| Page Range | 17899-18194 | |
| FR Document |
| Page and Subject | |
|---|---|
| 83 FR 18191 - Delegation of Authority To Approve Certain Military Decorations | |
| 83 FR 17899 - National Park Week, 2018 | |
| 83 FR 18086 - Government in the Sunshine Act Meeting Notice | |
| 83 FR 18085 - Government in the Sunshine Act Meeting Notice | |
| 83 FR 18007 - Pacific Fishery Management Council; Public Meeting | |
| 83 FR 18008 - North Pacific Fishery Management Council; Public Meeting | |
| 83 FR 18015 - Notice Announcing Availability of Funds and Application Deadlines; Hurricane Education Recovery | |
| 83 FR 18129 - Multiemployer Pension Plan Application To Reduce Benefits | |
| 83 FR 18130 - Multiemployer Pension Plan Application To Reduce Benefits | |
| 83 FR 18018 - Agency Information Collection Extension | |
| 83 FR 17925 - Chlormequat Chloride; Pesticide Tolerances | |
| 83 FR 18051 - Proposed Information Collection Request; Comment Request; Contractor Cumulative Claim and Reconciliation (Renewal) | |
| 83 FR 18051 - 2018 Safer Choice Partner of the Year Awards Program | |
| 83 FR 18058 - Change in Bank Control Notices; Acquisitions of Shares of a Bank or Bank Holding Company | |
| 83 FR 18057 - Formations of, Acquisitions by, and Mergers of Bank Holding Companies | |
| 83 FR 17934 - Connect America Fund; Universal Service Reform-Mobility Fund | |
| 83 FR 18087 - Aerospace Safety Advisory Panel; Meeting | |
| 83 FR 17921 - International Mail Manual; Incorporation by Reference | |
| 83 FR 17922 - Domestic Mail Manual; Incorporation by Reference | |
| 83 FR 18052 - Agency Information Collection Activities: Proposed Collection; Submission for OMB Review | |
| 83 FR 18112 - Title: Bureau of Political-Military Affairs; Statutory Debarment Under the Arms Export Control Act and the International Traffic in Arms Regulations | |
| 83 FR 18116 - 30-Day Notice of Proposed Information Collection: Foreign Service Officer Test Registration Form | |
| 83 FR 18084 - Agency Information Collection Activities; Efficacy of Oak Savanna Restoration History Information Request | |
| 83 FR 17942 - Fisheries of the Caribbean, Gulf of Mexico, and South Atlantic; Snapper-Grouper Resources of the South Atlantic; 2018 Commercial Trip Limit Reduction | |
| 83 FR 18000 - Quarterly Update to Annual Listing of Foreign Government Subsidies on Articles of Cheese Subject to an In-Quota Rate of Duty | |
| 83 FR 18083 - Agency Information Collection Activities; Submission to the Office of Management and Budget for Review and Approval; Phragmites Adaptive Management Framework | |
| 83 FR 18009 - Request for Input on LabCFTC Prize Competitions | |
| 83 FR 18018 - Notice of Commissioner and Staff Attendance at North American Electric Reliability Corporation Meetings | |
| 83 FR 18018 - Spire STL Pipeline, LLC; Notice Granting Late Interventions | |
| 83 FR 18019 - Commission Information Collection Activities (FERC-725x); Comment Request | |
| 83 FR 18072 - Mortgagee Review Board: Administrative Actions | |
| 83 FR 18054 - Notice of Public Meeting To Discuss the Proposed Draft Staff Implementation Guidance 6.1: Guidance for Implementation of SFFAS 6, Accounting for Property, Plant, and Equipment, as amended | |
| 83 FR 18118 - Petition for Exemption; Summary of Petition Received; Croman Corporation | |
| 83 FR 18119 - Petition for Exemption; Summary of Petition Received; Minnesota Department of Natural Resources | |
| 83 FR 18002 - Glycine From India, the People's Republic of China, and Thailand: Initiation of Countervailing Duty Investigations | |
| 83 FR 17995 - Glycine From India, Japan, and Thailand: Initiation of Less-Than-Fair-Value Investigations | |
| 83 FR 17921 - DoD Freedom of Information Act (FOIA) Program | |
| 83 FR 17964 - Approval and Promulgation of Implementation Plans; Texas; Reasonable Further Progress Plan for the Houston-Galveston-Brazoria Ozone Nonattainment Area | |
| 83 FR 18020 - Certification of New Interstate Natural Gas Facilities | |
| 83 FR 18001 - Circular Welded Carbon Steel Pipes and Tubes From Thailand: Amended Final Results of Antidumping Duty Administrative Review; 2015-2016 | |
| 83 FR 17995 - Silicomanganese From the People's Republic of China: Notice of Correction to the Final Results of the Expedited Fourth Sunset Review of the Antidumping Duty Order | |
| 83 FR 18119 - Agency Information Collection Activities: Request for Comments for the Renewal of a Previously Approved Information Collection | |
| 83 FR 18117 - Projects Rescinded for Consumptive Uses of Water | |
| 83 FR 18117 - Projects Approved for Consumptive Uses of Water | |
| 83 FR 18118 - Projects Approved for Minor Modifications | |
| 83 FR 17944 - Energy Conservation Program: Test Procedures for Cooking Products, Notification of Petition for Rulemaking | |
| 83 FR 18115 - Notice of Determinations; Culturally Significant Objects Imported for Exhibition Determinations: “The Chiaroscuro Woodcut in Renaissance Italy” Exhibition | |
| 83 FR 18116 - Notice of Determinations; Culturally Significant Object Imported for Exhibition Determinations: “Picture in Focus: Hugo van der Goes or a Member of His Circle's Virgin and Child With Saint Thomas, John the Baptist, Jerome, and Louis” Exhibition | |
| 83 FR 18117 - Notice of Determinations; Culturally Significant Objects Imported for Exhibition Determinations: “Art of Iron: Objects From the Musée Le Secq des Tournelles, Rouen, Normandy” Exhibition | |
| 83 FR 18120 - FY 2018 Competitive Funding Opportunity: Low or No Emission Grant Program | |
| 83 FR 18007 - Proposed Information Collection; Comment Request; Papahanaumokuakea Marine National Monument Mokupapapa Discovery Center Exhibit Evaluation | |
| 83 FR 18013 - Denali Commission Fiscal Year 2019 Draft Work Plan | |
| 83 FR 18118 - Charter Renewal of the Regional Resource Stewardship Council | |
| 83 FR 18075 - Endangered and Threatened Wildlife and Plants; Initiation of 5-Year Status Reviews of Five Listed Animal Species | |
| 83 FR 18092 - New Postal Product | |
| 83 FR 18058 - Privacy Act of 1974; System of Records | |
| 83 FR 18060 - Agency Information Collection Activities; Submission for OMB Review; Comment Request; Extension | |
| 83 FR 17962 - Safety Zone; Officer Lehner Memorial Vintage Regatta; Buffalo Outer Harbor, Buffalo, NY | |
| 83 FR 17921 - Drawbridge Operation Regulation; Upper Mississippi River, Rock Island, IL | |
| 83 FR 17923 - Approval and Promulgation of State Plans for Designated Facilities and Pollutants; North Dakota; Control of Emissions From Existing Commercial and Industrial Solid Waste Incineration Units | |
| 83 FR 18106 - Self-Regulatory Organizations; ICE Clear Europe Limited; Notice of Filing of Proposed Rule Change, Security-Based Swap Submission or Advance Notice Relating to Amendments to the ICE Clear Europe CDS End-of-Day Pricing Policy | |
| 83 FR 18108 - Self-Regulatory Organizations; ICE Clear Credit LLC; Order Approving Proposed Rule Change Relating to Amendments to the ICC Operational Risk Management Framework | |
| 83 FR 18099 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify Rule 6.8-O, Commentary .06 To Expand Position Limits for Options on Certain Exchange-Traded Funds | |
| 83 FR 18093 - Self-Regulatory Organizations; NYSE American LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify Rule 904, Commentary .07 To Expand Position Limits for Options on Certain Exchange-Traded Funds | |
| 83 FR 18110 - Self-Regulatory Organizations; Nasdaq BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Clarify the Requirements for Delivery of a Contrary Exercise Advice | |
| 83 FR 18019 - Atmos Pipeline-Texas; Notice of Technical Conference | |
| 83 FR 18033 - Combined Notice of Filings | |
| 83 FR 18033 - Combined Notice of Filings #1 | |
| 83 FR 17913 - Revised Critical Infrastructure Protection Reliability Standard CIP-003-7-Cyber Security-Security Management Controls | |
| 83 FR 18134 - Uplift Cost Allocation and Transparency in Markets Operated by Regional Transmission Organizations and Independent System Operators | |
| 83 FR 18132 - Agency Information Collection Activity: Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion (Documents and Information Required for Specially Adapted Housing Assistive Technology Grant) and Scoring Criteria for SAH Assistive Technology Grants | |
| 83 FR 18131 - Agency Information Collection Activity: Application for Fee or Roster Personnel Designation | |
| 83 FR 18056 - Filing Dates for the Mississippi Senate Special Election | |
| 83 FR 17961 - The Declaration of Added Sugars on Honey, Maple Syrup, and Certain Cranberry Products: Draft Guidance for Industry; Extension of Comment Period | |
| 83 FR 18089 - Mitigation Strategies for Beyond-Design-Basis External Events | |
| 83 FR 18061 - Uber Technologies, Inc.; Analysis To Aid Public Comment | |
| 83 FR 18085 - Notice of Temporary Concession Contract for Fuel Sales, Convenience Retail Merchandise, RV and Campground Services in the Hite Area of Glen Canyon National Recreation Area, Arizona | |
| 83 FR 18086 - Applied Research Laboratories of South Florida, LLC: Grant of Recognition as a Nationally Recognized Testing Laboratory | |
| 83 FR 18088 - Notice of Open Meeting. | |
| 83 FR 17994 - Notice of Public Meeting of the Virginia Advisory Committee | |
| 83 FR 17993 - Notice of Public Meeting of the West Virginia Advisory Committee | |
| 83 FR 18091 - Florida Power & Light Company; Turkey Point Units 6 and 7 | |
| 83 FR 18090 - Florida Power & Light Company; Turkey Point Units 6 and 7 | |
| 83 FR 17930 - Final Flood Elevation Determinations | |
| 83 FR 18066 - Final Flood Hazard Determinations | |
| 83 FR 18070 - Proposed Flood Hazard Determinations | |
| 83 FR 17994 - Notice of Public Meeting of the Minnesota Advisory Committee | |
| 83 FR 17993 - Notice of Public Meeting of the Michigan Advisory Committee | |
| 83 FR 18126 - Hazardous Materials: Public Meeting Notice for the Research and Development Forum | |
| 83 FR 18093 - Product Change-Priority Mail Negotiated Service Agreement | |
| 83 FR 18068 - Proposed Flood Hazard Determinations | |
| 83 FR 18071 - 30-Day Notice of Proposed Information Collection: Evaluation of the Office of Public and Indian Housing's (PIH) Energy Performance Contracting (EPC) Program | |
| 83 FR 18126 - Agency Information Collection Activities: Information Collection Renewal; Submission for OMB Review; Credit Risk Retention | |
| 83 FR 18112 - Presidential Declaration of a Major Disaster for Public Assistance Only for the State of KENTUCKY | |
| 83 FR 18034 - Notice of Requests for Approval of Alternative Means of Emission Limitation | |
| 83 FR 18042 - National Emission Standards for Hazardous Air Pollutants for Asbestos: Request for Approval of an Alternative Work Practice for Asbestos Cement Pipe Replacement | |
| 83 FR 18112 - Presidential Declaration of a Major Disaster for Public Assistance Only for the State of West Virginia | |
| 83 FR 18054 - Information Collection Being Reviewed by the Federal Communications Commission | |
| 83 FR 18055 - Information Collection Being Reviewed by the Federal Communications Commission | |
| 83 FR 17931 - Reporting Requirements for U.S. Providers of International Services; 2016 Biennial Review of Telecommunications Regulations | |
| 83 FR 17968 - Connect America Fund, ETC Annual Reports and Certifications, Establishing Just and Reasonable Rates for Local Exchange Carriers, Developing a Unified Intercarrier Compensation Regime | |
| 83 FR 17933 - Implementation of the NET 911 Improvement ACT of 2008: Location Information From Owners and Controllers of 911 and E911 Capabilities | |
| 83 FR 18065 - National Institute of Allergy and Infectious Diseases; Notice of Closed Meeting | |
| 83 FR 18065 - National Institute of Biomedical Imaging and Bioengineering Notice of Meeting | |
| 83 FR 18064 - National Institute of Diabetes and Digestive and Kidney Diseases; Notice of Closed Meetings | |
| 83 FR 18065 - National Institute of General Medical Sciences; Notice of Closed Meeting | |
| 83 FR 18111 - Presidential Declaration of a Major Disaster for Public Assistance Only for the State of OHIO | |
| 83 FR 18065 - Center for Scientific Review Notice of Closed Meetings | |
| 83 FR 18002 - Environmental Technologies Trade Advisory Committee (ETTAC) Public Meeting | |
| 83 FR 18077 - Marine Mammals; Incidental Take During Specified Activities; Proposed Incidental Harassment Authorization | |
| 83 FR 17901 - Capital Planning and Supervisory Stress Testing | |
| 83 FR 17910 - Accuracy of Advertising and Notice of Insured Status | |
| 83 FR 18088 - Submission for OMB Review; Comment Request | |
| 83 FR 17987 - Migratory Bird Permits; Regulations for Managing Resident Canada Goose Populations | |
| 83 FR 18160 - Amendments to the Regulatory Capital, Capital Plan, and Stress Test Rules | |
| 83 FR 17979 - Revise and Streamline VA Acquisition Regulation |
International Trade Administration
National Oceanic and Atmospheric Administration
Federal Energy Regulatory Commission
Food and Drug Administration
National Institutes of Health
Coast Guard
Federal Emergency Management Agency
Fish and Wildlife Service
Geological Survey
National Park Service
Occupational Safety and Health Administration
Office of Government Information Services
Federal Aviation Administration
Federal Transit Administration
Pipeline and Hazardous Materials Safety Administration
Comptroller of the Currency
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National Credit Union Administration (NCUA).
Final rule.
The NCUA Board (Board) is issuing this final rule to amend its regulations regarding capital planning and stress testing for federally insured credit unions with $10 billion or more in assets (covered credit unions). The final rule reduces regulatory burden by removing some of the capital planning and stress testing requirements currently applicable to certain covered credit unions. The final rule also makes the NCUA's requirements more efficient by, among other things, authorizing covered credit unions to conduct their own stress tests in accordance with the NCUA's requirements and permitting covered credit unions to incorporate the stress test results into their capital plans.
This final rule is effectiveJune 1, 2018.
At its October 19, 2017 meeting, the Board proposed amending its regulations regarding capital planning and stress testing for covered credit unions.
The NCUA is issuing this final rule pursuant to its authority under the Federal Credit Union Act (FCUA).
The NCUA received a total of 17 comment letters from federally insured credit unions, credit union leagues, and credit union trade organizations. All of the commenters generally supported giving covered credit unions regulatory relief from the current capital planning and stress testing requirements. All also recommended, however, that the NCUA provide even more regulatory relief. The comments are discussed in more detail below.
Under the proposal, covered credit unions would be subject to tiered regulatory requirements that would further ensure their capital plans and stress testing requirements are tailored to reflect their size, complexity, and financial condition. The proposal would divide covered credit unions into three tiers, with each tier subject to different regulatory requirements. The proposal defined: (1) A tier I credit union as a covered credit union that has completed fewer than three capital planning cycles and has less than $20 billion in total assets; (2) a tier II credit union as a covered credit union that has completed three or more capital planning cycles and has less than $20 billion in total assets, or is otherwise designated as a tier II credit union by the NCUA; and (3) a tier III credit union as a covered credit union that has $20 billion or more in total assets, or is otherwise designated as a tier III credit union by the NCUA. Nearly all of the commenters recommended changing the threshold levels for tier I, II, and III covered credit unions by increasing the size threshold levels for each tier. Several commenters suggested incorporating prudential factors into the threshold levels.
A majority of commenters encouraged the NCUA to increase the asset thresholds to be more consistent with the thresholds for banks. To achieve parity with banks, commenters generally recommended two different approaches to establishing size thresholds. A number of commenters recommended that the NCUA take the size thresholds established for banks and reduce that threshold to reflect the proportionately smaller size of the National Credit Union Share Insurance Fund (NCUSIF). The commenters explained that the NCUSIF is approximately one-seventh the size of the Deposit Insurance Fund (DIF), therefore, the appropriate threshold for credit unions would be about $36.5 billion (one-seventh of the proposed $250 billion threshold for banks).
While commenters consistently recommended increasing the size threshold levels, there were mixed opinions on the appropriate size thresholds that the NCUA should establish for each tier. Commenters that suggested using $36.5 billion or $50 billion as the appropriate size threshold may have differed on whether that threshold was appropriate for a tier I, II, or III covered credit union. For example, in the case of tier I covered credit unions, recommended size thresholds varied from $10 billion to $50 billion.
As compared to the proposed rule, the Board in the final rule has partially revised the thresholds for tier I and II covered credit unions. In the final rule, a tier I credit union is a covered credit union that has less than $15 billion in total assets and a tier II credit union is a covered credit union that has $15 billion or more in total assets, but less than $20 billion in total assets (or is otherwise designated as a tier II credit union by the NCUA). Therefore, in the final rule, a covered credit union that remains under $15 billion will not conduct annual stress tests, even if it has been subject to capital planning requirements for over three years. For such covered credit unions, the final rule provides additional regulatory relief from supervisory stress testing. However, a tier I credit union that crosses the $15 billion threshold in less than three years after becoming a covered credit union, will have to conduct stress tests earlier under the final rule than as proposed. The NCUA has determined to remove the three year phase-in period in favor of a strict asset-size threshold because the NCUA believes that size is one of the primary indicators of systemic risk to the NCUSIF. Specifically, the NCUA believes that a $15 billion threshold balances the goal of providing regulatory relief with the additional risk that larger, more systemically significant credit unions pose to the NCUSIF. Therefore, the NCUA believes that at $15 billion in total assets a covered credit union represents sufficient risk to the NCUSIF that supervisory stress tests are warranted. The designation for a tier III credit union remains the same as proposed and includes a covered credit union that has $20 billion or more in total assets (or is otherwise designated as a tier III credit union by the NCUA).
Several commenters recommended that the NCUA define the tier I, II, and III thresholds to include factors other than a credit union's size and number of completed capital planning cycles. A common theme among such commenters was that the NCUA should explicitly consider a covered credit union's financial health and risk profile in defining the thresholds. These commenters urged the NCUA to provide additional regulatory relief and flexibility to covered credit unions that pose less risk to the NCUSIF. Factors mentioned by commenters that the NCUA could consider in granting additional regulatory relief include prompt corrective action capital levels, CAMEL ratings (specifically composite, capital, and management ratings), levels of interest rate risk, earnings, rates of growth, and concentration risk.
Capital plan review and supervisory stress testing, however, are forward-looking assessments of a covered credit union's financial condition. In contrast, capital ratings, earnings, rates of growth, and concentration risk are important supervisory tools that are based on a covered credit union's current financial condition. Additionally, capital planning and supervisory stress testing contribute to a covered credit union's CAMEL ratings and overall risk assessments. Therefore, the NCUA believes that including CAMEL ratings as criteria for supervisory thresholds would create inappropriate circularity and has not incorporated prudential conditions into the thresholds for capital planning and stress testing requirements.
Several commenters recommended that the NCUA incorporate an additional grace period between the time when a covered credit union becomes a tier I credit union and when it becomes a tier II credit union. Commenters stated that such additional time would allow tier I covered credit unions to focus on building strong capital planning and capital adequacy assessment processes before having to incorporate supervisory stress testing programs. The NCUA agrees with commenters that it is important for tier I covered credit unions to focus on building strong capital planning and capital adequacy assessment processes before incorporating supervisory stress testing programs. Therefore, as discussed above, in the final rule, a tier I credit union will not be automatically subject to stress testing requirements after a three-year phase in period. Instead, a tier I credit union will only be subject to stress testing requirements after its total assets exceed $15 billion. The NCUA believes that the $15 billion threshold provides credit unions additional control over their timeline for beginning supervisory stress testing. In recent years, covered credit unions have grown an average of 10 percent per year. At this rate of growth, a covered credit union would have about four years to focus on their capital planning processes before becoming a tier II credit union and incorporating supervisory stress testing programs. The NCUA believes that modifying the thresholds by removing the three year phase-in period in favor of a strict asset-size threshold provides additional regulatory relief and that credit unions that grow in a safe and sound manner will have sufficient time to build upon their capital planning procedures before implementing stress testing requirements. The NCUA notes that a credit union with an exceptional rate of growth such that it must begin supervisory stress testing requirements less than three years after becoming a tier I credit union may raise supervisory concerns.
A few commenters recommended removing the proposed language allowing the NCUA the discretion to designate a credit union as a tier II or tier III credit union. Alternatively, the commenters suggested setting clear criteria, along with examples, to delineate the situations when this could happen. The NCUA recognizes that size alone does not provide a complete view of risk at a credit union. Each credit union is unique and matters of complexity and financial condition are nuanced. To maintain flexibility, to avoid creating a “one size fits all” rule, and to incorporate the unique attributes of individual credit unions, the Board is retaining in the final rule the ability to elevate a credit union's tier designations. Thus, in the final rule, asset size establishes the baseline for determining the credit union's tier designation, but a credit union's financial condition, complexity, and other environmental matters may be considered by the Board to elevate its
Under the proposed rule, a covered credit union would continue to annually develop and submit to the NCUA a capital plan. For tier I and II covered credit unions, however, review of their capital plans would be incorporated into their supervisory oversight. For tier III covered credit unions, review of their capital plans would continue to be subject to the current requirement that the NCUA formally approve or reject them. A few commenters specifically expressed support for the proposed changes to the capital planning requirements. Several other commenters, however, recommended specific changes to further reduce the burden of capital planning requirements.
Specifically, several commenters stated that the NCUA should reduce the frequency of capital planning requirements. For example, a commenter recommended that the NCUA eliminate the requirement that covered credit unions provide annual capital plans. Instead, the commenter recommended that the NCUA use the supervisory process to evaluate capital. Other commenters suggested that for certain covered credit unions, capital plans should only be required every two to three years. The NCUA believes that capital adequacy considerations and capital actions should be regular and ongoing activities at covered credit unions and viewed alongside the credit union's strategic and financial plans. Annual revisions and more frequent reviews of capital plans are appropriate so that the credit union has a current view of threats to capital and can take timely mitigating action. The NCUA does not consider annual capital plan preparation, even with incorporated supervisory stress tests, to be an excessive burden, and therefore, the final rule continues to require annual development of capital plans for all covered credit unions.
Additionally, a few commenters recommended tailoring capital planning requirements to complement the stress testing changes by providing tiered expectations for capital planning requirements. The NCUA notes that it will review tier I and tier II credit union capital plans through the supervisory process and those plans are not subject to formal approval by the NCUA. Commenters also had different opinions on whether the NCUA should formally approve or reject any covered credit union's capital plan. For example, a commenter recommended that the NCUA review all capital plans through the supervisory process, while another commenter supported the proposal to retain the requirement that the NCUA approve or reject a tier III credit union's capital plan. The final rule's tiered approach enables the NCUA to tailor capital plan expectations to the individual credit union, reserving the highest expectations and most critical assessment for the tier III credit unions. For tier III credit unions, which pose the most systemic risk to the NCUSIF, it is prudent to establish formal triggers requiring action to mitigate NCUSIF risk exposure. Therefore, in the final rule, capital plans for tier III credit unions will continue to be subject to formal approval requirements.
Under the proposal, the NCUA would no longer conduct the annual supervisory stress tests on applicable covered credit unions. Rather, the covered credit unions themselves would conduct the stress tests according to the NCUA's instructions, which ensures that the stress tests performed by credit unions are conducted in a consistent and comparable manner. Covered credit unions also would be subject to tiered stress testing requirements. Tier I credit unions would no longer be subject to stress testing requirements, and tier II and III credit unions would conduct annual stress tests. Additionally, unlike their larger counterparts in tier III, tier II credit unions would not be subject to a 5 percent minimum stress test capital threshold. Commenters had mixed opinions on whether the proposed changes to stress testing requirements provided meaningful regulatory relief. Commenters also had varied opinions on whether the NCUA or covered credit unions should conduct the required stress tests. Several commenters specifically stated their support for allowing covered credit unions to conduct their own stress tests. Other commenters, however, stated that such a change would increase operational burden and expense for credit unions. Another commenter recommended retaining the current opt-in approach to conducting stress tests. The NCUA believes that credit unions are better informed of risk when they perform their own capital adequacy assessments. Having covered credit unions conduct their own supervisory stress tests further informs their capital analysis. Also, it eliminates any negative consequences that could result from the NCUA conducting the tests, namely that a covered credit union might abdicate its responsibility to perform rigorous capital analyses to the NCUA. Furthermore, the NCUA views the production and reporting of supervisory stress test results as incidental given the expectation that credit unions have sound capital adequacy assessment processes. Therefore, the NCUA is not changing the proposed requirement to have tier II and III covered credit unions conduct their own supervisory stress tests.
Many commenters encouraged the NCUA to consider providing more substantial regulatory relief, including reducing or eliminating stress testing requirements. Several commenters recommended eliminating the stress testing requirements altogether. Others suggested reducing the frequency of testing or waiving certain requirements based on the credit union's risk profile. The primary objective of stress testing is for the NCUA and the covered credit union to have an understanding of the credit union's ability to absorb the impact of significant economic stresses and to determine with a high degree of confidence when a covered credit union does not have sufficient capital to protect the NCUSIF from losses. Annual supervisory stress testing is an important prudential tool that provides the NCUA an aggregate view of the covered credit union's financial condition and capital resiliency. Therefore, in the final rule, tier II and III credit unions will continue to be required to conduct annual stress tests.
Commenters also had specific recommendations for the stress testing process. For example, a few commenters objected to the proposed timeline for conducting stress tests and completing capital plans. The commenters believed that the May 31st submission date provides insufficient time to complete the stress tests and incorporate results into the capital planning process. Instead, commenters suggested submission dates of July 31st or August 31st. As recently as 2015, the NCUA considered the timing of capital planning and stress test elements. In July 2015, the NCUA adopted a revised capital planning and stress testing schedule, which included consideration of the potential for credit union run stress testing.
A minority of commenters discussed the scenarios required for stress testing. For example, a commenter recommended that tier II covered credit unions be exempt from the baseline and adverse stress test scenarios. The NCUA believes that each scenario is necessary for the NCUA and a credit union to have a complete understanding of the credit union's risks and that each scenario serves a distinct purpose in the stress test exercise. Specifically, the baseline scenario, conducted under the NCUA's instructions, serves as a benchmark to evaluate results under the stress scenarios. The stress scenarios are used to stress different aspects of a credit union's positions under unfavorable conditions and may be designed to focus on different risk characteristics of a credit union's portfolio. The spectrum of scenarios is necessary to have a complete understanding of a credit union's capital position in different economic conditions. Therefore, the NCUA believes that all stress tests should include all scenarios. Furthermore, consistent testing parameters ensure that credit union results are comparable to each other. Another commenter recommended that the NCUA continue utilizing the Federal Reserve Board's stress test assumption scenarios rather than designing its own unique tests. The commenter believed that standardization across the financial services industry is preferable. The NCUA agrees with this commenter. Consistent with past practice, the NCUA intends to publish scenarios that are consistent with the scenarios published by the banking agencies. However, the NCUA reserves the right to modify scenarios or produce unique scenarios to ensure risk at covered credit unions is sufficiently captured in the exercise.
Covered credit unions are currently required to submit data to the NCUA as part of the stress testing process, and the proposal did not include any changes to these requirements. Several commenters, nevertheless, encouraged the NCUA to eliminate or substantially reduce the data submissions. Commenters, however, generally did not offer specific data items that they considered unnecessary or burdensome. Data collection is part of the NCUA's strategic initiative to enhance supervision and is used to inform qualitative and quantitative assessments and ratings of covered credit unions. The data currently collected for the NCUA to conduct supervisory stress tests will continue to be used by the agency to assess a covered credit union's capital adequacy through review of its capital plan and supervisory stress tests results. Also, the collected data can drive supervisory efficiencies that reduce regulatory burden for covered credit unions. For example, the data may lead to more targeted supervisory work resulting in less time on-site at covered credit unions. Therefore, the final rule retains the current data collection requirements.
A few commenters recommended amending the definition of “covered credit union” so that a credit union with total assets over $10 billion does not becomes a “covered credit union” until its most recent four-quarter average of consolidated total assets exceeds $10 billion. Based on our experience implementing the capital planning and stress testing rules, the NCUA has not found that many credit unions decrease under $10 billion after becoming covered credit unions. Therefore, the NCUA does not believe the added complexity required by determining a four-quarter average is warranted and is not making any such changes to the final rule.
A few commenters also stated that given the enterprise-wide nature of the capital planning and supervisory stress testing regime, the NCUA should consider whether certain generally applicable requirements that must be met for a credit union to be eligible for insurance coverage are unnecessarily redundant when applied to covered credit unions. The commenters specifically noted liquidity and risk-based capital standards. Capital planning and stress testing are distinctive supervisory tools that the NCUA uses in the supervision of risk at covered credit unions. They complement, but do not replace, other regulatory and supervisory tools used by the agency.
After carefully considering the public comments, the NCUA has made several changes to the final rule. The final rule reflects the NCUA's experiences in implementing the current rule's requirements, while also considering the systemic risk that covered credit unions pose to the NCUSIF. As explained in more detail below, the final rule is intended to reduce regulatory burden by removing some of the more onerous capital planning and stress testing requirements currently applicable to covered credit unions. The changes to the NCUA's capital planning and stress testing requirements will more closely align the agency's regulatory requirements with its current supervisory expectations for covered credit unions.
In the final rule, covered credit unions are subject to new tiered regulatory requirements that further ensure their capital plans and stress testing requirements are tailored to reflect their size, complexity, and financial condition. For example, under the final rule, tier I and II covered credit unions will continue to develop annual capital plans, but the capital plans will no longer be formally submitted to the NCUA by May 31st each year. In contrast, tier III covered credit unions will continue to submit capital plans to the NCUA by May 31st that must be formally accepted or rejected by the NCUA. Additionally, stress testing requirements under the final rule are also tiered. Under the final rule, tier I credit unions are not subject to any stress testing requirements. In contrast, tier II and III covered credit unions are required to conduct stress testing, although tier II covered credit unions are not subject to a 5 percent minimum stress test capital threshold. Further, under the final rule, the NCUA will no longer be required to conduct the annual supervisory stress tests on applicable covered credit unions. Rather, the covered credit unions will conduct the stress tests.
While the NCUA recognizes that all covered credit unions are of systemic importance to the NCUSIF, the NCUA believes it is appropriate to differentiate the capital planning and stress testing requirements applicable to such institutions based on their individual characteristics. Specifically, size is deemed to be the most significant
The final rule retains the proposed use of tiers to differentiate the capital planning and stress testing requirements applicable to covered credit unions. The final rule identifies three tiers of covered credit unions and imposes varying levels of regulatory requirements based on those tiers. In brief, the tier comprised of the smallest covered credit unions is subject to the least regulatory requirements, with a concomitant increase in requirements for each tier as the size and complexity of those covered credit unions increases. In response to commenters, the final rule has partially revised the thresholds for tier I, II, and III covered credit unions as compared to the proposed rule. Under the final rule, the three tiers are as follows:
• A
• A
• A
In the final rule, the level of the capital planning requirements for tier I and II credit unions generally decreases from the current regulatory requirements, but generally remains the same for tier III credit unions. This approach reduces regulatory burdens on tier I and II credit unions while allowing them to focus on establishing sound capital planning and capital adequacy assessment processes. Tier III credit unions, on the other hand, which pose the greatest systemic risk to the NCUSIF and which are most capable of complying with the current requirements, remain subject to most of the current requirements.
In the final rule, tier I and II covered credit unions are required to develop and maintain an annual capital plan, but they are no longer required to formally submit their capital plans to the NCUA for approval by May 31st of each year. The removal of the requirement for tier I and II credit unions to formally submit capital plans to the NCUA is a change from the proposed rule. The NCUA believes this provides smaller covered credit unions with additional flexibility to incorporate their annual capital plan into their planning processes, such as development of their strategic plans.
Additionally, under the final rule, tier I and II credit unions are no longer required to have their capital plans formally approved by the NCUA. Instead, capital plan reviews for tier I and II credit unions will be conducted as part of the NCUA's supervisory process. This approach provides the NCUA greater latitude when reviewing capital plan submissions and provides the NCUA with additional flexibility to use the supervisory process to address plan deficiencies, especially for credit unions newly covered by the capital planning requirements. The NCUA believes that any increased risk to the NCUSIF that may occur as a result of providing regulatory relief can be addressed through the supervisory process.
For tier III credit unions, the final rule retains the current requirement that all such credit unions submit capital plans to the NCUA no later than May 31st of each year. In addition, for tier III credit unions, the NCUA will formally approve or reject its capital plan. Because the failure of a tier III credit union poses the most significant risk to the NCUSIF, the NCUA believes it is prudent to retain the current, more formal requirements for those credit unions. The NCUA's formal rejection of a capital plan is subject to the Supervisory Review Committee process.
The final rule applies the asset thresholds as of the March 31st measurement date of each year.
The changes outlined above are discussed in more detail in the Section-by-Section Analysis below.
The final rule retains most of the definitions included in the proposed rule except that the proposed definition of capital planning cycle has been removed. The definition was necessary to distinguish between tier I and II credit unions in the proposed rule, but is not necessary in the final rule as the number of capital planning cycles completed is no longer a distinguishing factor between the tier I and II threshold classifications. The final rule also retains most of the definitions from current § 702.502, without change, with the following exceptions.
The final rule removes the definition of “adverse scenario” from § 702.502 and replaces this term throughout subpart E with terms more commonly used in the financial services industry. This change is intended to reduce confusion for covered credit unions. No substantive changes to the requirements of subpart E are intended by this change and covered credit unions will continue to be subject to the baseline and one or more stressed scenarios.
The final rule makes conforming amendments to the current definition of “covered credit union” in § 702.502. The amended definition provides that “covered credit union” means a federally insured credit union whose assets are $10 billion or more. The definition provides further that a credit union that crosses that asset threshold as of March 31st of a given calendar year is subject to the applicable requirements of subpart E in the following calendar year.
The revised definition provides that “scenarios” are those sets of conditions that affect the U.S. economy or the financial condition of a covered credit union that serve as the basis for stress testing, including, but not limited to, NCUA-established baseline scenarios, and stress scenarios. It is the NCUA's intention to continue to base the NCUA-established scenarios on the scenarios developed by the Federal Reserve Board. As currently is the practice, the NCUA may modify such scenarios to ensure they are appropriate for domestic banking operations.
The final rule deletes the definition of “severely adverse scenario” from § 702.502 and replaces this term throughout subpart E with terms more commonly used in the financial services industry. This change is intended to reduce confusion for covered credit unions. No substantive changes to the requirements of subpart E are intended by this change and covered credit unions will continue to be subject to the baseline and one or more stressed scenarios.
The final rule adds the definition “stress scenario” to § 702.502. The definition provides that “stress scenario” means a scenario that is more adverse than that associated with the baseline scenario.
The final rule adds the definition of “tier I credit union” to § 702.502. The definition provides that “tier I credit union” means a covered credit union that has less than $15 billion in total assets. The definition of a tier I credit union provides regulatory relief for qualifying covered credit unions. This definition allows the NCUA to better align regulatory expectations based on the size, complexity, and financial condition of each covered credit union.
The final rule adds the definition of “tier II credit union” to § 702.502. The definition provides that “tier II credit union” means a covered credit union that has $15 billion or more in total assets but less than $20 billion in total assets, or is otherwise designated as a tier II credit union by NCUA. This definition recognizes the iterative nature of the NCUA's capital planning and stress testing processes, and acknowledges that covered credit unions get better at developing and implementing their capital plans over time and through repetition. The NCUA believes these changes provide regulatory relief for tier II credit unions.
The final rule adds the definition of “tier III credit union” to § 702.502. The definition provides that “tier III credit union” means a covered credit union that has $20 billion or more in total assets, or is otherwise designated as a tier III credit union by NCUA. The final rule identifies credit unions with total assets of $20 billion or more as posing the highest degree of risk to the NCUSIF. While the NCUA considers qualitative and quantitative capital plan supervision and credit union-run stress test review to be appropriate for covered credit unions with less than $20 billion in total assets, it does not for larger covered credit unions. For covered credit unions with total assets of $20 billion or more, the NCUA believes it is prudent, given the size of the NCUSIF and the potential loss associated with the failure of a credit union that large, to establish formal triggers requiring the NCUA and credit union actions to further mitigate NCUSIF risk exposure.
The Board retains the authority to designate a covered credit union as a tier II credit union or tier III credit union.
The final rule retains most of current § 702.504 without change, with the following exceptions.
Section 702.504(a)(1) continues to provide that all covered credit unions must develop and maintain a capital plan. Under the final rule, however, only tier III credit unions are required to submit their capital plan and capital policy to the NCUA. Therefore, the final rule amends § 702.504(a)(1) to state that a tier I and II credit union must complete a capital plan by December 31st each year, but are not required to submit a plan to the NCUA. Additionally, the final rule has been amended to state that the capital plan must be based on financial data from either of the two preceding calendar quarters. For example, if a tier I or II credit union's board approves its capital plan in the fourth quarter, the plan financial data must be as of either September 30th or June 30th. Section 702.504(a)(1) is also amended to explicitly state that a tier III credit union must submit its plan and capital policy to the NCUA by May 31st each year, or such later date as directed by the NCUA. The final rule also continues to provide that for tier III covered credit unions, the plan must be based on the covered credit union's financial data as of December 31st of the preceding calendar year, or such other date as directed by the NCUA. Finally, § 702.504(a)(1) will no longer include the last sentence in current § 702.504(a)(1), which provides that the NCUA will assess whether the capital planning and analysis process is sufficiently robust in determining whether to accept a credit union's capital plan. Given the other changes in this final rule, this sentence is no longer necessary.
