For recipients that are elementary and secondary schools, the recipient's grievance procedures may require a live hearing. With or without a hearing, the decision-maker must, after the recipient has incorporated the parties' responses to the investigative report under § 106.45(b)(3)(ix), ask each party and any witnesses any relevant questions and follow-up questions, including those challenging credibility, that a party wants asked of any party or witnesses. If no hearing is held, the decision-maker must afford each party the opportunity to submit written questions, provide each party with the answers, and allow for additional, limited follow-up questions from each party. With or without a hearing, all questioning must exclude evidence of the complainant's sexual behavior or predisposition, unless such evidence about the complainant's sexual behavior is offered to prove that someone other than the respondent committed the conduct alleged by the complainant, or if the evidence concerns specific incidents of the complainant's sexual behavior with respect to the respondent and is offered to prove consent. The decision-maker must explain to the party proposing the questions any decision to exclude questions as not relevant;
• For institutions of higher education, the recipient's grievance procedure must provide for a live hearing. At the hearing, the decision-maker must permit each party to ask the other party and any witnesses all relevant questions and follow-up questions, including those challenging credibility. Such cross-examination at a hearing must be conducted by the party's advisor of choice, notwithstanding the discretion of the recipient under § 106.45(b)(3)(iv) to otherwise restrict the extent to which advisors may participate in the proceedings. If a party does not have an
• Provide both parties an equal opportunity to inspect and review evidence obtained as part of the investigation that is directly related to the allegations raised in a formal complaint, including the evidence upon which the recipient does not intend to rely in reaching a determination regarding responsibility, so that each party can meaningfully respond to the evidence prior to conclusion of the investigation. Prior to completion of the investigative report, the recipient must send to each party and the party's advisor, if any, the evidence subject to inspection and review in an electronic format, such as a file sharing platform, that restricts the parties and advisors from downloading or copying the evidence, and the parties shall have at least ten days to submit a written response, which the investigator will consider prior to completion of the investigative report. The recipient must make all such evidence subject herein to the parties' inspection and review available at any hearing to give each party equal opportunity to refer to such evidence during the hearing, including for purposes of cross-examination; and
• Create an investigative report that fairly summarizes relevant evidence and, at least ten days prior to a hearing (if a hearing is required under § 106.45) or other time of determination regarding responsibility, provide a copy of the report to the parties for their review and written response.
Proposed paragraph (b)(3)(i) would place the burden of proof and the burden of gathering evidence sufficient to reach a determination regarding responsibility on the recipient, not on the parties. Recipients, not complainants or respondents, must comply with Title IX, so the burden of gathering evidence relating to allegations of sexual harassment under Title IX and determining whether the evidence shows responsibility appropriately falls to the recipient. Although a school could contract with a third-party agent to perform an investigation or otherwise satisfy its responsibilities under this section, including to gather evidence, the recipient will be held to the same standards under this section regardless of whether those responsibilities are performed by the recipient directly through its employees or through a third party such as a contractor. Likewise, although schools will often report misconduct under this section to the appropriate authorities, including as required under state law, a report to police or the presence of a police investigation regarding misconduct under this section does not relieve a recipient of its obligations under this section. Nothing in the proposed regulation prevents a recipient from using evidence merely because it was collected by law enforcement.
With the goal of ensuring fairness and equity for all parties throughout the investigation process, proposed paragraphs (b)(3)(ii), (iii), (iv), and (viii) would require recipients to provide the parties with an equal opportunity to present witnesses and other inculpatory and exculpatory evidence; permit the parties to discuss the investigation; provide the parties with the same opportunities to have others present during any grievance proceeding, including the opportunity to be accompanied by an advisor of their choice with any restrictions on the advisor's participation being applied equally to both parties; provide the parties with equal opportunity to inspect and review any evidence obtained as part of the investigation that is directly related to the allegations raised in a formal complaint, including the evidence upon which the recipient does not intend to rely in reaching a determination regarding responsibility; equal opportunity to respond to such evidence; and equal opportunity to refer to such evidence during the hearing, including for purposes of cross-examination. Because both parties can review and respond to this evidence, discuss the investigation with others in order to identify additional evidence, introduce any additional evidence into the proceeding, and receive guidance from an advisor of their choice throughout, the process will be substantially more thorough and fair and the resulting outcomes will be more reliable. Proposed paragraph (b)(3)(iv) generally tracks the language in the Clery Act regulations at 34 CFR 688.46(k)(2)(iii) and (iv) and would apply to all recipients subject to Title IX. And, proposed paragraph (b)(3)(viii) is consistent with the Family Educational Rights and Privacy Act (FERPA), under which a student has a right to inspect and review records that directly relate to that student. The Department believes that permitting both parties to be accompanied by an advisor or other individual of their choice (who may be an attorney) is also important at the elementary and secondary education level to ensure that both parties are treated equitably.
To ensure that the complainant and respondent are able to meaningfully participate in the process and that any witnesses have adequate time to prepare, proposed § 106.45(b)(3)(v) would require recipients to provide to the party whose participation is invited or expected written notice of all hearings, investigative interviews, or other meetings with a party, with
Cross-examination is the “greatest legal engine ever invented for the discovery of truth.”
The Department has carefully considered how best to incorporate the value of cross-examination for proceedings at both the postsecondary level and the elementary and secondary level. Because most parties and many witnesses are minors in the elementary and secondary school context, sensitivities associated with age and developmental ability may outweigh the benefits of cross-examination at a live hearing. Proposed § 106.45(b)(3)(vi) allows—but does not require—elementary and secondary schools to hold a live hearing as part of their grievance procedures. With or without a hearing, the complainant and the respondent must have an equal opportunity to pose questions to the other party and to witnesses prior to a determination of responsibility, with each party being permitted the opportunity to ask all relevant questions and follow-up questions, including those challenging credibility, and a requirement that the recipient explain any decision to exclude questions on the basis of relevance. If no hearing is held, each party must have the opportunity to conduct its questioning of other parties and witnesses by submitting written questions to the decision-maker, who must provide the answers to the asking party and allow for additional, limited follow-up questions from each party.
In contrast, the Department has determined that at institutions of higher education, where most parties and witnesses are adults, grievance procedures must include live cross-examination at a hearing. Proposed § 106.45(b)(3)(vii) requires institutions to provide a live hearing, and to allow the parties' advisors to cross-examine the other party and witnesses. If a party does not have an advisor at the hearing, the recipient must provide that party an advisor aligned with that party to conduct cross-examination. Cross-examination conducted by the parties' advisors (who may be attorneys) must be permitted notwithstanding the discretion of the recipient under § 106.45(b)(3)(iv) to otherwise restrict the extent to which advisors may participate in the proceedings. In the context of institutions of higher education, the proposed regulation balances the importance of cross-examination with any potential harm from personal confrontation between the complainant and the respondent by requiring questions to be asked by an advisor aligned with the party. Further, the proposed regulation allows either party to request that the recipient facilitate the parties being located in separate rooms during cross-examination while observing the questioning live via technological means. The proposed regulations thereby provide the benefits of cross-examination while avoiding any unnecessary trauma that could arise from personal confrontation between the complainant and the respondent.
In addition, proposed § 106.45(b)(3)(vi) and (vii) would set forth a standard for when questions regarding a complainant's sexual behavior may be asked, applicable to all recipients. These sections incorporate language from (and are in the spirit of) the rape shield protections found in Federal Rule of Evidence 412, which is intended to safeguard complainants against invasion of privacy, potential embarrassment, and stereotyping.
To maintain a transparent process, the parties need a complete understanding of the evidence obtained by the recipient and how a determination regarding responsibility is made. For that reason, proposed § 106.45(b)(3)(viii) would require recipients to provide both parties an equal opportunity to inspect and review any evidence obtained as part of the investigation that is directly related to the allegations raised in a formal complaint, including evidence upon which the recipient does not intend to rely in making a determination regarding responsibility. The evidence must also be provided electronically and the parties must be given at least ten days to submit a written response; these requirements will facilitate each party's ability to identify evidence that supports their position and emphasize such evidence in their arguments to the decision-maker. The scope of the parties' right to inspect and review evidence collected by the recipient is consistent with students' privacy rights under FERPA, under which a student
Proposed § 106.45(b)(3)(ix) would require recipients to create an investigative report that summarizes relevant evidence and provide a copy of the report to the parties, allowing both parties at least ten days prior to any hearing or other time of determination regarding responsibility the opportunity to respond in writing to the report. These requirements will put the parties on the same level in terms of access to information to ensure that both parties participate in a fair, predictable process that will allow the parties to serve as a check on any decisions the recipient makes regarding the inclusion or relevance of evidence. Notwithstanding the foregoing rights of the parties to review and respond to the evidence collected by the recipient, the recipient must at all times proceed with the burden of conducting the investigation into all reasonably available, relevant evidence; the burden of collecting and presenting evidence should always remain on the recipient and not on the parties.