The current rule states that a covered credit union's board of directors (or a designated committee of the board) must at least annually, and prior to the submission of the capital plan, review and approve the credit union's capital plan. The final rule clarifies that this requirement applies to all covered credit unions, even if the credit union is not required to submit the plan to the NCUA.
The final rule deletes current § 702.504(b)(4) from the regulation. Current § 702.504(b)(4) provides that if a credit union conducts its own stress test under § 702.506(c), its capital plan must include a discussion of how the credit union will maintain a stress test capital ratio of 5 percent or more under
The final rule amends current § 702.505(a) by dividing paragraph (a) into two subparts. Under this final rule, § 702.505(a)(1) provides that the NCUA will address any deficiencies in the capital plans submitted by tier I and tier II credit unions through the supervisory process. The intent of this change is to provide regulatory relief to tier I and tier II credit unions by removing the regulatory review and regulatory “accept or reject” assessment of their capital plans. It also provides the NCUA with additional flexibility in addressing plan deficiencies.
Under this final rule, § 702.505(a)(2) continues to require that the NCUA accept or reject tier III credit unions' capital plans. The NCUA is not removing this requirement for tier III credit unions at this time for the reasons discussed above. Accordingly, § 702.505(a)(2) provides that the NCUA will notify tier III credit unions of the acceptance or rejection of their capital plans by August 31 of the year in which their plan is submitted.
The final rule also makes additional conforming changes throughout § 702.505 to clarify that only tier III credit unions are required to operate under a capital plan formally accepted by the NCUA. No substantive changes, other than those discussed above, are intended.
Much of the substance of current § 702.506 remains unchanged in the final rule. Each of the substantive amendments are discussed in detail below. The final rule also makes some non-substantive conforming amendments to address certain changes in terminology.
The final rule amends current § 702.506(a) by adding a new clarifying sentence to the beginning of paragraph (a). The new sentence provides that only tier II and tier III credit unions are required to conduct supervisory stress tests. The NCUA believes that exempting tier I credit unions from supervisory stress testing provides prudent regulatory relief and enables tier I credit unions time to develop their own capital adequacy assessments. The NCUA considers the supervisory stress testing exemption for tier I credit unions, which allow credit unions to grow from $10 billion in total assets to $15 billion in total assets, to be sufficient time to develop internal capabilities to perform credit union-run supervisory stress tests.
The final rule deletes current § 702.506(b) regarding NCUA conducted stress tests, which, because of the other changes being implemented to part 702, is overridden. The NCUA reserves, in amended § 702.506(b)(3), the right to conduct stress tests on covered credit unions if it deems such action necessary.
The final rule makes significant revisions to current § 702.506(c) (which has been renumbered to § 702.506(b) in the final rule) to require tier II and tier III credit unions to conduct their own stress tests instead of first having to get approval from the NCUA. In the final rule, renumbered § 702.506(b) is split into three new subparagraphs, each of which is described in more detail below.
Section 702.506(b)(1) of the final rule provides that all supervisory stress tests must be conducted according to the NCUA's instructions. The NCUA is adding this requirement to ensure that supervisory stress tests performed by tier II and tier III credit unions are conducted in a manner that promotes consistency and comparability. Credit union-run stress tests must adhere to these principles in order for the NCUA to assess inherent risk in the portfolios of covered credit unions and establish supervisory benchmarks. The NCUA will publish credit union-run supervisory stress test instructions on its website.
Section 702.506(b)(2) of the final rule provides that when conducting its stress test, a tier III credit union must apply the minimum stress test capital ratio to all time periods in the planning horizon. The NCUA believes that only tier III credit unions should be subject to a minimum stress test capital requirement. Therefore, tier II credit unions do not have to apply a minimum stress test capital ratio to each time period in the planning horizon.
Section 702.506(b)(3) of the final rule retains the last two sentences in current § 702.506(c), without change. Section 702.506(b)(3) of the final rule provides that the NCUA reserves the right to conduct the stress tests described in this section on any covered credit union at any time. Paragraph (b)(3) provides further that where both the NCUA and a covered credit union have conducted the tests, the results of the NCUA's tests will determine whether the covered credit union has met the requirements of part 702. The final rule includes no substantive changes to these two sentences as compared to the current rule.
The final rule states that all stress test results are due to the NCUA by May 31st each year. The May 31st stress testing due date applies to both tier II and III credit unions, even though tier II covered credit unions are not required to submit a capital plan on May 31st.
The final rule retains much of the language in current § 702.506(g), but inserts some additional language. The section also is broken into three subsections, each of which is discussed in more detail below.
Section 702.506(f)(1) of the final rule provides that if a credit union-run stress test shows a tier III credit union does not have the ability to maintain a stress test capital ratio of 5 percent or more under expected and stressed conditions in each quarter of the planning horizon, the credit union must incorporate into its capital plan a stress test capital enhancement plan showing how it will meet that target.
Section 702.506(f)(2) provides that if an NCUA-run stress test shows that a tier III credit union does not have the ability to maintain a stress test capital ratio of 5 percent or more under expected and stressed conditions in each quarter of the planning horizon, the credit union must provide the NCUA, by November 30 of the calendar year in which the NCUA conducted the tests, a stress test capital enhancement plan showing how it will meet that target. As explained above, the NCUSIF risk exposure to a tier I and tier II credit union is sufficiently mitigated through qualitative and quantitative supervision of the credit union's capital planning and capital adequacy analysis. Accordingly, the final rule offers
Section 702.506(f)(3) of the final rule provides that a tier III credit union operating without an NCUA-approved stress test capital enhancement plan required under this section may be subject to supervisory action. A tier III credit union operating without an accepted capital plan or an approved stress test capital enhancement plan will be considered poorly managed and/or operating with insufficient capital to support the credit union's risk profile. The NCUA believes it is prudent to subject a tier III credit union to heightened regulatory scrutiny under such circumstances.
The final rule is effective June 1, 2018, after the May 31, 2018 submission date for capital plans. Therefore, the current rule remains effective for covered credit unions' 2018 capital plans and all covered credit unions must complete their capital plans by May 31, 2018. Tier I and II credit unions, however, do not need to submit their capital plans to the NCUA by May 31, 2018, and the NCUA will review their capital plans through the supervisory process. With respect to stress testing, the NCUA will conduct stress tests in calendar year 2018 for supervisory purposes.
The Regulatory Flexibility Act requires the NCUA to prepare an analysis of any significant economic impact any regulation may have on a substantial number of small entities (primarily those under $100 million in assets).
The Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501
In accordance with the PRA, the information collection requirements included in this final rule has been submitted to OMB for approval under control number 3133-0199, and includes the following program changes:
Section 702.504 requires FICUs with assets of at least $10 billion (covered credit unions) to develop and maintain capital plans; but only tier III to submit NCUA. The removal of the requirement for tier I and II credit unions to formally submit capital plans to NCUA is a change from the proposed rule and reflects a reduction of 30 burden hours annually. Also, an increase of 240 burden hours is due to an adjustment in the number of respondents from 3 to 4 falling under the recordkeeping requirements of § 702.504.
Section 702.506 requires tier II and III credit unions to conduct their own supervisory stress tests in a manner prescribed by NCUA, which had previously been conducted by NCUA. It is estimated this new information collection requirement impacts five credit unions for a total increase of 500 burden hours.
Executive Order 13132 encourages independent regulatory agencies to consider the impact of their actions on state and local interests. The NCUA, an independent regulatory agency as defined in 44 U.S.C. 3502(5), voluntarily complies with the executive order to adhere to fundamental federalism principles. The final rule 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. The Board has, therefore, determined that this final rule does not constitute a policy that has federalism implications for purposes of the executive order.
The Board has determined that this final rule will not affect family well-being within the meaning of section 654 of the Treasury and General Government Appropriations Act, 1999, Public Law 105-277, 112 Stat. 2681 (1998).
The Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA) provides generally for congressional review of agency rules. A reporting requirement is triggered in instances where NCUA issues a final rule as defined by Section 551 of the Administrative Procedure Act. NCUA does not believe this final rule is a “major rule” within the meaning of the relevant sections of SBREFA. NCUA has submitted the rule to the Office of Management and Budget for its determination in that regard.
Credit unions, Reporting and recordkeeping requirements.
For the reasons discussed above, the National Credit Union Administration amends 12 CFR part 702 as follows:
12 U.S.C. 1766(a), 1784(a), 1786(e), 1790d.
The revision reads as follows:
(a) * * * (1) A covered credit union must develop and maintain a capital plan. Tier I and tier II credit unions must complete this plan and their capital policy by December 31 each year, but are not required to submit this plan to the NCUA. For tier I and tier II credit unions, the plan must be based on the credit union's financial data from either of the two calendar quarters preceding the quarter in which the plan is approved by the credit union's board of directors (or a designated committee of the board). A tier III credit union must submit this plan and its capital policy to NCUA by May 31 each year, or such later date as directed by NCUA. For tier III credit unions, the plan must be based on the credit union's financial data as of December 31 of the preceding calendar year, or such other date as directed by NCUA.
The revision reads as follows:
(a)
(2)
(a)
(b)
(2)
(3)
(c)
(1) Losses, pre-provision net revenues, loan and lease loss provisions, and net income; and
(2) The potential impact on the stress test capital ratio, incorporating the effects of any capital action over the planning horizon and maintenance of an allowance for loan losses appropriate for credit exposures throughout the horizon. The credit union, or the NCUA if it elects to conduct the stress test under paragraph (b)(3) of this section, will conduct the stress tests without assuming any risk mitigation actions on the part of the credit union, except those existing and identified as part of the credit union's balance sheet, or off-balance sheet positions, such as derivative positions, on the date of the stress test.
(d)
(e)
(f)
(2) If an NCUA-run stress test shows that a tier III credit union does not have the ability to maintain a stress test capital ratio of 5 percent or more under expected and stressed conditions in each quarter of the planning horizon, the credit union must provide NCUA, by November 30 of the calendar year in which NCUA conducted the tests, a stress test capital enhancement plan showing how it will meet that target.
(3) A tier III credit union operating without an NCUA approved stress test capital enhancement plan required under this section may be subject to supervisory actions.
(g)
National Credit Union Administration (NCUA).
Final rule.
The NCUA Board (Board) is revising provisions of the NCUA's advertising rule to provide regulatory relief to federally insured credit unions (FICUs). The advertising rule requires FICUs to use the NCUA's official advertisement statement when advertising, and it currently permits three versions of that statement. Under this final rule, the Board is allowing FICUs the option of using a fourth
This final rule becomes effective May 25, 2018.
Marvin Shaw, Staff Attorney, Office of General Counsel, telephone (703) 518-6553.
The Federal Credit Union Act (Act) requires each FICU to display NCUA's “official sign” regarding National Credit Union Share Insurance Fund insurance of the FICU's share accounts. The sign includes language that the coverage is backed by the full faith and credit of the United States Government.
Part 740 prohibits any FICU from using advertising
Currently, there are two versions of the NCUA's official advertising statement: (1) The longer version, which reads “This credit union is federally insured by the National Credit Union Administration”; and (2) the shorter version, which reads “Federally insured by NCUA.” In accordance with part 740, a FICU may, as a third option, display the official sign in advertisements in lieu of making the official advertising statement. With certain exemptions discussed below, a FICU must use the official advertising statement in all of its advertisements, although it is at the FICU's discretion to choose among the three options noted.
Section 740.5(c) of the NCUA's regulations enumerates several kinds of advertisements that, for practical reasons, are exempted from the general rule requiring the use of the official advertising statement.
For many years, the NCUA's advertising and official sign regulations were essentially the same as those of the Federal Deposit Insurance Corporation (FDIC).
The NCUA's 2011 amendments also required FICUs to include the advertising statement on statements of condition required to be published by law, a requirement not imposed on banks.
On October 4, 2017 (2017 NPRM),
The NCUA received 36 comments from federal and state credit unions, trade associations, credit union leagues, credit union employees, and an individual. These commenters generally supported the proposed rule, although a few commenters opposed discreet aspects of the proposal.
In supporting the proposal, several commenters called the changes modest yet important. A few commenters emphasized that part 740's primary goal is to inform the public about share insurance.
Commenters stated that the proposed rule would: (1) Provide regulatory relief
Each proposed amendment and the corresponding public comments recommending alternatives or modifications are discussed in more detail below.
As noted, part 740 currently provides three options for the NCUA's official advertising statement: (1) “This credit union is federally insured by the National Credit Union Administration”; (2) “Federally insured by NCUA”; and (3) the official sign may be displayed in advertisements in lieu of the advertising statement.
Virtually all commenters supported the proposal to add an additional version of the official advertising statement. Commenters expressed appreciation for this proposed alternative, stating that it provides regulatory relief. One commenter noted that the proposed version consists of 13 characters as opposed to 22 or 71 characters. Commenters stated that the change is especially meaningful for new social media platforms because it enhances flexibility while still conveying the important message regarding federal share insurance. They further posited that providing a shorter alternative makes advertising more cost effective because print and electronic advertising prices are often based on length and duration.
One commenter recommended allowing an even shorter ten character message—“NCUA Insured” or twelve character message “Member NCUSIF.” This commenter stated that this would provide parity with the FDIC advertising statement—“Member FDIC,” thus enhancing flexibility.
The Board agrees the proposed alternative will add flexibility without any adverse effect on potential members. However, it does not believe it necessary to adopt the suggested “NCUA Insured” or “Member NCUSIF.” Therefore, the Board adopts this aspect of the proposal as proposed.
As noted above, the current advertising rule exempts from the requirements of part 740 radio and television advertisements that are less than 15 seconds in duration. In the 2017 NPRM, the Board proposed to expand the radio and television advertisements exemption from 15 seconds to 30 seconds. Virtually all commenters supported this aspect of the proposal. The commenters supported the Board's goal of restoring parity between FICUs and banks and noted this change would enhance a FICU's ability to communicate to members. The commenters stated that the previous reduction of the exemption in 2011 from 30 seconds to 15 seconds was unnecessary and increased regulatory burden.
The Board agrees and adopts this aspect of the proposal as proposed.
The 2011 amendments, for the first time, required FICUs to include the advertising statement on statements of condition required to be published by law. In the 2017 NPRM, the Board proposed to relieve FICUs of this burden. Of the commenters who addressed this aspect of the proposal, all agreed with it. They stated that the requirement is unnecessary and that relief from it restores parity with banks.
The Board agrees with the commenters and adopts this aspect of the proposal as proposed.
Current part 740 focuses primarily on traditional forms of advertising such as print, radio, and television. In the 2017 NPRM, the Board requested comment on whether to modify the regulations to more precisely address advertising on social media, mobile banking, text messaging, and other digital communication platforms, such as Twitter and Instagram. The Board requested specific recommendations that would balance the goal of informing the public regarding federal share insurance coverage with the practical constraints inherent in social media advertising.
Twelve commenters addressed this topic, noting that digital media typically are designed as extremely short forms of communication. Several commenters favored making no changes to part 740, stating that the proposal to permit the fourth version of the official advertising statement was sufficient to accommodate new forms of advertising. Other commenters recommended adding new exemptions to part 740 for various forms of digital advertisements provided the official advertising statement appears elsewhere in the FICU's advertisement. Others recommended modifying certain provisions of part 740 short of adding new exemptions. For example, one commenter recommended that, for text-based messaging, the regulations should allow the official advertising statement to be expressed by a hashtag for Twitter,
The Board has determined that, given the rapidly changing technological landscape, it is appropriate to delay taking action to amend part 740 regarding social media at this time. The Board believes that part 740 provides a sufficient framework to inform potential and current credit union members regarding federal share insurance coverage for advertisements made in traditional ways and on social media. Additionally, the NCUA's Office of General Counsel is authorized to provide guidance to any FICU with questions regarding part 740 in the context of advertising on social media.
The Regulatory Flexibility Act requires the NCUA to prepare an analysis to describe any significant economic impact a regulation may have on a substantial number of small entities.
The Paperwork Reduction Act of 1995 (“PRA”) applies to rulemakings in which an agency by rule creates a new paperwork burden on regulated entities or modifies an existing burden.
Executive Order 13132 encourages independent regulatory agencies to consider the impact of their actions on state and local interests. In adherence to fundamental federalism principles, the NCUA, an independent regulatory agency as defined in 44 U.S.C. 3502(5), voluntarily complies with the executive order. The rule will not have substantial direct effect on the states, on the connection between the national government and the states, or on the distribution of power and responsibilities among the various levels of government. The NCUA has determined that this rule does not constitute a policy with federalism implications for purposes of the executive order.
The Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121) (SBREFA) provides generally for congressional review of agency rules. A reporting requirement is triggered in instances where the NCUA issues a final rule as defined in Section 551 of the Administrative Procedure Act. The NCUA does not believe this final rule is a “major rule” within the meaning of the relevant sections of SBREFA. As required by SBREFA, the NCUA has filed the appropriate documentation with OMB for review.
The NCUA has determined that this rule will not affect family well-being within the meaning of Section 654 of the Treasury and General Government Appropriations Act, 1999.
Advertisements, Credit unions, Share insurance, Signs and symbols.
For the reasons discussed above, the NCUA Board amends 12 CFR part 740 as follows:
12 U.S.C. 1766, 1781, 1785, and 1789.
(a) Each insured credit union must include the official advertising statement, prescribed in paragraph (b) of this section, in all of its advertisements, including on its main internet page, except as provided in paragraph (c) of this section.
(b)(1) The official advertising statement is in substance one of the following:
(i) This credit union is federally insured by the National Credit Union Administration;
(ii) Federally insured by NCUA;
(iii) Insured by NCUA; or
(iv) A reproduction of the official sign as described in § 740.4(b) may be used in lieu of the other statements included in this section. If the official sign is used as the official advertising statement, an insured credit union may alter the font size to ensure its legibility as provided in § 740.4(b)(2).
(2) The official advertising statement must be in a size and print that is clearly legible and may be no smaller than the smallest font size used in other portions of the advertisement intended to convey information to the consumer.
(c) * * *
(7) Advertisements by radio which do not exceed thirty (30) seconds in time;
(8) Advertisements by television, other than display advertisements, which do not exceed thirty (30) seconds in time;
Federal Energy Regulatory Commission.
Final rule.
The Federal Energy Regulatory Commission (Commission) approves Critical Infrastructure Protection (CIP) Reliability Standard CIP-003-7 (Cyber Security—Security Management Controls), submitted by the North American Electric Reliability Corporation (NERC). Reliability Standard CIP-003-7 clarifies the obligations pertaining to electronic access control for low impact BES Cyber Systems; requires mandatory security controls for transient electronic devices (
This rule will become effective June 25, 2018.
1. Pursuant to section 215 of the Federal Power Act (FPA),
2. In the NOPR, the Commission proposed to direct that NERC modify Reliability Standard CIP-003-7 to: (1) Provide clear, objective criteria for electronic access controls for low impact BES Cyber Systems; and (2) address the need to mitigate the risk of malicious code that could result from third-party transient electronic devices.
3. As discussed below, in view of the comments from NERC and others, we are persuaded that Reliability Standard CIP-003-7 provides a clear security objective that establishes compliance expectations. Accordingly, we do not adopt the proposed directive relating to electronic access controls for low impact BES Cyber Systems. Instead, as suggested in the comments, we direct NERC to conduct a study to assess the implementation of Reliability Standard CIP-003-7 to determine whether the electronic access controls adopted by responsible entities provide adequate security. NERC must submit the directed study within eighteen months of the effective date of Reliability Standard CIP-003-7.
4. With regard to the second issue discussed in the NOPR, we remain concerned that the proposed Reliability Standard lacks a clear requirement to mitigate the risk of malicious code that could result from third-party transient electronic devices. Accordingly, we direct NERC to develop a modification to the Reliability Standard to provide the needed clarity. Such modification will better ensure that registered entities clearly understand their mitigation obligations and, thus, improve individual entity mitigation plans and collectively improve the cybersecurity posture of the electric grid.
5. Section 215 of the FPA requires a Commission-certified Electric Reliability Organization (ERO) to develop mandatory and enforceable Reliability Standards, subject to Commission review and approval. Reliability Standards may be enforced by the ERO, subject to Commission oversight, or by the Commission independently.
6. The Commission approved the “Version 1” CIP Reliability Standards in January 2008, and subsequently acted on revised versions of the CIP Reliability Standards.
7. In addition, in Order No. 822, pursuant to section 215(d)(5) of the FPA, the Commission directed NERC,
8. On March 3, 2017, NERC submitted a petition seeking approval of Reliability Standard CIP-003-7 and the associated violation risk factors and violation severity levels, implementation plan and effective date. NERC states that Reliability Standard CIP-003-7 satisfies the criteria set forth in Order No. 672 that the Commission applies when reviewing a proposed Reliability Standard.
9. NERC states that Reliability Standard CIP-003-7 improves upon the existing protections that apply to low impact BES Cyber Systems. NERC avers that the proposed modifications address the Commission's directives from Order No. 822 by: (1) Clarifying electronic access control requirements applicable to low impact BES Cyber Systems; and (2) adding requirements for the protection of transient electronic devices used for low impact BES Cyber Systems. In addition, while not required by Order No. 822, NERC proposes a CIP Exceptional Circumstances policy for low impact BES Cyber Systems.
10. In response to the Commission's directive to develop modifications to eliminate ambiguity surrounding the term “direct” as it is used in the LERC definition, NERC proposes to: (1) Retire the terms LERC and LEAP from the NERC Glossary; and (2) modify Section 3 of Attachment 1 to Reliability Standard CIP-003-7 “to more clearly delineate the circumstances under which Responsible Entities must establish access controls for low impact BES Cyber Systems.”
11. With regard to the Commission's directive that NERC develop modifications to the CIP Reliability Standards to provide mandatory protection for transient electronic devices used at low impact BES Cyber Systems, NERC proposes to add a new section to Attachment 1 of Reliability Standard CIP-003-7 that requires responsible entities to include controls in their cyber security plans to mitigate the risk of the introduction of malicious code to low impact BES Cyber Systems that could result from the use of “Transient Cyber Assets or Removable Media.” Specifically, proposed Section 5 of Attachment 1 lists controls to be applied to Transient Cyber Assets and Removable Media that NERC contends “will provide enhanced protections against the propagation of malware from transient devices.”
12. NERC also proposes a modification that was not directed by the Commission in Order No. 822. Namely, NERC proposes revisions in Requirement R1 of Reliability Standard CIP-003-7 to require responsible entities to have a policy for declaring and responding to CIP Exceptional Circumstances related to low impact BES Cyber Systems.
13. NERC requests that Reliability Standard CIP-003-7 and the revised definitions of Transient Cyber Asset and Removable Media become effective the first day of the first calendar quarter that is eighteen months after the effective date of the Commission's order approving the Reliability Standard.
14. On October 19, 2017, the Commission issued a NOPR that proposed to approve Reliability Standard CIP-003-7. The NOPR proposed to determine that Reliability Standard CIP-003-7 is just, reasonable, not unduly discriminatory or preferential, and in the public interest and addresses the directives in Order No. 822 by: (1) Clarifying the obligations pertaining to electronic access control for low impact BES Cyber Systems; and (2) adopting mandatory security controls for transient electronic devices used at low impact BES Cyber Systems. In addition, the NOPR observed that, by requiring responsible entities to have a policy for declaring and responding to CIP Exceptional Circumstances for low impact BES Cyber Systems, Reliability Standard CIP-003-7 would align the treatment of low impact BES Cyber Systems with that of high and medium impact BES Cyber Systems, which currently include a requirement for declaring and responding to CIP Exceptional Circumstances. Therefore, the Commission proposed to approve Reliability Standard CIP-003-7 because the proposed modifications improve the base-line cybersecurity posture of responsible entities compared to the current Commission-approved CIP Reliability Standards.
15. In addition, the Commission proposed to direct that NERC develop modifications to Reliability Standard CIP-003-7 to addressed two issues: (1) Provide clear, objective criteria for electronic access controls for low impact BES Cyber Systems; and (2) address the need to mitigate the risk of malicious code that could result from third-party transient electronic devices. The Commission explained that modifications directed at these two concerns will address potential gaps and improve the cyber security posture of responsible entities that must comply with the CIP Reliability Standards.
16. The Commission received comments in response to the NOPR from Jonathan Appelbaum (Appelbaum), Electric Consumers Resource Council (ELCON), North American Electric Reliability Corporation (NERC), Transmission Access Policy Study Group (TAPS), and Trade Associations.
17. Pursuant to section 215(d)(2) of the FPA, we approve Reliability Standard CIP-003-7 as just, reasonable, not unduly discriminatory or preferential, and in the public interest. Reliability Standard CIP-003-7 addresses the directives in Order No. 822 and is an improvement over the currently-effective, Commission-
18. In addition, as discussed below, pursuant to section 215(d)(5) of the FPA, we adopt the NOPR proposal and direct NERC to develop modifications to the CIP Reliability Standards to mitigate the risk of malicious code that could result from third-party transient electronic devices. However, for the reasons discussed below, we determine not to adopt the NOPR proposal to direct NERC to develop criteria for electronic access controls for low impact BES Cyber Systems at this time.
19. Below, we discuss the following matters: (A) Criteria for electronic access controls for low impact BES Cyber Systems; (B) mitigation of the risk of malicious code associated with third-party transient electronic devices; and (C) implementation plan and effective date.
20. In the NOPR, the Commission proposed to direct NERC to develop modifications to Section 3 of Attachment 1 to Reliability Standard CIP-003-7 to provide clear, objective criteria for electronic access controls for low impact BES Cyber Systems.
21. The Commission observed that without clear, objective criteria or measures, auditors will not necessarily have adequate information to assess the reasonableness of the responsible entity's decision with respect to how the responsible entity identified necessary communications or restricted electronic access to specific low impact BES Cyber Systems. The Commission posited that absent such information, it is possible that an auditor could assess a violation where an entity adequately protected its low impact BES Cyber Systems or fail to recognize a situation where additional protections are necessary to meet the security objective of the Reliability Standard.
22. NERC acknowledges the NOPR concerns but comments that a directive “may not be necessary.”
23. NERC concludes that while the Commission's proposed directive may not be necessary and could potentially be an inefficient use of NERC and industry resources, “[a]rticulating objective criteria for electronic access controls for low impact BES Cyber Systems may improve clarity and auditability, and help ensure that entities implement effective electronic access controls.”
24. Trade Associations, TAPS and ELCON do not support the proposed directive, claiming that the proposal would impose additional burdens on registered entities without a corresponding reliability benefit. Trade Associations and TAPS contend that Section 3 of Attachment 1 to Reliability Standard CIP-003-7 gives responsible entities needed flexibility to develop and implement effective electronic access controls for low impact BES Cyber Systems. TAPS adds that Reliability Standard CIP-003-7 reflects what NERC, through the standard development process, “determined was a technically appropriate tailoring of electronic access controls requirements to low impact BES cyber systems.”
25. Further, Trade Associations assert that a risk-based approach is essential to allow responsible entities to focus their resources on assets that have a higher impact on bulk electric system reliability. ELCON adds that while it “appreciates the value establishing more tangible criteria for adequate Low-Impact BES Cyber System controls, . . . the additional requirements that the Commission proposes would do nothing to harden a Low-Impact facility against the rapid evolution in cyber warfare.”
26. Appelbaum supports the proposed directive regarding Section 3 of Attachment 1 to Reliability Standard CIP-003-7. Appelbaum notes that Reliability Standard CIP-003-7 “leaves the choice of controls to the [responsible entity] and leaves an Auditor with no requirement basis to perform an audit.”
27. We do not to adopt the proposed directive, but rather adopt the Trade Associations' recommendation for a study and report to be filed with the Commission. We are satisfied with the explanation of NERC and other commenters that Section 3 of Attachment 1 to Reliability Standard CIP-003-7 provides a clear security objective that establishes compliance expectations. Specifically, we are persuaded by commenters that Section 3 of Attachment 1 requires responsible entities to adopt security controls to permit only necessary inbound and outbound electronic access to Cyber Assets connected using a routable protocol to low impact BES Cyber Systems.
28. The concern raised in the NOPR focused on the lack of clear, objective criteria or measures to assess compliance with Reliability Standard CIP-003-7. As noted above, however, NERC states in its comments that responsible entities will be required to demonstrate that electronic access permissions and controls associated with low impact BES Cyber Systems are consistent with the stated security objective. NERC also clarifies that responsible entities will be required to “document the [business or operational] necessity of its inbound and outbound electronic access permissions and provide justification of the need for such access.”
29. In response to Appelbaum's comment that auditors will not have a common understanding on which to judge compliance across the ERO enterprise, in view of NERC's comments, we believe that NERC and the Regional Entities will have the ability to assess the effectiveness of a responsible entity's electronic access control plan as well as a responsible entity's adherence to its electronic access control plan.
30. Moreover, to ensure that the security controls are implemented and that Section 3 accomplishes its intended purpose, we adopt Trade Associations' proposal and direct NERC to conduct a study to assess the implementation of Reliability Standard CIP-003-7.
31. In the NOPR, the Commission proposed to direct NERC to develop modifications to proposed Section 5 of Attachment 1 to Reliability Standard CIP-003-7 to mitigate the risk of malicious code that could result from third-party transient electronic devices.
32. The Commission expressed concern that Reliability Standard CIP-003-7 may contain a reliability gap where a responsible entity contracts with a third-party but fails to mitigate potential deficiencies discovered in the third-party's malicious code detection and prevention practices prior to a transient electronic device being connected to a low impact BES Cyber System. The Commission explained that the reliability gap would result from the fact that Reliability Standard CIP-003-7 does not contain: (1) A requirement for the responsible entity to mitigate any malicious code found during the third-party review(s); or (2) a requirement that the responsible entity take reasonable steps to mitigate the risks of third party malicious code on its systems, if an arrangement cannot be made for the
33. Therefore, pursuant to section 215(d)(5) of the FPA, the Commission proposed to direct NERC to modify Reliability Standard CIP-003-7 to require responsible entities to implement controls to address the need to mitigate the risk of malicious code that could result from third-party transient electronic devices.
34. NERC states that it “agrees with the Commission that, should a Responsible Entity find that a third party's processes and practices for protecting its transient electronic devices inadequate, the Responsible Entity must be required to take mitigating action prior to connecting third-party transient electronic devices to a low impact BES Cyber System.”
35. Trade Associations and ELCON do not support the proposed directive. Trade Associations contend that “[a]lthough Section 5.2 [of Attachment 1 to CIP-003-7] does not explicitly require the responsible entity to mitigate the introduction of malicious code, risk mitigation is an explicit obligation under Section 5.”
Although the Supplemental Material does not create binding obligations on responsible entities, the text of the Supplemental Material in the Proposed Standard further clarifies and reinforces that the binding requirements found in CIP-003-7, Attachment 1, Section 5 include the obligation to take additional steps if a third-party's practices do not meet the security objective.
36. ELCON states that “the requirement for a Low-Impact BES Cyber System owner or operator to actively mitigate deficiencies in third party's anti-virus security programs
37. We adopt the NOPR proposal and, pursuant to section 215(d)(5) of the FPA, direct that NERC develop modifications to Reliability Standard CIP-003-7 to address our concern and ensure that responsible entities implement controls to mitigate the risk of malicious code that could result from third-party transient electronic devices. NERC could satisfactorily address the identified concern, for example, by modifying Section 5 of Attachment 1 to CIP-003-7 to clarify that responsible entities must implement controls to mitigate the risk of malicious code that could result from the use of third-party transient electronic devices.
38. The directed modification will improve the security posture of responsible entities by clarifying compliance expectations. While commenters claim that the provision is sufficiently clear and ask the Commission not to adopt the proposal, all commenters agree that there is not an explicit requirement to mitigate the threat of malicious code that could result from third-party transient electronic devices. While Trade Associations state that Section 5.2 of Attachment 1 does not explicitly require the mitigation of malicious code, Trade Associations and ELCON suggest that Section 5 generally requires risk mitigation. While commenters agree that, at least implicitly, the mitigation of malicious code is an obligation, the lack of a clear requirement could lead to confusion in both the development of a compliance plan and in the implementation of a compliance plan. In addition, although NERC contends that the proposed directive may not be necessary, NERC agrees that modifying Reliability Standard CIP-003-7 to address the mitigation of malicious code explicitly could clarify compliance obligations.
39. Therefore, pursuant to FPA section 215(d)(5), we direct NERC to develop and submit modifications to Reliability Standard CIP-003-7 to include an explicit requirement that responsible entities implement controls to mitigate the risk of malicious code that could result from third-party transient electronic devices.
40. In its petition, NERC requests an effective date for Reliability Standard CIP-003-7 and the revised definitions of Transient Cyber Asset and Removable Media on the first day of the first calendar quarter that is eighteen months after the effective date of the Commission's order approving the Reliability Standard. NERC explains that the implementation plan does not alter the previously-approved compliance dates for Reliability Standard CIP-003-6 other than the compliance date for Reliability Standard CIP-003-6, Requirement R2, Attachment 1, Sections 2 and 3, which
41. The NOPR proposed to approve NERC's implementation plan and effective date for Reliability Standard CIP-003-7. The Commission did not receive any comments regarding this aspect of the NOPR. Accordingly, we approve NERC's proposed implementation plan and effective date.
42. The FERC-725B information collection requirements contained in this Final Rule are subject to review by the Office of Management and Budget (OMB) under section 3507(d) of the Paperwork Reduction Act of 1995.
43. The Commission bases its paperwork burden estimates on the changes in paperwork burden presented by the proposed revision to CIP Reliability Standard CIP-003-7 as compared to the current Commission-approved Reliability Standard CIP-003-6. The Commission has already addressed the burden of implementing Reliability Standard CIP-003-6.
44. The NERC Compliance Registry, as of September 2017, identifies approximately 1,320 U.S. entities that are subject to mandatory compliance with Reliability Standards. Of this total, we estimate that 1,100 entities will face an increased paperwork burden under Reliability Standard CIP-003-7, estimating that a majority of these entities will have one or more low impact BES Cyber Systems. Based on these assumptions, we estimate the following reporting burden:
45. The
Legal (Occupation Code: 23-0000): $143.68
Electrical Engineer (Occupation Code: 17-2071): $68.12
Office and Administrative Support (Occupation Code: 43-0000): $40.89
($143.68 + $68.12 + $40.89) ÷ 3 = $84.23. The figure is rounded to $84.00 for use in calculating wage figures in this NOPR.
•
•
• The paperwork burden estimate includes costs associated with the initial development of a policy to address requirements relating to: (1) Clarifying the obligations pertaining to electronic access control for low impact BES Cyber Systems; (2) adopting mandatory security controls for transient electronic devices (
46.
47. 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:
48. For submitting comments concerning the collection(s) of information and the associated burden estimate(s), please send your comments to the Commission, and to the 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, phone: (202) 395-4638, fax: (202) 395-7285]. For security reasons, comments to OMB should be submitted by email to:
49. The Regulatory Flexibility Act of 1980 (RFA) generally requires a description and analysis of Final Rules that will have significant economic impact on a substantial number of small entities.
50. Of the 1,100 affected entities discussed above, we estimate that approximately 857 or 78 percent
51. Based on the above analysis, we certify that the approved Reliability Standard will not have a significant economic impact on a substantial number of small entities.
52. 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.
53. In addition to publishing the full text of this document in the
54. 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 of this document, excluding the last three digits, in the docket number field. 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
55. The Final Rule is effective June 25, 2018. The Commission has determined, with the concurrence of the Administrator of the Office of Information and Regulatory Affairs of OMB, that this rule is not a “major rule” as defined in section 351 of the Small
By the Commission.
Office of the Secretary, DoD.
Final rule.
This final rule removes one of the Department's two DoD-level regulations concerning the implementation of and assignment of responsibilities for the DoD Freedom of Information Act (FOIA) program. Any content required to be in an agency's FOIA rule from this part was incorporated into the Department's other DoD-level regulation concerning the DoD FOIA program, which was recently revised and for which a final rule published on February 6, 2018. Therefore, this part can now be removed from the CFR.
Additionally, the revised DoD-level FOIA rule now includes DoD component FOIA program information, which eliminated the requirement for component supplementary rules. Accordingly, all of the department's necessary FOIA public guidance has been incorporated into a single part.
This rule is effective on April 25, 2018.
James Hogan at 571-372-0462.
It has been determined that publication of this CFR part removal for public comment is impracticable, unnecessary, and contrary to public interest because any public-facing guidance from this part was incorporated into another CFR part for which public comment has already been taken. Any internal guidance from this part will continue to be published in DoD Directive 5400.07 available at
With the finalization of the DoD-level FOIA rule at 32 CFR part 286, the Department is eliminating the need for this separate DoD-level FOIA rule and reducing costs to the public as explained in the preamble of the revised DoD-level FOIA rule at 32 CFR part 286 published at 83 FR 5196-5197.
This rule is not significant under Executive Order (E.O.) 12866, “Regulatory Planning and Review,” therefore, E.O. 13771, “Reducing Regulation and Controlling Regulatory Costs” does not apply.
Freedom of information.
Coast Guard, DHS.
Notice of deviation from drawbridge regulation.
The Coast Guard has issued a temporary deviation from the operating schedule that governs the Rock Island Railroad and Highway Drawbridge across the Upper Mississippi River, mile 482.9, at Rock Island, Illinois. The deviation is necessary to facilitate the Quad City Heart Walk. This deviation allows the bridge to remain in the closed-to-navigation position for approximately two and a half (2.5) hours on one day until the race is completed.
This deviation is effective from 8:30 a.m. through 11 a.m. on May 19, 2018.
The docket for this deviation, [USCG-2018-0325] is available at
If you have questions on this temporary deviation, call or email Mr. Eric A. Washburn, Bridge Administrator, Western Rivers, Coast Guard; telephone 314-269-2378, email
The U.S. Army Rock Island Arsenal, owner and operator of the Rock Island Railroad and Highway Drawbridge, across the Upper Mississippi River, mile 482.9, at Rock Island, Illinois, requested a temporary deviation from the current operating schedule to accommodate the Quad City Heart Walk. The bridge has a vertical clearance of 23.8 feet above normal pool in the closed-to-navigation position. This bridge is governed by 33 CFR 117.5.
This deviation allows the bridge to remain in the closed-to-navigation position from 8:30 a.m. through 11 a.m. on May 19, 2018. Navigation on the waterway consists primarily of commercial tows and recreational watercraft. This temporary deviation has been coordinated with waterway users. No objections were received.
Vessels able to pass through the bridge in the closed position may do so at any time. The bridge will not be able to open for emergencies and there are no alternate routes for vessels transiting this section of the Upper Mississippi River. The Coast Guard will inform users of the waterways through our Local and Broadcast Notices to Mariners of the change in operating schedule for the bridge so the vessel operators can arrange their transits to minimize any impact caused by this temporary deviation.
In accordance with 33 CFR 117.35(e), the drawbridge must return to its regular operating schedule immediately at the end of the effective period of this temporary deviation. This deviation from the operating regulations is authorized under 33 CFR 117.35.
Postal Service
Final rule.
The Postal Service announces the issuance of the
This final rule is effective on April 25, 2018. The incorporation by reference of the IMM is approved by the Director of the Federal Register as of April 25, 2018.
Lizbeth Dobbins, (202) 268-3789.
The
Foreign relations, Incorporation by reference.
In view of the considerations discussed above, the Postal Service hereby amends 39 CFR part 20 as follows:
5 U.S.C. 552(a); 13 U.S.C. 301-307; 18 U.S.C. 1692-1737; 39 U.S.C. 101, 401, 403, 404, 407, 414, 416, 3001-3011, 3201-3219, 3403-3406, 3621, 3622, 3626, 3632, 3633, and 5001.
(a) Section 552(a) of title 5, U.S.C., relating to the public information requirements of the Administrative Procedure Act, provides in pertinent part that matter reasonably available to the class of persons affected thereby is deemed published in the
(b) * * *
The provisions of the
Postal Service
Final rule.
The Postal Service announces the issuance of the
This final rule is effective on April 25, 2018.
The incorporation by reference of the DMM dated March 5, 2018, is approved by the Director of the Federal Register as of April 25, 2018.
Lizbeth Dobbins (202) 268-3789.
The most recent issue of the
Changes to mailing standards will continue to be published through
Administrative practice and procedure, Incorporation by reference.
In view of the considerations discussed above, the Postal Service hereby amends 39 CFR part 111 as follows:
5 U.S.C. 552(a); 13 U.S.C. 301-307; 18 U.S.C. 1692-1737; 39 U.S.C. 101, 401, 403, 404, 414, 416, 3001-3011, 3201-3219, 3403-3406, 3621, 3622, 3626, 3632, 3633, and 5001.
(f) * * *
Environmental Protection Agency (EPA)
Final rule.
The Environmental Protection Agency (EPA) is approving a revised state plan (the “plan”) submitted by the North Dakota Department of Health (the “Department”) for the regulation of existing commercial and industrial solid waste incineration (CISWI) units within the jurisdiction of the State of North Dakota. The Department submitted the plan to the EPA for approval following the promulgation of federal new source performance standards (NSPS) and emission guidelines (EG) for CISWI units on March 21, 2011, and the subsequent, limited revisions to that final rule published on February 7, 2013, and June 23, 2016. This plan approval final rulemaking action is being taken in accordance with sections 111(d) and 129 of the Clean Air Act (CAA, or the “Act”).
This final rule is effective on May 25, 2018.
The EPA has established a docket for this action under Docket ID No. EPA-R08-OAR-2017-0698. All documents in the docket are listed on the
Gregory Lohrke, Air Program, U.S. Environmental Protection Agency (EPA), Region 8, Mail Code 8P-AR, 1595 Wynkoop Street, Denver, Colorado 80202-1129, (303) 312-6396,
Sections 111 and 129 of the CAA outline the EPA's statutory authority for regulating new and existing solid waste incineration units. Section 111(b) directs the EPA Administrator (the “Administrator”) to publish and periodically revise a list of source categories which significantly cause or contribute to air pollution. This subsection also directs the Administrator to establish federal standards of performance for new sources within these categories. Section 111(d) grants the EPA statutory authority to require states to submit to the agency implementation plans for establishing performance standards applicable to existing sources belonging to those categories established in section 111(b). Section 129 of the CAA specifically addresses solid waste combustion and requires that the EPA regulate new and existing waste incineration units pursuant to section 111 of the Act, including the requirement that a state in which existing designated facilities operate, submit for approval, a state plan for each category of regulated waste incineration units. Section 129(b)(3) requires the EPA to promulgate a federal plan for existing waste incineration units of any designated category located in any state which has not submitted an approvable 111(d)/129 state plan for said category of waste incineration units. Such federal plans remain in effect until the state in question submits a new or revised state plan and subsequently receives approval and promulgation of the plan under 40 CFR part 62.
State plan submittals under CAA sections 111(d) and 129 must be consistent with the relevant new or revised EG. Section 129(a)(1)(D) of the Act requires the EPA to develop and periodically revise operating standards for new and existing CISWI units. The original NSPS and EG for CISWI units were promulgated on December 1, 2000, at 40 CFR part 60, subparts CCCC and DDDD, respectively. Revisions to the CISWI NSPS and EG were subsequently promulgated by the EPA on March 21, 2011 (76 FR 15704), with final actions on reconsideration of the rule published on February 7, 2013 (78 FR 9112), and June 23, 2016 (81 FR 40956). State plan requirements specific to CISWI units, along with a model rule to ease adoption of the EG, are found in subpart DDDD, while more general state plan requirements are found in 40 CFR part 60, subpart B, and part 62, subpart A. The guidelines found in subpart DDDD require that states impose emission limits on designated facilities for those pollutants regulated under section 129, including: dioxins/furans, carbon monoxide, metals (cadmium, lead and mercury), hydrogen chloride, sulfur dioxide, oxides of nitrogen, opacity and particulate matter. The EG also requires that state plans include essential elements pursuant to section 129 requirements, including monitoring, operator training and facility permitting requirements.
On June 12, 2014, the Department submitted to the EPA a revised section 111(d)/129 state plan for existing CISWI units in the State of North Dakota. The current state plan received final approval and was promulgated on September 17, 2003 (68 FR 54374), at 40 CFR part 62, subpart JJ. Pursuant to each state's obligations following the revision of the CISWI rule, the State of North Dakota has revised their state rulemaking, and has submitted a revised state plan document as well as a demonstration of legal and enforcement authority to comply with CAA section 111/129 requirements.
The EPA has completed a review of the revised North Dakota section 111(d)/129 state plan for existing CISWI units. The EPA has determined that the plan submittal meets the requirements found in 40 CFR part 60, subparts B and DDDD, and those of part 62, subpart A of that title. Accordingly, the EPA is approving the submitted revised plan as proposed.
This rule will be finalized as proposed without revisions. The EPA received five anonymous public comments on the proposed approval of the revised North Dakota CISWI state plan. After reviewing the comments, the EPA has determined that the comments are outside the scope of our proposed action or fail to identify any material issue necessitating a response. All public comments received on this rulemaking action are available for review by the public and may be viewed by following the instructions for access to docket materials as outlined in the
The EPA is approving North Dakota's amended section 111(d)/129 state plan for existing CISWI units. The North Dakota state plan requirements being approved today are at least as stringent as the requirements for existing CISWI units found in 40 CFR part 60, subpart DDDD. Therefore, the EPA is amending 40 CFR part 62, subpart JJ to reflect the approved revisions to North Dakota's previously approved, current CISWI state plan. The EPA is limiting the scope of the plan approval to the provisions of 40 CFR parts 60 and 62 for existing CISWI units, as found in the EG at 40 CFR part 60, subpart DDDD. The Administrator retains the authorities as listed under 40 CFR 60.2542 and 60.2030(c).
Under the CAA, the Administrator is required to approve a section 111(d)/129 plan submission that complies with the provisions of the Act and applicable federal regulations. Thus, in reviewing section 111(d)/129 plan submissions, the EPA's role is to approve state choices, provided that they meet the criteria of the CAA and are not specifically disapproved. Accordingly, this action merely finalizes approval of 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 expected to be an Executive Order 13771 regulatory action because this action is not significant 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 CAA; and,
• Is not subject to Executive Order 12898 (59 FR 7629, February 16, 1994) because it does not establish an environmental health or safety standard.
In addition, this final rule 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 CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by
Environmental protection, Air pollution control, Commercial and industrial solid waste incineration, Intergovernmental relations, Reporting and recordkeeping requirements.
For the reasons stated in the preamble, the EPA amends 40 CFR part 62 as set forth below:
42 U.S.C. 7401
North Dakota “Amended Section 111(d)/129 Plan for Commercial and Industrial Solid Waste Incineration Units,” and the associated State regulation as it is incorporated in the North Dakota Administrative Code under the State's Standards of Performance for New Stationary Sources, Chapter 33-15-12-02, subpart DDDD. The plan and associated regulation were submitted by the State on June 12, 2014.
The amended plan applies to each existing commercial and industrial solid waste incinerator unit and air curtain incinerator in the State of North Dakota that commenced construction on or before June 4, 2010, or commenced modification or reconstruction after
The federally enforceable effective date of the amended section 111(d)/129 plan for commercial and industrial solid waste incineration units is May 25, 2018.
Environmental Protection Agency (EPA).
Final rule.
This regulation establishes tolerances for residues of chlormequat chloride in or on multiple commodities which are identified and discussed later in this document. Taminco US LLC, a subsidiary of Eastman Chemical Company requested these tolerances under the Federal Food, Drug, and Cosmetic Act (FFDCA).
This regulation is effective April 25, 2018. Objections and requests for hearings must be received on or before June 25, 2018, and must be filed in accordance with the instructions provided in 40 CFR part 178 (see also Unit I.C. of the
The docket for this action, identified by docket identification (ID) number EPA-HQ-OPP-2016-0661, is available at
Michael Goodis, Registration Division (7505P), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave. NW, Washington, DC 20460-0001; main telephone number: (703) 305-7090; email address:
You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:
• Crop production (NAICS code 111).
• Animal production (NAICS code 112).
• Food manufacturing (NAICS code 311).
• Pesticide manufacturing (NAICS code 32532).
You may access a frequently updated electronic version of EPA's tolerance regulations at 40 CFR part 180 through the Government Printing Office's e-CFR site at
Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2016-0661 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before June 25, 2018. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).
In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2016-0661, by one of the following methods:
•
•
•
Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at
In the
Based upon review of the data supporting the petition, EPA has modified the levels at which some of the tolerances are being established as well as the commodities for which tolerances are being established. The reasons for
Section 408(b)(2)(A)(i) of FFDCA allows EPA to establish a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) of FFDCA requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue. . . .”
Consistent with FFDCA section 408(b)(2)(D), and the factors specified in FFDCA section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure for chlormequat chloride including exposure resulting from the tolerances established by this action. EPA's assessment of exposures and risks associated with chlormequat chloride follows.
EPA has evaluated the available toxicity data and considered its validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children.
Decreases in body weight and signs of neurotoxicity (
There was no quantitative or qualitative susceptibility observed in the offspring compared to the adult animals in the rat and rabbit developmental studies and the rat two-generation reproduction study.
No systemic toxicity was observed in the 21-day dermal study in rabbits when tested up to the limit dose. Dermal irritation and histopathological lesions of the treated skin (acanthosis, subacute inflammation and edema) was observed at 345 mg/kg/day in female rabbits only. No immunotoxicity study was available; however, no evidence of immunotoxicity was observed in the chlormequat chloride database.
Carcinogenicity studies in mice and rats did not demonstrate potential signs of carcinogenicity and chlormequat chloride was non-mutagenic in four genotoxicity studies. Therefore, chlormequat chloride is classified as “Not Likely to be a Carcinogen to Human” based on the lack of evidence of carcinogenicity.
Specific information on the studies received and the nature of the adverse effects caused by chlormequat chloride as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies can be found at
Once a pesticide's toxicological profile is determined, EPA identifies toxicological points of departure (POD) and levels of concern to use in evaluating the risk posed by human exposure to the pesticide. For hazards that have a threshold below which there is no appreciable risk, the toxicological POD is used as the basis for derivation of reference values for risk assessment. PODs are developed based on a careful analysis of the doses in each toxicological study to determine the dose at which no adverse effects are observed (the NOAEL) and the lowest dose at which adverse effects of concern are identified (the LOAEL). Uncertainty/safety factors are used in conjunction with the POD to calculate a safe exposure level—generally referred to as a population-adjusted dose (PAD) or a reference dose (RfD)—and a safe margin of exposure (MOE). For non-threshold risks, the Agency assumes that any amount of exposure will lead to some degree of risk. Thus, the Agency estimates risk in terms of the probability of an occurrence of the adverse effect expected in a lifetime. For more information on the general principles EPA uses in risk characterization and a complete description of the risk assessment process, see
A summary of the toxicological endpoints for chlormequat chloride used for human risk assessment is shown in Table 1 of this unit.
1.
i.
Such effects were identified for chlormequat chloride. In estimating acute dietary exposure, EPA used food consumption information from the U.S. Department of Agriculture's National Health and Nutrition Examination Survey, What We Eat in America, (NHANES/WWEIA). As to residue levels in food, EPA assumed tolerance-level residues and 100 percent crop treated (PCT).
ii.
iii.
iv.
2.
Based on the First Index Reservoir Screening Tool (FIRST) and Screening Concentration in Ground Water (SCI-GROW) models, the estimated drinking water concentrations (EDWCs) of chlormequat chloride for acute exposures are estimated to be 2574 parts per billion (ppb) for surface water and 24 ppb for ground water and for chronic exposures are estimated to be 91 ppb for surface water and 24 ppb for ground water.
Modeled estimates of drinking water concentrations were directly entered into the dietary exposure model. For the acute dietary risk assessment, the water concentration value of 2574 ppb was used to assess the contribution to drinking water. For the chronic dietary risk assessment, the water concentration of value 91 ppb was used to assess the contribution to drinking water.
3.
Chlormequat chloride is not registered for any specific use patterns that would result in residential exposure.
4.
EPA has not found chlormequat chloride to share a common mechanism of toxicity with any other substances, and chlormequat chloride does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that chlormequat chloride does not have a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see EPA's website at
1.
2.
3.
i. The toxicity database for chlormequat chloride is complete.
ii. Although a subchronic neurotoxicity study is not available, evidence of neurotoxicity was observed in the acute neurotoxicity, developmental rat, two-generation reproduction and chronic dog studies. However, there is a low degree of concern for the potential neurotoxic effects of chlormequat chloride because clear no observed adverse effect levels (NOAELs) were identified for the neurotoxic effects, and the endpoints chosen for risk assessment are protective of any potential neurotoxicity.
iii. There is no evidence that chlormequat chloride results in increased susceptibility in
iv. There are no residual uncertainties identified in the exposure databases. The dietary food exposure assessments were performed based on 100 PCT and tolerance-level residues. EPA made conservative (protective) assumptions in the ground and surface water modeling used to assess exposure to chlormequat chloride in drinking water. These assessments will not underestimate the exposure and risks posed by chlormequat chloride.
EPA determines whether acute and chronic dietary pesticide exposures are safe by comparing aggregate exposure estimates to the acute PAD (aPAD) and chronic PAD (cPAD). For linear cancer risks, EPA calculates the lifetime probability of acquiring cancer given the estimated aggregate exposure. Short-, intermediate-, and chronic-term risks are evaluated by comparing the estimated aggregate food, water, and residential exposure to the appropriate PODs to ensure that an adequate MOE exists.
1.
2.
3.
Short- and intermediate-term adverse effects were identified; however, chlormequat chloride is not registered for any use patterns that would result in either short- or intermediate-term residential exposure. Short- and intermediate-term risk is assessed based on short- and intermediate-term residential exposure plus chronic dietary exposure. Because there is no short- or intermediate-term residential exposure and chronic dietary exposure has already been assessed under the appropriately protective cPAD (which is at least as protective as the POD used to assess short-term risk), no further assessment of short- or intermediate-term risk is necessary, and EPA relies on the chronic dietary risk assessment for evaluating short- and intermediate-term risk for chlormequat chloride.
4.
5.
The method may be requested from: Chief, Analytical Chemistry Branch, Environmental Science Center, 701 Mapes Rd., Ft. Meade, MD 20755-5350; telephone number: (410) 305-2905; email address:
In making its tolerance decisions, EPA seeks to harmonize U.S. tolerances with international standards whenever possible, consistent with U.S. food safety standards and agricultural practices. EPA considers the international maximum residue limits (MRLs) established by the Codex Alimentarius Commission (Codex), as required by FFDCA section 408(b)(4). The Codex Alimentarius is a joint United Nations Food and Agriculture Organization/World Health Organization food standards program, and it is recognized as an international food safety standards-setting organization in trade agreements to which the United States is a party. EPA may establish a tolerance that is different from a Codex MRL; however, FFDCA section 408(b)(4) requires that EPA explain the reasons for departing from the Codex level.
The Codex has established MRLs for chlormequat chloride in or on the commodities referenced in this document at the same levels as the tolerances established for chlormequat chloride in this rule.
Two comments were received in response to the notice of filing. One noted that “these are of a highly technical nature and should be written in a format that the layperson can understand.” The other comment stated that “there should not be ANY residue of chlormequat chloride on ANY commodity, ever.”
The first comment does not materially impact this establishment of these tolerances. Concerning the second comment, although the Agency recognizes that some individuals believe that pesticides should be banned on agricultural crops, the existing legal framework provided by section 408 of the Federal Food, Drug and Cosmetic Act (FFDCA) authorizes EPA to establish tolerances when it determines that the tolerance is safe. Upon consideration of the validity, completeness, and reliability of the available data as well as other factors the FFDCA requires EPA to consider, EPA has determined that these chlormequat chloride tolerances are safe. The commenter has provided no information supporting a contrary conclusion.
The petitioner requested tolerances for several animal commodities in addition to the barley, oat, and wheat grain tolerances. The Agency has determined that tolerances are only needed on meat and meat byproducts to cover the liver and kidney tissues. In addition, based on residue data and using the Organisation for Economic Cooperation and Development calculator, the Agency is establishing tolerances for the barley, oat, and wheat grain commodities at levels that harmonize with Codex MRLs. In addition, EPA is revising the commodity terminology used by the petitioner to be consistent with the commodity vocabulary EPA uses for establishing tolerances.
Therefore, tolerances are established for residues of chlormequat chloride, in or on barley, grain at 2.0 ppm; cattle, meat byproduct at 0.50 ppm; cattle, meat at 0.20 ppm; egg at 0.10 ppm; goat, meat byproduct at 0.50 ppm; goat, meat at 0.20 ppm; hog, meat byproduct at 0.50 ppm; hog, meat at 0.20 ppm; milk at 0.50 ppm; oat, grain at 10 ppm; poultry, meat byproduct at 0.10 ppm; poultry, meat at 0.04 ppm; sheep, meat byproduct at 0.50 ppm; sheep, meat at 0.20 ppm; and wheat, grain at 3.0 ppm.
This action establishes tolerances under FFDCA section 408(d) in response to a petition submitted to the Agency. The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled “Regulatory Planning and Review” (58 FR 51735, October 4, 1993). Because this action has been exempted from review under Executive Order 12866, this action is not subject to Executive Order 13211, entitled “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001) or Executive Order 13045, entitled “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997), nor is it considered a regulatory action under Executive Order 13771, entitled “Reducing Regulations and Controlling Regulatory Costs” (82 FR 9339, February 3, 2017). This action does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA) (44 U.S.C. 3501
Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601
This action directly regulates growers, food processors, food handlers, and food retailers, not States or tribes, nor does this action alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of FFDCA section 408(n)(4). As such, the Agency has determined that this action will not have a substantial direct effect on States or tribal governments, on the relationship between the national government and the States or tribal governments, or on the distribution of power and responsibilities among the various levels of government or between the Federal Government and Indian tribes. Thus, the Agency has determined that Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999) and Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 9, 2000) do not apply to this action. In addition, this action does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act (UMRA) (2 U.S.C. 1501
This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to section 12(d) of the National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note).
Pursuant to the Congressional Review Act (5 U.S.C. 801
Environmental protection, Administrative practice and procedure, Agricultural commodities, Pesticides and pests, Reporting and recordkeeping requirements.
Therefore, 40 CFR chapter I is amended as follows:
21 U.S.C. 321(q), 346a and 371.
(a)
(b)
(c)
(d)
Federal Emergency Management Agency, DHS.
Final rule.
Base (1% annual-chance) Flood Elevations (BFEs) and modified BFEs are made final for the communities listed below. The BFEs and modified BFEs are the basis for the floodplain management measures that each community is required either to adopt or to show evidence of being already in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP).
The date of issuance of the Flood Insurance Rate Map (FIRM) showing BFEs and modified BFEs for each community. This date may be obtained by contacting the office where the maps are available for inspection as indicated in the table below.
The final BFEs for each community are available for inspection at the office of the Chief Executive Officer of each community. The respective addresses are listed in the table below.
Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 400 C Street SW, Washington, DC 20472, (202) 646-7659, or (email)
The Federal Emergency Management Agency (FEMA) makes the final determinations listed below for the modified BFEs for each community listed. These modified elevations have been published in newspapers of local circulation and ninety (90) days have elapsed since that publication. The Deputy Associate Administrator for Mitigation has resolved any appeals resulting from this notification.
This final rule is issued in accordance with section 110 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and 44 CFR part 67. FEMA has developed criteria for floodplain management in floodprone areas in accordance with 44 CFR part 60.
Interested lessees and owners of real property are encouraged to review the proof Flood Insurance Study and FIRM available at the address cited below for each community. The BFEs and modified BFEs are made final in the communities listed below. Elevations at selected locations in each community are shown.
Administrative practice and procedure, Flood insurance, Reporting and recordkeeping requirements.
Accordingly, 44 CFR part 67 is amended as follows:
42 U.S.C. 4001
Federal Communications Commission.
Announcement of effective date.
In this document, the Federal Communications Commission (Commission) announces that the Office of Management and Budget (OMB) has approved the information collection requirements associated with the Commission's Report and Order, Reporting Requirements for U.S. Providers of International Services; 2016 Biennial Review of Telecommunications Regulations, FCC 17-136. This document is consistent with the Report
Sections 0.457(d)(1)(xi), 1.767(g)(13) through (16), 43.62, 43.82, 63.10(c)(2), 63.21(d), and 63.22(e), (h), and (i), published at 82 FR 55323, November 21, 2017, are effective on April 25, 2018.
Cathy Williams by email at
This document announces that on March 28, 2018 and April 3, 2018, OMB approved the information collection requirements contained in the Commission's Report and Order, FCC 17-136, published at 82 FR 55323. The OMB Control Numbers are 3060-0686 and 3060-1156. The Commission publishes this document as an announcement of the effective date of those information collection requirements.
The foregoing notice is required by the Paperwork Reduction Act of 1995, Public Law 104-13, October 1, 1995, and 44 U.S.C. 3507.
The total annual reporting burdens and costs for the respondents are as follows:
The frequency of filing applications pursuant to Sections 214 will be determined largely by the applicant seeking to provide U.S. international common carrier service under section 214 of the Communications Act, 47 U.S.C. 214. Carriers will also determine largely the frequency of filing under the other rules included in this collection, with the exception of the quarterly reports required of certain carriers under 47 CFR 63.10(c) and the list of routes for which a facilities-based international service provider must make a one-time filing and update as necessary under 47 CFR 63.22(h). If the collections are not conducted or are conducted less frequently, applicants will not obtain the authorizations necessary to provide telecommunications services, and the Commission will be unable to carry out its mandate under the Communications Act of 1934. In addition, without the information collections, the United States would jeopardize its ability to fulfill the U.S. obligations as negotiated under the World Telecommunications Organization (WTO) Basic Telecom Agreement because these collections are imperative to detecting and deterring anticompetitive conduct. They are also necessary to preserve the Executive Branch agencies' and the Commission's ability to review foreign investments for national security, law enforcement, foreign policy, and trade concerns. Regarding 47 CFR 63.11, carriers determine largely when to notify the Commission of planned investments by or in foreign carriers. If the information is not collected by the Commission, we will not be able to prevent carriers that control bottleneck facilities in foreign countries from using those bottlenecks to discriminate against unaffiliated U.S. carriers.
The circuit capacity reports are comprised of two parts. First, licensees of a submarine cable extending between the United States and a foreign point as of December 31 of the reporting period report the available capacity and planned capacity of the cable—the cable operators report. Second, each cable landing licensee and common carrier that holds capacity on the U.S. end of a submarine cable extending between the United States and a foreign point as of December 31 of the reporting period (“capacity holders”) reports its available capacity on the U.S. end of every submarine cable between the United States and any foreign point on which it holds capacity as of that date—the capacity holders report. A holding of capacity is an interest in the U.S. end of an international submarine cable through cable ownership, an indefeasible right of use (IRU), or an inter-carrier lease (ICL).
The Commission uses the circuit capacity data for such purposes as analyzing international transport markets in merger reviews. More importantly, these data are essential for our national security and public safety responsibilities in regulating communications, an important linchpin of the Commission's statutory authority. Submarine cables are critical infrastructure and the circuit capacity data are important for the Commission's contributions to the national security and defense of the United States. The Commission uses the data, for example, to have a complete understanding of the ownership and use of submarine cable capacity and to assist in the protection, restoration, and resiliency of the infrastructure during national security or public safety emergencies, such as hurricanes. The Department of Homeland Security (DHS) filed comments stating that it also finds this information to be critical to its national and homeland security functions, and states that this information, when combined with other data sources, is used to protect and preserve national security and for its emergency response purposes.
There are no alternative reliable third party commercial sources for the reported data. Although some sources collect general capacity information from cable owners, neither the FCC nor DHS has found any alternative sources for capacity holder data. Commercial source data may include capacity information, but the data are not verified by company officials and do not include capacity holder data. Although the Commission obtains the ownership and location of individual cables through the licensing process, distribution of a cable's capacity among providers is not required to be reported under our current submarine cable licensing rules and is provided only annually through the Circuit Capacity Reports. Further, the Commission's licensing rules do not require an applicant to include the entities that have acquired capacity on the cable through an IRU or ICL.
The Registration Form provides basic information about the filing and about the entity itself—such as address, phone number, email address, and the international Section 214 authorizations and cable landing licenses held by the filer. This information will assist in keeping track of who holds international circuit capacity and how to contact them. The Registration Form also includes a certification by the filing entity to certify the accuracy and completeness of its report. The Registration Form provides the means by which the filing entity may request confidential treatment of the data filed in the report.
The Filing Manual sets forth instructions on how to file the reports.
Federal Communications Commission.
Final rule; announcement of effective date.
In this document, the Commission announces that the Office of Management and Budget (OMB) has approved, for a period of three years, an information collection requirement associated with the Implementation of the NET 911 Improvement Act of 2008: Location Information from Owners and Controllers of 911 and E911 Capabilities Report and Order (
47 CFR 9.7(a), published at 74 FR 31860, July 6, 2009, is effective April 25, 2018.
Brenda Boykin, Policy and Licensing Division, Public Safety and Homeland Security Bureau at (202) 418-2062 or
A summary of the
As required by the Paperwork Reduction Act of 1995 (44 U.S.C. 3507), the FCC is notifying the public that it received final OMB approval on December 3, 2009, for the information collection requirement contained in the Commission's rule at 47 CFR 9.7(a).
Under 5 CFR part 1320, an agency may not conduct or sponsor a collection of information unless it displays a current, valid OMB Control Number.
No person shall be subject to any penalty for failing to comply with a collection of information subject to the Paperwork Reduction Act that does not display a current, valid OMB Control Number. The OMB Control Number is 3060-1131.
The foregoing notice is required by the Paperwork Reduction Act of 1995, Public Law 104-13, October 1, 1995, and 44 U.S.C. 3507.
The total annual reporting burdens and costs for the respondents are as follows:
Federal Communications Commission.
Final rule; petition for reconsideration.
In this document, the Federal Communications Commission (Commission) resolves the remaining petitions for reconsideration regarding the requirements for Mobility Fund Phase II (MF-II). The Commission revises the language of its rule for collocation, and reduces the value of the letter of credit that a Mobility Fund Phase II support recipient is required to hold after the Universal Service Administration Company (USAC), together with the Commission, has verified that the MF-II support recipient has achieved significant progress toward completing their buildout and service provision requirements. The Commission affirms its Mobility Fund Phase II rules in all other respects.
Effective May 25, 2018, except for the amendment to § 54.1016 (a)(1)(ii), which contains information collection requirements that have not been approved by OMB. The Commission will publish a document in the
Wireless Telecommunications Bureau, Auction and Spectrum Access Division, Audra Hale-Maddox, at (202) 418-0660. For further information concerning the Paperwork Reduction Act information collection requirements contained in this document, contact Cathy Williams at (202) 418-2918 or via the internet at
This is a summary of the Commission's Second Order on Reconsideration (
As required by the Regulatory Flexibility Act of 1980, the Commission has prepared a Supplemental Final Regulatory Flexibility Analysis (FRFA) of the possible significant economic impact on small entities of the policies and rules adopted in this document. The Supplemental FRFA is set forth in an appendix to the
The
The Commission will send a copy of this
1. In the
2. In February 2017, the Commission adopted rules to move forward expeditiously to an MF-II auction. The Commission established a budget of $4.53 billion to be disbursed monthly over a term of ten years to provide ongoing support for the provision of service in areas that lack adequate mobile voice and broadband coverage absent subsidies. The Commission further decided that geographic areas lacking unsubsidized, qualified 4G LTE service would be deemed “eligible areas” for MF-II support, and that it would use a competitive bidding process (specifically, a reverse auction) to distribute funding to providers to serve those areas. The Commission also decided that, prior to an MF-II auction, it would compile a list of areas that were presumptively eligible for MF-II support and it would provide a limited timeframe for challenges to areas that were found to be ineligible for support during the pre-auction process.
3. Seven petitions were filed seeking reconsideration of the
4. We now resolve the remaining issues raised by petitioners. We grant the requests of petitioners, insofar as we amend the rules to apply the collocation requirement for MF-II recipients to “all newly constructed” towers. We affirm our decision to require that MF-II recipients obtain a letter of credit (LOC), but grant the petitions insofar as we modify the LOC requirements to align our MF-II rules with recent changes made in the Connect America Fund Phase II (CAF-II) proceeding. These modifications should provide MF-II support recipients with some additional relief from the costs of maintaining an LOC and alleviate some of the concerns raised by petitioners and commenters. Additionally, for the reasons explained below, we deny the petitions seeking reconsideration of the Commission's decisions to: (i) Establish an MF-II budget of $4.53 billion over a term of ten years; (ii) disburse annual support on a monthly basis; (iii) adopt performance metrics for supported networks requiring a median data speed of 10/1 megabits per second (Mbps) and data latency of 100 milliseconds (ms) round trip; (iv) not adopt bidding credits for the auction; and (v) not prevent MF-II support recipients from entering into equipment exclusivity arrangements. We also decline to clarify or limit the role of the Universal Service Administrative Company (USAC) in testing winning bidders' compliance with MF-II performance metrics, public interest obligations, or other program requirements.
5. First, we clarify that the MF-II collocation rule, 47 CFR 54.1015(f), should require a recipient of MF-II funds to allow for reasonable collocation by other providers of services that meet the technological requirements of MF-II on all towers that the MF-II recipient owns or manages that it “newly constructed” to satisfy MF-II performance obligations in the areas for which it receives support. The Commission stated its intent to adopt the same collocation and voice and data roaming obligations for MF-II winning bidders as it had adopted for MF-I. However, the rule in MF-I required reasonable collocation by other providers of services that met the technological requirements of MF-I on “all newly constructed towers that the recipient owns or manages in the area for which it receives support,” while the language of the rule adopted in the
6. We affirm the Commission's decision to require an MF-II recipient to obtain an LOC before it begins receiving support disbursements, but we modify the Commission's rules to provide some additional relief from the burden
7. In the
8. We are convinced by claims of petitioners and commenters that the Commission's existing MF-II LOC requirements may warrant additional relief on reconsideration. We continue to conclude that MF-II bidders will take into account the costs associated with program requirements, including an LOC, as they formulate their bids, and that many bidders can do so without the consequences alleged by some petitioners and commenters. We nonetheless recognize that the costs associated with maintaining an LOC may pose a greater financial burden on those bidders that lack the resources of larger, more established companies. Such bidders may have to factor relatively higher LOC-related costs into their bids. One purpose of using competitive bidding to select support recipients is that it promotes providing support to those parties that can accomplish the MF-II program goals in the most cost-effective manner. However, we recognize that the exact cost of any requirement, including obtaining and maintaining an LOC, will affect each prospective bidder in the MF-II auction differently. A bidder's LOC-related costs will likely vary based on the amount of support that it is authorized to receive, and the impact of those costs on the bidder will also vary based on its size and creditworthiness. Thus, we cannot reasonably predict the costs of our LOC requirements for each potential winning bidder and weigh them relative to the benefit to the public of protecting the funds from default. The fees associated with maintaining an LOC can range by several percentage points and, when applied to the sizable amounts of support that may be awarded to bidders here, the costs may become substantial over time, particularly for winning bidders that are small businesses and new entrants.
9. Accordingly, consistent with the rule modifications we recently adopted in the
10. By increasing the amount by which an LOC may be reduced after verification that an MF-II recipient has met a significant portion of its performance obligations, we can provide MF-II recipients with a measure of relief from the costs of maintaining an LOC without posing undue risks to the Universal Service Fund. As the Commission stated in the
11. We are not, however, persuaded by arguments that we should eliminate the requirement for an MF-II recipient to obtain an LOC because they are unnecessary to protect the public interest. Our obligation to safeguard the disbursement of universal service support justifies requiring an LOC and outweighs the limited burden incurred by winning bidders. For this same reason, we are not convinced by the contentions that an MF-II LOC requirement is unnecessary for rural telephone companies based on their history of providing service and using
12. Similarly, we disagree with the assertion that the Commission should eliminate the LOC requirement and instead ensure the security of program funds by imposing a monetary forfeiture on the defaulting MF-II recipient or using the threat of revocation or non-renewal of its licenses as leverage to demand repayment of the funds. The exercise of our forfeiture, revocation, and licensing authority requires additional procedures and standards that are not well suited to the prompt action required in enforcing our milestones because, among other reasons, such authority does not effectively address the regulatory purpose behind our adoption of the LOC—making the Universal Service Fund whole if a support recipient failed to fulfill its MF-II performance requirements. Without an LOC, the Commission has no security to protect itself against the risks of default. Accordingly, we affirm the Commission's prior conclusion that the LOC requirement is necessary to ensure the recovery of a significant amount of MF-II support should such a need arise, and we find that, on balance, our commitment to fiscal responsibility supports the limited burden faced by support recipients.
13. We also decline to grant requests in the petitions for reconsideration to take further steps to modify our LOC requirements. In the
14. In reviewing arguments regarding the costs of maintaining an LOC, we also emphasize that the Commission's LOC requirements already include an incentive for a recipient to meet its final performance milestone as soon as possible, because once it has been verified that a support recipient has met its final performance milestone, the recipient can further reduce costs by no longer maintaining that LOC. In this regard, we note that the Commission provided in the
15. We affirm the MF-II total budget amount of $4.53 billion that the Commission adopted in the
16. We are not persuaded that we should reconsider that decision and base the MF-II budget on carriers' projected costs for deployment as some parties advocate. Phase II of the Mobility Fund is a considerable departure from the prior method of distributing CETC funding, and we anticipate that a $4.53 billion budget, distributed in a more efficient and targeted manner, will lead to significant expansion and improvement in the provision of mobile voice and broadband services to areas that would otherwise be underserved or unserved without support. After the Commission has the opportunity to evaluate the impact of the MF-II auction, it can determine whether additional funding (and if so, how much) is needed. Furthermore, while we believe that the total budget of $4.53 billion will be sufficient to address a more targeted set of eligible areas, we reiterate thatMF-II is only one component of our broader universal service reform efforts, and we need not wait until the end of the MF-II support term to determine if additional funding is necessary.
17. Moreover, the proposal to base the MF-II budget on carriers' projected costs for providing service to all census blocks throughout the U.S. unserved by 4G LTE fails to address the Commission's long-standing commitment to fiscal responsibility and would be inconsistent with extensive 4G LTE deployment through private investment in recent years. As a responsible steward of the Universal Service Fund, the Commission adopted a budget that reflected its priorities in allocating finite funds to areas of
18. Recognizing that the Universal Service Fund is limited, the Commission has consistently determined the amount of the MF-II budget by starting with the amount of existing CETC support, subtracting the support going to areas where support is not needed, and redirecting that amount to the areas in need. By weighing the need to distribute support to areas that would otherwise be unserved against the burden that consumers and businesses must bear by contributing to the Universal Service Fund, the Commission has demonstrated a commitment to fiscal responsibility while acknowledging that its efforts are needed to supplement private investment. Taking this type of balanced approach has been previously upheld by the Tenth Circuit Court of Appeals, which noted that, in challenging the sufficiency of the MF-II budget, the petitioners in
19. For similar reasons, we further conclude that the claim that the amount of the MF-II budget is not supported by data related to coverage needs is equally flawed. While it is true that, for the reasons explained above, the Commission did not base the amount of its MF-II budget upon carrier cost deployment data, it did use data regarding the provision of service to eligible areas when establishing the budget. Specifically, the Commission relied on a 2016 analysis by the Wireless Telecommunications Bureau (Wireless Bureau) of mobile broadband providers, which revealed that, conservatively, three quarters of support currently distributed to mobile providers is being directed to areas where it is not needed. Moreover, the Wireless Bureau's analysis showed that, as of 2016, 1.4 million people in the U.S. have no LTE coverage and another 1.7 million live in areas where LTE coverage is provided only on a subsidized basis, so that 3.1 million people (or approximately 1 percent of the U.S. population) live in areas with no LTE or only subsidized LTE. Thus, staff analysis of data regarding the provision of service revealed that, despite extensive private investment spurring 4G LTE deployment generally, certain areas remain unserved without government subsidies, which the Commission took into consideration when it chose to reallocate current CETC support and derive greater coverage from the limited amount of funding.