Moreover, Title IX grievance processes are also analogous to various kinds of civil administrative proceedings, which often employ a clear and convincing evidence standard.
After considering this issue, the Department decided that its proposed regulation should leave recipients with the discretion to use either a preponderance or a clear and convincing standard in their grievance procedures. The Department does not believe it would be appropriate to impose a preponderance requirement in the absence of all of the features of civil litigation that are designed to promote reliability and fairness. Likewise, the Department believes that in light of the due process and reliability protections afforded under the proposed regulations, it could be reasonable for recipients to choose the preponderance standard instead of the clear and convincing standard, and thus, it is appropriate for the Department to give them the flexibility to do so.
To ensure that recipients do not single out respondents in sexual harassment matters for uniquely unfavorable treatment, a recipient would only be allowed to use the preponderance of the evidence standard for sexual harassment complaints if it uses that standard for other conduct code violations that carry the same potential maximum sanction as the recipient could impose for a sexual harassment conduct code violation. Likewise, to avoid the specially disfavored treatment of student respondents in comparison to respondents who are employees such as faculty members, who often have superior leverage as a group in extracting guarantees of protection under a recipient's disciplinary procedures, recipients are also required to apply the same standard of evidence for complaints against students as they do for complaints against employees, including faculty. In contrast, because of the heightened stigma often associated with a complaint regarding sexual harassment, the proposed regulation gives recipients the discretion to impose a clear and convincing evidence standard with regard to sexual harassment complaints even if other types of complaints are subject to a preponderance of the evidence standard. Within these constraints, the proposed regulation recognizes that recipients should be able to choose a standard of proof that is appropriate for investigating and adjudicating complaints of sex discrimination given the unique needs of their community.
The written determination must include—
• Identification of the section(s) of the recipient's code of conduct alleged to have been violated;
• A description of the procedural steps taken from the receipt of the complaint through the determination, including any notifications to the
• Findings of fact supporting the determination;
• Conclusions regarding the application of the recipient's code of conduct to the facts;
• A statement of, and rationale for, the result as to each allegation, including a determination regarding responsibility, any sanctions the recipient imposes on the respondent, and any remedies provided to the complainant designed to restore or preserve access to the recipient's education program or activity; and
• The recipient's procedures and permissible bases for the complainant and respondent to appeal.
The recipient must provide the written determination to the parties simultaneously. If the recipient does not offer an appeal, the determination regarding responsibility becomes final on the date that the recipient provides the parties with the written determination. If the recipient offers an appeal, the determination regarding responsibility becomes final at either the conclusion of the appeal process, if an appeal is filed, or, if an appeal is not filed, the date on which an appeal would no longer be considered timely.
To foster reliability and thoroughness and to ensure that a recipient's findings are adequately explained, proposed § 106.45(b)(4)(i) would require recipients to issue a written determination regarding responsibility. So that the parties have a complete understanding of the process and information considered by the recipient to reach its decision, proposed § 106.45(b)(4)(ii) would require the notice of determination to include: The sections of the recipient's code of conduct alleged to have been violated; the procedural steps taken from the receipt of the complaint through the determination; findings of fact supporting the determination; conclusions regarding the application of the recipient's code of conduct to the facts; a statement of, and the recipient's rationale for, the result, including a determination regarding responsibility; any sanctions the recipient imposes on the respondent; and information regarding the appeals process and the recipient's procedures and permissible bases for the complainant and respondent to appeal.
Proposed § 106.45(b)(4)(ii)(E) requires that the written determination contain a statement of, and rationale for, the result, including any sanctions imposed by the recipient and any remedy given to the complainant. Proposed § 106.45(b)(4)(iii) requires that this written determination be provided simultaneously to the parties. These provisions generally track the language of the Clery Act regulations at 34 CFR 668.46(k)(2)(v) and (k)(3)(iv) already applicable to institutions of higher education. The Department believes that the benefits of these provisions, including promoting transparency and equal treatment of the parties, are equally applicable at the elementary and secondary level.
Proposed § 106.45(b)(4)(iii) instructs recipients to provide the written determination simultaneously to both parties so that both parties know the outcome and, if an appeal is available, both parties have equal opportunity to consider filing an appeal. If the recipient does not offer an appeal, the determination regarding responsibility becomes final on the date that the recipient provides the parties with the written determination. If the recipient offers an appeal, the determination regarding responsibility becomes final when the appeal process is concluded, or if no appeal is filed, on the date on which an appeal would not be timely under the recipient's designated time frames. Once the determination regarding responsibility has become final, in cases where the respondent is found responsible, the recipient must promptly implement remedies designed to help the complainant maintain equal access to the recipient's educational programs, activities, benefits, and opportunities. In cases where the respondent is found not responsible, no remedies are required for the complainant, although a recipient may continue to offer supportive measures to either party.
Similarly to the initial investigation and adjudication, the recipient must ensure that any appeal process is conducted in a timely manner and gives both parties an equal opportunity to argue for or against the outcome. Like any of the recipient's Title IX Coordinators, investigators, or decision-makers, the appeal decision-maker must be free from bias or conflicts of interest, and must be trained on the definition of sexual harassment and the recipient's grievance process using training materials that promote impartial decision-making and are free from sex stereotypes. When designating reasonable timeframes for the filing and resolution of appeals, recipients should endeavor to permit parties sufficient time to file an appeal and submit written arguments, yet resolve the appeal process as expeditiously as possible to provide finality of the grievance process for the benefit of all parties.
• The allegations;
• The requirements of the informal resolution process including the circumstances under which it precludes the parties from resuming a formal complaint arising from the same allegations, if any; and
• Any consequences resulting from participating in the informal resolution process, including the records that will be maintained or could be shared.
The recipient must also obtain the parties' voluntary, written consent to the informal resolution process.
• The sexual harassment investigation, including any determination regarding responsibility, disciplinary sanctions imposed on the respondent, and remedies provided to the complainant;
• Any appeal and the result therefrom;
• Informal resolution, if any; and
• All materials used to train coordinators, investigators, decision-makers with regard to sexual harassment.
This provision would also provide that a recipient must create and maintain for a period of three years records of any actions, including any supportive measures, taken in response to a report or formal complaint of sexual harassment. In each instance, the recipient must document the basis for its conclusion that its response was not clearly unreasonable, and document that it has taken measures designed to restore or preserve access to the recipient's educational program or activity. The documentation of certain bases or measures does not limit the recipient in the future from providing additional explanations or detailing additional measures taken.
For example, if a student entitled to speech therapy under her Individualized Education Program (IEP) complains that a school district did not provide the therapy, the Department may permissibly require that the school district reimburse the parents for their reasonable and documented expenses for obtaining services that that the school district was required to provide.
Title 34 CFR 106.8(b) requires recipients to adopt and publish grievance procedures providing for prompt and equitable resolution of student and employee complaints of sex discrimination.
Title 34 CFR 106.9(a)(1) requires recipients to notify applicants for admission and employment, students and parents of elementary and secondary school students, employees, sources of referral for applicants for admission and employment, and unions or professional organizations holding collective bargaining agreements or professional agreements with the recipient that it does not discriminate on the basis of sex in the education program or activity which it operates. Such notice must state that inquiries about the application of Title IX may be referred to the employee designated pursuant to § 106.8, or to the Assistant Secretary.
Title 34 CFR 106.9(b) lists the types of publications where the recipient shall publish its nondiscrimination policy, and 34 CFR 106.9(c) specifies the manner of distribution of such publications.
We also propose moving the “notification of policy” requirement in current § 106.9(a)(1) to proposed § 106.8(b)(1). Proposed § 106.8(b)(1) would streamline the list of people whom recipients must notify of its policy of non-discrimination based on sex, and clarify that such a notice must state that inquiries about application of Title IX to the recipient may be made to the recipient's Title IX Coordinator or the Assistant Secretary, or to both.
Proposed § 106.8(b)(2) requires recipients to prominently display their Title IX non-discrimination policy on their website (if any) and in each handbook or catalog that it makes available to the list of people who must be notified in paragraph (b)(1), and prohibits recipients from using or distributing publications stating that the recipient treats applicants, students, or employees differently on the basis of sex except as such different treatment is permitted by this part.