20. In addition, to ensure that the MF-II support is directed specifically to areas that lack unsubsidized qualifying 4G LTE coverage, we have adopted a challenge process that is administratively efficient and fiscally responsible, and will enable us to resolve eligible area disputes quickly and expeditiously, so that limited funds are focused on the areas that need it the most. As part of the challenge process, we have also undertaken a new, one-time collection of standardized, up-to-date 4G LTE coverage data from mobile wireless providers. These actions, taken together with the use of competitive bidding to distribute support, will focus MF-II funds on areas that lack unsubsidized qualified 4G LTE service, thereby providing additional funds for those targeted areas that warrant such funding. These actions also will ensure the budget is used to minimize service disparities between rural and urban areas, while continuing our obligation to be a fiscally responsible steward of universal service funding. Therefore, we decline to revise the MF-II budget at this time.
21. We decline to alter the Commission's monthly disbursement schedule for MF-II. The Commission, in deciding to provide support in monthly disbursements as it had adopted for the CAF program, including CAF-II, reasoned that such an approach would provide MF-II recipients with reliable and predictable support payments that conform to a variety of business cycles. We are not persuaded that, instead of monthly disbursements of MF-II support to winning bidders, the program should provide larger installment payments early in the construction process that are more closely matched to some providers' expected outlays. Although the Commission recognized that some MF-II support recipients might incur higher up-front project costs, it also observed that the timing of project expenses varies. Thus, it is administratively burdensome, if not impossible, for the Commission, USAC, and the winning bidders to try to match payments to expenses in a manner that would synchronize precisely with the budgetary needs of all bidders. Further, the Commission observed that, in Mobility Fund Phase I (MF-I), even with support payments based on deployment milestones, disbursements were not tied to the timing of expenditures, as petitioners request. A shift to a front-loaded disbursement mechanism or a cost reimbursement process, as requested by petitioners, would place undue strains on the universal service budget, and would thereby undermine the ability of the Commission to ensure continued program compliance over the entire10-year term. We note that the Commission also purposefully aligned its disbursement schedule with the schedule adopted for CAF-II, which established regular and predictable monthly payments that would not exceed the budget in any one year of the term. We believe that this approach best balances the burdens on the Commission and USAC with the budgetary needs of recipients.
22. We also decline to reconsider the minimum baseline performance requirements for recipients of MF-II funding. In the
23. We are not persuaded that the minimum baseline performance requirement for median data speeds should be reduced to
24. Similarly, with respect to latency, the Commission has noted that latency is important for a variety of real-time, interactive applications, including Voice over internet Protocol (VoIP), video calling, and distance learning, which “may be effectively unusable over high latency connections, regardless of the download/upload speeds being offered.” Contrary to petitioner's assertion that the Commission failed to account for the inherent differences between wireless and wireline technologies in adopting the 100 ms latency standard, the Commission established the performance metrics, including latency, to ensure reasonably comparable service. According to petitioner's own data analysis, the majority (approximately 75 percent) of existing networks already meet the 100 ms standard with 90 percent probability in Metropolitan Statistical Areas (MSAs). Further, technological improvements, including newly available 600 MHz spectrum, will likely enable more carriers to exceed this performance requirement in the near future. Thus, reducing the performance benchmark for data latency to 220 ms would risk relegating rural areas to a lower standard of service that is not comparable to urban 4G LTE service, which includes support for advanced mobile applications. Accordingly, in light of the statutory mandate with respect to reasonably comparable service, we affirm that the minimum baseline performance requirement for data latency is that at least 90 percent of all required measurements must be at or below 100 ms round trip.
25. We decline to reconsider the Commission's decision not to adopt bidding preferences for the MF-II auction. In the
26. We reject petitioners' claims that the Commission has a statutory obligation under section 309(j) of the Act to promote small business and rural carrier participation in the universal service context. The Commission's authority to award universal service support through competitive bidding is not derived from section 309(j), which authorizes the use of competitive bidding for granting spectrum licenses or construction permits, not for reverse auctions to award universal service funding. Moreover, even in spectrum auctions, where section 309(j) does apply, the Commission does not always provide bidding credits, and courts have held that the statutorily prescribed objectives in section 309(j)(3) are not mandatory. Additionally, the Commission's primary goal in using competitive bidding in MF-II is to maximize the impact of the funding to increase and preserve mobile coverage. Since bidding preferences for any entities (be they small businesses or rural service providers) would hamper that goal by effectively decreasing the number of eligible areas covered by the finite level of funding, the Commission chose not to award bidding preferences in lieu of greater coverage. Accordingly, we are not persuaded that section 309(j) obligates us to overlook this concern and adopt bidding preferences for the MF-II auction.
27. Likewise, we reject petitioner's assertion that the Commission should not have factored into its decision for
28. We dismiss a provider's request to impose a new certification requirement on all MF-II support recipients that they do not and will not participate in equipment exclusivity arrangements. The petition relies on comments that the provider filed in this proceeding in 2014; however, those 2014 comments make no reference to exclusivity arrangements. Thus, to the extent that the provider raises this argument for the first time in its Petition, we dismiss it as untimely. Further, in its 2012
29. We decline to limit USAC's role in testing winning bidders' compliance with MF-II performance metrics, public interest obligations, or other program requirements as requested by a provider. We find no merit in contentions that we should limit USAC's responsibility for conducting compliance reviews in order to ensure a cost-efficient process.
30. In the
31. In the case of MF-I, USAC's compliance reviews did not entail duplication of a recipient's drive tests as the petitioner contends, but rather verification of data transmission rates and transmission latency for a statistically valid random sample of a small portion of the total road miles for which a recipient claimed it was entitled to a support payment. Although the petitioner argues that USAC's role was redundant because USAC's drive tests ultimately validated the data the provider had already submitted forMF-I, we are not persuaded by the petitioner's claim that the benefits of USAC compliance review testing in the context of MF-I were outweighed by the time and expense spent conducting such testing. We decline to draw a conclusion about the overall value of USAC's compliance testing based only on the experience of one MF-I participant. Further, we find it lacking in logic to argue that it serves no purpose to attempt to verify, even by sampling, recipients' compliance with program requirements, merely because some recipients have been found, through such testing, to be in compliance. Compliance reviews, like audits, are an essential tool for the Commission and USAC to ensure program integrity and to detect and deter waste, fraud, and abuse. Therefore, we will not limit USAC's role in verifying the data that recipients submit to demonstrate compliance with our MF-II coverage requirements.
32. This
33. In this present document, we have assessed the effects of the modifications that the Commission is making to the letter of credit rule and the collocation rule adopted by the Commission in the
34. The Commission will send a copy of the
35. As required by the Regulatory Flexibility Act of 1980, as amended (RFA), the Commission prepared Initial Regulatory Flexibility Analyses (IRFAs) in connection with the
36. The
37. There were no comments filed that specifically addressed the IRFAs that are relevant to the issues discussed here.
38. 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 Small Business Administration (SBA), and to provide a detailed statement of any change made to the proposed rules as a result of those comments.
39. The Chief Counsel did not file any comments in response to the proposed rules in this proceeding.
40. 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 rules adopted herein. 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.
41. As noted above, FRFAs were incorporated into the
42. We expect the amended rules in the Second Order on Reconsideration will not impose any new or additional reporting or recordkeeping or other compliance obligations on small entities and, as described below, will reduce their costs.
43. 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 or reporting requirements under the rule for small entities; (3) the use of performance, rather than design, standards; and (4) and exemption from coverage of the rule, or any part thereof, for small entities.”
44. The Commission has taken steps which will minimize the economic impact on small entity MF-II recipients because we recognize that the costs associated with maintaining an LOC may pose a greater financial burden on those bidders that lack the resources of larger, more established companies. Such bidders may have to factor relatively higher LOC-related costs into their bids. One purpose of using competitive bidding to select support recipients however is that it promotes providing support to those parties that can accomplish the MF-II program goals in the most cost-effective manner. Therefore, in the
45. The Commission will send a copy of the
46. Accordingly,
• The parameters set forth in the
• The Petition for Reconsideration and/or Clarification filed by Rural Wireless Association, Inc. on April 12, 2017, is granted in part and denied in part to the extent described herein.
• The Petition for Reconsideration filed by Blooston Rural Carriers on April 27, 2017, is granted in part and denied in part to the extent described herein.
• The Petition for Reconsideration filed by Rural Wireless Carriers on April 27, 2017, is granted in part and denied in part to the extent described herein.
• The Petition for Reconsideration filed by T-Mobile USA, Inc. on April 27, 2017, is denied to the extent described herein.
• The Petition for Reconsideration filed by Buffalo-Lake Erie Wireless Systems L.L.C. dba Blue Wireless on April 27, 2017, is granted in part and denied in part to the extent described herein.
• The Commission's Consumer and Governmental Affairs Bureau, Reference Information Center, shall send a copy of the
Communications common carriers, internet, Reporting and recordkeeping requirements, Telecommunications.
For the reasons discussed in the preamble, the Federal Communications Commission amends 47 CFR part 54 as follows:
47 U.S.C. 151, 154(i), 155, 201, 205, 214, 219, 220, 254, 303(r), 403, and 1302 unless otherwise noted.
(f)
(a) * * *
(1) * * *
(ii) Once the recipient has met its 80 percent service milestone as described in § 54.1015(c) of this chapter, it may, subject to the consent of the Universal Service Administrative Company, obtain a new letter of credit or renew its existing letter of credit so that it is valued at a minimum at 60 percent of the total support amount already disbursed plus the amount that will be disbursed in the coming year.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Temporary rule; commercial trip limit reduction.
NMFS issues this temporary rule to reduce the commercial trip limit for vermilion snapper in or from the exclusive economic zone (EEZ) of the South Atlantic to 500 lb (227 kg), gutted weight, 555 lb (252 kg), round weight. This trip limit reduction is necessary to protect the South Atlantic vermilion snapper resource.
This rule is effective 12:01 a.m., local time, April 26, 2018, until 12:01 a.m., local time, July 1, 2018.
Mary Vara, NMFS Southeast Regional Office, telephone: 727-824-5305, email:
The snapper-grouper fishery in the South Atlantic includes vermilion snapper and is managed under the Fishery Management Plan for the Snapper-Grouper Fishery of the South Atlantic Region (FMP). The South Atlantic Fishery Management Council prepared the FMP. The FMP is implemented by NMFS under the authority of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act) by regulations at 50 CFR part 622.
The commercial ACL (commercial quota) for vermilion snapper in the South Atlantic is divided among two 6-month fishing seasons, January through June and July through December. For the January 1 through June 30, 2018, fishing season, the commercial quota is 388,703 lb (176,313 kg), gutted weight, 431,460 lb (195,707 kg), round weight (50 CFR 622.190(a)(4)(i)(D)).
Under 50 CFR 622.191(a)(6)(ii), NMFS is required to reduce the commercial trip limit for vermilion snapper from 1,000 lb (454 kg), gutted weight, 1,110 lb (503 kg), round weight, to 500 lb (227 kg), gutted weight, 555 lb (252 kg), round weight, when 75 percent of the applicable commercial quota is reached or projected to be reached, by filing a notification to that effect with the Office of the Federal Register, as established by Regulatory Amendment 18 to the FMP (78 FR 47574; August 6, 2013). Based on current information, NMFS has determined that 75 percent of the available commercial quota for the January 1 through June 30, 2018, fishing season for vermilion snapper will be reached by April 26, 2018. Accordingly, NMFS is reducing the commercial trip limit for vermilion snapper to 500 lb (227 kg), gutted weight, 555 lb (252 kg),
The Regional Administrator, Southeast Region, NMFS, has determined this temporary rule is necessary for the conservation and management of South Atlantic vermilion snapper and is consistent with the Magnuson-Stevens Act and other applicable laws.
This action is taken under 50 CFR 622.191(a)(6)(ii) and is exempt from review under Executive Order 12866.
These measures are exempt from the procedures of the Regulatory Flexibility Act because the temporary rule is issued without opportunity for prior notice and comment.
This action responds to the best scientific information available. The Assistant Administrator for Fisheries, NOAA (AA), finds that the need to immediately implement this commercial trip limit reduction constitutes good cause to waive the requirements to provide prior notice and opportunity for public comment pursuant to the authority set forth in 5 U.S.C. 553(b)(B), because prior notice and opportunity for public comment on this temporary rule is unnecessary and contrary to the public interest. Such procedures are unnecessary because the rule establishing and providing for a reduction in the commercial trip limit has already been subject to notice and comment, and all that remains is to notify the public of the commercial trip limit reduction. Providing prior notice and opportunity for public comment is contrary to the public interest because any delay in reducing the commercial trip limit could result in the commercial quota being exceeded. There is a need to immediately implement this action to protect the vermilion snapper resource, since the capacity of the fishing fleet allows for rapid harvest of the commercial quota. Providing prior notice and opportunity for public comment on this action would require time and increase the likelihood that the commercial sector could exceed its quota.
For the aforementioned reasons, the AA also finds good cause to waive the 30-day delay in the effectiveness of this action under 5 U.S.C. 553(d)(3).
16 U.S.C. 1801
Office of Energy Efficiency and Renewable Energy, Department of Energy.
Notification of petition for rulemaking; request for comment.
On March 26, 2018, the Department of Energy (DOE) received a petition from the Association of Home Appliance Manufacturers (AHAM) to withdraw, and immediately stay the effectiveness of, the conventional cooking top test procedure. Through this notification, DOE seeks comment on the petition, as well as any data or information that could be used in DOE's determination whether to proceed with the petition.
Written comments and information are requested on or before June 25, 2018.
Interested persons are encouraged to submit comments, identified by “Test Procedure Cooking Products Petition,” by any of the following methods:
Celia Sher, U.S. Department of Energy, Office of the General Counsel, 1000 Independence Avenue SW, Washington, DC 20585. E-mail:
The Administrative Procedure Act (APA), 5 U.S.C. 551 et seq., provides among other things, that “[e]ach agency shall give an interested person the right to petition for the issuance, amendment, or repeal of a rule.” (5 U.S.C. 553(e)) DOE received a petition from AHAM, as described in this document and set forth verbatim below,
In its petition, AHAM requests that DOE undertake rulemaking to withdraw the cooking top test procedure, while maintaining the repeal of the oven test procedure that was part of the Final Rule. And, in the interim, AHAM seeks an immediate stay of the effectiveness of the Final Rule, including the requirement that manufacturers use the final test procedure to make energy related claims. Should DOE continue to pursue a revised cooking top test procedure, AHAM asserts that DOE should address repeatability and reproducibility and demonstrate, through round robin testing, that the test is repeatable and reproducible and, for gas cooking tops, accurate. AHAM claims that its analyses show that the test procedure is not representative for gas cooking tops and, for gas and electric cooking tops, has such a high level of variation it will not produce accurate results for certification or enforcement purposes and will not assist consumers in making purchasing decisions based on energy efficiency.
Although DOE welcomes comments on any aspect of the petition for reconsideration, DOE is particularly interested in receiving comments and views of interested parties concerning the following issues:
(1) The repeatability and reproducibility of the test procedure for conventional electric and gas cooking tops. DOE previously presented results from round robin testing completed by the Department and by IEC in the docket of the test procedure rulemaking. DOE seeks comments on that data as well as the new data AHAM has supplied supporting its petition;
(2) The accuracy of determining the simmer setting and turndown temperature;
(3) The impact of heating element cycling during the initial heat-up phase of testing on the overall measured energy consumption of electric cooking tops, and the prevalence of such cycling in units available on the market.
(4) The extent of any warpage which may have been observed at the bottom surface of test vessels during cooking top testing;
(5) The impact of varying gas burner and grate systems on the representativeness of the water-heating test method for gas cooking tops;
(6) The type of control system, heating element, and other product redesigns necessitated by changes in safety standards for electric cooking tops, and the impact of these new product designs on the repeatability, reproducibility, and representativeness of the electric cooking product test procedure;
(7) Characteristics of a representative test sample for electric and gas cooking tops for use in any additional round robin testing to evaluate the applicability of the test procedure to the conventional cooking top market as a whole;
(8) Information on how consumers cook differently on gas cooktops versus electric cooktops;
(9) Information on how consumers use the simmer setting on a gas cooktop; and,
(10) The test burden associated with the test procedure for conventional electric and gas cooking tops, including the ability of testing laboratories to meet the required ambient test conditions.
DOE invites all interested parties to submit in writing by June 25, 2018 comments and information regarding this petition.
Submitting comments via
However, your contact information will be publicly viewable if you include it in the comment or in any documents attached to your comment. Any information that you do not want to be publicly viewable should not be included in your comment, nor in any document attached to your comment. Persons viewing comments will see only first and last names, organization names, correspondence containing comments, and any documents submitted with the comments.
Do not submit to
DOE processes submissions made through
Submitting comments via hand delivery, or mail. Comments and documents via hand delivery or mail will also be posted to
Include contact information in your cover letter each time you submit comments, data, documents, and other information to DOE. If you submit via mail or hand delivery, please provide all items on a CD, if feasible. It is not necessary to submit printed copies. No facsimiles (faxes) will be accepted.
Comments, data, and other information submitted electronically should be provided in PDF (preferred), Microsoft Word or Excel, WordPerfect, or text (ASCII) file format. Provide documents that are not secured, written in English and free of any defects or viruses. Documents should not include any special characters or any form of encryption and, if possible, they should carry the electronic signature of the author.
Campaign form letters. Please submit campaign form letters by the originating organization in batches of between 50 to 500 form letters per PDF or as one form letter with a list of supporters' names compiled into one or more PDFs. This reduces comment processing and posting time.
Confidential Business Information. According to 10 CFR 1004.11, any person submitting information that he or she believes to be confidential and exempt by law from public disclosure should submit via email, postal mail, or hand delivery two well-marked copies: One copy of the document marked confidential including all the information believed to be confidential, and one copy of the document marked non-confidential with the information believed to be confidential deleted. Submit these documents via email or on a CD, if feasible. DOE will make its own determination about the confidential status of the information and treat it according to its determination.
Factors of interest to DOE when evaluating requests to treat submitted information as confidential include (1) a description of the items, (2) whether and why such items are customarily treated as confidential within the industry, (3) whether the information is generally known by or available from other sources, (4) whether the information has previously been made available to others without obligation concerning its confidentiality, (5) an explanation of the competitive injury to the submitting person which would result from public disclosure, (6) when such information might lost its confidential character due to the passage of time, and (7) why disclosure of the information would be contrary to the public interest.
It is DOE's policy that all comments may be included in the public docket, without change and as received, including any personal information provided in the comments (except information deemed to be exempt from public disclosure).
DOE considers public participation to be a very important part of its process for considering rulemaking petitions. DOE actively encourages the participation and interaction of the public during the comment period. Interactions with and between members of the public provide a balanced discussion of the issues and assist DOE in determining how to proceed with a petition. Anyone who wishes to be added to DOE mailing list to receive future notifications and information about this petition should contact Appliance and Equipment Standards Program staff at (202) 586-6636 or via email at
The Secretary of Energy has approved publication of this notification of petition for rulemaking.
In the Matter of: Energy Conservation Program: Test Procedures for Cooking Products
The Association of Home Appliance Manufacturers (AHAM) respectfully
AHAM believes that, overall, the adoption of a water-boil test procedure for cooking products is the appropriate procedure. And we thank DOE for making changes to its earlier proposed test procedure which would have used a hybrid block after AHAM demonstrated the practical difficulties associated with that test. But DOE adopted a final cooktop test procedure too hastily, especially in light of comments AHAM submitted that demonstrated the test's lack of repeatability and reproducibility and questioned the use of a test procedure meant for electric cooktops for gas cooktops. AHAM has evaluated the Final Rule and conducted additional testing on gas cooktops. Our analyses show that the test procedure is not representative for gas cooktops and, for gas and electric cooktops, has such a high level of variation
AHAM thus requests that DOE withdraw the cooktop test procedure. And, in the interim, we seek an immediate stay of the effectiveness, including the requirement that manufacturers use the final test procedure to make energy related claims, of the cooktop test procedure. Should DOE continue to pursue an improved cooktop test procedure, DOE should address repeatability and reproducibility and demonstrate, through round robin testing, that the test is repeatable and reproducible and, for gas cooktops, representative.
DOE began revisions to the cooktop test procedure with a notice of proposed rulemaking on January 30, 2013 (January 2013 NOPR) in which DOE proposed amendments to Appendix I to subpart B of 10 C.F.R. part 430 (Appendix I) that would allow for the measuring of active mode energy consumption of induction cooking products. Specifically, DOE proposed to require the use of test equipment—hybrid test blocks comprised of an aluminum body and a stainless steel base—compatible with induction technology.
AHAM objected to DOE's proposed amendments to the test procedure because the amendments did not enhance the accuracy and/or representativeness of the test procedure.
In response to stakeholder comments, DOE published a supplemental notice of proposed rulemaking modifying its proposal. 79 Fed. Reg. 71894 (Dec. 3, 2014) (December 2014 SNOPR). DOE's modified proposal maintained a hybrid test block approach despite AHAM's comments. DOE proposed to add a layer of thermal grease between the stainless steel base and aluminum body of the hybrid test block to facilitate heat transfer between the two pieces, and DOE proposed additional test equipment for electric surface units with large diameters and gas cooking top burners with high input rates.
AHAM's comments on the December 2014 SNOPR raised serious concerns about the hybrid test blocks and the thermal grease.
Based on comments it received in response to the December 2014 SNOPR and a series of manufacturer interviews DOE conducted in February and March 2015, DOE subsequently withdrew its proposal for testing conventional cooktops with a hybrid test block in yet another supplemental notice of proposed rulemaking. 81 Fed. Reg. 57374 (Aug. 22, 2016) (August 2016 SNOPR). In the August 2016 SNOPR, DOE instead proposed to modify its procedure to incorporate by reference the relevant sections of EN 60350-2:2013 “Household electric cooking appliances Part 2: Hobs—Methods for measuring performance,” which uses a water-heating test method to measure energy consumption of electric cooktops. Despite the fact that the EN test procedure DOE cited applies only to electric cooktops, DOE also proposed to extend that method to gas cooktops.
AHAM generally agreed and continues to agree with DOE that the best test method for cooktops is a water boil test and supported DOE's abandoning of the hybrid test block method.
Prior to DOE proposing a water-heating test, AHAM conducted a round robin based on the Second Edition of IEC 60350-2 (2015), Household Electric Cooking Appliances—Part 2: Hobs—Methods for Measuring Performance.
Based on that testing, AHAM commented that a significant amount of work remained to be done to finalize a test and to demonstrate that the final test is repeatable and reproducible.
• Lack of a tolerance on staying “as close as possible” to 90° C;
• Variability in energy consumption during the simmering phase;
• Variability in determining the turn down temperature;
• Variability in determining the turn down setting;
• Unit cycling;
• Specifying a temperature sensor for measuring the water temperature;
• A proposal to use a moving average for calculating the final result;
• Limited suppliers of test pots;
• No tool or tolerance specified for cooktop diameter measurement;
• Test pots do not accommodate all grate designs;
• Difficulty with placement of pots on gas cooktops;
• Impact of gas burner system, geometry, spacing, and grates on repeatability and reproducibility;
• Impact of using the electric test pots on gas cooktops; and
• Overshoot temperature of the water can reach beyond 90° C for some gas cooktops.
In response to AHAM's comments, DOE sent AHAM a request for data on September 27, 2016. That data request was voluminous and overlapped with the comment period on the proposed standards for cooking products—which ended on November 2, 2016—and DOE proposed in parallel with the August 2016 SNOPR.
The Final Rule adopted DOE's proposed test procedure with some changes DOE believed would improve repeatability and reproducibility. In support of the final test procedure, DOE conducted additional testing. DOE conducted testing of five electric cooktops incorporating different heating technologies and control types. For each unit, DOE conducted testing on surface units capturing a range of heating element sizes. DOE conducted two to three tests per surface unit. For each individual test, DOE performed the full surface unit test method, including the preliminary test required to determine the turndown temperature and simmering setting for a given surface unit. DOE varied test operators for surface unit tests, but did not conduct testing in different laboratories. In addition, DOE included test results from previous tests of these units conducted in support of the August 2016 SNOPR. DOE relied on that minimal data to determine that the final test procedure, finalized only two months after DOE received voluminous comments from AHAM concerning a lack of repeatability and reproducibility as demonstrated through 27 tests on three units at three different laboratories.
The Energy Policy and Conservation Act of 1975, as amended (EPCA) requires that test procedures be reasonably designed to produce test results which measure energy efficiency, energy use, or estimated annual operating cost of a covered product during a representative average use cycle and shall not be unduly burdensome to conduct. 42 U.S.C. § 6293(b)(3). This requirement is meaningless if the test procedure is not repeatable and reproducible—only a repeatable and reproducible test procedure can produce accurate results that DOE can rely on for certification and verification purposes and that consumers can rely on to compare energy use or efficiency across products.
AHAM appreciates that DOE made changes from the August 2016 SNOPR to the Final Rule in an attempt to address AHAM's September 21, 2016 comments. AHAM also appreciates that DOE conducted additional testing to further assess the proposed and final test procedure. But DOE did not take the time or do the work necessary to finalize a test procedure that fully or satisfactorily addresses the significant issues AHAM raised in its comments or the data AHAM provided in response to DOE's request. This is further demonstrated based on additional testing and analysis AHAM conducted after the Final Rule was published.
DOE did not support the Final Rule with sufficient data to demonstrate that it is accurate, repeatable, and reproducible. More specifically, as discussed more fully below:
□ DOE has not demonstrated that the test procedure is representative for gas products. DOE did not demonstrate that its deviation from the international approach—testing gas cooktops using a different procedure than is used for testing electric cooktops—was warranted or would produce accurate, representative results. And DOE tested only a small sample that cannot be representative of the many different types of gas models on the market and the result is that the test may not adequately address the different systems available to consumers. Thus, DOE has not demonstrated that the test procedure is representative or accurate for gas products.
□ DOE's testing of electric and gas cooktops was insufficient to evaluate repeatability and reproducibility and, thus, DOE's conclusions are based on results with a low confidence level which is highlighted by AHAM's conflicting results. Accordingly, DOE did not produce sufficient evidence to demonstrate that its test procedure is supported by data.
□ Although DOE tried to address variation by requiring recording of the simmering setting selection, AHAM's testing demonstrates that that requirement does not in fact reduce variation.
□ Although DOE attempted to clarify when the simmering period starts, DOE's clarification does not adequately reduce variation.
□ DOE improperly dismissed unit cycling's contribution to variation.
□ DOE did not account for the fact that electric coil cooktops are currently undergoing significant redesign to comply with voluntary safety standards. It is possible that the new products will not respond the same way to the test.
□ DOE did not investigate the impact of pan warpage on test results. Initial data from a study done for AHAM shows pan warpage will contribute to variation.
□ Based on data from a round robin AHAM conducted with gas cooktops, the test procedure is not repeatable or reproducible for gas cooktops. Within unit and between unit variation also contributes to the total variation and DOE has not accounted for it.
In addition, the test procedure is unduly burdensome to conduct. Based on AHAM's experience to date, it takes on average 20 hours to conduct a single test on a four burner cooktop and requires the testing of every single
Because the final test procedure may not be representative for gas products and is not repeatable or reproducible for either gas or electric cooktops, it does not accurately measure cooktop energy efficiency and will not allow consumers to compare products on that basis. Thus, because the test is also unduly burdensome to conduct, the cooktop test procedure as a whole does not meet EPCA's statutory requirement that test procedures be reasonably designed to produce representative results and are not unduly burdensome to conduct. Moreover, because DOE did not support the conclusions in the Final Rule with sufficient data, DOE's Final Rule could be determined to be arbitrary and capricious. Accordingly, AHAM respectfully requests that DOE withdraw the Final Rule amending the cooktop test procedure. And, in the interim, we seek an immediate stay of the effectiveness, including the requirement that manufacturers use the final test procedure to make energy related claims, of the Final Rule.
In the August 2016 SNOPR, DOE proposed to extend the electric test procedure in EN 60350-2:2013 “Household electric cooking appliances Part 2: Hobs—Methods for measuring performance” to gas cooktops. AHAM commented in its September 21, 2016 comments that there is no consumer data on the consumer representativeness of that method for gas cooktops. AHAM noted that DOE's proposal, and now Final Rule, is not harmonized with the European approach, which uses a different test procedure and different test pots to test gas cooktops. DOE's methodology is also different than ASTM F152, “Standard Test Methods for Performance of Range Tops,” which DOE reviewed during the test procedure rulemaking and is used by the commercial range industry. DOE dismissed ASTM F1521 because of the BTU range for commercial range tops, and AHAM is not arguing that it is the appropriate procedure for residential products. But the science behind the test setup in ASTM is similar to the EN gas test procedure which demonstrates that
Accordingly, no manufacturer or third party test laboratory—in the U.S., Europe, or elsewhere in the world—had experience with DOE's proposed test procedure for gas cooktops other than DOE's minimal testing in one laboratory prior to the publishing of the Final Rule. Thus, neither DOE nor manufacturers have knowledge of whether this test will be representative for gas products. Accordingly, DOE does not have the necessary data to justify the use of this method on gas cooktops in the United States, especially in light of the fact that Europe uses a different approach.
In fact, AHAM believes that the evidence supports the opposite conclusion—i.e., that the cooktop test procedure is not representative for gas cooktops. The EN and ASTM standards use a different test procedure for gas cooktops and do so for good reason. Unlike electric cooktops, gas cooktops utilize a system approach—every component and design choice is connected to other components and design choices and they work together. The cooking heat out to the pot depends on the design of the burner, flow of gas, mass of the grate, and height of the grate from the burner.
Gas testing is a science, and DOE did not do sufficient study to determine whether the electric test procedure it adopted would measure representative results for gas cooktops:
1. First, the purpose behind EN 60350-2:2013 was to establish a test to determine
2. In an attempt to keep one test method, DOE extended this electric method to gas cooktops. AHAM appreciates the attempt to reduce the number of test methods. But, in this case, there is no reason to use one type of test. There are not different types of gas technologies and so a simmer period is not needed to differentiate between technologies as it is in electric. The significant added burden of including the simmer setting (and the variation it introduces) is not likely balanced by a benefit in terms of energy savings.
In addition, most consumers likely replace their cooktops with the same fuel that is already in their home. Based on a 2010 study conducted for AHAM, the vast majority of consumers surveyed replaced their cooktops and ranges with a similar unit. According to the study, nearly nine in ten households that bought a freestanding single oven range did a direct replacement. Homeowners were even more likely to do a direct replacement of this type of appliance, at 94 percent.
3. The best comparison for comparing gas cooktops to other gas cooktops would be based on a simple bring to boil test, which is what Europe and the ASTM methods both use. DOE is the first to reinvent the wheel and require gas and electric cooktops to be tested in the same way.
4. On a gas unit, there is very little overshoot which means there is no retained heat. Electric cooktops, on the other hand, often have a significant amount of retained heat. A gas cooktop's ability to maintain simmer in the absence of retained heat is largely a function of grate to burner relationships, burner design, valve design, and pan position. This relationship is not accounted for in the electric cooktop test because it does not need to be. But it does need to be addressed in a test applicable to gas cooktops.
5. More so than electric elements, gas burners are designed for a specific cooking purpose. For example:
a. Small or semi-rapid burners are typically used for simmering. This simmering performance is developed for melting chocolate and fine sauces, not keeping water simmering.
b. Ultra rapid or rapid burners are designed to reduce time to boil, or for frying. Often flame stability suffers at low rates, making simmering results poor.
c. Other high input burners are designed for rapid cooking (i.e. Wok) and are not designed for simmering.
Each of these burner types have been optimized in design to serve a particular cooking function for consumers. Thus, it may not make sense to apply a water boil test to all of them. For example, a consumer would not likely boil water on the small/semi-rapid burner that is meant to be used for melting chocolate or cooking fine sauces—the time to boil on such a burner would be extremely long, perhaps 40 minutes. In addition to not being representative, the test will drive significant variation in the assessment because DOE did not address this in the test procedure. DOE did, however, address this issue for electric cooktops—the test procedure removes certain burners from assessment.
6. Additionally, because DOE extended a test meant for electric cooktops to gas cooktops, the test does not require preheating of the gas burner. A gas system will change rates and how
7. The pots specified by the European electric test are different than the pots used in the European gas cooktop test. The gas pots are Aluminum test pans having a matt base and polished walls—that material is of the highest level of conduction. The electric test pans are a very thick stainless steel plate (6 mm) with thin stainless walls (1 mm) that are joined by a heat resistant glue. The pan construction is significantly different which will have an impact on heat transfer from the burner to the pan. The pot spacing of the large flat corner pans designed for electric cooktops will perform differently with the gas burners compared to the EN specified Aluminum pots and will not drive representative results. A gas flame heats a pot differently and this should be accounted for in the test.
AHAM has not been the only commenter to question the representativeness of extending the European electric test procedure to gas cooktops. During the test procedure rulemaking, Southern California Gas Company, San Diego Gas and Electric, and Southern California Edison (collectively, the Southern California investor-owned utilities (SoCal IOUs)) commented that DOE should conduct a sensitivity analysis of the impact of ambient temperature and pressure conditions on the test results for gas and electric cooking products in order to ensure consistent test results across various regions, climates, and altitudes. In addition, the SoCal IOUs commented that validating the ambient condition requirements would address the impact of the proposed correction to the gas heating value to standard temperature and pressure conditions. DOE responded only that it incorporated the ambient air pressure and temperature conditions specified in EN 60350-2:2013 and thus believed that the results “should not” be impacted by tests being conducted in different locations.
In addition, the U.S. market consists of a wide array of grate and burner offerings to consumers and DOE did not sufficiently assess those offerings in developing the test procedure. DOE itself acknowledged 283 gas configurations.
Because of the short comment period on the August 2016 SNOPR, AHAM was not able to conduct a round robin to assess the repeatability and reproducibility of the test procedure for gas products. And DOE had no data regarding repeatability or reproducibility upon which to rely. DOE instead relied on a European Committee of Domestic Equipment Manufacturers (CECED) round robin conducted five years ago on
In order to address AHAM's concerns, DOE conducted investigative testing on gas cooktops in support of the Final Rule. DOE conducted testing on five gas cooking tops that covered a range of burner input rates, installation widths (two 30 inch and three 36 inch), burner quantities (two four burner, three six burner), and grate weights. To evaluate variation in the test, DOE conducted two to three tests on each burner. For each individual test, DOE performed the full test method, including the preliminary test required to determine the turndown temperature and simmering setting for a given burner. DOE also included test results from previous testing conducted in support of the August 2016 SNOPR. The coefficient of variation DOE observed for the measured AEC for its test sample was, on average 1.0 percent. DOE also noted that the average per-cycle energy consumption coefficient of variation for each burner was 1.7 percent.
DOE based its Final Rule conclusions regarding total variation of the entire plethora of cooktops in the marketplace on only this meager five unit sample
Moreover, because DOE tested such a small sample the confidence level of its results is low (the same is true for electric cooktops). For a sample size of five, trying to represent the millions of units that will be produced and the tens of different labs that will be doing testing this inherently has a large margin of error as shown in Figure 2.
Based on this sample size, results can vary plus or minus 26 percent. We fully understand that a larger sample size is a function of cost and that there are limitations on the amount of further testing that can be done.
Moreover, as with electric cooktops and discussed more fully below, DOE did not engage stakeholders—either manufacturer labs or third party labs—in its assessment of the Final Rule.
In order to assess whether the final test procedure for gas cooktops is repeatable and reproducible, after DOE issued the final test procedure rule, AHAM conducted a round robin on gas cooktops. It is likely that even more testing would be helpful in better understanding both the test procedure and its variation, but these results are enough to demonstrate that there is sufficient doubt regarding the gas cooktop test procedure's accuracy such that DOE should withdraw it.
AHAM's gas cooktop round robin included four units (two cooktops and two ranges), with a range of product types.
We note that some of the tests could not meet the specified ambient temperature requirements. Specifically, some of the laboratories were not able to hold the ambient temperature as required during the duration of the test. Manufacturers ran the tests in the tightest environments that are currently available at +/−5 °F in their laboratories. The Final Rule requires new equipment to maintain +/−2 °F, which is difficult or, in some cases, impossible to do in existing laboratories. Section IV below further discusses this point. The labs that ran the tests have been approved by the safety certification bodies and Canadian Energy Verification organization. We removed the most errant runs and included the test data to show the variation that was noticeable during our tests as it is representative of the current lab capability. Importantly, improving the ability to maintain ambient temperature will involve significant upgrades to laboratories, which will add cost and burden for manufacturers.
As mentioned above, AHAM's test plan called for running the test differently than the DOE test by having the first laboratory mark the turn down temperature it used. AHAM understands that this is not fully
The DOE test procedure tried to address some of the variation that is not controllable in the methodology of its burdensome test procedure—e.g., heating values, different ambient temperatures, equipment, and technicians. AHAM's methodology was an effort to determine if the extra burden aimed at reducing that variation reduced it enough to justify the extra time, labor, and cost. Our conclusion: it is not.
Good lab practice is that within lab variation should clearly be less than two percent. For current data acceptance programs within the appliance industry, it is common practice that data between labs should be no more than three percent variation. DOE's data within its own lab fell within the target zone for variation for four of the five units DOE tested. DOE did not test at different labs, so the Final Rule is not based on any accurate lab-to-lab data showing an acceptable range of lab-to-lab variation.
AHAM's round robin shows similar results to DOE's in terms of within lab variation. Significantly, however, as shown in Table 1, lab-to-lab variation considerably exceeds the three percent maximum lab-to-lab variation target regardless of whether the full DOE test was run or the truncated test was run.