We also propose moving the requirements in current 34 CFR 106.8(b) to proposed § 106.8(c), with modifications as proposed below. Proposed § 106.8(c) would clarify that with respect to sexual harassment, the grievance procedures requirements specifically apply to formal complaints as defined in § 106.30. Proposed § 106.8(c) would also require recipients to provide notice of their grievance procedures to students and employees.
We also propose adding paragraph (d) to § 106.8 to clarify that the policy and grievance procedures described in this section need not apply to persons outside the United States.
Proposed § 106.8(a) would also modernize the notification requirements to better ensure that students and employees are aware of how to contact a recipient's Title IX Coordinator. Given the changes in methods of communication since the regulations were issued in 1975, the proposed amendments would require the recipient to notify students and employees of the electronic mail address of the employee or employees designated as Title IX Coordinators, in addition to providing the coordinator's office address and phone number. To alleviate the administrative and financial burden on a recipient to provide a new notice every time it designates an additional or different coordinator, the proposed amendments permit recipients to provide notice of a coordinator's name and contact information or, alternatively, simply a title with an established method of contacting the coordinator that does not change as the identity of the coordinator changes. The Department solicits comments on whether larger institutions of higher education should have a minimum number of individuals with whom individuals can file a complaint of sex discrimination.
Proposed § 106.8(b)(2) would require recipients to prominently display their non-discrimination policy on their websites, if any, and in each handbook or catalog made available to the list of people to whom notice must be sent under paragraph (b)(1). Proposed § 106.8(b)(2) streamlines the list of required publications that must display the recipient's Title IX non-discrimination policy, to reduce the burden on recipients (including the requirement for distribution of written publications included in current § 106.9(c)) while still ensuring that the policy is adequately communicated to all required persons, in light of the reality that most recipients have websites where the non-discrimination policy would have to be prominently displayed. In addition, proposed § 106.8(b)(2) would replace the existing restriction on publications that
Proposed § 106.8(d) would clarify that the recipient's code of conduct and grievance procedures apply to all students and employees located in the United States with respect to allegations of sex discrimination in an education program or activity of the recipient. The statutory language of Title IX limits its application to protecting “person[s] in the United States.” 20 U.S.C. 1681(a).
The Department recognizes that when a party is a minor, has been appointed a guardian, is attending an elementary or secondary school, or is under the age of 18, recipients have the discretion to look to state law and local educational practice in determining whether the rights of the party shall be exercised by the parent(s) or guardian(s) instead of or in addition to the party. For example, if the parent or guardian of a minor student at an elementary or secondary school files a complaint on behalf of the student, and state law and local educational practice recognize the parent or guardian as the appropriate person to exercise that student's legal rights, the student would be a “complainant” under the proposed regulation even though the action of filing the complaint was taken by the parent or guardian instead of the student.
The Department seeks additional comments on the questions below:
1.
2.
3.
4.
5.
6.
7.
8.
9.
Under Executive Order 12866, the Office of Management and Budget (OMB) must determine whether this regulatory action is “significant” and, therefore, subject to the requirements of the Executive order and subject to review by OMB. Section 3(f) of Executive Order 12866 defines a “significant regulatory action” as an action likely to result in a rule that may—
(1) Have an annual effect on the economy of $100 million or more, or adversely affect a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities in a material way (also referred to as an “economically significant” rule);
(2) Create serious inconsistency or otherwise interfere with an action taken or planned by another agency;
(3) Materially alter the budgetary impacts of entitlement grants, user fees, or loan programs or the rights and obligations of recipients thereof; or
(4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles stated in the Executive order.
Under Executive Order 12866,
Under Executive Order 13771, for each new regulation that the Department proposes for notice and comment or otherwise promulgates that is a significant regulatory action under Executive Order 12866 and that imposes total costs greater than zero, it must identify two deregulatory actions. For FY 2019, no regulations exceeding the agency's total incremental cost allowance will be permitted, unless required by law or approved in writing by the Director of the Office of Management and Budget. The proposed regulations are a significant regulatory action under E.O. 12866 but do not impose total costs greater than zero. Accordingly, the Department is not required to identify two deregulatory actions under E.O. 13771.
We have also reviewed these proposed regulations under Executive Order 13563, which supplements and explicitly reaffirms the principles, structures, and definitions governing regulatory review established in Executive Order 12866. To the extent permitted by law, Executive Order 13563 requires that an agency—
(1) Propose or adopt regulations only on a reasoned determination that their benefits justify their costs (recognizing that some benefits and costs are difficult to quantify);
(2) Tailor its regulations to impose the least burden on society, consistent with obtaining regulatory objectives and taking into account—among other things and to the extent practicable—the costs of cumulative regulations;
(3) In choosing among alternative regulatory approaches, select those approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity);
(4) To the extent feasible, specify performance objectives, rather than the behavior or manner of compliance a regulated entity must adopt; and
(5) Identify and assess available alternatives to direct regulation, including economic incentives—such as user fees or marketable permits—to encourage the desired behavior, or provide information that enables the public to make choices.
Executive Order 13563 also requires an agency “to use the best available techniques to quantify anticipated present and future benefits and costs as accurately as possible.” The Office of Information and Regulatory Affairs of OMB has emphasized that these techniques may include “identifying changing future compliance costs that might result from technological innovation or anticipated behavioral changes.”
We are issuing these proposed regulations only on a reasoned determination that their benefits justify their costs. Based on the analysis that follows, the Department believes that these regulations are consistent with the principles in Executive Order 13563.
We also have determined that this regulatory action does not unduly interfere with State, local, or tribal governments in the exercise of their governmental functions.
In this RIA we discuss the need for regulatory action, the potential costs and benefits, assumptions, limitations, and data sources, as well as regulatory alternatives we considered. Although the majority of the costs related to information collection are discussed within this RIA, elsewhere in this notice under Paperwork Reduction Act of 1995 we also identify and further explain burdens specifically associated with information collection requirements.
Based on its extensive review of the critical issues addressed in this rulemaking, the Department has determined that current regulations and guidance do not provide sufficiently clear standards for how recipients must respond to incidents of sexual harassment, including defining what conduct constitutes sexual harassment. To address this concern, we propose this regulatory action to address sexual harassment under Title IX for the central purpose of ensuring that recipients understand their legal obligations, including what conduct is actionable as harassment under Title IX, the conditions that activate a mandatory response by the recipient, and particular requirements that such a response must meet in order to ensure that the recipient is protecting the rights of all its students to equal access to education free from sex discrimination.
In addition to addressing sexual harassment, the Department has concluded it is also necessary to amend three parts of the existing regulations that apply to all sex discrimination under Title IX. We propose expressly stating that Title IX does not require recipients to infringe upon existing constitutional protections, that the Department may not require money damages as a remedy for violations under Title IX, and that recipients that qualify for a religious exemption under Title IX need not submit a letter to the Department as a prerequisite to claiming the exemption.
The Department has analyzed the costs and benefits of complying with these proposed regulations. Due to the number of affected entities, the variation in likely responses, and the limited information available about current practices, particularly at the local educational agency (LEA) level, we cannot estimate the likely effects of these proposed regulations with absolute precision. The Department specifically invites public comment on: Data sources which would provide comprehensive information regarding current practices in Title IX enforcement, information regarding the number of recipients in each analytical group described in section 4.b below, and time estimates for the activities described in 4.c disaggregated by type of recipient. Despite these limitations, we estimate that these regulations would result in a net cost savings of between $286.4 million to $367.7 million over ten years.
The proposed regulatory action will result in recipients better understanding their legal obligations to address sexual harassment under Title IX by providing a legal framework for recipients' responses to sexual harassment that ensures all reports of sexual harassment are treated seriously and all persons accused are given due process protections before being disciplined for sexual harassment. The proposed regulatory action will correct problems identified by the Department with the current framework governing sexual harassment (under current regulations and guidance), such as recipients not understanding their duties and responsibilities and a lack of robust due process protections in recipient grievance procedures under Title IX. In addition, the proposed regulatory action will correct capturing too wide a range of misconduct resulting in infringement on academic freedom and free speech.
These proposed regulations would among other things: Define sexual harassment for Title IX purposes; clarify when a recipient's obligation to investigate a complaint of sexual harassment is activated; define the minimum requirements of grievance
Prior to discussing the Department's estimates, we believe it is important to emphasize that these estimates are not an attempt to quantify the economic effects of sexual harassment, broadly, or sexual assault, specifically. Other studies
To accurately estimate the costs of these proposed regulations, the Department needed to establish an appropriate baseline for current practice. In doing so, it was necessary to know the current number of Title IX investigations occurring in LEAs and institutions of higher education (IHEs) eligible for Title IV federal funding. In 2014, the U.S. Senate Subcommittee on Financial and Contracting Oversight released a report
Because the report only surveyed four-year institutions, the Department needed to impute similar data for two-year and less-than-two-year institutions, which represent approximately 57 percent of all Title IV-eligible institutions. In order to do so, the Department analyzed sexual offenses reported under the Clery Act and combined those data with total enrollment information from the Integrated Postsecondary Education Data System (IPEDS) for all Title IV-eligible institutions within the United States. Assuming that the number of reports of sexual offenses under the Clery Act is positively correlated with the number of investigations, the Department arrived at a general rate of investigations per reported sexual offense at four-year IHEs by institutional enrollment. These rates were then applied to two-year and less-than-two-year institutions within the same category using the average number of sexual offenses reported under the Clery Act for such institutions to arrive at an average number of investigations per year by size and level of institution. These estimates were then weighted by the number of Title IV-eligible institutions in each category to arrive at an estimated average 2.36 investigations of sexual harassment per IHE per year.
The Department does not have information on the average number of investigations of sexual harassment occurring each year in LEAs. As part of the Civil Rights Data Collection (CRDC), the Department does, however, gather information on the number of incidents of harassment based on sex in LEAs each year. During school year 2015-2016, LEAs reported an average of 3.23 of such incidents. Therefore, the Department assumes that LEAs, on average, currently conduct approximately 3.23 Title IX investigations each year. We invite public comment on the extent to which this is a reasonable assumption.
After the Department issued guidance regarding Title IX compliance in 2011, the Department noted a much larger number of incidents of sexual harassment being reported to and investigated by LEAs and IHEs each year. In 2017, the Department rescinded that guidance and published alternative, interim guidance while this proposed regulatory action was underway. The Department reaffirmed that the interim guidance is not legally binding on recipients. Wiersma-Mosley and DiLoreto
In general, the Department assumes that recipients fall into one of three groups: (1) Recipients who have complied with the statutory and regulatory requirements and either did not comply with the 2011 DCL or the 2014 Q&A or who reduced Title IX activities to the level required by statute and regulation after the rescission of the 2011 DCL or the 2014 Q&A and will continue to do so; (2) recipients who continued Title IX activities at the level required by the 2011 DCL or the 2014 Q&A but will amend their Title IX activities to the level required under current statute and the proposed regulations issued in this proceeding; and (3) recipients who continued Title IX activities at the level required under the 2011 DCL or the 2014 Q&A and will continue to do so after final regulations are issued. In this structure, we believe that recipients in the second group are most likely to experience a net cost savings under these proposed regulations. We therefore only estimate savings for this group of recipients. To the extent that recipients in the other two groups experience savings, we herein underestimate the savings from this proposed action. We note that we calculate some increased costs for recipients in all three categories.
In estimating the number of recipients in each group, we assume that most LEAs and Title IV-eligible IHEs are generally risk averse regarding Title IX compliance, and so we assume that very few would have adjusted their enforcement efforts after the rescission of the 2011 DCL or the 2014 Q&A or would have failed to align their activities with the guidance initially. Therefore, we estimate that only 5 percent of LEAs and 5 percent of IHEs fall into Group 1.
Unless otherwise specified, our model uses median hourly wages for personnel employed in the education sector as reported by the Bureau of Labor Statistics
We assume that, once the Department issues final regulations, all recipients will need to review the regulations. At the LEA level, we assume this would involve the Title IX Coordinator (assuming a loaded wage rate of $65.22 per hour for educational administrators) for 4 hours and a lawyer (at a rate of $90.71 per hour) for 8 hours. At the IHE level, we assume the Title IX Coordinator and lawyer would spend more time reviewing the regulations, at 8 hours and 16 hours, respectively. This results in a total cost of $29,732,680 in Year 1.
We also assume that recipients would be required to revise their grievance procedures to ensure compliance with the proposed regulations. Although the requirements of these proposed regulations closely mirror requirements in other regulations and statutes, we assume that all recipients will need to revise their procedures. We believe that revising grievance procedures at the LEA level will require the work of the Title IX Coordinator for 4 hours and a lawyer for 16 hours. At the IHE level, we assume this would require the Title IX Coordinator devote 8 hours and a lawyer devote 32 hours. In total, we estimate the cost of revising grievance procedures to be approximately $51,603,180 in Year 1.
The proposed regulations also require recipients to post nondiscrimination statements on their websites as required under the existing regulation. We assume, however, that this is already standard practice for many recipients. We assume that 40 percent of LEAs and 20 percent of IHEs
The proposed regulations also require relevant staff to receive training on the requirements of Title IX. Although recipients may currently engage in annual training of Title IX staff,
The proposed regulations require recipients to conduct an investigation only in the event of a formal complaint of sexual harassment. In reviewing a sample of public Title IX documents, the Department noted that larger IHEs were more likely than smaller IHEs to conduct investigations only in the event of formal complaints, as opposed to investigating all reports they received. Consistent with this observation, the Department found that the rate of average investigations relative to the number of reports of sexual offenses under the Clery Act was lower at large (more than 10,000 students) four-year institutions than it was at smaller four-year institutions. As a result, the Department used the Clery Act data to impute the likely effect of these proposed regulations on various institutions. Specifically, we assume that, under these regulations, the gap in the rate of investigations between large IHEs and smaller ones would decrease by approximately 50 percent. Therefore, we estimate that the requirement to investigate only in the event of formal complaints would result in a reduction in the average number of investigations per IHE per year of 0.75. This reduction is equivalent to all IHEs in Group 2 experiencing a reduction in investigations of approximately 32 percent. In addition, the proposed regulations only require investigations in the event of sexual harassment within a recipient's education program or activity. Again, assuming that Clery Act reports correlate with all incidents of sexual harassment (as defined in these proposed regulations), we assume a further reduction in the number of investigations per IHE per year of approximately 0.18, using the number of non-campus, public property, and reported-by-police reports as a proxy for the number of off-campus sexual harassment investigations currently being conducted by IHEs.
At the LEA level, given the lack of information regarding the actual number of investigations conducted each year, the Department assumes that only 50% of the incidents reported in the CRDC would result in a formal complaint, for a reduction in the number of investigations of 1.62 per year. We invite the public to provide any information on the extent to which this is a reasonable assumption.
To be clear, these estimates are not meant to discourage recipients from investigating at a higher rate. Nor do these estimates of a decrease in investigations predict a decrease in recipient's obligation to respond in some appropriate way to a report of sexual harassment. For example, as noted earlier, nothing in the proposed regulations would prevent a recipient from initiating a student conduct proceeding or offering supportive measures to students who report sexual harassment that occurs outside the recipient's education program or activity.
Although we estimate that the number of investigations under the proposed regulations will decrease at both the IHE and LEA levels, Title IX Coordinators are still expected to respond to informal complaints or reports. Such responses will not be dictated by the recipient's grievance procedures, but may involve talking with the reporting party, discussing options, connecting him or her with relevant on- or off-campus resources, conducting some sort of further investigation, and other supportive measures.
We assume that the provision of supportive measures will take approximately 3 hours per report for Title IX coordinators and 8 hours for an administrative assistant at the LEA level. At the IHE level, we estimate that it would require 3 hours per incident for the Title IX coordinator and 16 hours for an administrative assistant. We therefore estimate that the response to informal complaints will cost approximately $5,356,590 per year.
At the LEA level, we assume that the average response to a formal complaint will require 8 hours from the Title IX Coordinator, 16 hours for an administrative assistant, one hour each for two lawyers (assuming both parties obtain legal counsel),
At the IHE level, we assume that the average response to a formal complaint would require 24 hours from the Title IX Coordinator, 40 hours from an administrative assistant, 40 hours each for 2 lawyers (assuming both parties obtain counsel), 40 hours for an investigator, and 16 hours for a decision-maker. We note that, under these proposed regulations, recipients are required to provide parties with advisors to conduct cross-examination if they do not have an advisor present. Given that our estimates assume all parties obtain counsel, we do not believe that this additional requirement would result in an increased cost not otherwise captured by our estimates. Consistent with Wiersma-Mosley and DiLareto, we also assume that the Title IX coordinator serves as the decision-maker in 60 percent of IHEs. Assuming an average reduction of 0.0.93 investigations per year per IHE and the use of independent decision-makers, we estimate these proposed regulations to result in a net cost savings of $41,440,300 per year at the IHE level.