This highlights the significant gap in the data DOE used to justify the rule. DOE assumed that low variation in one lab means repeatability and reproducibility across labs. But AHAM's round robin demonstrates that this is not the case. Our round robin shows reproducibility is not present in the current procedure as demonstrated by only one of the three units, Unit A, having an acceptable coefficient of variation across labs. Notably, the low input rate on that burner is 8,000 BTU. AHAM units B, C, and D all have low capacity burner rates of or about 5,000 BTU. DOE only tested one of its five units with a low capacity burner at 5,000 BTU. DOE's coefficient of variation for that model was 1.40 percent. Some of the best AHAM single lab coefficients of variation for models at that rate are 0.78, 1.59, 1.70, and 1.80 percent. The AHAM data would appear to agree that one lab can repeat the same results,
Focusing on the units with low simmer rates and digging deeper into the data, AHAM's data show the following:
• On all units except one, Unit B, the repeatability on the high capacity burner within the lab had acceptable variation but the reproducibility across labs did not. Overall,
• On all units, the repeatability on the low capacity burner was marginal—25 percent of the time the variation was greater than the two percent maximum target. There is a distinct difference in the low capacity variation and the three units that had simmer at or near 5,000 BTU had significant repeatability and reproducibility issues. In some cases, using the truncated test actually
DOE did not evaluate or account for variation within units. There are issues inherent in testing gas cooktops and ranges that contribute significantly to within unit variation. For example, heating value, gas pressure, and atmospheric pressures all have an impact. More specifically, as atmospheric pressure changes due to weather, test results will vary even on the same unit from day to day. Also, gas pressure and atmospheric pressure can vary from run to run, and that can have an impact on how the gas is mixing within the burner port which then impacts burner combustion and energy creation. Moreover, heating values vary within a lab on a daily basis and likely vary greatly between labs. Thus, the same unit tested on different days in the same lab or in different labs will not perform the same unless the heating value of the gas is the same. That is statistically unlikely because values vary every day. It is not likely that the heating value is 1075, so there is a conversion from what it actually was to 1075 and this artificial adjustment induces variation. Each of these factors, among others, individually and collectively contribute to variation from test to test and DOE has made no effort to understand the impact of these factors.
This inherent variation in gas cooking product testing has been known for decades and is the reason the safety test, ANSI Z21.1, requires certified technicians to drill testing orifices. The drilling of orifices achieves precise rates for nominal, high, and low values. Experience shows that certified gas technicians can dial in the precise values for assessment by using number sized drills but there are also factors the technician must manage in this process such as burrs from the drilling.
In addition, neither DOE nor AHAM have evaluated or accounted for the additional variation inherent in producing gas products, i.e., between unit variation. This is significant because it will add further variation on top of the within lab variation, lab to lab variation, and within unit variation. In order to ensure compliance with any future energy conservation standard, manufacturers will have to take this total variation into account. The result will likely be that it becomes difficult or impossible to meet standards because the buffer needed to ensure accurate ratings will require levels of efficiency that are not economically justified or technologically feasible. AHAM explored this concept in more detail in its comments on DOE's proposed standards, which we hereby incorporate by reference.
One of the test requirements that will vary within the unit is the simmer setting on gas products. Subsequent to AHAM's round robin, Lab Three conducted some additional investigative testing to determine whether using the same simmering setting improves repeatability. The lab used two different operators to test a unit and provided both with the same instructions, which are identified in Exhibit A. The test plan was as follows:
1. Operator F conducted the test and found the simmer setting and gas flow;
2. Operator M conducted the test independently and found a simmer setting and gas flow;
3. Operator M repeated the test using the Operator F simmer setting; and
4. Operator F repeated the test using the Operator M simmer setting.
The results show that technicians are likely to be able to work to achieve passing results on their own efforts to determine a simmering setting. But when given the target setting, the results show that it is likely that different technicians cannot recreate a first technician's passing result about half of the time.
The data also highlight that there are more issues with finding the right simmer setting on low capacity burners—the Lab Three technicians each failed the first time they tried to set the low capacity burner. Also, see in Exhibit A where an additional experiment was run with one of Lab Four's technicians developing the simmer setting without using the previously provided information. This resulted in different energy average and lower variation values between the two Lab 4 technicians.
According to these results, relying on a given setting actually
As stated previously, DOE's small sample size could not address the full population or total variation. Table 2 below lists the units have been tested to the final test procedure as specified
Figure 3 shows the units tested and what their AAEC number is versus their lowest burner capacity rating. It highlights how skewed the DOE sampling was, especially as compared to AHAM's. As discussed above in Section I, DOE identified that nearly half of the models in the market had a 5,000 BTU burner. Yet, DOE selected only one unit with a burner of that capacity. Aside from the fact that DOE's sample inadequately represents the market, this demonstrates that DOE's test procedure will produce inaccurate results for most of the gas products on the market. The test has a high degree of variation for those products, as shown above, and, thus, the test will not allow consumers to compare across products.
Neither DOE nor AHAM have evaluated or accounted for the all of the variation inherent in producing gas products, i.e., total variation across the population. It is a large task and assuming the small amount of work applies to the total picture is not acceptable and further supports the withdrawal of the test procedure.
As discussed above, in response to the August 2016 SNOPR, based on round-robin testing, AHAM identified several sources of potential variation that needed to be resolved prior to DOE finalizing a cooktop test procedure. DOE conducted additional testing in order to evaluate AHAM's concerns and made clarifications to attempt to address many of them. Unfortunately, DOE's testing was not sufficient to demonstrate that the final test procedure significantly reduced the high degree of total variation AHAM identified in its comments. AHAM does not agree that the final test procedure is sufficiently repeatable and reproducible. Accordingly, AHAM respectfully requests that DOE withdraw the cooktop test procedure.
DOE did not do enough testing to verify that its clarifications resulted in a final test procedure that is repeatable and reproducible and, so, the Final Rule is not supported by sufficient data. DOE conducted testing of five electric cooktops incorporating different heating technologies (one coil element cooktop, two radiant element cooktops, and two induction cooktops) and control types (four with step controls and one with infinite). For each unit, DOE conducted testing on surface units capturing a range of heating element sizes. DOE conducted two to three tests per surface unit. For each individual test, DOE performed the full surface unit test method, including the preliminary test required to determine the turndown temperature and simmering setting for a given surface unit. DOE varied test operators for surface unit tests, but did not test at different laboratories. DOE also included test results from previous tests of these units conducted in support of the August 2016 SNOPR.
AHAM appreciates that DOE conducted this testing. But it is not enough to justify finalizing the test procedure. DOE did not complete full tests—it tested only two to three burners. Although that is helpful in assessing potential variation, AHAM is
DOE's testing demonstrates a low average coefficient of variation of 1.2 percent. It is uncertain whether those results are accurate given that DOE did assess the full IAEC for an entire cooktop. But, assuming that the partial tests do give a reasonable understanding of repeatability and reproducibility, DOE has not identified why DOE's coefficient of variation was so much lower than AHAM's.
One potential reason is that DOE's testing did not truly test reproducibility from lab to lab—DOE simply used different technicians for some of its tests. DOE did not conduct testing on the same units in
Conversely, AHAM's tests were conducted on the same units in three (now four)
Moreover, DOE did not engage stakeholders—either manufacturer labs or third party labs—in its assessment of the Final Rule.
AHAM commented that there is variability in determining the simmering setting for the simmering phase of the test and noted that the simmering setting plays an important role in the overshoot temperature and the ability to maintain a temperature as close as possible to 90 °C during the simmering phase of the test.
DOE responded that it expects that correctly following the methodology—starting with the lowest simmering setting and repeating the test as necessary with the next highest setting until the setting that maintains the water temperature above, but as close as possible to 90 °C, is identified—will result in only a single appropriate simmering setting for a given surface unit.
DOE agreed with AHAM that the selection of the simmering setting has a significant impact on the overall energy consumption of a surface unit and amended Appendix I to require that the simmering setting selection for the energy test cycle of each cooking area/zone be recorded. AHAM appreciates that DOE required recording the simmering setting selection—it will help in enforcement/verification actions to understand differences in test results. Unfortunately, recording the setting
AHAM acknowledges that in its initial round robin, laboratories did not start at the lowest simmering setting—laboratories started at the lowest setting they believed would be able to maintain a water temperature above and as close as possible to 90 °C. AHAM is a proponent of conducting the test that way in order to reduce test burden which, as discussed further below, is already significant.
Nevertheless, in order to understand if variation would decrease by following the letter of the test procedure as DOE suggested in the Final Rule, AHAM, in conducting a round robin on gas cooktops, required participating laboratories to (a) follow the DOE test procedure for selection of the simmering setting; (b) record their simmering setting; and (c) for the first lab, mark the turn down temperature on the unit itself.
AHAM incorporates by reference the data we submitted to DOE during the rulemaking regarding our electric round robin, which is summarized in the below tables. These data highlight that the simmer setting is a significant source of variation. Because DOE has not yet adequately addressed it, and, thus has not sufficiently demonstrated that its test procedure is valid, DOE should withdraw the cooktop test procedure.
AHAM commented that our round robin demonstrated difficulty in determining when the water temperature first reaches 90 °C to start the 20-minute simmering phase of the test because, when the temperature first reaches that temperature, it may oscillate slightly above or below it. DOE's testing showed similar fluctuations. Thus, DOE amended Appendix I to clarify that the 20-minute simmering period starts when the water temperature first reaches 90 °C and does not drop below 90 °C for more than 20 seconds after initially reaching 90 °C.
AHAM thanks DOE for making this clarification which seems like it could reduce variation. DOE's testing—completed in a single lab and with technicians trained in the same lab—does not, however, adequately demonstrate that this clarification sufficiently reduces variation and improves reproducibility. AHAM's members were not able to dedicate resources to re-performing a round robin to verify DOE's findings on a single unit. Without knowing whether total variation has, in fact, been reduced, DOE should not have finalized the test procedure and
AHAM commented that cycling of power to the heating element is unpredictable and causes variation in test results. It is unknown if the surface unit will cycle the heating element off during a critical phase of the test—i.e., at the start of the simmering phase or when determining the simmering setting. In response to DOE's September 27, 2016 data request, AHAM provided further data on how this was observed during our testing. DOE could not have reviewed or considered that data in drafting the Final Rule given that the Final Rule was issued the same day AHAM provided the data. AHAM incorporates the data we submitted on November 23, 2016, in this petition by reference.
DOE did, however, examine its own data. DOE indicated that it observed only one electric smooth-radiant cooktop in its sample for which the heater cycled on and off during the heat-up phase of the test. That particular unit cycled back on within a few seconds of cycling off and, as a result, the water temperature continued to rise at a “fairly steady state.” Thus, DOE concluded that it was infrequent for heating elements to cycle during the heat-up phase and, so, it was unlikely that other electric smooth-radiant cooktops would require any substantive amount of heating element cycling to protect the glass surface. DOE indicated that it did not expect any measurable impacts of heating element cycling on the total measured per-cycle energy consumption.
DOE based its conclusions on the single unit in its sample and is
Moreover, AHAM submitted additional data to DOE regarding the unit cycling it observed. As mentioned in that data submission, AHAM tested two eight-inch coil elements on different cooktops with the same model number to evaluate unit to unit variation. One cooktop cycled during the T70 turndown test and the other did not. The unit that cycled resulted in a higher turn down temperature when compared to the test that did not cycle. The unit did not cycle on either test run during the final T90 simmer test. The high Tc value caused one test run to have a higher overshoot and allowed for a lower turn down during the simmer phase driving unit to unit variation. This resulted in 36 watts less power on the unit with the lower turn down. This is six percent of the normalized power level. Six percent is not insignificant and demonstrates the potential difference between the energy measured on two units of the same construction. DOE should withdraw the Final Rule for cooktops and review and consider the data AHAM submitted. This issue must be addressed in order to reduce total variation.
Furthermore, DOE did not address the arguments AHAM made about the uncertainty regarding how unit cycling will impact test results and test burden—this is a significant concern and could drive redesign of products. Heating element cycling is key to cooking performance for electric ranges because the algorithm that governs heating element cycling controls the temperature of the food being cooked. If the temperature is not properly maintained, the consistency of the food can change. Moreover, for smooth top electric ranges, heating element cycling also serves a safety function. Such cooktops are equipped with a glass break sensor to monitor temperature. That sensor will dictate when a unit needs to cycle down to avoid glass breakage. AHAM is concerned that the test procedure, as finalized by DOE, could drive changes to the algorithm for heating element cycling design. Any such changes will result in significant product development efforts which have not been accounted for in DOE's test procedure rulemaking. A test procedure change should not dictate this sort of design change simply to manage uncertainty and variation.
For these reasons, DOE should withdraw the cooktop test procedure due to total variation that is not fully understood and, from available data, appears to be at an unacceptable level.
As AHAM has commented to DOE many times, Underwriters Laboratory (UL) Standard 858 will soon require a new test for electric coil element cooktops. The change to the voluntary safety standard, which AHAM developed and proposed to UL with the support of the Consumer Product Safety Commission, will require electric coil element cooktops and ranges to monitor and limit pan bottom temperature and is aimed at reducing the incidences of unattended cooking fires.
Given the date of this requirement, it is certain that any cooktop standard DOE may promulgate (and AHAM opposes any change to the existing standards for conventional cooking products) would apply to these newly designed products. But, because these products are still in development, DOE has not done testing on products using these controls and neither have manufacturers. Because company designs to comply with the UL 858 requirements may involve cycling of the element, it is quite possible that heating element cycling will be different than it is for existing products. Thus, DOE's data, even as supplemented by AHAM's data, on heating element cycling may be irrelevant because it does not represent products that will be on the market if the test is required to demonstrate compliance with possible energy conservation standards.
As shown in Figure 4, initial data, based on testing conducted by Primaria LLC to develop UL 858's new requirements, show that though time to boil water may not increase significantly using temperature limiting controls on coil cooktops, the difference could be enough to further impact the current assumptions on variation. And, the control cycling could be somewhat different as well. DOE should understand how the energy test will respond to these new technologies.
Although DOE sought feedback on the degree to which the heating element or cookware may deform and impact the heat transfer between the two surfaces in its rulemaking on energy conservation standards for cooktops, DOE did not investigate the impact of pan warpage on the repeatability and reproducibility of the test procedure.
The UL 858 test for coil cooktops initially required use of an aluminum pan. But, based on manufacturer experience doing significant testing, AHAM proposed a cast iron alternative to aluminum pans for the test. UL published this update in August of 2017. The shift is to account for warping and the variation and lack of repeatability it is driving in the safety assessment. There is no reason to believe this variation will not also extend to energy testing.
The data from the UL 858 work with Primaira show that any variation in pans of the same type will drive variation that the energy testing has not yet shown because the pans have yet to warp substantially. Significantly, using a warped stainless steel pan on a ceramic cooktop did increase the boil time with the cooktop fire mitigation control active (that control cycles the element on and off per an algorithm). And, warpage on stainless steel pans style will cause a difference in energy use on units without a limiting control as shown in Figure 5. DOE's failure to further investigate this issue means that its test procedure is not adequately supported.
The discussion in the sections above highlights several significant burdens associated with conducting DOE's cooktop test procedure that AHAM believes make it unduly burdensome to conduct. Specifically:
• The test procedure takes about 20 hours for an average four burner cooktop and requires the testing of every single burner or element individually. And, because the test requires the technician to determine the turn-down temperature before every test and the ambient conditions are quite tight, several runs are often required before a valid run can be achieved. Our testing found that some tests took upward of five days for a single cooktop.
• As indicated by AHAM's truncated gas test plan, it is burdensome to determine the turn down temperature for each individual test and burner. And doing so does not serve any purpose as it appears that it does not decrease variation.
• The ambient temperature requirements are incredibly tight and it is difficult or impossible for some laboratories to meet them without investing in lab improvements. Some companies had difficulty maintaining the ambient conditions and AHAM could not use their data in its round robin results.
• Test pots will warp during testing and will need to either be repaired or replaced frequently.
• The test procedure variation means that manufacturers will need to add a larger than usual “buffer” to any eventual energy conservation standards ratings, which will effectively increase the stringency of any future standard, probably by a large amount.
In addition to the test burden itself, there is also substantial cost associated with the test procedure. DOE determined that the test procedure would cost $700 per test for labor, with a one-time investment of $2,000 for new test equipment, which was split between test pots and other instrumentation. AHAM collected data from its members on the cost of the test procedure, both ongoing and initial investments. This data is based on company experience with the test through AHAM's round robins and in testing in Europe, on the number of models each company has, and on the potential need for third party testing. AHAM's data show that DOE significantly underestimated the cost associated with running the cooktop test procedure.
Table 3 below shows the difference between DOE's estimates in the Final Rule and AHAM's data.
One of the significant differences between DOE's estimate and AHAM's data is the total number of tests required and the number of models to be tested. It is difficult for manufacturers to determine at this stage how many basic models they would have. DOE's proposed energy conservation standards for cooktops, which AHAM strongly opposes, would be the first time manufacturers would need to certify compliance with standards and determine basic models. To do that may require testing of all models in order to determine likely model families, particularly because cooking products are complex. It will be difficult to determine which models can be grouped together in a basic model. That said, AHAM understands that not each individual model will need to be tested. Thus, it is likely that something between DOE's estimate and AHAM's data would be the actual average total number of models tested.
Nevertheless, the difference in the number of tests and number of models to be tested is shown below in Table 4. DOE cost estimations (particularly for labor) are on a per-test basis. As described above, it is difficult to determine the total number of tests to be performed in the initial year. Comparing the DOE estimation of number of tests to AHAM member data shows a signficant difference or wide range. As a result, total costs are substantially higher when considering the average number of tests required according to AHAM member data.
Another important difference is that DOE did not address upfront investments made in order for manufacturers to be able to perform the test procedure. But those costs should not be ignored. Manufacturers identified significant investments in specialized equipment to perform the test procedure successfully. For example, all respondants to AHAM's survey expressed frustration in obtaining the necessary test pots because the supplier is overseas. Acquiring even one set is difficult, as AHAM has discussed in previous comments, and the cost is about $9,500 excluding shipping and handling. Manufacturers indicated they would require between three and 24 sets to do certification testing.
DOE concluded that it would cost about $500 to fabricate existing testing structures. But manufacturers identified significantly higher costs. AHAM's members consistently cited investments to redesign entire lab stations and expand facility space. These changes would be needed to control for ambient temperature at the tight levels DOE's test requires, cool test units, add new equipment, and account for much higher volumes of testing. AHAM also believes that third party testing (for certification only) could cost over $2,500 per model. Table 5 details the comprehensive costs.
The test and cost burden associated with the cooktop test procedure is not likely justified by any balancing benefit to consumers or the environment. In 2009, DOE determined that none of the trial standards levels that included efficiency standards instead of just prescriptive design standards had benefits that were outweighed by the economic burden that would be placed on consumers. DOE found that the potential economic savings realized by average consumers were outweighed by the risk that certain consumers would not realize the savings and the adverse loss of industry net present value, among other things. Thus, DOE prescribed standards consisting of prescriptive design standards, not energy performance standards. As we have commented previously, AHAM does not believe anything has changed since 2009 to justify amended standards.
Given the extraordinary regulatory burden the cooktop test procedure will place on manufacturers,
Because AHAM's testing shows that DOE did not sufficiently demonstrate that the cooktop test procedure is repeatable or reproducible for gas and electric cooktops, because DOE has yet to demonstrate—as EPCA requires it to do—that the final test procedure is representative for gas cooktops, and because the test procedure is unduly burdensome to conduct, we respectfully request that DOE withdraw the final cooktop test procedure while maintaining the repeal of the oven test procedure that was part of this same Final Rule. Even absent an energy conservation standard for cooktops that requires use of the test procedure, manufacturers are required to report energy use via a test procedure DOE has not demonstrated is representative of consumer use for all product types and AHAM has demonstrated is not reproducible. This means that reported energy values for some products could be inaccurate and, for all products, will not be directly comparable to each other across manufacturers. Thus, consumers could be misled when evaluating and comparing energy claims. Accordingly, we also seek an immediate stay of the effectiveness of the cooktop test procedure, including the requirement that manufacturers use the final test procedure to make energy related claims.
Food and Drug Administration, HHS.
Notification of availability; extension of comment period.
The Food and Drug Administration (FDA or we) is extending the comment period for the notification of availability of a draft guidance for industry entitled “The Declaration of Added Sugars on Honey, Maple Syrup, and Certain Cranberry Products: Guidance for Industry” that appeared in the
We are extending the comment period on the document that published in the
You may submit comments 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
Blakely Fitzpatrick, Center for Food Safety and Applied Nutrition, Food and Drug Administration, 5001 Campus Dr., College Park, MD 20740, 240-402-1450.
In the
We have received requests to extend the comment period for the draft guidance (Refs. 1 and 2). The requests conveyed concern that the current 60-day comment period does not allow sufficient time to develop meaningful or thoughtful comments to the draft guidance.
We have considered the requests and are extending the comment period for the draft guidance for 45 additional days, until June 15, 2018. We believe that this extension allows adequate time for interested persons to submit comments without significantly delaying finalizing the guidance.
The following references are on display at the Dockets Management Staff (see
Coast Guard, DHS.
Notice of proposed rulemaking.
The Coast Guard proposes to establish a temporary safety zone for certain waters of the Buffalo Outer Harbor during the Officer Lehner Memorial Vintage Regatta. This proposed rulemaking would prohibit persons and vessels from being in the safety zone unless authorized by the Captain of the Port Buffalo or a designated representative. We invite your comments on this proposed rulemaking.
Comments and related material must be received by the Coast Guard on or before May 25, 2018.
You may submit comments identified by docket number USCG-2018-0078 using the Federal eRulemaking Portal at
If you have questions about this proposed rulemaking, call or email LT Michael Collet, Chief of Waterways Management, U.S. Coast Guard Sector Buffalo; telephone 716-843-9322, email
On December 27, 2017, the Buffalo Vintage Boat Racing Association and BR Guest Inc., notified the Coast Guard that it will be conducting a boat race from 10:00 a.m. to 4:00 p.m. on July 1, 2018, on the Buffalo Outer Harbor. Hazards from the boat regatta include high speed vessels. The Captain of the Port Buffalo (COTP) has determined that potential hazards associated with the Officer Lehner Memorial Vintage Regatta would be a safety concern for anyone within the designated course encompassed by all waters inside of the Outer Harbor, Buffalo, NY starting at position 42° 52′04″ N, 078° 53′03″ W then South to 42° 51′07″ N, 078° 52′09″ W (NAD 83). The course will extend a minimum of 100 yards from the shore and the breakwall.
The purpose of this rulemaking is to ensure the safety of vessels and the navigable waters within the above stated points before, during, and after the scheduled event. The Coast Guard proposes this rulemaking under authority in 33 U.S.C. 1231.
The COTP proposes to establish a temporary safety zone, enforced intermittently, from 9:45 a.m. to 4:15 p.m. on July 1, 2018. The safety zone will encompass all waters inside of the Outer Harbor, Buffalo, NY starting at position 42° 52′04″ N, 078° 53′03″ W then South to 42° 51′07″ N, 078° 52′09″ W (NAD 83). The course will extend a minimum of 100 yards from the shore and the breakwall. The duration of the
We developed this proposed 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 NPRM has not been designated a “significant regulatory action,” under Executive Order 12866. Accordingly, the NPRM has not been reviewed by the Office of Management and Budget (OMB), and pursuant to OMB guidance it is exempt from the requirements of Executive Order 13771.
This regulatory action determination is based on the size, location, duration, and time-of-day of the safety zone. Vessel traffic would be able to safely transit around this safety zone, which would impact a small designated area of the Buffalo Outer Harbor, by transiting a short distance in Lake Erie. The safety zone would also have built in times where vessels will be able to transit through between race heats. Moreover, the Coast Guard would issue a Broadcast Notice to Mariners via VHF-FM marine channel 16 about the zone, and the rule would allow vessels to seek permission to enter the zone.
The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this proposed rule would not have a significant economic impact on a substantial number of small entities.
While some owners or operators of vessels intending to transit the safety zone may be small entities, for the reasons stated in section IV. A. above, this proposed rule would not have a significant economic impact on any vessel owner or operator.
If you think that your business, organization, or governmental jurisdiction qualifies as a small entity and that this rule would have a significant economic impact on it, please submit a comment (see
Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Public Law 104-121), we want to assist small entities in understanding this proposed 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
This proposed rule would not call for a new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).
A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this proposed 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 proposed rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it would not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. If you believe this proposed 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 proposed rule would not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.
We have analyzed this proposed rule under Department of Homeland Security Directive 023-01, which guides the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have made a preliminary determination that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This proposed rule involves an intermittently enforced safety zone lasting 6.5 hours that would prohibit entry into all waters inside of the Outer Harbor, Buffalo, NY starting at position 42° 52′04″ N, 078° 53′03″ W then South to 42° 51′07″ N, 078° 52′09″ W (NAD 83). The course will extend a minimum of 100 yards from the shore and the breakwall. Normally such actions are categorically excluded from further review under paragraph L[61] of Appendix A, Table 1 of DHS Instruction Manual 023-01-001-01, Rev. 01. A preliminary Record of Environmental Consideration supporting this determination is available in the docket where indicated under
The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to contact the person listed in the
We view public participation as essential to effective rulemaking, and will consider all comments and material received during the comment period. Your comment can help shape the outcome of this rulemaking. If you submit a comment, please include the docket number for this rulemaking, indicate the specific section of this document to which each comment applies, and provide a reason for each suggestion or recommendation.
We encourage you to submit comments through the Federal eRulemaking Portal at
We accept anonymous comments. All comments received will be posted without change to
Documents mentioned in this NPRM as being available in the docket, and all public comments, will be in our online docket at
Harbors, Marine safety, Navigation (water), Reporting and record keeping requirements, Security measures, Waterways.
For the reasons discussed in the preamble, the Coast Guard proposes to amend 33 CFR part 165 as follows:
Authority: 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)
(1) In accordance with the general regulations in § 165.23 of this part, entry into, transiting, or anchoring within this safety zone is prohibited unless authorized by the Captain of the Port Buffalo or his designated on-scene representative.
(2) This safety zone is closed to all vessel traffic, except as may be permitted by the Captain of the Port Buffalo or his designated on-scene representative.
(3) The “on-scene representative” of the Captain of the Port Buffalo is any Coast Guard commissioned, warrant or petty officer who has been designated by the Captain of the Port Buffalo to act on his behalf.
(4) Vessel operators desiring to enter or operate within the safety zone must contact the Captain of the Port Buffalo or his on-scene representative to obtain permission to do so. The Captain of the Port Buffalo or his on-scene representative may be contacted via VHF Channel 16. Vessel operators given permission to enter or operate in the safety zone must comply with all directions given to them by the Captain of the Port Buffalo, or his on-scene representative.
Environmental Protection Agency (EPA).
Proposed rule.
Pursuant to the Federal Clean Air Act (CAA or the Act), the Environmental Protection Agency (EPA) is proposing to approve a revision to the Texas State Implementation Plan (SIP) to meet the Reasonable Further Progress (RFP) requirements for the Houston-Galveston-Brazoria (HGB) moderate 2008 8-hour ozone nonattainment area (HGB area). Specifically, EPA is proposing to approve the RFP demonstration, contingency measures, motor vehicle emissions budgets (MVEBs) and an updated 2011 base year emissions inventory.
Written comments must be received on or before May 25, 2018.
Submit your comments, identified by Docket No. EPA-R06-OAR-2017-0056, at
Ms. Wendy Jacques, 214-665-7395,
Throughout this document wherever
In 2008, we revised the 8-hour ozone primary and secondary national ambient air quality standards (NAAQS) to a level of 0.075 parts per million (ppm) to provide increased protection of public health and the environment (73 FR 16436, March 27, 2008). The HGB area was classified as a marginal ozone nonattainment area for the 2008 8-hour ozone NAAQS and initially given an attainment date of no later than December 31, 2015 (77 FR 30088 and 77 FR 30160, May 21, 2012). The HGB area consists of Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery and Waller counties.
On December 23, 2014, the DC Circuit Court issued a decision rejecting, among other things, our attainment deadlines for the 2008 ozone nonattainment areas, finding that we did not have statutory authority under the CAA to extend those deadlines to the end of the calendar year.
RFP plans must include contingency measures that will take effect without further action by the state or EPA, which includes additional controls that would be implemented if the area fails to reach the RFP milestones (CAA 172(c)(9)). While the CAA does not specify the type of measures or quantity of emissions reductions required, EPA provided guidance interpreting the CAA that implementation of these contingency measures would provide additional emissions reductions of up to 3% of the adjusted base year inventory (or a lesser percentage that will make up the identified shortfall) in the year following the RFP milestone year. For more information on contingency measures, please, see the April 16, 1992 General Preamble (57 FR 13498, 13510) and the November 29, 2005 Phase 2 8-hour ozone standard implementation rule (70 FR 71612, 71650). RFP plans must also include MVEBs, which are the allowable on-road mobile emissions an area can produce and continue to demonstrate RFP (40 CFR 93.101 and 93.118(b)(1)(i)).
On December 29, 2016, Texas submitted a RFP SIP revision for the HGB moderate area. The SIP revision (1) updates the 2011 base year emissions inventory that was approved by EPA (80 FR 9204, February 20, 2015), (2) demonstrates a 15% emissions reduction in ozone precursors from the 2011 base year through the 2017 attainment year, (3) demonstrates a 3% emissions reduction for contingency in 2018 if the reductions for 2017 are missed and (4) sets the NO
We reviewed the Texas SIP submittal for consistency with the requirements of the CAA, EPA regulations, and EPA guidance. A summary of our analysis and findings are provided below. For a more detailed discussion of our evaluation, please see our Technical Support Document (TSD) found in regulations.gov (docket EPA-R06-OAR-2017-0056).
An emissions inventory is a comprehensive, accurate, and current inventory of actual emission from all sources. CAA sections 172(c)(3) and 182(b)(1) require that ozone nonattainment SIP revisions include an inventory of NO
Texas developed emissions projections for 2017 to demonstrate that NO
Texas has provided sufficient control measures in their RFP plan to offset growth in emissions by estimating the amount of growth that will occur between 2011 and 2017. The control measures used to achieve the necessary emission reductions to meet the RFP requirements are listed in Table 3.
The projections of growth are labeled as the “Uncontrolled Emissions” for 2017 under (a) in the table below. The State followed our standard guidelines in estimating the growth in emissions and are described in greater detail in the TSD.
As noted earlier in this action, RFP plans for moderate and above nonattainment areas must include contingency measures to be implemented in the event an RFP milestone is missed.
The Texas 3% attainment year RFP contingency measure demonstration is based on a 2% reduction in NOx and a 1% reduction in VOC, to be achieved between 2017 and 2018. Controlled emissions reductions not previously used in the 2017 RFP demonstration may also be used to satisfy contingency requirements, so the excess emissions reductions from the 2017 RFP demonstration are included in the contingency measure demonstration. The 2018 reductions from the federal motor vehicle control program, inspection and maintenance program, and the fuel requirements program were also used in the RFP contingency demonstration.
Texas demonstrated that federal and State measures being implemented are sufficient to reduce emissions by more than 3% and meet the contingency measure requirement for the RFP SIP. We determined that Texas used acceptable methodology to demonstrate that the required emissions reductions are in excess of those needed for RFP and propose to approve the RFP demonstration. Table 4 summarizes the demonstration. For more information,
An RFP plan must establish MVEBs for transportation conformity purposes (40 CFR 93.118(b)(1)(i)). The MVEB is the mechanism to ensure that future transportation activities will not produce new air quality violations, worsen existing violations, delay reaching RFP milestones, or delay timely attainment of the NAAQS. A MVEB establishes the maximum amount of emissions allowed in the SIP for on-road motor vehicles. The MVEBs for 2017 provided by Texas in the SIP revision can be found in Table 6.
For the budgets to be approvable, they must meet, at a minimum, EPA's adequacy criteria (40 CFR 93.118(e)(4)). The availability of these budgets was posted on our website on January 18, 2017, for the purpose of soliciting public comments on their adequacy. The comment period closed on February 17, 2017, and we received no comments. On March 6, 2017, we published the Notice of Adequacy Determination for these MVEBs (88 FR 26091). As a result of such adequacy determination, these MVEBs must be used by state and Federal agencies in determining whether proposed transportation projects conform to the SIP as required by section 176(c) of the CAA. The adequacy determination represents a preliminary finding by EPA of the acceptability of the MVEBs. We are proposing to finalize our finding that these MVEBs are fully consistent with RFP. As the MVEBs sets the allowable on-road mobile emissions the HGB area can produce and continue to demonstrate RFP, we are proposing to approve the MVEBs for the HGB area.
We are proposing to approve the HGB RFP SIP revision submitted on December 29, 2016. Specifically, we are proposing to approve the RFP demonstration, contingency measures, MVEBs and an updated 2011 base year emissions inventory.
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, the EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely proposes to approve 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 CAA; and
• Does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).
In addition, the SIP is not approved to apply on any Indian reservation land or in any other area where EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the 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, Nitrogen dioxide, Ozone, Volatile organic compounds.
42 U.S.C. 7401
Federal Communications Commission.
Proposed rule.
In this document, the Federal Communications Commission (Commission) considers further reform to establish a budget that will allow for robust broadband deployment in rate-of-return areas while minimizing the burden that contributions to the Universal Service Fund (the Fund) place on ratepayers and to bring greater certainty and stability to rate-of-return high-cost funding, both in the near term and in the future. The Commission also seeks comment on additional reforms to increase broadband deployment, while promoting the efficient use of limited resources.
Comments are due on or before May 25, 2018 and reply comments are due on or before June 25, 2018. If you anticipate that you will be submitting comments, but find it difficult to do so within the period of time allowed by this document, you should advise the contact listed below as soon as possible.
You may submit comments, identified by WC Docket Nos. 10-90, 14-58, 07-135, CC Docket No. 01-92, by any of the following methods:
•
•
•
For detailed instructions for submitting comments and additional information on the rulemaking process, see the
Suzanne Yelen, Wireline Competition Bureau, (202) 418-7400 or TTY: (202) 418-0484.
This is a summary of the Commission's Notice of Proposed Rulemaking (NPRM) in WC Docket Nos. 10-90, 14-58, 07-135, CC Docket No. 01-92; FCC 18-29, adopted on March 14, 2018 and released on March 23, 2018. The full text of this document is available for public inspection during regular business hours in the FCC Reference Center, Room CY-A257, 445 12th Street SW, Washington, DC 20554 or at the following internet address:
1. Universal service can—and must—play a critical role in helping to bridge the digital divide to ensure that rural America is not left behind as broadband services are deployed. The directive articulated by the Commission in 2011 remains as true today as it did then: “The universal service challenge of our time is to ensure that all Americans are served by networks that support high-speed internet access.” Though the Commission has made progress for rural Americans living in areas served by our nation's largest telecommunications companies, the rules governing smaller, community-based providers—rate-of-return carriers—appear to make it more difficult for these providers to serve rural America. As a result, approximately 11 percent of the housing units in areas served by rate-of-return carriers lack access to 10 Mbps downstream/1 Mbps upstream (10/1 Mbps) terrestrial fixed broadband service while 34 percent lack access to 25 Mbps downstream/3 Mbps upstream (25/3 Mbps). It is time to close this gap and ensure that all of those living in rural America have the high-speed broadband they need to participate fully in the digital economy.
2. By improving access to modern communications services, the Commission can help provide individuals living in rural America with the same opportunities that those in urban areas enjoy. Broadband access fosters employment and educational opportunities, stimulates innovations in health care and telemedicine and promotes connectivity among family and communities. And as important as these benefits are in America's cities, they can be even more important in America's more remote small towns, rural, and insular areas. Rural Americans deserve to reap the benefits of the internet and participate in the 21st century society—not run the risk of falling yet further behind.
3. Today, the Commission takes the next step in closing the digital divide through proposals designed to stimulate broadband deployment in rural areas. To reach its objective, the Commission must continue to reform its existing high-cost universal support programs. Building on earlier efforts to modernize high-cost universal service support, the Commission seeks to offer greater certainty and predictability to rate-of-return carriers and create incentives to bring broadband to the areas that need it most.
4. In the NPRM, the Commission considers further reforms to establish a budget that will allow for robust broadband deployment in rate-of-return areas while minimizing the burden that contributions to the Fund place on ratepayers and to bring greater certainty and stability to rate-of-return high-cost funding, both in the near term and in the future. The Commission also seeks comment on additional reforms to increase broadband deployment, while promoting the efficient use of limited resources. For example, the Commission seeks comment on whether to fully fund existing A-CAM support recipients, afford a new opportunity for legacy providers to elect model-based support, and establish a minimum threshold of support for legacy providers that would not be subject to a budget cap. Lastly, the Commission seeks comment on other reforms, including, for example, exploring the need for caps on capital and operating expenses, using an auction process to address substantial competitive overlaps, and other options for simplifying the legacy rate-of-return mechanism.
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6. Moreover, since 2011 consumers' expectations and the Commission's requirements regarding broadband speed have continued to increase. The Commission's initial speed benchmark for Connect America Fund (CAF) recipients was 4 Mbps downstream and 1 Mbps upstream, later revised to 10 Mbps downstream and 1 Mbps upstream, and certain CAF recipients are now required to offer 25 Mbps downstream and 3 Mbps upstream. Consumer demand for higher speeds is also evident. Among residential users, the percentage of fixed broadband connections with a “downstream speed of at least 25 Mbps has grown from 24% (or 23 million connections) in June 2013 to 57% (or 59 million connections) in June 2016,” and “slower downstream speeds of less than 3 Mbps has decreased from 18% (or 17 million connections) in June 2013 to 5% (or 5 million connections) in June 2016.” A budget designed to speed the deployment of 4 Mbps/1 Mbps broadband to rural America may be insufficient to encourage the deployment of the high-speed broadband networks that residents of rural America need.
7. In initiating the budget review, the Commission seeks comment on the appropriate level of support—and the Commission notes that the Communications Act of 1934, as amended (Act) requires such support to be “predictable and sufficient . . . to preserve and advance universal service.” Should the Commission establish a separate budget dedicated to High-cost Loop Support (HCLS) and Connect America Fund Broadband Loop Support (CAF BLS)? If so, should the Commission set that budget at $1.23 billion (the current amount available for HCLS and CAF BLS), at $1.35 billion (that amount adjusted by the inflationary ratio that reflects inflation since 2011), or at some other amount? Commenters should submit evidence that labor costs or other costs, such as fiber or electronics, have increased since 2011 due to inflation. Commenters should also submit evidence that those increased costs, if any, have not been offset by savings related to increased labor productivity or the lower cost of network equipment.
8. Alternatively, should the amount of support available for HCLS and CAF BLS continue to be calculated by subtracting Alternative Connect America Cost Model (A-CAM), Alaska Plan, and Connect America Fund Intercarrier Compensation (CAF ICC) support from a single rate-of-return budget? If so, should the Commission increase that rate-of-return budget for the 2018 budget year to $2.193 billion (the inflation-adjusted figure) or adopt some other figure? If the Commission retains a single budget, how should the Commission account for other changes and proposals it makes today? For example, in the concurrently adopted Report and Order, the Commission offers existing A-CAM carriers revised support up to a per-location cap of $146.10 and here seeks comment on making a second A-CAM offer to legacy carriers—should that additional funding come from within a single, combined budget? The Commission notes that any increase in the budget attributable to those carriers now receiving A-CAM could help fully fund the original offer at the $200 per-location cap or incent more legacy carriers to elect a new model offer. Should the Commission adopt a budget that would fully fund a new model offer and fully fund the original A-CAM offer for all existingA-CAM providers? The Commission also proposes to offer model-based support to glide path carriers, which would decline over the 10-year term as transition payments phase down to the model amount. Should that support then be available to carriers continuing to receive HCLS and CAF BLS?
9. In revisiting the budget, how should the Commission take into account the reforms it adopted in the
10. The Commission is mindful of its obligation to ensure that scarce public resources are spent judiciously. As courts have recognized, too much subsidization could affect the affordability of telecommunications services for those that pay for universal service support, in violation of section 254(b). The Commission also notes that when the Tenth Circuit upheld the budget adopted in 2011, it stated that “the FCC quite clearly rejected any notion that budgetary `sufficiency' is equivalent to `complete' or `full' funding for carrying out the broadband and other obligations imposed upon carriers who are voluntary recipients of USF funds.” The Commission therefore asks commenters to discuss whether the benefits of any budget increase would outweigh the burden on ratepayers from an increase in the contribution factor. The Commission notes that the proposed contribution factor for the second quarter of 2018 is 18.4 percent. The Commission takes seriously its obligations as steward of the Fund and is committed to fiscal responsibility. The Commission also recognizes that increases in the contribution factor raise the costs, directly and indirectly, of service to businesses and consumers. The Commission thus asks that commenters consider its commitment to fiscal responsibility when advocating an appropriate high-cost budget.
11. With any proposed budget, the Commission urges commenters to provide a detailed economic analysis. The Commission would find most helpful comments providing evidence on the amount of support legacy carriers would need to meet mandatory buildout requirements while offering at least one plan at the comparative benchmark rate, and why/if current support levels are insufficient. The Commission also asks that comments quantify how much additional broadband deployment could occur with any budget increase.
12. After the Commission has set a new initial budget, it proposes to increase that budget for inflation going forward and seek comment on this proposal. The Commission believes that adjusting the budget for inflation would account for any increases in the costs of network inputs and allow carriers an opportunity to recover those increased costs. The Commission seeks comment on inflation's impact on the costs of deploying and maintaining a network.
13. For an inflationary factor, the Commission proposes using Gross Domestic Product—Chain Price Index (GDP-CPI), the same factor used for the Rural Growth Factor (RGF). Using the same inflationary factor the Commission uses for the RGF would be administratively efficient. In addition, the Commission has been using the GDP-CPI in other contexts since 1996, and of the two versions used to index federal programs, the GDP-CPI is more accurate in estimating cost of living changes from month to month. Furthermore, in the document, the Commission modifies the operating expense limitation to add GDP-CPI as
14. The Commission also seeks comment on when it should next revisit the budget. Should the Commission revisit the budget again in six years, as set forth in the
15.
16. In proposing this new model offer, the Commission first seeks comment on limited adjustments to the cost model that may make participation more favorable to carriers that declined the A-CAM, including the addition of a Tribal Broadband Factor. The Commission next seeks comment on which carriers should be eligible to participate. The Commission then seeks comment on the support amounts available for electing carriers, as well as their accompanying obligations. Finally, the Commission seeks comment on the process used for elections.
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25. In the
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27. As adopted by the Commission for current A-CAM recipients, it proposes a three-tiered process to transition electing carriers from the legacy support mechanism to the model. The Commission proposes to base the transition payments on the difference between model support and legacy support, and phase down transition payments over longer periods of time where that difference is greater. If the Commission aligns the term of support for the new model offer with the 10-year term of the original A-CAM offer, the Commission proposes to adjust the percentage reductions also to align with the shorter support term. The Commission seeks comment on this proposal. In the alternative, the Commission seeks comment on modifying the transition payments so that a greater portion of the available budget will be directed to increased broadband deployment obligations. Commenters are also invited to address whether the Commission should modify deployment obligations if a carrier forgoes transition payments or accepts faster transitions.
28. The Commission notes that given that it proposes to extend a new model offer only to those carriers for whom the offer is less than their legacy support, support claims alone will cover theA-CAM support plus transition payments regardless of any per-location cap adopted by the Commission. The Commission therefore proposes to base the budget for a new model offer on the 2017 claims amount contributed by electing carriers.
29.
30. The Commission proposes to vary the deployment obligations by density, as it did for the previous A-CAM offers. Carriers with a density in the state of more than 10 housing units per square mile would be required to offer 25/3 Mbps to at least 75 percent of the fully funded locations; carriers with 10 or fewer, but more than five, housing units per square mile would be required to offer 25/3 Mbps to at least 50 percent of the fully funded locations; and carriers with five or fewer housing units per square mile would be required to offer 25/3 Mbps to at least 25 percent of the fully funded locations.
31. The Commission also proposes requiring carriers electing model support to offer at least 4/1 Mbps to a defined number of locations that are not fully funded (
32. Consistent with CAF requirements for funding recipients, the Commission proposes to require carriers electing the new model offer to offer a minimum usage allowance of the higher of 170 GB per month or one that reflects the average usage of a majority of consumers, using Measuring Broadband America data or a similar data source. In addition, the Commission proposes to require carriers electing to receive model support to certify that 95 percent or more of all peak period measurements of round-trip latency are at or below 100 milliseconds. Because there may be a need for relaxed standards in areas where carriers may use alternative technologies to meet their public interest obligations, the Commission proposes that this latency standard would apply to locations served by terrestrial technologies. The Commission seeks comment on whether to use the high latency metric adopted in the CAF II auction proceeding for any capped locations served by a non-terrestrial technology. Under the high-latency standard, carriers would be required to certify that 95 percent or more of all peak period measurements of round-trip latency are at or below 750 milliseconds, and with respect to voice performance, a score of four or higher using the Mean Opinion Score (MOS). The Commission seeks comment on these proposals.
33. The Commission proposes to require carriers electing a new model offer to meet the same deployment milestones as the Commission requires for existing A-CAM recipients, adjusted for the proposed nine-year term of support or as appropriate. Assuming a nine-year term, the Commission would eliminate the 40 percent benchmark in 2020, and propose to require new A-CAM support recipients to offer at least 10/1 Mbps service to 50 percent of the requisite number of funded locations by the end of 2021, an additional 10 percent each year thereafter, and 100 percent by 2026. In addition, by the end of 2026, the Commission proposes to require these carriers to offer at least 25/3 Mbps and 4/1 Mbps to the requisite percentage of locations, depending on density. The Commission also proposes to provide the same flexibility afforded other A-CAM recipients to deploy to only 95 percent of the required number of fully funded 10/1 Mbps locations by the end of the term of support. The Commission seeks comment on these proposed deployment milestones.
34. Consistent with existing obligations, the Commission proposes to require carriers to report geocoded location information for all newly deployed locations that are capable of delivering broadband meeting or exceeding the speed tiers. The Commission also proposes to adopt defined deployment milestones, so that the same previously adopted non-compliance measures would apply.
35.
36.
37.
38. The Commission now seeks comment on using additional headroom in the budget to offer the carriers that accepted the revised offer of A-CAM support in 2017 the fully funded amount, using a per-location funding cap of $200 per location. Providing full funding for the original A-CAM recipients would accelerate broadband deployment in those rural areas for which rate-of-return carriers accepted the first A-CAM offer. If all eligible carriers accept this offer, it anticipates that it would result in approximately $66.6 million more support per year for the 10-year A-CAM term. If the Commission were to move forward with this additional offer, the Bureau would release a public notice announcing the offer and provide carriers 30 days to accept the offer and carriers accepting the fully funded offer be subject to the original deployment obligations. The Commission seeks comment on this option, including any timing considerations that it should bear in mind.
39.
40.
41. Alternatively, if the Commission does not decide to collect sufficient contributions to fully fund all electors, should it direct the Bureau to reduce the funding cap and/or prioritize support amounts to those areas that have the lowest deployment of broadband? Should the Bureau first reduce the per-location funding cap? If the new model support amounts using this lower funding cap still exceeded the budget, should the Bureau further reduce support offers by varying percentages based on the percentage of locations lacking 10/1 Mbps? Is there a different way to allocate the budget amongst new model electors that would maximize broadband deployment?
42.
43.
44. Here, the Commission seeks to address this concern and provide greater long-term stability and predictability for legacy carriers to facilitate planning and help spur deployment. At the same time, the Commission wants to better motivate legacy carriers to operate efficiently. To achieve this result, the Commission proposes two changes to the budget control mechanism.
45.
46.
47. The Commission seeks comment on alternatives for establishing a level of high-cost support that would not be subject to the budget control mechanism. One option would be to set the uncapped amount of annual support at 80 percent of the amount a legacy carrier would have received had they elected the new model offer (based on a funding cap of $146.10 per location). In evaluating this option, the Commission seeks comment on whether basing a carrier's uncapped level of support using 80 percent of the revised model is appropriate, as opposed to a different percentage.
48. Another option would be to use the five-year CAF BLS forecast developed by the National Exchange Carrier Association (NECA) for the carrier-specific deployment obligation as the uncapped threshold, but subject any amounts greater than that to a budget control mechanism. A third option could set the uncapped threshold at a specified fraction of each carrier's unconstrained 2016 or 2017 claims amount. If the Commission adopts this approach, would a 70 percent fraction be appropriate? Should it be lower or higher? And should this amount be adjusted to reflect line loss, so that a carrier is not guaranteed a fixed amount to serve a decreasing number of lines? Finally, a fourth option if the Commission does retain the per-line reductions would be to limit any reductions in support due to the budget control mechanism to no more than twice the “budget adjustment factor.” For example, if total demand, prior to the application of the budget control mechanism, was $1.4 billion and the overall legacy rate-of-return budget remains at $1.23 billion, then a 12.1 percent reduction would be applied to CAF BLS and HCLS to stay within the budget. Under this alternative, no carrier would have a reduction in support greater than 24.2 percent.
49. The Commission seeks comment on these alternatives, and any others that parties may propose. What are the benefits and costs of each proposal? Would they result in a threshold level of support that is sufficient or excessive? Should any of these options be adopted as an additional layer to one of the methods of limiting support losses described above? In evaluating the various options, the Commission requests that commenters discuss what factors and goals it should consider. For instance, is the best option the one where the average decrease in support from current levels is the least or is it better to base the guaranteed amount on those carriers the cost model indicates can use it most efficiently? To what extent should the Commission weigh the certainty and predictability of support associated with each option? The Commission also seeks comment on how each option helps to mitigate the inefficiencies of the legacy rate-of-return system, such as the incentive for rate-of-return companies to over-invest capital to increase profits, the Averch-Johnson effect. In addition, the Commission seeks comment on any other mechanisms for calculating an amount of support not subject to a budget control that balances the Commission's objective of providing specific, predictable, and sufficient support, with its goals of spurring rural broadband deployment, all while fairly allocating a finite budget among legacy carriers.
50. The Commission seeks comment on revising deployment obligations should it decide to provide carriers a threshold level of support that is not subject to the budget control mechanism or a cap on overall support, based on the A-CAM model. The deployment obligations adopted in the
51. Consistent with the Commission's proposal in this document, it seeks comment on revising the deployment obligations to reflect any guaranteed level of support that is not subject to the budget control mechanism. Specifically, the Commission seeks comment on whether each carrier should have a minimum deployment obligation that is based on the number of locations that would be served under the revised A-CAM model at an 80 percent funding level. For example, if the revised A-CAM, at the 80 percent funding level, indicated that a carrier should serve 1,000 locations with broadband service, and it currently serves 900, then it would be required to build out to an additional 100 locations. Each carrier would have further deployment obligations based on any additional support it is forecasted to receive in excess of its uncapped threshold level of support. The forecasted amount and the further obligations could be developed using the same methodology as was initially used after the adoption of the
52. The Commission seeks comment on this option. Would this buildout requirement better serve the public interest and promote deployment than the current buildout obligations? Does setting deployment obligations consistent with the threshold level of support improve certainty for carriers? Are there any additional benefits or possible concerns regarding setting deployment obligations in this manner? Should deployment obligations be modified to align with the expiration of the A-CAM support mechanism? Are there other ways to improve the determination of deployment obligations?
53.
54. The Commission's experience suggests that a lower limit may be justified. Currently, approximately 13 study areas are affected by the monthly per-line limit. However, carriers serving only 10 of those study areas have petitioned the Commission to justify higher support amounts, and some withdrew their requests. To date, the Commission has awarded relief in only three instances. This history suggests that the $250 per-line monthly limit has been neither too restrictive nor likely to have a negative impact on the ability of carriers to provide service. Moreover, the Commission notes that a reduction to $200 would currently affect approximately 25 study areas that are not already subject to the $250 per-line monthly limit, and the same waiver process would be available to all affected study areas. Lowering the per-line monthly limit would also free up additional support within the legacy budget for other carriers. The Commission invites comment on whether to adopt a lower per-line monthly limit and, in particular, what amount may be appropriate.
55.
56. The Commission seeks comment on the effectiveness of the 100 percent overlap process. The Commission notes that to date there has been little participation by unsubsidized competitors. This lack of participation likely reflects the absence of incentives to participate. In competitively served rate-of-return areas, a study area is often not completely overlapped by one competitor, but rather multiple competitors covering different parts of the study area. An unsubsidized competitor that only partially overlaps an incumbent may not participate in the current process because there is a cost to doing so (
57. In lieu of the current process to determine whether a study area is 100 percent overlapped, the Commission seeks comment on using an auction mechanism to award support to either the incumbent LEC or the competitor(s) in areas where there is significant competitive overlap. Competitive bidding can result in more efficient levels of support. Competitors will have an incentive to bid less than the amount the incumbent currently receives, and incumbents will have an incentive to increase efficiencies by bidding less than the competitor(s). In addition, the Commission anticipates that the competitive overlap process adopted by the Commission in the 2016
58. If the Commission were to conduct auctions, should it focus only on study areas that are 100 percent overlapped according to FCC Form 477 data, or should the Commission focus on some lesser percentage, such as 90 percent overlapped or greater? If a lesser percentage, should the Commission adopt an auction to replace the competitive overlap process adopted by the Commission in the
59.
60. The Commission also seeks comment on whether combining its high-cost support programs into one support stream would be simpler to administer and provide carriers with more flexibility. HCLS and CAF BLS rely on mechanisms originally designed to support voice services. Carriers receiving A-CAM support receive one monthly payment in exchange for meeting specific buildout obligations. Would a single support mechanism that combines current HCLS and CAF BLS resources and focuses on broadband deployment rather than voice services reduce regulatory burdens and provide more certainty and predictability to carriers receiving legacy support? Could such a mechanism be structured to provide incentives for carriers to operate efficiently and minimize the disadvantages of rate-of-return regulation? The Commission seeks comment on how a single high-cost support mechanism could reduce the need for complex cost regulation while encouraging broadband deployment.
61. The Commission seeks comment on whether there are other alternatives it should consider to further enhance the efficiency of the legacy high-cost program and target support to where it is most needed. For example, should the Commission target support not only to high-cost areas but low-income areas as well? Should the Commission adopt means-testing within the high-cost program? Either approach could target support where it is needed most by focusing only on areas or consumers with lower household income. Should the Commission award support for high-cost areas through a portable consumer subsidy or voucher? Would a voucher system increase the choices available to consumers? Should the Commission target support to States with less ability to fund the deployment of broadband in rural areas? How should the Commission identify States that are most in need of support, and how can the Commission do so while avoiding perverse incentives? Are there other alternatives the Commission should consider? Commenters should address considerations of timeliness, ease of administration, and cost effectiveness for each alternative.
62.
63. The Commission also seeks comment on the extent to which the limitations on capital and operating expenditures have been effective in promoting efficient spending. Do the company-specific limitations reflect reasonable upper limits on the amount of operating and capital expenses that a carrier need incur? For example, the Commission notes that that the National Tribal Telecommunications Association recently argued that carriers serving Tribal lands incur costs that other rural carriers do not face, resulting in significantly higher operating expenses to serve very sparsely populated service areas. Are there other specific examples that the Commission should take into account? For instance, are there modifications to the process or amounts that would improve operation of these limitations? Alternatively, should the Commission eliminate the opex limitation or the capital investment allowance entirely?
64.
65. First, the Commission proposes to change the date for mandatory line count filings for CAF BLS to March 31 of each year but to continue to require line counts as of December 31 (
66. The Commission notes that the FCC Form 507 filing deadlines mirror the line count filing deadlines used for HCLS. Would changing the FCC Form 507 deadlines so that they no longer coincided with the HCLS deadlines create significant administrative burdens? Would it be feasible also to revise the HCLS line count deadlines to be consistent with the proposed FCC Form 507 deadlines? If the Commission modifies the filing schedule as proposed, do the optional filings serve any benefit, or could they be eliminated?
67. The Commission also seeks comment regarding whether FCC Form 507 should be mandatory for rate-of-return carriers that do not receive CAF BLS (
68. In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-02, Leases, which is codified as Accounting Standards Codification (ASC) Topic 842 (ASC 842). The new standard affects both capital and operating leases. Under this new standard, capital leases are referred to as financing leases and the procedures for expensing amounts recorded for financing leases are the same procedures previously used for capital leases.
69. ASC 842 adopts new requirements for operating leases. For example, ASC 842 requires that operating leases longer than one year be carried on a company's balance sheet along with a corresponding liability to reflect the net present value of future lease commitments. The new standard provides procedures for expensing amounts recorded in the operating lease asset account. A carrier would recognize a lease expense from the operating lease on a straight-line basis over the lease term. Thus, for an operating lease with an escalation clause, ASC 842 would require the recorded operating expense to be higher in the first year than the amount paid in cash. This is different than the current Part 32 treatment of operating leases, which classifies leases as expenses associated with the executory agreements that are recorded as expenses at the time lease payments are made. Pursuant to the current Part 32 treatment, a company would continue to disclose future lease commitments through a footnote to the financial statements. Additional recordkeeping would be necessary if Part 32 were not to adopt the ASC 842 guidelines.
70. The Commission seeks comment on whether to incorporate the ASC 842 guidelines into the Uniform System of Accounts (USOA) contained in Part 32. The differences in the two approaches raise questions regarding how the asset and liability should be recorded and the ability of, and the additional burden on, a carrier to maintain records to support the two approaches. The Commission seeks comment on these questions in general, as well as in connection with the specific issues raised below. The Commission is particularly interested in the additional record-keeping burden that maintaining both the Part 32 and ASC 842 lease accounts would place on carriers if the Commission were not to adopt ASC 842 for Part 32 purposes. A party asserting a burden should address the level of that burden in the context of any ratemaking effects that would occur.
71. If the Commission were to incorporate ASC 842 into Part 32, it proposes to create an asset and a liability account to reflect operating leases. The Commission seeks comment on this proposal. The Commission also invites comment on whether other balance sheet or income statement-related accounts are necessary to account for leasing activities, either financing or operating. If so, parties should specify the additional accounts that are needed. The Commission proposes to adopt new or revised instructions for accounting for leases. Commenters supporting the adoption of ASC 842 are encouraged to provide language for the instructions and other rule revisions needed to implement ACS 842 in Part 32, taking into account the issues raised below.
72. The creation of a new asset account and a new liability account for operating leases raises questions about the treatment of these amounts in the ratemaking context. The operating lease asset would record the discounted value of payments due under operating leases longer than one year. Because there is no current outlay of funding for the operating leases, the Commission proposes that such amounts be excluded from the carrier's rate base. Similarly, because the liability is based on the value in the operating lease account, the Commission proposes that such liability should not be used in calculating the cost of capital. The Commission seeks comment on these two proposals, including whether the proposed treatment is warranted and what effect such treatment would have on a carrier's revenue requirement. Commenters are encouraged to identify and provide specific language to effectuate the changes to Part 65, or other affected provisions in the Commission's rules, that would be needed to implement this proposal.
73. Adopting ASC 842 would also modify the way operating lease expenses are currently calculated pursuant to the Commission's Part 32 rules. As noted earlier, ASC 842 would spread lease payments on a straight-line basis over the term of the operating lease. The Commission seeks comment on any recognition or timing issues between the Part 32 treatment and the treatment under ASC 842. In particular, the Commission seeks comment on how any entries reflecting interest associated with the use of the net present value approach to recording operating leases should be treated for purposes of calculating lease expense. If the Commission adopts ASC 842, it proposes to assign operating lease costs to the expense accounts currently being used to record such amounts. Would any revisions to the separations rules contained in Part 36 would be required under this proposal, and if so, which sections would need to be revised and what specific language should be used?
74. The Commission also seeks comment on the impact any ratemaking changes resulting from this proposed accounting modification would have on the levels or distribution of CAF BLS or other universal service support mechanisms. Commenters should identify any recognition and/or timing issues raised by any change and should,
75. ASC 842 becomes effective for fiscal years beginning after December 15, 2018 for public business entities and certain other businesses. For all other entities, it becomes effective for fiscal years beginning after December 15, 2019. Early adoption is permitted. The Commission seeks comment on when any changes the Commission adopts should become effective and whether there are any other implementation issues the Commission should address.
76. The NPRM adopted herein contains new, proposed new or modified information collection requirements. The Commission, as part of its continuing effort to reduce paperwork burdens, invites the general public and the Office of Management and Budget (OMB) to comment on the information collection requirements contained in this document, as required by the Paperwork Reduction Act of 1995, Public Law 104-13. In addition, pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, the Commission seeks specific comment on how it might further reduce the information collection burden for small business concerns with fewer than 25 employees.
77. As required by the Regulatory Flexibility Act of 1980, as amended (RFA), the Commission has prepared this Initial Regulatory Flexibility Analysis (IRFA) of the possible significant economic impact on a substantial number of small entities from the policies and rules proposed in the NPRM. The Commission requests written public comment on this IRFA. Comments must be identified as responses to the IRFA and must be filed by the deadlines for comments on the NPRM. The Commission will send a copy of the NPRM, including this IRFA, to the Chief Counsel for Advocacy of the Small Business Administration (SBA). In addition, the NPRM and IRFA (or summaries thereof) will be published in the
78. The proposals in this NPRM seek to build on efforts to modernize high-cost universal service support by offering greater certainty, predictability, and stability to rate-of-return carriers and creating incentives for efficient spending and bringing broadband to the areas that need it most.
79. The Commission reviews the amount of support available to rate-of-return carriers by initiating review of the high-cost universal service support budget, proposing to increase the budget based on inflation, and proposing an offer of model-based support for carriers whose model-based support would be lower than the support they received in 2016. By examining the budget and the support available for rate-of-return carriers, the Commission is looking to bring stability to the program and fulfill its commitment to reexamine the budget. To address some of the shortcomings and inefficiencies in the Commission's existing support programs, it also seeks comment on whether to fully-fund carriers that have elected to receive model-based support, subject to additional build-out obligations, and on providing another opportunity for all legacy rate-of-return carriers still receiving legacy support to elect a voluntary path to model support. For those carriers that choose to remain on legacy support, the Commission proposes to adopt a mechanism whereby legacy carriers would be guaranteed a threshold level of annual support, and the Commission seeks comment on an implementing an individual cap for each legacy carriers. This would alleviate the unpredictability created by the budget control mechanism. The Commission also seeks comment on eliminating limitations on capital, operational, and corporate expenses to minimize the burden these mechanisms put on carriers. Finally, the Commission seeks comment on modifying various rules, including legacy buildout obligations, the methodology for applying the budget constraint, the $250 per-loop, per-month cap, and looking at other reforms to the rate-of-return mechanisms. The Commission also seeks comment on proposals to modify line count data reporting requirements and accounting rules for capital and operating leases.
80. The legal basis for any action that may be taken pursuant to the NPRM is contained in sections 1-4, 5, 201-206, 214, 218-220, 251, 252, 254, 256, 303(r), 332, 403, and 405 of the Communications Act of 1934, as amended, and section 706 of the Telecommunications Act of 1996, 47 U.S.C. 151-155, 201-206, 214, 218-220, 251, 256, 254, 256, 303(r), 403 and 405.
81. The RFA directs agencies to provide a description of, and where feasible, an estimate of the number of small entities that may be affected by the proposed rules, if adopted. The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” In addition, the term “small business” has the same meaning as the term “small-business concern” under the Small Business Act. A “small-business concern” is one 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 Small Business Administration (SBA).
82.
83. 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 Aug 2016, there were approximately 356,494 small organizations based on registration and tax data filed by nonprofits with the Internal Revenue Service (IRS).
84. Finally, the small entity described as a “small governmental jurisdiction” is defined generally as “governments of cities, counties, towns, townships, villages, school districts, or special districts, with a population of less than fifty thousand.” U.S. Census Bureau data from the 2012 Census of Governments 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 this data the Commission estimates that at least 49,316 local government jurisdictions fall in the category of “small governmental jurisdictions.”
85.
86.
87.
88. The RFA requires an agency to describe any significant alternatives that it has considered in reaching its proposed approach, which may include (among others) the following four alternatives: (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. The Commission expects to consider all of these factors when it has received substantive comment from the public and potentially affected entities.
89. Largely, the proposals in the NPRM if adopted would have no impact on or would reduce the economic impact of current regulations on small entities. Certain proposals in this NPRM could have a positive economic impact on small entities; for instance, the Commission seeks comment on fully funding the original A-CAM offer and increasing the budget for rate-of-return carriers based on an inflationary factor.
90. In this NPRM, the Commission seeks comment on making a second offer of A-CAM support. The offer will be voluntary and carriers are not required to accept it or take any action. Therefore, the Commission's proposal for a second A-CAM will not have a significant impact on small entities.
91. The Commission also seeks comment on mechanisms to provide legacy carriers a guaranteed threshold of annual support and a carrier specific cap, which would reduce the unpredictability of the current budget control mechanism. The Commission proposes several alternatives for carriers to evaluate. In addition, because legacy carriers' support amounts could change due to the Commission's proposals, to minimize significant economic impact, the Commission seeks comment on whether or how deployment obligations should change.
92. The Commission also seeks comment on whether it should retain the operating expense limitation, the corporate operations limit, and the capital investment allowance. If the Commission were to eliminate these limitations on expenses and investment, it would be further minimizing the economic impacts on small entities of the Commission's current regulations. In addition, the Commission seeks comment on ways to simplify legacy support mechanisms by making changes to how HCLS and CAF BLS are calculated.
93. The Commission proposes to change the date for mandatory line count filings for CAF BLS to March 31st of each year, but to continue to require line counts as of December 31st (
94. More generally, the Commission expects to consider the economic impact on small entities, as identified in comments filed in response to the NPRM and this IRFA, in reaching its final conclusions and taking action in this proceeding. The proposals and questions laid out in the NPRM were designed to ensure the Commission has a complete understanding of the benefits and potential burdens associated with the different actions and methods.
95.
96.
97. Comments and reply comments must include a short and concise summary of the substantive arguments raised in the pleading. Comments and reply comments must also comply with section 1.49 and all other applicable sections of the Commission's rules. The Commission directs all interested parties to include the name of the filing party and the date of the filing on each page of their comments and reply comments. All parties are encouraged to utilize a table of contents, regardless of the length of their submission. The Commission also strongly encourages parties to track the organization set forth in the NPRM in order to facilitate its internal review process.
98. Accordingly,
99.
100.
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 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 June 25, 2018 to be considered in the formulation of the final rule.
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 (OFPP) Act, which provides the authority for an agency head to issue agency acquisition regulations that implement or supplement the FAR.
VA is proposing to revise the VAAR to add new policy or regulatory requirements and to remove any redundant guidance and guidance that is applicable only to VA's internal operating processes or procedures. Codified acquisition regulations may be amended and revised only through rulemaking. All amendments, revisions, and removals have been reviewed and concurred with by VA's Integrated Product Team of agency stakeholders.
The VAAR uses the regulatory structure and arrangement of the FAR and headings and subject areas are broken up consistent with the FAR content. The VAAR is divided into subchapters, parts (each of which covers a separate aspect of acquisition), subparts, sections, 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 authority that
We propose to revise the part 829 authorities to include the applicable U.S. code citations where the Secretary of the Treasury has exempted spirits and alcohol purchases by the Federal government, pursuant to 26 U.S.C. 5214(a)(2), 26 U.S.C. 5271, and 26 U.S.C. 7510. We also propose to include an updated positive law codification of Title 41 authority—41 U.S.C.1303(a)(2), to reflect additional authority of VA as an executive agency to issue regulations that are essential to implement Government-wide policies and procedures, as well as to issue additional policies and procedures required to satisfy VA's specific needs.
In subpart 829.2, Federal Excise Taxes, we propose to redesignate 829.202-70, Tax exemptions for alcohol products, as 829.203-70, Tax exemptions for alcohol products. We propose to revise paragraphs (a), (b) and (c) to reflect updated legislative and regulatory citations, to include 26 U.S.C. 5214(a)(2), 26 U.S.C. 5271, and 27 CFR parts 1-39. We also propose to remove paragraph (d) since there is no free of tax provision for beer in the Department of the Treasury regulation. This revised structure would conform more closely to the FAR structure of part 29, and moves to the VAAM the internal procedural instructions to the contracting officer regarding obtaining new permits. We also propose to remove the number and title of 829.202, General exemptions, since its sole section is proposed for removal.
We propose to remove 829.302, Application of State and local taxes to the Government, and move it to the VAAM as internal procedural guidance to the contracting officer.
We propose to remove 829.302-70, Purchases made from patients' funds, which prescribes 852.229-70, Sales or Use Taxes, as obsolete and redundant of FAR 52.212-4, Contract Terms and Conditions—Commercial Items clause, paragraph (k), which requires contractors to include “all applicable Federal, State, and local taxes and duties.” While VA uses the personal funds of patients to maintain fiscal controls and accountability, such controls are administrative in nature and unrelated to contracting.
We propose to add 829.303, Application of State and local taxes to Government contractors and subcontractors, to delegate to the Head of the Contracting Activity (HCA), without power of redelegation, the authority to make the determination prescribed in FAR 29.303(a).
In new subpart 846.1, General, we propose to add 846.101, Definition, to explain the term “rejected goods” since that term is the subject of a revised clause at 852.246-71, Rejected goods.
We propose to revise subpart 846.3, Contract Clauses, to remove 846.302-70, Guarantee clause, which prescribes 852.246-70, Guarantee, because there are sufficient FAR warranty clauses that could be used, such as FAR clause 52.246-19, Warranty of Systems and Equipment under Performance Specifications or Design Criteria.
We propose to remove 846.302, Fixed-price supply contracts, and add 846.370, Clauses for supplies, equipment or perishable goods, as the current VAAR numbering convention for subpart 846.3, Contract Clauses, does not align with the FAR subpart 46.3, Contract Clauses.
We propose to revise 846.312, Construction contracts, to remove a duplicate contract clause number.
We propose to add 846.370, Clauses for supplies, equipment or perishable goods. The analysis of the current VAAR revealed that the present VAAR numbering convention for subpart 846.3, Contract Clauses, does not align with FAR subpart 46.3, Contract clauses. For example, FAR 46.302 deals solely with fixed-price supply contracts and the current sections which prescribe these clauses (
846.370-1, Rejected goods, (formerly 846.302-71, Inspection), which would prescribe the clause 852.246-71, Rejected Goods, and clarify a contractor's obligations to remove goods rejected by the Government.
846.370-2, Frozen processed foods (formerly 846.302-72), which would prescribe clause 852.246-72, Frozen Processed Foods, and describe the requirements for safe handling of frozen foods.
846.370-3, Noncompliance with packaging, packing and/or marking requirements (formerly 846.302-73), which would prescribe clause 852.246-73, Noncompliance with Packaging, Packing and/or Marking Requirements, describing corrective steps for compensating the Government in the case of non-compliance.
We propose to add 846.370-4, Purchase of Shellfish, formerly 870.111-3, to conform to the FAR requirement to place clauses and their prescriptions in the appropriate parts, and would prescribe clause 852.246-76, Purchase of Shellfish, and describe the requirements for safe handling of shellfish.
We propose to revise subpart 846.4, Government Contract Quality Assurance.
In section 846.408, Single-agency assignments of Government contract quality assurance (no text), we propose to remove the single title as it is unnecessary.
We propose to amend 846.408-70, Inspection of subsistence, to remove paragraph (a) since FAR 46.408 identifies the Food and Drug Administration, the Department of Agriculture and the National Maritime Fisheries Service of the Department of Commerce as the entities to perform inspection. We also propose to remove paragraph (c) since it contains procedural guidance that is internal to VA and will be updated and moved to the VAAM, and to simplify the requirements in paragraph (d) that are the contractor's responsibilities, eliminating parts of paragraph (3) and all of (4). Paragraphs throughout the section will be appropriately renumbered.
We propose to remove 846.408-71, Waiver of USDA inspection and specifications, since no other agencies, including the Department of Agriculture, still require this type of inspection for subsistence.
We propose to remove the existing text of 846.471, Determination authority, since the authority it grants is provided to the contracting officer in 846.470. We propose to revise the title of 846.471, to now read, “Food service equipment,” formerly at 870.115. This conforms to the FAR requirement to place clauses and their prescriptions in the appropriate parts, and to require all dietetic food service equipment to meet National Sanitation Foundation (NSF) standards.
We propose to remove 846.472, Inspection of repairs for properties under the Loan Guaranty Program and Direct Loan Programs, and its two sections, 846.472-1, Repairs of $1,000 or less, and 846.472-2, Repairs in excess of $1,000. Such sections are unnecessary given that a private
In subpart 846.7, Warranties, we propose to remove 846.710, Contract clauses, since it redundantly prescribes a clause in FAR. We also propose to delete the two sections: 846.710-70, Special warranties, as repetitive of FAR clause coverage, and 846.710-71, Warranty for construction—guarantee period services, which has been replaced by 846.702-70, Guarantee period services and specifications.
We propose to add 846.702-70, Guarantee period services and specifications, to state VA's policy regarding guarantee period services, and to prescribe a clause, 852.246-75, Warranty of Construction—Guarantee Period Services, in all solicitations and contracts for construction that include the FAR clause 52.246-21, Warranty of Construction.
We propose to amend the authority citation for part 847 to add 41 CFR part 102-117. This CFR reference pertains to “Transportation Management” and it has relevance to part 847.
We propose to add subpart 847.2, Contracts for Transportation or for Transportation-Related Services. This new subpart would be comprised of new section 847.207, Solicitation provisions, contract clauses, and special requirements, and the following sections:
847.207-8, Government responsibilities, which would provide guidance to contracting officers for VA transportation contracts and subsequent payments on those contracts, and 847.207-70, VA solicitation provisions, contract clauses, and special requirements, which would provide guidance on contractual requirements for insurance provisions and contractor personnel performing on VA transportation contracts.
We propose to revise subpart 847.3, Transportation in Supply Contracts, by adding 847.302, Place of delivery—F.o.b. point. This section would specify delivery locations, in addition to referencing a new corresponding clause, to be inserted in supply contracts when it is necessary to specify delivery locations. This new section would help eliminate confusion by specifying exact delivery locations, so there would be a better representation of delivery scheduling and pricing.
Under subpart 847.3, we propose to remove the following sections as they include internal guidance and will be considered for revision and placement in the VAAM:
847.303, Standard delivery terms and contract clauses.
847.303-1, F.o.b. origin.
847.303-70, F.o.b. origin, freight prepaid, transportation charges to be included on the invoice.
Under 847.305, Solicitation provisions, contract clauses, and transportation factors, we propose to add 847.305-10, Packing, marking, and consignment instructions. This new section would specify consignment instructions, and would prescribe new clauses to be included in VAAR Part 852. It would cover those areas of shipping and marking that may not otherwise be covered, and are not covered in the FAR. We propose to add new section 847.305-70, Potential destinations known but quantities unknown, which prescribes clause 852.247-70, Determining Transportation Costs for Evaluation of Offers, when the contracting officer contracts with multiple bidders to provide items directly to VA field installations, on an F.o.b. origin basis.
We propose to add new section 847.305-71, VA contract clauses. This section references new clauses to the VAAR that are used for both free on board (F.o.b.) origin and F.o.b. destination, ensuring proper receipt and documentation of shipments.
We propose to remove 847.306-70, Transportation payment and audit, and replace it with 847.306-70, Records of claims. This new section recommends that the contracting officer use an offeror's record of claims involving loss or damage as an evaluation factor or subfactor for VA transportation contracts.
In subpart 852.2, Texts of Provisions and Clauses, we propose to remove clause 852.229-70, Sales or Use Taxes, as obsolete and redundant of FAR clause 52.212-4, Contract Terms and Conditions—Commercial Items, paragraph (k), which would require contractors to include all applicable Federal, State, and local taxes and duties.
We propose to remove 852.246-70, Guarantee, as redundant of the coverage of warranties by several clauses in FAR sections 52.246-17 through 52.246-21, and to reserve the section number.
We propose to revise 852.246-71, Inspection, to retitle it as “Rejected Goods” to more accurately reflect the content; to revise the citation where it is prescribed; and to make other minor edits for clarity.
We propose to revise 852.246-72, Frozen Processed Foods, to revise the prescription citation.
We propose to revise 852.246-73, Noncompliance with Packaging, Packing, and/or Marking Requirements, to revise the prescription citation, and to make one minor edit.