We recognize that some recipients may currently conduct investigations in a manner with a less robust due process framework than what would be required under the proposed regulations. For these recipients, included in Group 1 as described in section 4.b, the regulations may result in an increased cost per investigations. At the LEA level, we assume these regulations would require 2 additional hours from the Title IX coordinator, 4 hours from an administrative assistant, 1 hour each from two lawyers, 10 additional hours from an investigator, and 8 additional hours from a decision-maker per investigation, for a total increased cost of approximately $1,609,200 per year. At the IHE level, we assume that these proposed regulations would require an additional 6 hours from a Title IX coordinator, 10 hours from an administrative assistant, 20 hours each from two lawyers, 20 hours from an investigator, and 16 hours from a decision-maker, for a total increased cost of $2,829,570 per year.
We note that the proposed regulations require a hearing for formal complaints at the IHE level. We do not estimate any additional cost associated with this provision beyond those outlined above, given that the use of hearing boards has become a relatively common practice at the IHE level.
In addition, the proposed regulations allow for formal complaints to be informally resolved. We assume that 10 percent of all formal complaints at the LEA and IHE level would be resolved through informal resolution.
The proposed regulations also require grievance procedures to include the opportunity for both parties to appeal if an appeal is offered. Richards indicates that approximately 84 percent of IHEs have an appeals process. For purposes of these estimates, we assume that any recipient in Group 3, as described in section 4.b, currently operates an appeals process. However, all recipients in Groups 1 and 2 would need to institute such a structure. Given that many recipients in Groups 1 and 2 may currently operate an appeals process, this approach would overestimate the costs of these proposed regulations. Based on our review of Title IX documents from various institutions, we assume that approximately 50 percent of investigations taken through to a determination of responsibility will result in an appeal by either party. We assume that, at the LEA level, each appeal will require 4 hours from the Title IX coordinator, 8 hours from an administrative assistant, one hour each from two lawyers, and 8 hours from a decision-maker. At the IHE level, we assume each appeal will require 12 hours from a Title IX coordinator, 20 hours from an administrative assistant, 10 hours each from 2 lawyers, and 8 hours from a decision-maker. In total, we estimate the appeals process will cost approximately $20,770,220 per year. To the extent that IHEs choose not to offer appeals, this calculation would represent an overestimate of actual burden.
The proposed regulations require recipients to maintain certain documentation regarding their Title IX activities. We assume that the proposed recordkeeping and documentation requirements would have a higher first year cost associated with establishing the system for documentation with a lower out-year cost for maintaining it. At the LEA level, we assume that the Title IX Coordinator would spend 4 hours in Year 1 establishing the system and an administrative assistant would spend 8 hours doing so. At the IHE level, we assume recipients are less likely to use a paper filing system and are likely to use an electronic database for managing such information. Therefore, we assume it will take a Title IX Coordinator 24 hours, an administrative assistant 40 hours, and a database administrator ($50.71) 40 hours to set up the system for a total Year 1 estimated cost of approximately $38,836,760.
In later years, we assume that the systems will be relatively simple to maintain. At the LEA level, we assume it will take the Title IX Coordinator 2 hours and an administrative assistant 4 hours to do so. At the IHE level, we assume 4 hours from the Title IX Coordinator, 40 hours from an administrative assistant, and 8 hours from a database administrator. In total, we estimate an ongoing cost of approximately $15,189,260 per year.
In total, the Department estimates these proposed regulations will result in a net cost savings of approximately $286.4 million to $367.7 million over ten years on a net present value basis.
The proposed regulations address three topics that do not involve a recipient's response to sexual harassment and which the Department estimates will not result in any net cost or benefit to regulated entities.
First, the proposed regulations emphasize that nothing about enforcement of Title IX shall require the
Second, the proposed regulations state that money damages shall not be required by the Department as a remedy for a recipient's violation of Title IX or its regulations. The Department's OCR generally does not impose money damages as a remedy under Title IX; however, occasionally OCR does require a recipient to pay sums of money as reimbursement to remedy a Title IX violation. Although the number of instances in which OCR imposes money damages is minimal, the Department wishes to emphasize through the proposed regulation that any remedy involving payment of money must be linked to bringing the recipient into compliance with Title IX, rather than falling into a category of imposing money damages. There is no cost associated with this proposed regulation because no new act is required of recipients.
Third, the proposed regulations clarify that a religious institution is not required to preemptively submit a written letter to the Department to claim the religious exemption from Title IX provided for by statute. There is no cost associated with the proposed regulation concerning religious institutions because the proposed regulation simply clarifies that such institutions do not need to submit a written letter to the Department to claim the religious exemption available under the Title IX statute, and does not require any new action by recipients.
The Department's estimated costs and benefits for these proposed regulations are largely driven by two assumptions: The number of recipients that will not conduct activities beyond those required for compliance with the final regulations, and the change in the number of investigations conducted each year by each of those recipients. To assess the robustness of our estimates, we have conducted nine different simulations of our model with varying combinations of an upper, lower, and current estimate for each of these two factors. Regarding the upper bound for the number of recipients that will not conduct activities beyond those required for compliance with the final regulations, we assume 100 percent of LEAs and 85 percent of IHEs. For the lower bound, we assume 50 percent of LEAs and 33 percent of IHEs. In both instances, we assume the remainder of recipients are in Group 3. As discussed above, alternative coding of investigation rate data would have resulted in an estimated reduction in the number of investigations per IHE per year ranging from 0.60 to 1.58. Therefore, these estimates served as our upper and lower bound estimates for those institutions with a 25 percent to 75 percent reduction for LEAs. The estimated net present value of each of these alternative models, discounted at seven percent, is included in the table below.
Based on this analysis, the Department believes that its evaluation of the likely costs and benefits is accurate in assuming these proposed regulations would result in a net cost savings to recipients over a ten year period. Although we believe the estimates presented herein are conservative estimates of savings, even extreme lower bound estimates result in a calculated net cost savings.
The Department considered the following alternatives to the proposed regulations: (1) Leaving the current regulations and current guidance in place and issuing no proposed regulations at all; (2) leaving the current regulations in place and reinstating the 2011 DCL or the 2014 Q&A; and (3) issuing proposed regulations that added to the current regulations broad statements of general principles under which recipients must promulgate grievance procedures. Alternative (2) was rejected by the Department for the reasons expressed in the preamble to these proposed regulations; the procedural and substantive problems with the 2011 DCL and the 2014 Q&A that prompted the Department to rescind that guidance remained as concerning now as when the guidance was rescinded, and the Department determined that restoring that guidance would once again leave recipients unclear about how to ensure they implemented prompt and equitable grievance procedures. Alternative (1) was rejected by the Department because even though current regulations require recipients to have grievance procedures providing for “prompt and equitable” resolution of sex discrimination complaints, current regulations are entirely silent on whether Title IX and those implementing regulations cover sexual harassment; addressing a crucial topic like sexual harassment through guidance would unnecessarily leave this serious issue subject only to non-legally binding guidance rather than regulatory prescriptions. The lack of legally binding standards would leave survivors of sexual harassment with fewer legal protections and persons accused of sexual harassment with no predictable, consistent expectation of the level of fairness or due process available from recipients' grievance procedures. Alternative (3) was rejected by the Department because the problems with the status quo regarding recipients' Title IX procedures, as identified by numerous stakeholders and experts, made it clear that a regulation that was too vague or broad (
As required by OMB Circular A-4, in the following table we have prepared an accounting statement showing the classification of the expenditures associated with the provisions of these proposed regulations. This table provides our best estimate of the changes in annual monetized costs, benefits, and transfers as a result of the proposed regulations.
Executive Order 12866 and the Presidential memorandum “Plain Language in Government Writing” require each agency to write regulations that are easy to understand. The Secretary invites comments on how to make these proposed regulations easier to understand, including answers to questions such as the following:
• Are the requirements in the proposed regulations clearly stated?
• Do the proposed regulations contain technical terms or other wording that interferes with their clarity?
• Does the format of the proposed regulations (use of headings, paragraphing, etc.) aid or reduce their clarity?
• Would the proposed regulations be easier to understand if we divided them into more (but shorter) sections? (A “section” is preceded by the symbol “section” and a numbered heading; for example, section 106.9 Dissemination of policy.)