We propose to remove 852.246-74, Special Warranties, as redundant of the coverage of warranties by several clauses in FAR sections 52.246-17 through 52.246-21, and to reserve the section number.
We propose to amend 852.246-75, Warranty of Construction—Guarantee Period Services, to revise the prescription citation, and to make one minor edit for clarity.
We propose to add 852.246-76, Purchase of Shellfish, formerly 852.270-3, to conform to the FAR requirement to place clauses and their prescriptions in the appropriate parts, and to make one minor edit for clarity.
We propose to amend 852.247-70 to revise its title to “Determining Transportation Costs for Evaluation of Offers” which would make it applicable to negotiated as well as sealed bid contracts.
We propose to add 852.247-71, Delivery Location. This new clause would ensure that the proper delivery locations are included in the contract, for accountability, tracking, and delivery.
We propose to add 852.247-72, Marking Deliverables. This new clause would ensure that packages are properly marked for tracking, delivery, and acceptance purposes.
We propose to add 852.247-73, Packing for Domestic Shipment. This new clause would ensure acceptance by common carriers and safe delivery at destination.
We propose to add 852.247-74, Advance Notice of Shipment. This new clause would be used when the F.o.b. point is destination, and special Government assistance is required in the delivery or receipt of the items.
We propose to add 852.247-75, Bills of Lading, which would define when a commercial or Government bill of lading is to be used when shipments of deliverable items under this contract are F.o.b. origin.
We propose to delete 852.270-2, Bread and Bakery Products—Quantities, as unnecessary since variations in quantities is adequately covered in FAR subpart 11.7, Variation in Quantity, and in its related clauses.
We propose to delete 852.270-3, Purchase of Shellfish, and move it to 852.246-76 to conform to the FAR
We propose to delete 870.111-3, Contract clauses, since paragraph (a) prescribes the clause 852.270-2, Bread and Bakery Products—Quantities, which is unnecessary since variations in quantities is adequately covered in FAR subpart 11.7 and in its related clauses, and paragraph (b), which prescribes the clause 852.270-3, Purchase of Shellfish, and which is proposed to be moved to new section 852.246-76 to conform to the FAR requirement to place clauses and their prescriptions in the appropriate parts.
We propose to remove 870.111-5, Frozen processed food products, which is proposed to be moved to 846.370-2.
We propose to remove 870.115, Food service equipment, which is proposed to be moved to 846.471.
We propose to reserve part 870 since all sections and sections have either been proposed for deletion or removal to other parts of the VAAR.
Title 48, Federal Acquisition Regulations System, Chapter 8, Department of Veterans Affairs, of the Code of Federal Regulations, as proposed to be revised by this rulemaking, would represent VA's implementation of its legal authority and publication of the VAAR for the cited applicable parts. Other than future amendments to this rule or governing statutes for the cited applicable parts, or as otherwise authorized by approved deviations or waivers in accordance with FAR subpart 1.4, Deviations from the FAR, and as implemented by VAAR subpart 801.4, Deviations from the FAR or VAAR, no contrary guidance or procedures would be authorized. All existing or subsequent VA guidance would be read to conform with the rulemaking if possible or, if not possible, such guidance would be superseded by this rulemaking as pertains to the cited applicable VAAR parts.
Executive Orders (E.O.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 to be a significant regulatory action under E.O. 12866, because it raises novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in this Executive Order. VA's impact analysis can be found as a supporting document at
This proposed rule contains no provisions constituting a collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521).
This proposed rule would not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-612. The overall impact of the proposed rule would be of benefit to small businesses owned by Veterans or service-disabled Veterans as the VAAR is being updated to remove extraneous procedural information that applies only to VA's internal operating procedures. VA is merely adding existing and current regulatory requirements to the VAAR and removing any guidance that is applicable only to VA's internal operation processes or procedures. VA estimates no cost impact to individual business would result from these rule updates. This rulemaking does not change VA's policy regarding small businesses, does not have an economic impact to individual businesses, and there are no increased or decreased costs to small business entities. On this basis, the proposed rule would not have an 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.
Government procurement, Taxes.
Government procurement.
Government procurement, Transportation.
Government procurement, Reporting and recordkeeping requirements.
Asbestos, Frozen foods, Government procurement, Telecommunications.
The Secretary of Veterans Affairs, or designee, 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. Gina S. Farrisee, Deputy Chief of Staff, Department of Veterans Affairs,
For the reasons set out in the preamble, VA proposes to amend 48 CFR, chapter 8, parts 829, 846, 847, 852, and 870 as follows:
26 U.S.C. 5214(a), 5271, 7510; 40 U.S.C. 121(c); 41 U.S.C. 1303(a)(2) and 48 CFR 1.301-1.304.
(a)
(2) When purchasing spirits under a tax exemption, the contracting officer shall indicate in the contract document the basis for the exemption and make a copy of the permit available to the contractor. Upon receipt of the spirits, the contractor shall return the permit to the contracting officer unless future orders are anticipated or as directed by the contracting officer.
(3) Department of Veterans Affairs activities that require spirits free of tax for beverage purposes under 26 U.S.C. 7510 must provide a proper purchase order signed by the head of the agency or an authorized designee.
(b)
(1) Permits previously issued on Alcohol, Tobacco, and Firearms (ATF) Form 1444, Tax-Free Spirits for Use of United States, remain valid until surrendered or cancelled.
(2) A copy of the current ATF Form 1444 or TTB Form 5150.33 shall be made available to the supplier with the initial order. The permit number only needs to be referenced on any future orders with the same supplier.
(c)
(a) The authority to make the determination prescribed in FAR 29.303(a) is delegated, without power of redelegation, to the Head of the Contracting Activity (HCA).
40 U.S.C. 121(c); 41 U.S.C. 1303; 41 U.S.C. 1702; and 48 CFR 1.301-1.304.
As used in this part—
The contracting officer shall insert the clause at 852.236-74, Inspection of Construction, in solicitations and contracts for construction that include the FAR clause at 52.246-12, Inspection of Construction.
The contracting officer shall insert the clause at 852.246-71, Rejected Goods, in solicitations and contracts for the acquisition of supplies, equipment or perishable goods. Perishable goods include such items as packing house and dairy products, bread and bakery products, fresh and frozen fruits, and vegetables.
(a) The contracting officer shall insert the clause at 852.246-72, Frozen Processed Foods, in solicitations and contracts for frozen processed foods.
(b) The following frozen processed food products must contain a label that complies with the Federal Food, Drug and Cosmetic Act (21 U.S.C. 301), which requires all ingredients be listed in accordance with their predominance order:
(1) Frozen processed food products that contain meat, poultry, or a significant proportion of eggs.
(2) Frozen processed food products that contain fish or fish products.
(3) Frozen bakery products.
(c) All procured frozen processed food products that contain meat, poultry or a significant proportion of eggs must meet the following requirements:
(1) The products must be processed or prepared in plants operating under the supervision of the Department of Agriculture (USDA).
(2) The product must be inspected and approved in accordance with USDA regulations governing meat, poultry, or egg inspection. A label or seal that indicates compliance with USDA regulations, affixed to the container, will be accepted as evidence of compliance.
(d) All procured frozen processed food products that contain fish or fish products must meet the following requirements:
(1) The product must be processed or prepared in plants operated under the supervision of the Department of Commerce (DOC). The products listed in DOC's publication “Approved List of Sanitarily Inspected Fish
(2) If the condition in paragraph (d)(1) of this section was not met (
(e) Producers of frozen bakery products that ship products in interstate commerce are required to comply with the Federal Food, Drug and Cosmetic Act. Therefore, the product must be verified as shipped interstate or that the producer ships products to other purchasers interstate.
The contracting officer shall insert the clause at 852.246-73, Noncompliance with Packaging, Packing, and/or Marking Requirements, in non-commercial item solicitations and contracts for supplies or equipment where there are special packaging, packing and/or marking requirements. The clause may be used in commercial item acquisitions if a waiver is approved in accordance with FAR 12.302(c).
(a) The U.S. Food and Drug Administration (FDA) at
(b) The contracting officer shall insert the clause at 852.246-76, Purchase of Shellfish, in solicitations and contracts for shellfish.
(a) The contracting officer shall indicate the time and place of inspection in the solicitation.
(b) The contracting office shall also provide in the solicitation that the contractor is responsible for all of the following:
(1) Arranging and paying for inspection services.
(2) Obtaining from the inspectors a certificate indicating that the product complies with specifications.
(3) Assuring that the certificate, or copy, accompanies the shipment.
(4) Furnishing samples for inspection at the contractor's expense.
(5) Indicating the address where inspection will occur.
(c) The contracting officer must furnish a copy of the purchase document to the inspecting activity.
The contracting officer may use a commercial organization for inspection and grading services when the contracting officer determines that all of the following exist:
(a) The results of a technical inspection or grading are dependent upon the application of scientific principles or specialized techniques.
(b) VA is unable to employ the personnel qualified to properly perform the services and is unable to locate another Federal agency capable of providing the service.
(c) The inspection or grading results issued by a private organization are essential to verify the acceptance or rejection of a special commodity.
(d) The services may be performed without direct Government supervision.
(a) All new food service equipment purchased for Dietetic Service through other than the Defense General Supply Center sources must meet requirements set forth by National Sanitation Foundation (NSF) at
(b) The contracting officer will ensure that the following language is placed in the solicitation to assert that the equipment meets NSF standards:
The Government will accept an affixed NSF label and/or documentation of the NSF Certification from the contractor as evidence that the subject equipment meets NSF Sanitation standards.
(a) Guarantee period of services are associated with preserving and protecting a specified piece of contractor-installed equipment that is guaranteed under a construction contract. Specifications for certain high-dollar or traditionally troublesome equipment are designed to allow for the original installer of the equipment to service the equipment throughout the guaranty period.
(b) Guarantee period services are not the same as the 1-year general construction guaranty clause found at FAR clause 52.246-21, Warranty of Construction.
(c) The contracting officer may determine, when in the best interest of VA that guarantee period services, not to exceed a period of 5 years, are appropriate to protect the integrity of the installed equipment and ensure that the equipment performs as guaranteed.
(d) When the determination is made under paragraph (c), the contracting officer shall include the guarantee period of services as a separately priced contract line item number (CLIN) in solicitations and contracts.
(e) The contracting officer shall insert the clause at 852.246-75, Warranty of Construction—Guarantee Period Services, in solicitations and contracts for construction that include the FAR clause 52.246-21, Warranty of Construction, and that also include guarantee period services.
(f) In accordance with the approved VA specifications, the following types of equipment contain the guarantee period services specifications. The following represents a sampling of these specifications.
(1)
(i) Electric Dumbwaiters Geared Traction and Winding Drum (VA 14 12 11)
(ii) Electric Traction Elevators (VA 14 21 00)
(iii) Traction Cartlift (VA 14 21 11)
(iv) Hydraulic Elevators (VA 14 24 00)
(v) Hydraulic Cartlift (VA 14 24 11)
(vi) Public Address and Mass Notification Systems (VA 27 51 16)
(2)
Intercommunication and Program Systems (VA 27 51 23)
(g) The construction contractor shall require the original installer of the equipment, which is normally a subcontractor to provide the guarantee period services.
38 U.S.C. 513; 40 U.S.C. 121(c); 31 U.S.C. 1303; 41 U.S.C. 1702; 41 CFR part 102-117; and 48 CFR 1.301-1.304.
Transportation payments are audited by the Traffic Manager, to ensure that payment and payment mechanisms for agency transportation are uniform and appropriate in accordance with 41 CFR part 102-117.
(a) Insurance under patient transportation contracts. The contracting officer shall ensure that all the proper certificates of insurance are submitted to perform on the contract, as outlined in the solicitation, and subsequently included in the contract file. In accordance with 828.306, the contracting officer shall insert the provision at 852.228-71, Indemnification and Insurance, in solicitations when utilizing term contracts or contracts of a continuing nature for ambulance, automobile and aircraft service. When contracting for these services, consider using requirements language such as the following:
(1) Written proof of Insurance coverage as required and outlined in the solicitation is required prior to award of any contract. Coverage must be maintained continually through the life of the contract.
(2) Within 10 days of notification of acceptance and pending award of contract, the contractor shall furnish to the contracting officer a certificate of insurance which shall contain an endorsement to the effect that cancellation of, or any material change in, the policies which adversely affect the interests of the Government in such insurance shall not be effective unless a 30-day advance written notice of cancellation or change is furnished to the contracting officer.
(3) Within 10 days of notification of acceptance and pending award of contract, and prior to award of a contract, the contractor shall furnish to the contracting officer a copy of the contractor's current and valid Worker's Compensation certificate.
(b) Contractor personnel. The contracting officer shall ensure that the contractor personnel have the appropriate level of training, experience, licensure, and pertinent qualifications to ensure patient safety. When contracting for these services, consider using requirements language such as the following:
(1) All contractor personnel performing contract services shall meet the qualifications as specified in the contract, as well as any qualifications required by Federal, State, county, and local government entities from the place in which they operate. Contractor personnel shall meet these qualifications at all times while performing contract services.
(2) During the contract period of performance, if the contractor proposes to add-on, or replace personnel to perform contract services, the contractor shall submit required evidence of training, certifications, licensing, background, and security clearances, and any other applicable qualifications to the designated COR. At no time shall the contractor utilize add-on or replacement personnel to perform contract services who do not meet the qualifications under the terms and conditions of the contract.
(3) Records of contractor personnel qualifications and eligibility to perform on the contract must be maintained current throughout the life of the contract, and be made available for inspection upon request. The contractor shall forward to the contracting officer, on an annual basis, a list of contractor employees listing the employees name, position(s), and licenses and/or certifications and their current certification number. This annual statement of driver competency must include any advanced certifications, such as Advanced Cardiac Life Support or specialized training to assist and secure patients by stretcher or wheelchair, as applicable.
(4) Within seven (7) days after receipt of award notification, the contractor shall provide evidence of required training, certifications, licensing and any other qualifications of any personnel who will be performing services under the contract. The initial documentation shall be provided to the contracting officer and COR.
(c) Contracts must include requirements to report vehicle accidents and incidents to the Contracting Officer with a formal accident report.
(d) Contracts for ambulance services must require that the contractor meet the current specifications of Federal Specification KKK-A-1822E, “Star of Life Ambulance” standard.
(e) Contracts must include requirements to ensure patient safety is maintained through the consistent practice of securing patient care equipment, other cargo, and vehicles, and ensure that security of patients in vehicles is established and observed when transportation needs are either primary or secondary in the actual performance of the contract. When contracting for these services, consider using requirements language to ensure that patient transportation meets industry standards for transporting patients based on the patient's condition/needs (
The contracting officer shall insert clause 852.247-71, Delivery Location, or a clause substantially the same as the clause at 852.247-71, Delivery Location, in supply contracts when it is necessary to specify delivery locations. If appropriate, the clause may reference an attachment which lists various delivery locations and other delivery details (
(a) The contracting officer shall insert clause 852.247-72, Marking Deliverables, or a clause substantially the same as 852.247-72 in solicitations and contracts if special marking on deliverables are required.
(b) The contracting officer shall insert the clause at 852.247-73, Packing for
When the contracting officer contracts with multiple bidders to provide items directly to VA field installations, on an f.o.b. origin basis, the evaluation of bids must follow specific procedures. In these instances, the contracting officer shall insert clause 852.247-70, Determining Transportation Costs for Evaluation of Offers, or a clause substantially the same as clause 852.247-70. By inserting this clause, each bid is placed on an equal basis, even though specific quantities required by each facility cannot be predetermined. The contracting officer must use an anticipated demand factor in proportion to the number of hospital beds or patient workload.
(a) The contracting officer shall insert clause 852.247-74, Advance Notice of Shipment, or a clause substantially as 852.247-74, in solicitations and contracts when the F.o.b. point is destination, and special Government assistance is required in the delivery or receipt of the items.
(b) The contracting officer shall insert clause 852.247-75, Bills of Lading, or a clause substantially the same as clause at 852.247-75, in F.o.b. origin solicitations and contracts.
When contracting for transportation, and consistent with FAR 15.304, contracting officers should consider using the following as an evaluation factor or subfactor: Record of claims involving loss or damage.
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 846.370-1, insert the following clause:
(a)
(b)
As prescribed in 846.370-2, insert the following clause:
The products delivered under this contract shall be in excellent condition, shall not show evidence of defrosting, refreezing, or freezer burn and shall be transported and delivered to the consignee at a temperature of 0 degrees Fahrenheit or lower.
As prescribed in 846.370-3, insert the following clause:
Failure to comply with the packaging, packing and/or marking requirements indicated herein, or incorporated herein by reference, may result in rejection of the merchandise and request for replacement or repackaging, repacking, and/or marking. The Government reserves the right, without obtaining authority from the Contractor, to perform the required repackaging, repacking, and/or marking services and charge the Contractor at the actual cost to the Government for the same or have the required repackaging, repacking, and/or marking services performed commercially under Government order and charge the Contractor at the invoice rate. In connection with any discount offered, time will be computed from the date of completion of such repackaging, repacking and/or marking services.
As prescribed in 846.702-70(e), insert the following clause:
The clause 52.246-21, Warranty of Construction, is supplemented as follows:
Should the Contractor fail to complete the work or fail to proceed promptly to provide guarantee period services after notification by the Contracting Officer, the Government may, subject to the default clause contained at FAR 52.249-10, Default (Fixed-Price Construction), and after allowing the Contractor 10 days to correct and comply with the contract, terminate the right to proceed with the work (or the separable part of the work) that has been delayed or unsatisfactorily performed. In this event, the Government may take over the work and complete it by contract or otherwise, and may take possession of and use any materials, appliances, and plant on the work site necessary for completing the work. The Contractor and its sureties shall be liable for any damages to the Government resulting from the Contractor's refusal or failure to complete the work within this specified time, whether or not the Contractor's right to proceed with the work is terminated. This liability includes any increased costs incurred by the Government in completing the work.
As prescribed in 846.370-4 insert the following clause:
The supplier certifies that oysters, clams, and mussels will be furnished only from plants approved by and operated under the supervision of shellfish authorities of States whose certifications are endorsed currently by the U.S. Public Health Service, and the names and certificate numbers of those shellfish dealers must appear on current lists published by the U.S. Public Health Service. These items shall be packed and delivered in approved containers, sealed in such manner that tampering is easily discernible, and marked with packer's certificate number
As prescribed in 847.305-70, insert the following provision:
For the purpose of evaluating bids and for no other purpose, the delivered price per unit will be determined by adding the nationwide average transportation charge to the F.o.b. origin bid prices. The nationwide average transportation charge will be determined by applying the following formula: Multiply the guaranteed shipping weight by the freight, parcel post, or express rate, whichever is proper, to each destination shown below and then multiply the resulting transportation charges by the anticipated demand factor shown for each destination. Total the resulting weighted transportation charges for all destinations and divide the total by 20 to give the nationwide average transportation charge.
As prescribed in 847.302, insert a clause substantially as follows:
Shipment of deliverable items, other than reports, shall be to: __* Contracting Officer shall insert appropriate identifying data.
As prescribed in 847.305-10(a) insert a clause substantially the same as:
(a) The contract number shall be placed on or adjacent to all exterior mailing or shipping labels of deliverable items called for by the contract.
(b) Mark deliverables, except reports, for:________*.
* Contracting Officer shall insert appropriate identifying data.
As prescribed in 847.305-10(b), insert the following clause:
Material shall be packed for shipment in such a manner that will insure acceptance by common carriers and safe delivery at destination. Containers and closures shall comply with regulations of carriers as applicable to the mode of transportation.
As prescribed in 847.305-71(a), insert the following clause:
[
[
As prescribed in 847.305-71(b), insert the following clause:
The purpose of this clause is to define when a commercial bill of lading or a government bill of lading is to be used when shipments of deliverable items under this contract are F.o.b. origin.
(a) Commercial Bills of Lading. All domestic shipments shall be made via commercial bills of lading (CBLs). The Contractor shall prepay domestic transportation charges. The Government shall reimburse the Contractor for these charges if they are added to the invoice as a separate line item supported by the paid freight receipts. If paid receipts in support of the invoice are not obtainable, a statement as described below must be completed, signed by an authorized company representative, and attached to the invoice.
“I certify that the shipments identified below have been made, transportation charges have been paid by (company name), and paid freight or comparable receipts are not obtainable.
Contract or Order Number: ________
Destination: ________.”
(b) Government Bills of Lading.
(1) International (export) and domestic overseas shipments of items deliverable under this contract shall be made by Government bills of lading (GBLs). As used in this clause, “domestic overseas” means non-continental United States,
(2) At least 15 days before shipment, the Contractor shall request in writing GBLs from: ________ [Insert name, title, and mailing address of designated transportation officer or other official delegated responsibility for GBLs]. If time is limited, requests may be by telephone: ________ [Insert appropriate telephone number]. Requests for GBLs shall include the following information.
(i) Item identification/description.
(ii) Origin and destination.
(iii) Individual and total weights.
(iv) Dimensional weight.
(v) Dimensions and total cubic footage.
(vi) Total number of pieces.
(vii) Total dollar value.
(viii) Other pertinent data.
Fish and Wildlife Service, Interior.
Proposed rule.
In 2005, the U.S. Fish and Wildlife Service (Service or “we”) published a final environmental impact statement on management of resident Canada geese (
Comments on this proposed rule must be received by May 25, 2018.
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We will not accept email or faxes. We will post all comments on
Paul I. Padding, Atlantic Flyway Representative, Division of Migratory Bird Management, U.S. Fish and Wildlife Service, 11510 American Holly Drive, Laurel, MD 20708; (301) 497-5851 or email
Migratory birds are protected under four bilateral migratory bird treaties the United States entered into with Great Britain (for Canada in 1916 as amended in 1999), the United Mexican States (1936 as amended in 1972 and 1999), Japan (1972 as amended in 1974), and the Soviet Union (1978). Regulations allowing the take of migratory birds are authorized by the Migratory Bird Treaty Act (Act; 16 U.S.C. 703-712), which implements the above-mentioned treaties. The Act provides that, subject to and to carry out the purposes of the treaties, the Secretary of the Interior is authorized and directed to determine when, to what extent, and by what means allowing hunting, killing, and other forms of taking of migratory birds, their nests, and eggs is compatible with the conventions. The Act requires the Secretary to implement a determination by adopting regulations permitting and governing those activities.
Canada geese are federally protected by the Act because they are listed as migratory birds in all four treaties. Because Canada geese are covered by all four treaties, regulations must meet the requirements of the most restrictive of the four. For Canada geese, this is the treaty with Canada. All regulations concerning resident Canada geese are compatible with its terms, with particular reference to Articles II, V, and VII.
Each treaty not only permits sport hunting, but permits the take of migratory birds for other reasons, including scientific, educational, propagative, or other specific purposes consistent with the conservation principles of the various Conventions. More specifically, Article VII, Article II (paragraph 3), and Article V of “The Protocol Between the Government of the United States of America and the Government of Canada Amending the 1916 Convention between the United Kingdom and the United States of America for the Protection of Migratory Birds in Canada and the United States” provides specific limitations on allowing the take of migratory birds for reasons other than sport hunting. Article VII authorizes permitting the take, kill, etc., of migratory birds that, under extraordinary conditions, become seriously injurious to agricultural or other interests. Article V relates to the taking of nests and eggs, and Article II, paragraph 3, states that, in order to ensure the long-term conservation of migratory birds, migratory bird populations shall be managed in accord with listed conservation principles.
The other treaties are less restrictive. The treaties with both Japan (Article III, paragraph 1, subparagraph (b)) and the Soviet Union (Article II, paragraph 1, subparagraph (d)) provide specific exceptions to migratory bird take prohibitions for the purpose of protecting persons and property. The treaty with Mexico requires, with regard to migratory game birds, only that there be a “closed season” on hunting and that hunting be limited to 4 months in each year.
Regulations governing the issuance of permits to take, capture, kill, possess, and transport migratory birds are promulgated at title 50, Code of Federal Regulations (CFR), parts 13, 21 and 22, and issued by the Service. The Service annually promulgates regulations governing the take, possession, and transportation of migratory game birds under sport hunting seasons at 50 CFR part 20. Regulations regarding all other take of migratory birds (except for eagles) are published at 50 CFR part 21, and typically are not changed annually.
In November 2005, the U.S. Fish and Wildlife Service (Service or “we”) published a final environmental impact statement on management of resident Canada geese that documented resident Canada goose population levels “that are increasingly coming into conflict with people and causing personal and public property damage.” On August 10, 2006, we published in the
In recent years, some resident Canada geese have initiated nests in February, particularly in the southern United States, and it seems likely that in the future nest initiation dates will begin earlier and hatching of eggs will perhaps end later than dates currently experienced. This proposed rule would amend the special permit and depredation and control orders to allow destruction of resident Canada goose nests and eggs at any time of year, thereby affording State agencies, private landowners, and airports greater flexibility to use these methods of controlling local abundances of resident Canada geese.
The current definition of resident Canada geese contained in 50 CFR 20.11 and 21.3 states that “Canada geese that
In title 50 of the CFR, destruction of resident Canada goose nests and eggs is currently authorized under special Canada goose permits (§ 21.26), a control order for airports and military airfields (§ 21.49), a depredation order specific to nests and eggs (§ 21.50), a depredation order for agricultural facilities (§ 21.51), and a public health control order (§ 21.52). Each of these regulations prescribes the dates during which nests and eggs of resident Canada goose may be destroyed. We propose to remove those date restrictions and allow destruction of Canada goose nests and eggs, as otherwise authorized under these regulations, at any time of year.
Our proposal is based on several factors. First, nest and egg destruction has been an effective tool in reducing local conflicts and damages caused by resident Canada geese. Second, resident Canada geese are identified as such based on where, not when, they nest. Lastly, some Canada geese are already nesting in February in southern States, and it seems likely that nest initiation dates will also advance into February in mid-latitude and perhaps northern States in the future, and hatching of nests may occur later than June 30.
On June 17, 1999, we published in the
On March 20, 2001, we published in the
We prepared an environmental assessment (EA) that analyzed two alternative courses of action to address these earlier nesting and later hatching dates and decrease local abundances of Canada geese that nest in the lower 48 States and the District of Columbia:
(1) Maintain the current date restrictions specified in regulations at 50 CFR 21.26, 21.49, 21.50, 21.51, and 21.52 on destruction of resident Canada goose nests and eggs, and no change in the definition of resident Canada geese at 50 CFR 20.11 and 21.3 (No action); and
(2) Revise the definition of resident Canada geese at 50 CFR 20.11 and 21.3, and allow destruction of resident Canada goose nests and eggs at any time of year under 50 CFR 21.26, 21.49, 21.50, 21.51, and 21.52 (Proposed action).
The full EA can be found on our website at
We note that the proposed amendment to § 21.26 in regard to accounting for the current status of the Aleutian Canada goose was not addressed in the EA, but is a categorically excluded action (43 CFR 46.210) addressed in an environmental action statement (EAS). The EAS can be found on our website at
You may submit your comments and supporting materials by one of the methods listed in
We will post your entire comment—including your personal identifying information—on
Executive Order (E.O.) 12866 provides that the Office of Information and Regulatory Affairs (OIRA) in the Office of Management and Budget (OMB) will review all significant rules. OIRA has determined that this rule is not significant.
Executive Order 13563 reaffirms the principles of E.O. 12866 while calling for improvements in the nation's regulatory system to promote predictability, to reduce uncertainty, and to use the best, most innovative, and least burdensome tools for achieving regulatory ends. The executive order directs agencies to consider regulatory approaches that reduce burdens and maintain flexibility and freedom of choice for the public where these approaches are relevant, feasible, and consistent with regulatory objectives. E.O. 13563 emphasizes further that regulations must be based on the best available science and that the rulemaking process must allow for public participation and an open
Under the Regulatory Flexibility Act (5 U.S.C. 601
SBREFA amended the Regulatory Flexibility Act to require Federal agencies to provide a statement of the factual basis for certifying that a rule would not have a significant economic impact on a substantial number of small entities. Thus, for a regulatory flexibility analysis to be required, impacts must exceed a threshold for “significant impact” and a threshold for a “substantial number of small entities.” See 5 U.S.C. 605(b).
The economic impacts of this proposed rule would primarily affect State and local governments and the U.S. Department of Agriculture's Wildlife Services because of the structure of wildlife damage management. Data are not available to estimate the exact number of local governments that would be affected, but it is unlikely to be a substantial number nationally. Therefore, we certify that, if adopted, this rule would not have a significant economic impact on a substantial number of small entities.
This proposed rule is not a major rule under SBREFA (5 U.S.C. 804(2)). It would not have a significant impact on a substantial number of small entities.
This rule would not have an annual effect on the economy of $100 million or more. This rule would not cause a major increase in costs or prices for consumers; individual industries; Federal, State, or local government agencies; or geographic regions.
Finally, this rule would not have significant adverse effects on competition, employment, investment, productivity, innovation, or the abilities of U.S.-based enterprises to compete with foreign-based enterprises.
This proposed rule is expected to be an Executive Order (E.O.) 13771 (82 FR 9339, February 3, 2017) deregulatory action because it would relieve a restriction in 50 CFR parts 20 and 21.
In accordance with the Unfunded Mandates Reform Act (2 U.S.C. 1501
a. This proposed rule would not “significantly or uniquely” affect small government activities. A small government agency plan is not required.
b. This proposed rule would not produce a Federal mandate on local or State government or private entities. Therefore, this action is not a “significant regulatory action” under the Unfunded Mandates Reform Act.
In accordance with E.O. 12630, this proposed rule does not contain a provision for taking of private property, and would not have significant takings implications. A takings implication assessment is not required.
This proposed rule would not interfere with the States' abilities to manage themselves or their funds. We do not expect any economic impacts to result from this regulations change. This rule would not have sufficient Federalism effects to warrant preparation of a federalism summary impact statement under E.O. 13132.
In accordance with E.O. 12988, the Office of the Solicitor has determined that the proposed rule will not unduly burden the judicial system and meets the requirements of sections 3(a) and 3(b)(2) of the Order.
This proposed rule does not contain new collections of information that require approval by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
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.
We have analyzed this proposed rule in accordance with the National Environmental Policy Act (NEPA; 42 U.S.C. 4321
Migrant Canada geese do not nest in the lower 48 States or the District of Columbia; thus, this proposed action (amendments related only to depredation and control orders) is not expected to have any significant impacts on migrant Canada geese. All resident Canada goose population abundances are well above population objectives. Assuming that the number of resident Canada geese that initiate nests in January or February does not exceed the current number that initiate nests in March, we expect that this proposed action would result in destruction of a maximum of 2,749 additional nests in January and February. We expect it is more likely that the proposed action would shift some portion of the current resident Canada goose nest and egg destruction activities occurring in March to either January or February. All populations of resident Canada geese are expected to remain at or above population objective levels.
Section 7 of the Endangered Species Act of 1973, as amended (ESA; 16 U.S.C. 1531
In accordance with the President's memorandum of April 29, 1994, “Government-to-Government Relations with Native American Tribal Governments” (59 FR 22951), E.O. 13175, and 512 DM 2, we have evaluated potential effects on federally recognized Indian tribes and have determined that there are no potential effects. This proposed rule would not interfere with the tribes' abilities to manage themselves or their funds or to regulate migratory bird activities on tribal lands.
We are required by Executive Orders 12866 and 12988 and by the Presidential Memorandum of June 1, 1998, to write all rules in plain language. This means that each rule we publish must:
(a) Be logically organized;
(b) Use the active voice to address readers directly;
(c) Use clear language rather than jargon;
(d) Be divided into short sections and sentences; and
(e) Use lists and tables wherever possible.
If you feel that we have not met these requirements, send us comments by one of the methods listed in
E.O. 13211 requires agencies to prepare Statements of Energy Effects when undertaking certain actions. This proposed rule is not a significant regulatory action under E.O. 13211, and would not significantly affect energy supplies, distribution, or use. Therefore, this action is not a significant energy action. No Statement of Energy Effects is required.
Exports, Hunting, Imports, Reporting and recordkeeping requirements, Transportation, Wildlife.
For the reasons stated in the preamble, we hereby propose to amend parts 20 and 21, of subchapter B, chapter I, title 50 of the Code of Federal Regulations, as set forth below:
16 U.S.C. 703
(n)
16 U.S.C. 703-712.
(d) * * *
(2)
(d) * * *
(3) Airports and military airfields may conduct management and control activities, involving the take of resident Canada geese, under this section between April 1 and September 15. The destruction of resident Canada goose nests and eggs may take place at any time of year.
(d) * * *
(4) Registrants may conduct resident Canada goose nest and egg destruction activities at any time of year. Homeowners' associations and local governments or their agents must obtain landowner consent prior to destroying nests and eggs on private property within the homeowners' association or local government's jurisdiction and be in compliance with all State and local laws and regulations.
(d) * * *
(4) Authorized agricultural producers and their employees and agents may
(e) * * *
(3) Authorized State and Tribal wildlife agencies and their employees and agents may conduct management and control activities, involving the take of resident Canada geese, under this section between April 1 and August 31. The destruction of resident Canada goose nests and eggs may take place at any time of year.
Commission on Civil Rights.
Announcement of meeting.
Notice is hereby given, pursuant to the provisions of the rules and regulations of the U.S. Commission on Civil Rights (Commission), and the Federal Advisory Committee Act (FACA) that a meeting of the West Virginia Advisory Committee to the Commission will convene by conference call at 12:00 p.m. (EST) on Friday, May 4, 2018. The purpose of the meeting is to hear presentations from a panel of experts who will provide a national perspective on the impact a felony conviction/record has on a person's access to employment, housing, occupational licenses and public benefits.
Friday, May 4, 2018, at 12:00 p.m. EST.
Conference call-in number: 1-800-474-8920 and conference call ID 8310490.
Ivy Davis at
Interested members of the public may listen to the discussion by calling the following toll-free conference call-in number: 1-800-474-8920 and conference call 8310490. Please be advised that before placing them into the conference call, the conference call operator will ask callers to provide their names, their organizational affiliations (if any), and email addresses (so that callers may be notified of future meetings). Callers can expect to incur charges for calls they initiate over wireless lines, and the Commission will not refund any incurred charges. Callers will incur no charge for calls they initiate over land-line connections to the toll-free conference call-in number.
Persons with hearing impairments may also follow the discussion by first calling the Federal Relay Service at 1-800-877-8339 and providing the operator with the toll-free conference call-in number: 1-800-474-8920 and conference call ID 8310490.
Members of the public are invited to submit written comments. The comments must be received in the regional office approximately 30 days after each scheduled meeting. Comments may be mailed to the Eastern Regional Office, U.S. Commission on Civil Rights, 1331 Pennsylvania Avenue, Suite 1150, Washington, DC 20425, or emailed to Corrine Sanders at
Records and documents discussed during the meeting will be available for public viewing as they become available at
U.S. Commission on Civil Rights.
Announcement of meeting.
Notice is hereby given, pursuant to the provisions of the rules and regulations of the U.S. Commission on Civil Rights (Commission) and the Federal Advisory Committee Act that the Michigan Advisory Committee (Committee) will hold a meeting on Wednesday May 23, 2018, at 11am EDT for the purpose discussing civil rights concerns in the state.
The meeting will be held on Wednesday May 23, 2018, at 11 a.m. EDT.
Melissa Wojnaroski, DFO, at
Members of the public can listen to the discussion. This meeting is available to the public through the above toll-free call-in number. Any interested member of the public may call this number and listen to the meeting. An open comment period will be provided to allow members of the public to make a statement as time allows. The conference call operator will ask callers to identify themselves, the organization they are affiliated with (if any), and an email address prior to placing callers into the conference room. Callers can expect to incur regular charges for calls they initiate over wireless lines, according to their wireless plan. The Commission will not refund any incurred charges. Callers will incur no charge for calls they initiate over land-line connections to the toll-free telephone number. Persons with hearing impairments may also follow the proceedings by first calling the Federal Relay Service at 1-800-877-8339 and providing the Service with the conference call number and conference ID number.
Members of the public are also entitled to submit written comments; the comments must be received in the regional office within 30 days following the meeting. Written comments may be mailed to the Midwestern Regional Office, U.S. Commission on Civil Rights, 230 S. Dearborn St., Suite 2120, Chicago, IL 60604. They may also be faxed to the Commission at (312) 353-8324, or emailed to Carolyn Allen at
Records generated from this meeting may be inspected and reproduced at the Midwestern Regional Office, as they become available, both before and after the meeting. Records of the meeting will be available via
Commission on Civil Rights.
Announcement of meeting.
Notice is hereby given, pursuant to the provisions of the rules and regulations of the U.S. Commission on Civil Rights (Commission), and the Federal Advisory Committee Act (FACA) that a meeting of the Virginia Advisory Committee to the Commission will convene by conference call at 12:00 p.m. (EST) on Wednesday, May 16, 2018. The purpose of the meeting is to hear presentations from a panel of experts who will provide a national perspective on the Committee's civil rights project, titled Hate Crimes in VA—Incidences and Responses.
Wednesday, May 16, 2018, at 12:00 p.m. EST.
Public call-in information: Conference call-in number: 1-800-474-8920 and conference call ID number: 8310490.
Ivy Davis at
Interested members of the public may listen to the discussion by calling the following toll-free conference call-in number: 1-800-474-8920 and conference call ID number: 8310490. Please be advised that before placing them into the conference call, the conference call operator will ask callers to provide their names, their organizational affiliations (if any), and email addresses (so that callers may be notified of future meetings). Callers can expect to incur charges for calls they initiate over wireless lines, and the Commission will not refund any incurred charges. Callers will incur no charge for calls they initiate over land-line connections to the toll-free conference call-in number.
Persons with hearing impairments may also follow the discussion by first calling the Federal Relay Service at 1-800-877-8339 and providing the operator with the toll-free conference call-in number: 1-800-474-8920 and conference call ID number: 8310490.
Members of the public are invited to submit written comments. Comments must be received in the regional office approximately 30 days after each scheduled meeting. They may be mailed to the Eastern Regional Office, U.S. Commission on Civil Rights, 1331 Pennsylvania Avenue, Suite 1150, Washington, DC 20425, or emailed to Corrine Sanders at
Records and documents discussed during the meeting will be available for public viewing as they become available at
U.S. Commission on Civil Rights.
Announcement of meeting.
Notice is hereby given, pursuant to the provisions of the rules and regulations of the U.S. Commission on Civil Rights (Commission) and the Federal Advisory Committee Act (FACA) that a meeting of the Minnesota Advisory Committee (Committee) to the Commission will be held from 2:00-3:00 p.m. CDT Wednesday June 6, 2018 to discuss civil rights concerns in the State.
The meeting will be held on Wednesday June 6, 2018, from 2:00-3:00 p.m. CDT.
Carolyn Allen at
This meeting is available to the public through the above toll-free call-in number. Any interested member of the public may call this number and listen to the meeting. Callers can expect to incur charges for calls they initiate over wireless lines, and the Commission will not refund any incurred charges. Callers will incur no charge for calls they initiate over land-line connections to the toll-free telephone number. Persons with hearing impairments may also follow the proceedings by first calling the Federal Relay Service at 1-800-877-8339 and providing the Service with the conference call number and conference ID number.
Members of the public are entitled to make comments during the open period at the end of the meeting. Members of the public may also submit written comments; the comments must be received in the Regional Programs Unit within 30 days following the meeting. Written comments may be mailed to the U.S. Commission on Civil Rights, Regional Programs Unit, 230 S. Dearborn, Suite 2120, Chicago, IL 60604. They may be faxed to the Commission at (312) 353-8324, or emailed Carolyn Allen at
Records and documents discussed during the meeting will be available for public viewing prior to and after the meeting at
Please click on the “Meeting Details” and “Documents” links to download. Records generated from this meeting may also be inspected and reproduced at the Regional Programs Unit, as they become available, both before and after the meeting. Persons interested in the work of this Committee are directed to the Commission's website,
Enforcement and Compliance, International Trade Administration, Department of Commerce.
Joseph Degreenia, AD/CVD Operations, Office III, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 432-6430
On February 8, 2018, the Department of Commerce (Commerce) published the final results of the expedited fourth sunset review of the antidumping duty order on silicomanganese from the People's Republic of China (China).
This correction is published in accordance with sections 751(c), 752(c) and 777(i) of the Tariff Act of 1930, as amended.
Enforcement and Compliance, International Trade Administration, Department of Commerce.
Applicable April 17, 2018.
Edythe Artman at (202) 482-3931 or Kent Boydston at (202) 482-5649 (India); Madeline Heeren at (202) 482-9179 or John McGowan at (202) 482-3019 (Japan); and Brian Smith at (202) 482-1766 or Jesus Saenz at (202) 482-8184 (Thailand); AD/CVD Operations, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230.
On March 28, 2018, the U.S. Department of Commerce (Commerce) received antidumping duty (AD) Petitions concerning imports of glycine from India, Japan, and Thailand, and countervailing duty (CVD) Petitions concerning imports of glycine from the People's Republic of China, India, and Thailand filed in proper form on behalf of GEO Specialty Chemicals, Inc., and Chattem Chemicals, Inc. (the petitioners).
On April 2, 6, and 10, 2018, Commerce requested supplemental information pertaining to certain areas of the Petitions.
In accordance with section 732(b) of the Tariff Act of 1930, as amended (the Act), the petitioners allege that imports of glycine from India, Japan, and Thailand are being, or are likely to be, sold in the United States at less than fair value within the meaning of section 731 of the Act, and that such imports are materially injuring, or threatening material injury to, the domestic industry producing glycine in the United States. Consistent with section 732(b)(1) of the Act, the Petitions are accompanied by information reasonably available to the petitioners supporting their allegations.
Commerce finds that the petitioners filed the Petitions on behalf of the domestic industry because the petitioners are interested parties as defined in section 771(9)(C) of the Act. Commerce also finds that the petitioners demonstrated sufficient industry support with respect to the initiation of the AD investigations that the petitioners are requesting.
Because the Petitions were filed on March 28, 2018, the period of investigation (POI) for each of the investigations is January 1, 2017, through December 31, 2017.
The product covered by these investigations is glycine from India, Japan, and Thailand. For a full description of the scope of these investigations,
During our review of the Petitions, Commerce issued questions to, and received responses from, the petitioners pertaining to the proposed scope to ensure that the scope language in the Petitions is an accurate reflection of the product for which the domestic industry is seeking relief.
As discussed in the
Commerce requests that any factual information the parties consider relevant to the scope of the investigations be submitted during this time period. However, if a party subsequently finds that additional factual information pertaining to the scope of the investigations may be relevant, the party may contact Commerce and request permission to submit the additional information. All such comments must be filed on the records of each of the concurrent AD and CVD investigations, in accordance with the filing requirements, discussed immediately below.
All submissions to Commerce must be filed electronically using Enforcement and Compliance's Antidumping Duty and Countervailing Duty Centralized Electronic Service System (ACCESS).
Commerce requests comments from interested parties regarding the appropriate physical characteristics of glycine to be reported in response to Commerce's AD questionnaires. This information will be used to identify the key physical characteristics of the merchandise under consideration in order to report the relevant costs of production accurately as well as to develop appropriate product-comparison criteria.
Interested parties may provide any information or comments that they feel are relevant to the development of an accurate list of physical characteristics. Specifically, they may provide comments as to which characteristics are appropriate to use as: (1) General product characteristics, and (2) product-comparison criteria. We note that it is not always appropriate to use all product characteristics as product-comparison criteria. We base product-comparison criteria on meaningful commercial differences among products. In other words, although there may be some physical product characteristics utilized by manufacturers to describe glycine, it may be that only a select few product characteristics take into account commercially meaningful physical characteristics. In addition, interested parties may comment on the order in which the physical characteristics should be used in matching products. Generally, Commerce attempts to list the most important physical characteristics first and the least important characteristics last.
In order to consider the suggestions of interested parties in developing and issuing the AD questionnaires, all product characteristics comments must be filed by 5:00 p.m. ET on May 7, 2018. Any rebuttal comments must be filed by 5:00 p.m. ET on May 14, 2018. All comments and submissions to Commerce must be filed electronically using ACCESS, as explained above, on the records of the India, Japan, and Thailand less-than-fair-value investigations.
Section 732(b)(1) of the Act requires that a petition be filed on behalf of the domestic industry. Section 732(c)(4)(A) of the Act provides that a petition meets this requirement if the domestic producers or workers who support the petition account for: (i) At least 25 percent of the total production of the domestic like product; and (ii) more than 50 percent of the production of the domestic like product produced by that portion of the industry expressing support for, or opposition to, the petition. Moreover, section 732(c)(4)(D) of the Act provides that, if the petition does not establish support of domestic producers or workers accounting for more than 50 percent of the total production of the domestic like product, Commerce shall: (i) Poll the industry or rely on other information in order to determine if there is support for the petition, as required by subparagraph (A); or (ii) determine industry support using a statistically valid sampling method to poll the “industry.”
Section 771(4)(A) of the Act defines the “industry” as the producers, as a whole, of a domestic like product. Thus, to determine whether a petition has the requisite industry support, the statute directs Commerce to look to producers and workers who produce the domestic like product. The International Trade Commission (ITC), which is responsible for determining whether “the domestic industry” has been injured, must also determine what constitutes a domestic like product in order to define the industry. While both Commerce and the ITC must apply the same statutory definition regarding the domestic like product,
Section 771(10) of the Act defines the domestic like product as “a product which is like, or in the absence of like, most similar in characteristics and uses with, the article subject to an investigation under this title.” Thus, the reference point from which the domestic like product analysis begins is “the article subject to an investigation” (
With regard to the domestic like product, the petitioners do not offer a definition of the domestic like product distinct from the scope of the investigations.
In determining whether the petitioners have standing under section 732(c)(4)(A) of the Act, we considered the industry support data contained in the Petitions with reference to the domestic like product as defined in the “Scope of the Investigations,” in the Appendix to this notice. To establish industry support, the petitioners provided their own production of the domestic like product in 2017.
Our review of the data provided in the Petitions, the General Issues Supplement, and other information readily available to Commerce indicates that the petitioners have established industry support for the Petitions.
Commerce finds that the petitioners filed the Petitions on behalf of the domestic industry because they are interested parties as defined in section 771(9)(C) of the Act, and they have demonstrated sufficient industry support with respect to the AD investigations that they are requesting that Commerce initiate.
The petitioners allege that the U.S. industry producing the domestic like product is being materially injured, or is threatened with material injury, by reason of the imports of the subject merchandise sold at less than normal value (NV). In addition, the petitioners allege that subject imports exceed the negligibility threshold provided for under section 771(24)(A) of the Act.
The petitioners contend that the industry's injured condition is illustrated by a significant and increasing volume of subject imports, reduced market share, underselling and price depression or suppression, decline in the domestic industry's shipments, production, and capacity utilization, decline in the domestic industry's financial performance, and lost sales and revenues.
The following is a description of the allegations of sales at less than fair value upon which Commerce based its decision to initiate AD investigations of imports of glycine from India, Japan, and Thailand. The sources of data for the deductions and adjustments relating to U.S. price and NV are discussed in greater detail in the country-specific initiation checklists.
For India, Japan, and Thailand, the petitioners based export price (EP) on pricing information for glycine produced in, and exported from, those countries and sold or offered for sale in the United States.
Where appropriate, the petitioners made deductions from U.S. price consistent with the terms of sale, as applicable.
For India, Japan and Thailand, the petitioners obtained home market prices but demonstrated that these prices were below the cost of production (COP) during the proposed POI. Therefore, the petitioners calculated NV based on constructed value (CV) pursuant to section 773(a)(4) of the Act.
As noted above, for India, Japan, and Thailand, the petitioners were able to obtain home market prices but demonstrated that these prices were below the COP during the POI; therefore, the petitioners based NV on CV pursuant to section 773(a)(4) of the Act. Pursuant to section 773(b)(3) of the Act, CV consists of the cost of manufacturing (COM); selling, general and administrative (SG&A) expenses; financial expenses; profit; and packing expenses.
For India, the petitioners calculated the COM based on a domestic producer's own input factors of production and usage rates for raw materials, energy, and packing.
For Japan, the petitioners calculated the COM based on a domestic producer's own input factors of production and usage rates for raw materials, energy, and packing.
For Thailand, the petitioners calculated the COM based on a domestic producer's own input factors of production and usage rates for raw materials, labor, energy, and packing.
Based on the data provided by the petitioners, there is reason to believe that imports of glycine from India, Japan, and Thailand are being, or are likely to be, sold in the United States at less than fair value. Based on comparisons of EP to NV in accordance with sections 772 and 773 of the Act, the estimated dumping margins for glycine for each of the countries covered by this initiation are as follows: (1) India—80.49 percent;
Based upon the examination of the Petitions, we find that the Petitions meet the requirements of section 732 of the Act. Therefore, we are initiating AD investigations to determine whether imports of glycine from India, Japan, and Thailand are being, or are likely to be, sold in the United States at less than fair value. In accordance with section 733(b)(1)(A) of the Act and 19 CFR 351.205(b)(1), unless postponed, we will make our preliminary determinations no
In the Petitions, the petitioners named ten companies in India, nine companies in Japan, and one company in Thailand, as producers/exporters of glycine.
We also intend to release the CBP data under Administrative Protective Order (APO) to all parties with access to information protected by APO on the record within five business days of publication of this
Although Commerce normally relies on import data from CBP to determine whether to select a limited number of producers/exporters for individual examination in AD investigations involving market economy countries, the petitioners identified only one company as a producer/exporter of glycine in Thailand, Newtrend Food Ingredient (Thailand) Co., Ltd., and the petitioners provided information from independent sources as support.
All respondent selection comments must be filed electronically using ACCESS. An electronically-filed document must be received successfully, in its entirety, by Commerce's electronic records system, ACCESS, no later than 5:00 p.m. ET on the dates noted above. We intend to make our decisions regarding respondent selection within 20 days of publication of this notice.
In accordance with section 732(b)(3)(A)(i) of the Act and 19 CFR 351.202(f), copies of the public version of the Petitions have been provided to the governments of India, Japan, and Thailand
We will notify the ITC of our initiation, as required by section 732(d) of the Act.
The ITC will preliminarily determine, within 45 days after the date on which the Petitions were filed, whether there is a reasonable indication that imports of glycine from India, Japan, and/or Thailand are materially injuring, or threatening material injury to, a U.S. industry.
Factual information is defined in 19 CFR 351.102(b)(21) as: (i) Evidence submitted in response to questionnaires; (ii) evidence submitted in support of allegations; (iii) publicly available information to value factors under 19 CFR 351.408(c) or to measure the adequacy of remuneration under 19 CFR 351.511(a)(2); (iv) evidence placed on the record by Commerce; and (v) evidence other than factual information described in (i)-(iv). Any party, when submitting factual information, must specify under which subsection of 19 CFR 351.102(b)(21) the information is being submitted
Parties may request an extension of time limits before the expiration of a time limit established under 19 CFR 351.301, or as otherwise specified by the Secretary. In general, an extension request will be considered untimely if it is filed after the expiration of the time limit established under 19 CFR 351.301. For submissions that are due from multiple parties simultaneously, an extension request will be considered untimely if it is filed after 10:00 a.m. ET on the due date. Under certain circumstances, we may elect to specify a different time limit by which extension requests will be considered untimely for submissions which are due from multiple parties simultaneously. In such a case, we will inform parties in the letter or memorandum setting forth the deadline (including a specified time) by which extension requests must be filed to be considered timely. An extension request must be made in a separate, stand-alone submission; under limited circumstances we will grant untimely-filed requests for the extension of time limits. Parties should review
Any party submitting factual information in an AD or CVD proceeding must certify to the accuracy and completeness of that information.
Interested parties must submit applications for disclosure under APO in accordance with 19 CFR 351.305. On January 22, 2008, Commerce published
This notice is issued and published pursuant to sections 732(c)(2) and 777(i) of the Act, and 19 CFR 351.203(c).
The merchandise covered by these investigations is glycine at any purity level or grade. This includes glycine of all purity levels, which covers all forms of crude or technical glycine including, but not limited to, sodium glycinate, glycine slurry and any other forms of amino acetic acid or glycine. Subject merchandise also includes glycine and precursors of dried crystalline glycine that are processed in a third country, including, but not limited to, refining or any other processing that would not otherwise remove the merchandise from the scope of these investigations if performed in the country of manufacture of the in-scope glycine or precursors of dried crystalline glycine. Glycine has the Chemical Abstracts Service (CAS) registry number of 56-40-6. Glycine and glycine slurry are classified under Harmonized Tariff Schedule of the United States (HTSUS) subheading 2922.49.43.00. Sodium glycinate is classified in the HTSUS under 2922.49.80.00. While the HTSUS subheadings and CAS registry number are provided for convenience and customs purposes, the written description of the scope of these investigations is dispositive.
Enforcement and Compliance, International Trade Administration Department of Commerce.
Applicable April 25, 2018.
Stephanie Moore, AD/CVD Operations, Office III, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Ave. NW, Washington, DC 20230, telephone: (202) 482-3692.
Section 702 of the Trade Agreements Act of 1979 (as amended) (the Act) requires the Department of Commerce (Commerce) to determine, in consultation with the Secretary of Agriculture, whether any foreign government is providing a subsidy with respect to any article of cheese subject to an in-quota rate of duty, as defined in section 702(h) of the Act, and to publish quarterly updates to the type and amount of those subsidies. We hereby provide Commerce's quarterly update of subsidies on articles of cheese that were imported during the periods October 1, 2017, through December 31, 2017.
Commerce has developed, in consultation with the Secretary of Agriculture, information on subsidies, as defined in section 702(h) of the Act, being provided either directly or indirectly by foreign governments on articles of cheese subject to an in-quota rate of duty. The appendix to this notice lists the country, the subsidy program or programs, and the gross and net amounts of each subsidy for which information is currently available. Commerce will incorporate additional programs which are found to constitute subsidies, and additional information on the subsidy programs listed, as the information is developed.
Commerce encourages any person having information on foreign government subsidy programs which benefit articles of cheese subject to an in-quota rate of duty to submit such information in writing to the Assistant Secretary for Enforcement and Compliance, U.S. Department of Commerce, 1401 Constitution Ave., NW, Washington, DC 20230.
This determination and notice are in accordance with section 702(a) of the Act.
Enforcement and Compliance, International Trade Administration, Department of Commerce.
The Department of Commerce (Commerce) is amending its final results of the administrative review of the antidumping duty order on circular welded carbon steel pipes and tubes (pipes and tubes) from Thailand. The period of review (POR) is March 1, 2015, through February 29, 2016. The amended final weighted-average dumping margin is listed below in the section entitled, “Amended Final Results.”
Applicable April 25, 2018.
Toni Page, AD/CVD Operations, Office VII, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-1398.
On October 10, 2017, Commerce published the
The products covered by the antidumping order are certain circular welded carbon steel pipes and tubes from Thailand. The subject merchandise has an outside diameter of 0.375 inches or more, but not exceeding 16 inches.
Commerce is not making any changes to the scope of the order for these amended final results.
Section 751(h) of the Tariff Act of 1930, as amended (the Act), defines “ministerial errors” as including “errors in addition, subtraction, or other arithmetic function, clerical errors resulting from inaccurate copying, duplication, or the like, and any other type of unintentional error which the administering authority considers ministerial.”
In accordance with section 751(h) of the Act and 19 CFR 351.224(e), we are amending the
As a result of correcting for these ministerial errors, we determine the following margin exists for the period March 1, 2015, through February 29, 2016:
Commerce intends to disclose the calculations performed for these amended final results of review within five days of the date of publication of this notice in the
Pursuant to section 751(a)(2)(C) of the Act and 19 CFR 351.212(b), Commerce shall determine, and CBP shall assess, antidumping duties on all appropriate entries of subject merchandise covered by this review. Commerce intends to issue assessment instructions to CBP 15 days after the date of publication of these amended final results in the
The following cash deposit requirements will be effective retroactively for all shipments of subject merchandise entered, or withdrawn from warehouse, for consumption on or after the October 10, 2017, the date of publication of the
This notice serves as a final reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this POR. Failure to comply with this requirement could result in Commerce's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties.
This notice also serves as the only reminder to parties subject to administrative protective order (APO) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3), which continues to govern business proprietary information in this segment of the proceeding. Timely written notification of the return or destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation.
These amended final results and notice are issued and published in accordance with sections 751(h) and 777(i) of the Act and 19 CFR 351.224(e).
International Trade Administration, DOC.
Notice of an Open Meeting of a Federal Advisory Committee.
This notice sets forth the schedule and proposed agenda of a meeting of the Environmental Technologies Trade Advisory Committee (ETTAC).
The meeting is scheduled for Tuesday, May 15, 2018 from 8:30 a.m.—3:30 p.m. Eastern Daylight Time (EDT). The deadline for members of the public to register or to submit written comments for dissemination prior to the meeting is 5:00 p.m. EDT on Monday, May 7, 2018. The deadline for members of the public to request auxiliary aids is 5:00 p.m. EDT on Monday, May 7, 2018.
The meeting will take place at the U.S. Department of Commerce, 1401 Constitution Avenue, NW, Washington, DC 20230, Room 6057-59. The address to register and obtain call-in information; submit comments; or request auxiliary aids is: Ms. Tracy Gerstle, Office of Energy & Environmental Industries (OEEI), International Trade Administration, Room 28018, 1401 Constitution Avenue NW, Washington, DC 20230 or email:
Ms. Tracy Gerstle, Office of Energy & Environmental Industries (OEEI), International Trade Administration, Room 28018, 1401 Constitution Avenue NW, Washington, DC 20230 (Phone: 202-482-0810; Fax: 202-482-5665; email:
The meeting will take place on May 15 from 8:30 a.m. to 3:30 p.m. EDT. The general meeting is open to the public and time will be permitted for public comment from 3:00—3:30 p.m. EDT. Members of the public seeking to attend the meeting are required to register in advance. Those interested in attending must provide notification by Monday, May 7, 2018 at 5:00 p.m. EDT, via the contact information provided above. This meeting is physically accessible to people with disabilities. Requests for sign language interpretation or other auxiliary aids should be directed to OEEI at (202) 482-0810 no less than one week prior to the meeting. Requests received after this date will be accepted, but it may not be possible to accommodate them.
Written comments concerning ETTAC affairs are welcome any time before or after the meeting. To be considered during the meeting, written comments must be received by Monday, May 7, 2018 at 5:00 p.m. EDT to ensure transmission to the members before the meeting. Minutes will be available within 30 days of this meeting.
Enforcement and Compliance, International Trade Administration, Department of Commerce.
Applicable April 17, 2018.
Tyler Weinhold at (202) 482-1121 (the People's Republic of China (China)), Chelsey Simonovich at (202) 482-1979 (India), and George Ayache at (202) 482-2623 (Thailand), AD/CVD Operations, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230.
On March 28, 2018, the U.S. Department of Commerce (Commerce) received countervailing duty (CVD) Petitions concerning imports of glycine from China, India, and Thailand, and antidumping duty (AD) Petitions concerning imports of glycine from India, Japan, and Thailand filed in proper form on behalf of GEO Specialty Chemicals, Inc. and Chattem Chemicals,
On April 2, 2018, Commerce requested supplemental information pertaining to certain areas of the Petitions.
In accordance with section 702(b)(1) of the Tariff Act of 1930, as amended (the Act), the petitioners allege that the Government of China (GOC), the Government of India (GOI), and the Royal Thai Government (RTG) are providing countervailable subsidies, within the meaning of sections 701 and 771(5) of the Act, to producers of glycine in China, India, and Thailand, respectively, and imports of such products are materially injuring, or threatening material injury to, the domestic glycine industry in the United States. Consistent with section 702(b)(1) of the Act and 19 CFR 351.202(b), for those alleged programs on which we are initiating a CVD investigation, the Petitions are accompanied by information reasonably available to the petitioners supporting their allegations.
Commerce finds that the petitioners filed the Petitions on behalf of the domestic industry because the petitioners are interested parties as defined in section 771(9)(C) of the Act. Commerce also finds that the petitioners demonstrated sufficient industry support with respect to the initiation of the CVD investigations that the petitioners are requesting.
Because the Petitions were filed on March 28, 2018, the period of investigation for each of the investigations is January 1, 2017, through December 31, 2017.
The product covered by these investigations is glycine from China, India, and Thailand. For a full description of the scope of these investigations,
During our review of the Petitions, Commerce issued questions to, and received responses from, the petitioners pertaining to the proposed scope to ensure that the scope language in the Petitions is an accurate reflection of the product for which the domestic industry is seeking relief.
As discussed in the
Commerce requests that any factual information the parties consider relevant to the scope of the investigations be submitted during this time period. However, if a party subsequently finds that additional factual information pertaining to the scope of the investigations may be relevant, the party may contact Commerce and request permission to submit the additional information. All such comments must be filed on the records of each of the concurrent AD and CVD investigations, in accordance with the filing requirements, discussed immediately below.
All submissions to Commerce must be filed electronically using Enforcement and Compliance's Antidumping Duty and Countervailing Duty Centralized Electronic Service System (ACCESS).
Pursuant to sections 702(b)(4)(A)(i) and (ii) of the Act, Commerce notified representatives of the Governments of China, India and Thailand of the receipt of the Petitions, and provided them the opportunity for consultations with
Section 702(b)(1) of the Act requires that a petition be filed on behalf of the domestic industry. Section 702(c)(4)(A) of the Act provides that a petition meets this requirement if the domestic producers or workers who support the petition account for: (i) At least 25 percent of the total production of the domestic like product; and (ii) more than 50 percent of the production of the domestic like product produced by that portion of the industry expressing support for, or opposition to, the petition. Moreover, section 702(c)(4)(D) of the Act provides that, if the petition does not establish support of domestic producers or workers accounting for more than 50 percent of the total production of the domestic like product, Commerce shall: (i) Poll the industry or rely on other information in order to determine if there is support for the petition, as required by subparagraph (A); or (ii) determine industry support using a statistically valid sampling method to poll the “industry.”
Section 771(4)(A) of the Act defines the “industry” as the producers, as a whole, of a domestic like product. Thus, to determine whether a petition has the requisite industry support, the statute directs Commerce to look to producers and workers who produce the domestic like product. The International Trade Commission (ITC), which is responsible for determining whether “the domestic industry” has been injured, must also determine what constitutes a domestic like product in order to define the industry. While both Commerce and the ITC must apply the same statutory definition regarding the domestic like product,
Section 771(10) of the Act defines the domestic like product as “a product which is like, or in the absence of like, most similar in characteristics and uses with, the article subject to an investigation under this title.” Thus, the reference point from which the domestic like product analysis begins is “the article subject to an investigation” (
With regard to the domestic like product, the petitioners do not offer a definition of the domestic like product distinct from the scope of the investigations.
In determining whether the petitioners have standing under section 702(c)(4)(A) of the Act, we considered the industry support data contained in the Petitions with reference to the domestic like product as defined in the “Scope of the Investigations,” in the Appendix to this notice. To establish industry support, the petitioners provided their own production of the domestic like product in 2017.
Our review of the data provided in the Petitions, the General Issues Supplement, and other information readily available to Commerce indicates that the petitioners have established industry support for the Petitions.
Commerce finds that the petitioners filed the Petitions on behalf of the domestic industry because they are interested parties as defined in section 771(9)(C) of the Act, and they have demonstrated sufficient industry support with respect to the CVD investigations that they are requesting that Commerce initiate.
Because China, India, and Thailand are “Subsidies Agreement Countries”
The petitioners allege that imports of the subject merchandise are benefitting from countervailable subsidies and that such imports are causing, or threaten to cause, material injury to the U.S. industry producing the domestic like product. In addition, the petitioners allege that subject imports exceed the negligibility threshold provided for under section 771(24)(A) of the Act.
The petitioners contend that the industry's injured condition is illustrated by a significant and increasing volume of subject imports, reduced market share, underselling and price depression or suppression, decline in the domestic industry's shipments, production, and capacity utilization, decline in the domestic industry's financial performance, and lost sales and revenues.
Based on the examination of the Petitions, we find that the Petitions meet the requirements of section 702 of the Act. Therefore, we are initiating CVD investigations to determine whether imports of glycine from China, India, and Thailand benefit from countervailable subsidies conferred by the GOC, GOI, and RTG, respectively. In accordance with section 703(b)(1) of the Act and 19 CFR 351.205(b)(1), unless postponed, we will make our preliminary determinations no later than 65 days after the date of this initiation.
Based on our review of the Petition, we find that there is sufficient information to initiate a CVD investigation on 21 of the 22 alleged subsidy programs. For a full discussion of the basis for our decision to initiate on each program,
Based on our review of the Petition, we find that there is sufficient information to initiate a CVD investigation on 38 of the 40 alleged subsidy programs.
Based on our review of the Petition, we find that there is sufficient information to initiate a CVD investigation on all ten alleged subsidy programs. For a full discussion of the basis for our decision to initiate on each program,
In the Petitions, the petitioners named 29 companies in China,
On April 9 and 10, 2018, Commerce released CBP data from China and India, respectively, under Administrative Protective Order (APO) to all parties with access to information protected by APO and indicated that interested parties wishing to comment regarding the CBP data and respondent selection must do so within three business days of the publication date of the notice of initiation of these CVD investigations.
Although Commerce normally relies on import data from CBP to determine whether to select a limited number of producers/exporters for individual examination in CVD investigations, the petitioners identified only one company as a producer/exporter of glycine in Thailand, Newtrend Food Ingredient (Thailand) Co., Ltd., and the petitioners provided information from independent sources as support.
All respondent selection comments must be filed electronically using ACCESS. An electronically filed document must be received successfully, in its entirety, by Commerce's electronic records system, ACCESS, no later than 5:00 p.m. ET on the date noted above. We intend to make our decisions regarding respondent selection within 20 days of publication of this notice.
In accordance with section 702(b)(4)(A)(i) of the Act and 19 CFR 351.202(f), copies of the public versions of the Petitions have been provided to the GOC, GOI, and RTG
We will notify the ITC of our initiation, as required by section 702(d) of the Act.
The ITC will preliminarily determine, within 45 days after the date on which the Petitions were filed, whether there is a reasonable indication that imports of glycine from China, India, and Thailand are materially injuring, or threatening material injury to, a U.S. industry.
Factual information is defined in 19 CFR 351.102(b)(21) as: (i) Evidence submitted in response to questionnaires; (ii) evidence submitted in support of allegations; (iii) publicly available information to value factors under 19 CFR 351.408(c) or to measure the adequacy of remuneration under 19 CFR 351.511(a)(2); (iv) evidence placed on the record by Commerce; and (v) evidence other than factual information described in (i)-(iv). Any party, when submitting factual information, must specify under which subsection of 19 CFR 351.102(b)(21) the information is being submitted
Parties may request an extension of time limits before the expiration of a time limit established under 19 CFR 351.301, or as otherwise specified by the Secretary. In general, an extension request will be considered untimely if it is filed after the expiration of the time limit established under 19 CFR 351.301. For submissions that are due from multiple parties simultaneously, an extension request will be considered untimely if it is filed after 10:00 a.m. ET on the due date. Under certain circumstances, we may elect to specify a different time limit by which extension requests will be considered untimely for submissions which are due from multiple parties simultaneously. In such a case, we will inform parties in the letter or memorandum setting forth the deadline (including a specified time) by which extension requests must be filed to be considered timely. An extension request must be made in a separate, stand-alone submission; under limited circumstances we will grant untimely-filed requests for the extension of time limits. Parties should review
Any party submitting factual information in an AD or CVD proceeding must certify to the accuracy and completeness of that information.
Interested parties must submit applications for disclosure under APO in accordance with 19 CFR 351.305. On January 22, 2008, Commerce published
This notice is issued and published pursuant to sections 702 and 777(i) of the Act and 19 CFR 351.203(c).
The merchandise covered by these investigations is glycine at any purity level or grade. This includes glycine of all purity levels, which covers all forms of crude or technical glycine including, but not limited to, sodium glycinate, glycine slurry and any other forms of amino acetic acid or glycine. Subject merchandise also includes glycine and precursors of dried crystalline glycine that are processed in a third country, including, but not limited to, refining or any other processing that would not otherwise remove the merchandise from the scope of the investigations if performed in the country of manufacture of the in-scope glycine or precursors of dried crystalline glycine. Glycine has the Chemical Abstracts Service (CAS) registry number of 56-40-6. Glycine and glycine slurry are classified under Harmonized Tariff Schedule of the United States (HTSUS) subheading 2922.49.4300. Sodium glycinate is classified in the HTSUS under 2922.49.8000. While the HTSUS subheadings and CAS registry number are provided for convenience and customs purposes, the written description of the scope of these investigations is dispositive.
National Oceanic and Atmospheric Administration (NOAA), Commerce.
Notice.
The Department of Commerce, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on proposed and/or continuing information collections, as required by the Paperwork Reduction Act of 1995.
Written comments must be submitted on or before June 25, 2018.
Direct all written comments to Jennifer Jessup, Departmental Paperwork Clearance Officer, Department of Commerce, Room 6616, 14th and Constitution Avenue NW, Washington, DC 20230 (or via the internet at
Requests for additional information or copies of the information collection instrument and instructions should be directed to Andy Collins, at (808) 933-8181 or
This request is for extension of a currently approved information collection. Mokupapapa Discovery Center (Center) is an outreach arm of Papahanaumokuakea Marine National Monument that reaches 65,000 people each year in Hilo, Hawai`i. The Center was opened fifteen years ago to help raise support for the creation of a National Marine Sanctuary in the Northwestern Hawaiian Islands. Since that time, the area has been proclaimed a Marine National Monument and the main messages we are trying to share with the public have changed to better reflect the new monument status, UNESCO World Heritage status and the joint management by the three co-trustees of the Monument. We therefore are seeking to find out if people visiting our Center are receiving our new messages by conducting an optional exit survey.
Surveys will be conducted by in-person interview as people exit the Center. Interviewers will record responses on paper, and later transfer them to an electronic database.
Comments are invited on: (a) whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency's estimate of the burden (including hours and cost) of the proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology.
Comments submitted in response to this notice will be summarized and/or included in the request for OMB approval of this information collection; they also will become a matter of public record.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Notice of public meeting (webinar).
The Pacific Fishery Management Council's (Pacific Council) Ad Hoc Ecosystem Workgroup (EWG) will hold a meeting via webinar, which is open to the public.
The webinar meeting will be held on Tuesday, May 22, 2018, starting at 9:30 a.m. and lasting approximately three hours.
The meeting will be held via webinar. A public listening station is available at the Pacific Council office (address below). To attend the webinar (1) join by visiting this link
Dr. Kit Dahl, Pacific Council; telephone: (503) 820-2422.
Two primary topics will be discussed by the EWG during this webinar. First, the EWG will discuss and finalize comments on the Pacific Council's draft 2018 Research and Data Needs document. This report communicates the Pacific Council's research and data needs through 2023, fulfilling the Council's responsibilities under section 302(h)(7) of the Magnuson-Stevens Fishery Conservation and Management Act. The Pacific Council will review the draft document and consider comments from its advisory bodies and the public at its June 8-13, 2018 meeting. Second,
Although non-emergency issues not contained in the meeting agenda may be discussed, those issues may not be the subject of formal action during this meeting. Action will be restricted to those issues specifically listed in this document and any issues arising after publication of this document that require emergency action under section 305(c) of the Magnuson-Stevens Fishery Conservation and Management Act, provided the public has been notified of the intent to take final action to address the emergency.
This meeting is physically accessible to people with disabilities. Requests for sign language interpretation or other auxiliary aids should be directed to Mr. Kris Kleinschmidt (503) 820-2411 at least 10 business days prior to the meeting date.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Notice of telephonic meeting.
The North Pacific Fishery Management Council (Council) Observer Advisory Committee Subgroup will meet May 11, 2018.
The meeting will be held on Friday, May 11, 2018, from 9 a.m. to 12 p.m.
The meeting will be held telephonically. Teleconference line: (907) 271-2896.
Elizabeth Figus, Council staff; telephone: (907)-271-2809.
The agenda will include: A discussion of the Observer Program Fee Analysis draft, including an outline, alternatives, and discussion of monitoring objectives.
The Agenda is subject to change, and the latest version will be posted at
Public comment letters will be accepted and should be submitted either electronically to Elizabeth Figus, Council staff:
The meeting is physically accessible to people with disabilities. Requests for sign language interpretation or other auxiliary aids should be directed to Shannon Gleason at (907) 271-2809 at least 7 working days prior to the meeting date.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Notice of public meeting.
The North Pacific Fishery Management Council (Council) Observer Advisory Committee (OAC) will meet May 16 through May 17, 2018.
The meeting will be held on Wednesday, May 16, 2018, from 8:15 a.m. to 5:30 p.m. and on Thursday, May 17, 2018, from 8:15 a.m. to 5:30 p.m.
The meeting will be held in the Traynor Room, Building 4 at the Alaska Fisheries Science Center, 7700 Sand Point Way NE, Seattle, WA 98115. Teleconference available upon request.
Elizabeth Figus, Council staff; telephone: (907) 271-2801.
The agenda will include: (a) An update on the EM Workgroup status and Council priorities; (b) review of the NMFS Cost Allocation Policy Directive document; (c) discussion of Observer Program Review Documents; (d) discussion of the Fee Analysis outline and objectives; (e) a review of the Observer Analytical Task status document; (f) a briefing on the observer safety report; and, (g) discussion of scheduling and other issues. The Agenda is subject to change, and the latest version will be posted at
Public comment letters will be accepted and should be submitted either electronically to Elizabeth Figus, Council staff:
These meetings are physically accessible to people with disabilities. Requests for sign language interpretation or other auxiliary aids should be directed to Shannon Gleason at (907) 271-2809 at least 7 working days prior to the meeting date.
Commodity Futures Trading Commission.
Request for input.
In May 2017, the Commodity Futures Trading Commission (“Commission” or “CFTC”) launched a new initiative, LabCFTC, to spearhead the CFTC's effort to facilitate the development and implementation of market-enhancing financial technologies (“FinTech”). As part of that effort, CFTC staff are exploring opportunities to play a constructive role to stimulate innovation and leverage FinTech solutions that can enhance our regulated markets and help make the Commission more effective and efficient in satisfying its mission. The Science Prize Competition Act (“SPCA”) authorizes the CFTC to invest federal funds in science and early-stage technology research and development as well as in science, technology, engineering, and mathematics education. Under this authority, the CFTC may implement a competition and award prizes to stimulate innovation designed to advance the CFTC's mission. Accordingly, the Science Prize Competition Act may offer a useful mechanism to further the goals of LabCFTC and the CFTC's mission. This Request for Input solicits feedback on focus areas for potential prize competitions, and how competitions could best be structured and administered. The Commission welcomes all public comments.
Comments must be received on or before July 24, 2018.
You may submit comments, identified by the title, “LabCFTC Prize RFI,” by any of the following methods:
•
•
•
Please submit comments by only one of these methods.
All comments should be submitted in English or accompanied by an English translation. Comments will be posted as received to
Daniel Gorfine, Director of LabCFTC and Chief Innovation Officer, (202) 418-5625; Brian Trackman, Counsel on FinTech and Innovation, Office of General Counsel, (202) 418-5163; Jorge Herrada, Senior Technical Data Specialist, Office of Data and Technology, (202) 418-5346; or
In May 2017, the CFTC launched the LabCFTC initiative to further the CFTC's goal of evolving as a 21st century regulator and keeping pace with technological innovation. LabCFTC is dedicated to understanding and facilitating market-enhancing financial technology (“FinTech”) innovation, promoting fair market competition, and ensuring proactive regulatory excellence. LabCFTC is designed to make the CFTC more accessible to FinTech and regulatory technology (“RegTech”) innovators, and to inform the Commission's understanding of emerging technologies and their regulatory implications.
Further to that effort, LabCFTC seeks to spur innovation and innovative applications of FinTech through prize competitions as described further below. By focusing attention on aspects of CFTC operations or regulated markets that could benefit from FinTech and actively encouraging development of innovative solutions, LabCFTC can act