• Could the description of the proposed regulations in the
• What else could we do to make the proposed regulations easier to understand?
To send any comments that concern how the Department could make these proposed regulations easier to understand, see the instructions in the
Consistent with Executive Order 13771 (82 FR 9339, February 3, 2017), we have estimated that this proposed rule will result in cost savings. Therefore, this proposed rule would be considered an Executive Order 13771 deregulatory action.
This analysis, required by the Regulatory Flexibility Act, presents an estimate of the effect of the proposed regulations on small entities. The U.S. Small Business Administration (SBA) Size Standards define proprietary institutions of higher education as small businesses if they are independently owned and operated, are not dominant in their field of operation, and have total annual revenue below $7,000,000. Nonprofit institutions are defined as small entities if they are independently owned and operated and not dominant in their field of operation. Public institutions and local educational agencies are defined as small organizations if they are operated by a government overseeing a population below 50,000.
Publicly available data from the National Center on Education Statistics' Common Core of Data indicate that, during the 2015-2016 school year, 99.4 percent of local educational agencies had enrollments of less than 50,000 students.
The Department's eZ-Audit data shows that there were 1,522 Title IV proprietary schools with revenue less than $7,000,000 for the 2015-2016 Award Year;
The Department has historically assumed that all private nonprofit institutions were small because none were considered dominant in their field. However, this approach masks significant differences in resources among different segments of these
• Two-year IHEs, enrollment less than 500 FTE; and
• Four-year IHEs, enrollment less than 1,000 FTE.
Table 3 shows the distribution of small institutions under this proposed definition using the 2016 IPEDS institution file.
Under the proposed definition, the two-year small institutions are 68% of all two-year institutions (2,708/3,962), 68% of all small institutions (2,708/3,996), and 39% of the overall population of institutions (2,708/6,951); whereas, four-year small institutions are 43% of all four-year institutions (1,288/2,989), 32% of all small institutions (1,288/3,996), and 19% of the overall population of institutions (1,288/6,951). Figure 1 shows a visual representation of the universe and the percentage that would be defined as small using the above proposed definition.
Similarly, small public institutions are 20% of all public institutions (406/1,999), 10% of all small public institutions (406/3,996), and 6% of the overall population of institutions (406/6,951). Small private nonprofit institutions are 53% of all private nonprofit institutions (1,018/1,999), 25% of all small institutions (1,018/3,996), and 15% of the overall population of institutions (1,018/6,951). Finally, and small proprietary institutions are 85% of all proprietary institutions (2,572/1,999), 64% of all small institutions (2,572/3,996), and 37% of the overall population of institutions (2,572/6,951).
The Department requests comment on the proposed definition. It will consider these suggestions in development of the final rule.
As disused in the
Using data from the 2015-2016 Civil Rights Data Collection, we examined the number of allegations of harassment and bullying based on sex by LEA size. Given the extreme upper end of the enrollment distribution that qualifies an LEA as no longer a small entity for these purposes—less than one percent of all LEAs—it is reasonable to expect that the number of reported incidents of such harassment in small LEAs closely aligns with the average number for all LEAs. On average, LEAs reported 3.23 allegations of harassment or bullying on the basis of sex in the 2015-2016 school year. By comparison, large LEAs (those with more than 50,000 students) reported an average of 112.54 such incidents and small LEAs reported 2.64 allegations on average.
Based on the model described in the
As with LEAs, the Department estimates that these proposed regulations will result in a net cost savings for IHEs over the ten year time horizon. The amount of savings that any particular IHE will realize, if any, depends on a wide number of factors, including its Title IX compliance history, its response to the proposed regulations, and the number of formal complaints of sexual harassment the IHE receives in the future. Regardless of these variables, the Department did analyze extant data sources to attempt to analyze the likely differential impact across IHEs of various sizes.
As noted in the
Assuming that Clery Act reports are correlated with the number of incidents of sexual harassment under Title IX, we would assume that small institutions have a lower number of Title IX complaints each year. As a result, they may experience less cost savings under this proposed rule given the smaller baseline. This lower baseline may, however, be offset slightly by the higher relative number of investigations undertaken at smaller institutions, as noted in the Senate report. Additionally, we note that small institutions also have a higher than average number of Clery Act reports occurring off-campus, indicating that they may also have a larger number of Title IX sexual harassment reports originating off-campus. In examining the model described in the
As part of its continuing effort to reduce paperwork and the burden of responding, the Department provides the general public and federal agencies with an opportunity to comment on proposed and continuing collections of information in accordance with the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3506(c)(2)(A)). This requirement helps ensure that: The public understands the Department's collection instructions; respondents can provide the requested data in the desired format; reporting burden (time and financial resources) is minimized; collection instruments are clearly understood; and the Department can properly assess the impact of collection requirements on respondents.
The following sections contain information collection requirements:
Section 106.45(b)(7) would require recipients to maintain certain documentation regarding their Title IX activities. LEAs and IHEs would be required to create and maintain for a period of three years records of: Sexual harassment investigations; determinations; appeals; disciplinary sanctions and remedies; informal resolutions; materials used to train coordinators, investigators, and decision-makers; any actions, including supportive measures, taken in response to a report or formal complaint of sexual harassment; and documentation of the bases upon which the recipient concluded that its response was not clearly unreasonable and that its measures taken were designed to restore or preserve access to the recipient's educational program or activity. This information will allow a recipient and OCR to assess on a longitudinal basis the prevalence of sexual harassment affecting access to a recipient's programs and activities, whether a recipient is complying with Title IX when responding to reports and formal complaints, and the necessity for additional or different training. We estimate the volume of records to be created and retained may represent a decline from current recordkeeping due to clarification elsewhere in the proposed regulations that no investigation needs to be conducted where allegations, if true, do not constitute sexual harassment as defined under the regulations, and that informal means may be used to resolve sexual harassment complaints, both changes likely resulting in fewer investigative records being generated.
We estimate that recipients would have a higher first-year cost associated with establishing the system for documentation with a lower out-year cost for maintaining it. At the LEA level, we assume that the Title IX Coordinator would spend 4 hours in Year 1 establishing the system and an administrative assistant would spend 8 hours doing so. At the IHE level, we assume recipients are less likely to use a paper filing system and are likely to use an electronic database for managing such information. Therefore, we assume it will take a Title IX Coordinator 24 hours, an administrative assistant 40 hours, and a database administrator 40 hours to set up the system for a total Year 1 estimated cost for 16,606 LEAs and 6,766 IHEs of approximately $38,836,760.
In later years, we assume that the systems will be relatively simple to maintain. At the LEA level, we assume it will take the Title IX Coordinator 2 hours and an administrative assistant 4 hours to do so. At the IHE level, we assume 4 hours from the Title IX Coordinator, 40 hours from an administrative assistant, and 8 hours from a database administrator. In total, we estimate an ongoing cost of approximately $15,189,260 per year.
We estimate that LEAs would take 12 hours and IHEs would take 104 hours to establish and maintain a recordkeeping system for the required sexual harassment documentation during Year 1. In out-years, we estimate that LEAs
Section 106.44(b)(3) applies only to IHEs and would require that where a complainant reports sexual harassment but does not wish to file a formal complaint, the IHE would have a safe harbor against a finding of deliberate indifference where it offers the complainant supportive measures, but must inform the complainant in writing of the complainant's right to file a formal complaint. This information provided by IHEs to complainants will ensure that complainants receive supportive measures to assist them in the aftermath of sexual harassment and also remain aware of their right to file a formal complaint that requires the IHE to investigate the sexual harassment allegations.
We estimate that most IHEs will need to create a form, or modify a form they already use, to comply with this requirement to inform the complainant in writing. We estimate that it will take Title IX Coordinators one (1) hour in Year 1 to create or modify a form to use for these purposes, that there will be no cost in out-years, and that the cost of maintaining such a form is captured under the recordkeeping requirements of § 106.45(b)(7) described above, for a total Year 1 cost of $441,270. Total burden for this requirement over three years is 6,766 hours.
Section 106.45(b)(2) would require all recipients, upon receipt of a formal complaint, to provide written notice to the complainant the respondent, informing the parties of the recipient's grievance procedures and providing sufficient details of the sexual harassment allegations being investigated. This written notice will help ensure that the nature and scope of the investigation, and the recipient's procedures, are clearly understood by the parties at the commencement of an investigation.
We estimate that most LEAs and IHEs will need to create a form, or modify one already used, to comply with these requirements. We estimate that it will take Title IX Coordinators one (1) hour to create or modify a form to use for these purposes, and that an attorney will spend 0.5 hours reviewing the form for compliance with § 106.45(b)(2). We estimate there will be no cost in out-years, and that the cost of maintaining such a form is captured under the recordkeeping requirements of § 106.45(b)(7) described above, for a total Year 1 cost of $2,584,310. Total burden for this requirement over three years is 35,058 hours.
Section 106.45(b)(6) would require that recipients who wish to provide parties with the option of informal resolution of formal complaints, may offer this option to the parties but may only proceed by: First, providing the parties with written notice disclosing the sexual harassment allegations, the requirements of an informal resolution process, any consequences from participating in the informal resolution process; and second, obtaining the parties' voluntary, written consent to the informal resolution process.
This provision permits—but does not require—LEAs and IHEs to allow for voluntary participation informal resolution as a method of resolving the allegations raised in formal complaints without completing the investigation and adjudication.
We estimate that not all LEAs or IHEs will choose to offer informal resolution as a feature of their grievance process; of those who do, we estimate that most will need to create a form, or modify one already used, to comply with the requirements of this section. We estimate that it will take Title IX Coordinators one (1) hour to create or modify a form to use for these purposes, and that an attorney will spend 0.5 hours reviewing the form for compliance with § 106.45(b)(6). We estimate there will be no cost in out-years, and that the cost of maintaining such a form is captured under the recordkeeping requirements of § 106.45(b)(7) described above, for a total Year 1 cost of $2,584,310. The total burden for this requirement over three years is 35,058 hours.
We have prepared an Information Collection Request (ICR) for these proposed requirements. If you want to review and comment on the ICR(s), please follow the instructions listed under the
When commenting on the information collection requirements, we consider
• Deciding whether the collections are necessary for the proper performance of our functions, including whether the information will have practical use;
• Evaluating the accuracy of our estimate of the burden of the collections, including the validity of our methodology and assumptions;
• Enhancing the quality, usefulness, and clarity of the information we collect; and
• Minimizing the burden on those who must respond, which includes exploring the use of appropriate automated, electronic, mechanical, or other technological collection techniques.
This program is not subject to Executive Order 12372 and the regulations in 34 CFR part 79 because it is not a program or activity of the Department that provides federal financial assistance.
In accordance with section 411 of the General Education Provisions Act, 20 U.S.C. 1221e-4, the Secretary particularly requests comments on whether these proposed regulations would require transmission of information that any other agency or authority of the United States gathers or makes available.
Executive Order 13132 requires us to ensure meaningful and timely input by State and local elected officials in the development of regulatory policies that have federalism implications. “Federalism implications” means substantial direct effects on the States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of government. The proposed regulations in 34 CFR 106.34 and 34 CFR 106.35 may have federalism implications, as defined in Executive Order 13132. We encourage State and local elected officials to review and provide comments on these proposed regulations.
Individuals with disabilities can obtain this document in an accessible format (
The official version of this document is the document published in the
You may also access documents of the Department published in the
Education, Sex discrimination, Civil rights, Sexual harassment.
For the reasons discussed in the preamble, the Secretary proposes to amend part 106 of title 34 of the Code of Federal Regulations as follows:
20 U.S.C. 1681
(a)
(d)
(1) Restrict any rights that would otherwise be protected from government action by the First Amendment of the U.S. Constitution;
(2) Deprive a person of any rights that would otherwise be protected from government action under the Due Process Clauses of the Fifth and Fourteenth Amendments of the U.S. Constitution; or
(3) Restrict any other rights guaranteed against government action by the U.S. Constitution.
(e)
(f)
(a)
(b)
(2)
(ii) A recipient must not use or distribute a publication stating that the recipient treats applicants, students, or employees differently on the basis of sex except as such treatment is permitted by this part.
(c)
(d)
(b)
As used in this subpart:
(1) An employee of the recipient conditioning the provision of an aid, benefit, or service of the recipient on an individual's participation in unwelcome sexual conduct;
(2) Unwelcome conduct on the basis of sex that is so severe, pervasive, and objectively offensive that it effectively denies a person equal access to the recipient's education program or activity; or
(3) Sexual assault, as defined in 34 CFR 668.46(a).
(a)
(b)
(2) When a recipient has actual knowledge regarding reports by multiple complainants of conduct by the same respondent that could constitute sexual harassment, the Title IX Coordinator must file a formal complaint. If the Title IX Coordinator files a formal complaint in response to the reports, and the recipient follows procedures (including implementing any appropriate remedy as required) consistent with § 106.45 in response to the formal complaint, the recipient's response to the reports is not deliberately indifferent.
(3) For institutions of higher education, a recipient is not deliberately indifferent when in the absence of a formal complaint the recipient offers and implements supportive measures designed to effectively restore or preserve the complainant's access to the recipient's education program or activity. At the time supportive measures are offered, the recipient must in writing inform the complainant of the right to file a formal complaint at that time or a later date, consistent with other provisions of this part.
(4) If paragraphs (b)(1) through (3) of this section are not implicated, a recipient with actual knowledge of sexual harassment in an education program or activity of the recipient against a person in the United States must, consistent with paragraph (a) of this section, respond in a manner that is not deliberately indifferent. A recipient is deliberately indifferent only if its response to sexual harassment is clearly unreasonable in light of the known circumstances.
(5) The Assistant Secretary will not deem a recipient's determination regarding responsibility to be evidence of deliberate indifference by the recipient merely because the Assistant Secretary would have reached a different determination based on an independent weighing of the evidence.
(c)
(d)
(a)
(b)
(1)
(i) Treat complainants and respondents equitably. An equitable resolution for a complainant must include remedies where a finding of responsibility for sexual harassment has been made against the respondent; such remedies must be designed to restore or preserve access to the recipient's education program or activity. An equitable resolution for a respondent must include due process protections before any disciplinary sanctions are imposed;
(ii) Require an objective evaluation of all relevant evidence—including both inculpatory and exculpatory evidence—and provide that credibility determinations may not be based on a person's status as a complainant, respondent, or witness;
(iii) Require that any individual designated by a recipient as a coordinator, investigator, or decision-maker not have a conflict of interest or bias for or against complainants or respondents generally or an individual complainant or respondent. A recipient must ensure that coordinators, investigators, and decision-makers receive training on both the definition of sexual harassment and how to conduct an investigation and grievance process, including hearings, if applicable, that protect the safety of students, ensure due process protections for all parties, and promote accountability. Any materials used to train coordinators, investigators, or decision-makers may not rely on sex stereotypes and must promote impartial investigations and adjudications of sexual harassment;
(iv) Include a presumption that the respondent is not responsible for the alleged conduct until a determination regarding responsibility is made at the conclusion of the grievance process;
(v) Include reasonably prompt timeframes for conclusion of the grievance process, including reasonably prompt timeframes for filing and resolving appeals if the recipient offers an appeal, and a process that allows for the temporary delay of the grievance process or the limited extension of timeframes for good cause with written notice to the complainant and the respondent of the delay or extension and the reasons for the action. Good cause may include considerations such as the absence of the parties or witnesses, concurrent law enforcement activity, or the need for language assistance or accommodation of disabilities;
(vi) Describe the range of possible sanctions and remedies that the recipient may implement following any determination of responsibility;
(vii) Describe the standard of evidence to be used to determine responsibility;
(viii) Include the procedures and permissible bases for the complainant and respondent to appeal if the recipient offers an appeal; and
(ix) Describe the range of supportive measures available to complainants and respondents.
(2)
(A) Notice of the recipient's grievance procedures.
(B) Notice of the allegations constituting a potential violation of the recipient's code of conduct, including sufficient details known at the time and with sufficient time to prepare a response before any initial interview. Sufficient details include the identities of the parties involved in the incident, if known, the specific section of the recipient's code of conduct allegedly violated, the conduct allegedly constituting sexual harassment under this part and under the recipient's code of conduct, and the date and location of the alleged incident, if known. The written notice must include a statement that the respondent is presumed not responsible for the alleged conduct and that a determination regarding responsibility is made at the conclusion of the grievance process. The written notice must also inform the parties that they may request to inspect and review evidence under paragraph (b)(3)(viii) of this section and inform the parties of any provision in the recipient's code of conduct that prohibits knowingly making false statements or knowingly submitting false information during the grievance process.
(ii)
(3)
(i) Ensure that the burden of proof and the burden of gathering evidence sufficient to reach a determination regarding responsibility rest on the recipient and not on the parties;
(ii) Provide equal opportunity for the parties to present witnesses and other inculpatory and exculpatory evidence;
(iii) Not restrict the ability of either party to discuss the allegations under investigation or to gather and present relevant evidence;
(iv) Provide the parties with the same opportunities to have others present during any grievance proceeding, including the opportunity to be accompanied to any related meeting or proceeding by the advisor of their choice, and not limit the choice of advisor or presence for either the complainant or respondent in any meeting or grievance proceeding; however, the recipient may establish restrictions regarding the extent to which the advisor may participate in the proceedings, as long as the restrictions apply equally to both parties;
(v) Provide to the party whose participation is invited or expected written notice of the date, time, location, participants, and purpose of all hearings, investigative interviews, or other meetings with a party, with sufficient time for the party to prepare to participate;
(vi) For recipients that are elementary and secondary schools, the recipient's grievance procedure may require a live hearing. With or without a hearing, the decision-maker must, after the recipient has incorporated the parties' responses to the investigative report under paragraph (b)(3)(ix) of this section, ask each party and any witnesses any relevant questions and follow-up questions, including those challenging credibility, that a party wants asked of any party or witnesses. If no hearing is held, the decision-maker must afford each party the opportunity to submit written questions, provide each party with the answers, and allow for additional, limited follow-up questions from each party. With or without a hearing, all such questioning must exclude evidence of the complainant's sexual behavior or predisposition, unless such evidence about the complainant's sexual behavior is offered to prove that someone other than the respondent committed the conduct alleged by the complainant, or if the evidence concerns specific incidents of the complainant's sexual behavior with respect to the respondent and is offered to prove consent. The decision-maker must explain to the party proposing the questions any decision to exclude questions as not relevant;
(vii) For institutions of higher education, the recipient's grievance procedure must provide for a live hearing. At the hearing, the decision-maker must permit each party to ask the other party and any witnesses all relevant questions and follow-up questions, including those challenging credibility. Such cross-examination at a hearing must be conducted by the party's advisor of choice, notwithstanding the discretion of the recipient under paragraph (b)(3)(iv) of this section to otherwise restrict the extent to which advisors may participate in the proceedings. If a party does not have an advisor present at the hearing, the recipient must provide that party an advisor aligned with that party to conduct cross-examination. All cross-examination must exclude evidence of the complainant's sexual behavior or predisposition, unless such evidence about the complainant's sexual behavior is offered to prove that someone other than the respondent committed the conduct alleged by the complainant, or if the evidence concerns specific incidents of the complainant's sexual behavior with respect to the respondent and is offered to prove consent. At the request of either party, the recipient must provide for cross-examination to occur with the parties located in separate rooms with technology enabling the decision-maker and parties to simultaneously see and hear the party answering questions. The decision-maker must explain to the party's advisor asking cross-examination questions any decision to exclude questions as not relevant. If a party or witness does not submit to cross-examination at the hearing, the decision-maker must not rely on any statement of that party or witness in reaching a determination regarding responsibility;
(viii) Provide both parties an equal opportunity to inspect and review any evidence obtained as part of the investigation that is directly related to the allegations raised in a formal complaint, including the evidence upon which the recipient does not intend to rely in reaching a determination regarding responsibility, so that each party can meaningfully respond to the evidence prior to conclusion of the investigation. Prior to completion of the investigative report, the recipient must send to each party and the party's advisor, if any, the evidence subject to inspection and review in an electronic format, such as a file sharing platform, that restricts the parties and advisors from downloading or copying the evidence, and the parties shall have at least ten days to submit a written response, which the investigator will consider prior to completion of the investigative report. The recipient must make all such evidence subject herein to the parties' inspection and review available at any hearing to give each party equal opportunity to refer to such evidence during the hearing, including for purposes of cross-examination; and
(ix) Create an investigative report that fairly summarizes relevant evidence and, at least ten days prior to a hearing (if a hearing is required under this section) or other time of determination
(4)
(ii) The written determination must include—
(A) Identification of the section(s) of the recipient's code of conduct alleged to have been violated;
(B) A description of the procedural steps taken from the receipt of the complaint through the determination, including any notifications to the parties, interviews with parties and witnesses, site visits, methods used to gather other evidence, and hearings held;
(C) Findings of fact supporting the determination;
(D) Conclusions regarding the application of the recipient's code of conduct to the facts;
(E) A statement of, and rationale for, the result as to each allegation, including a determination regarding responsibility, any sanctions the recipient imposes on the respondent, and any remedies provided by the recipient to the complainant designed to restore or preserve access to the recipient's education program or activity; and
(F) The recipient's procedures and permissible bases for the complainant and respondent to appeal, if the recipient offers an appeal.
(iii) The recipient must provide the written determination to the parties simultaneously. If the recipient does not offer an appeal, the determination regarding responsibility becomes final on the date that the recipient provides the parties with the written determination. If the recipient offers an appeal, the determination regarding responsibility becomes final at either the conclusion of the appeal process, if an appeal is filed, or, if an appeal is not filed, the date on which an appeal would no longer be considered timely.
(5)
(i) Notify the other party in writing when an appeal is filed and implement appeal procedures equally for both parties;
(ii) Ensure that the appeal decision-maker is not the same person as any investigator(s) or decision-maker(s) that reached the determination of responsibility;
(iii) Ensure that the appeal decision-maker complies with the standards set forth in paragraph (b)(1)(iii) of this section;
(iv) Give both parties a reasonable, equal opportunity to submit a written statement in support of, or challenging, the outcome;
(v) Issue a written decision describing the result of the appeal and the rationale for the result; and
(vi) Provide the written decision simultaneously to both parties.
(6)
(i) Provides to the parties a written notice disclosing—
(A) The allegations;
(B) The requirements of the informal resolution process including the circumstances under which it precludes the parties from resuming a formal complaint arising from the same allegations, if any; and
(C) Any consequences resulting from participating in the informal resolution process, including the records that will be maintained or could be shared; and
(ii) Obtains the parties' voluntary, written consent to the informal resolution process.
(7)
(A) Each sexual harassment investigation including any determination regarding responsibility, any disciplinary sanctions imposed on the respondent, and any remedies provided to the complainant designed to restore or preserve access to the recipient's education program or activity;
(B) Any appeal and the result therefrom;
(C) Informal resolution, if any; and
(D) All materials used to train coordinators, investigators, and decision-makers with regard to sexual harassment.
(ii) A recipient must create and maintain for a period of three years records of any actions, including any supportive measures, taken in response to a report or formal complaint of sexual harassment. In each instance, the recipient must document the basis for its conclusion that its response was not clearly unreasonable, and document that it has taken measures designed to restore or preserve access to the recipient's educational program or activity. The documentation of certain bases or measures does not limit the recipient in the future from providing additional explanations or detailing additional measures taken.
(A) serious human rights abuse in Nicaragua;
(B) actions or policies that undermine democratic processes or institutions in Nicaragua;
(C) actions or policies that threaten the peace, security, or stability of Nicaragua;
(D) any transaction or series of transactions involving deceptive practices or corruption by, on behalf of, or otherwise related to the Government of Nicaragua or a current or former official of the Government of Nicaragua, such as the misappropriation of public assets or expropriation of private assets for personal gain or political purposes, corruption related to government contracts, or bribery;
(A) any activities described in subsection (a)(i) of this section; or
(B) any person whose property and interests in property are blocked pursuant to this order; or
(b) The prohibitions in subsection (a) of this section apply except to the extent provided by statutes, or in regulations, orders, directives, or licenses that may be issued pursuant to this order, and notwithstanding any contract entered into or any license or permit granted prior to the date of this order.
(a) the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any person whose property and interests in property are blocked pursuant to this order; and
(b) the receipt of any contribution or provision of funds, goods, or services from any such person.
(b) Any conspiracy formed to violate any of the prohibitions set forth in this order is prohibited.
(a) the term “person” means an individual or entity;
(b) the term “entity” means a partnership, association, trust, joint venture, corporation, group, subgroup, or other organization;
(c) the term “United States person” means any United States citizen, permanent resident alien, entity organized under the laws of the United States or any jurisdiction within the United States (including foreign branches), or any person in the United States; and
(d) the term “Government of Nicaragua” means the Government of Nicaragua, any political subdivision, agency, or instrumentality thereof, including the Central Bank of Nicaragua, and any person owned or controlled by, or acting for or on behalf of, the Government of Nicaragua.
(b) This order shall be implemented consistent with applicable law and subject to the availability of appropriations.
(c) This order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration |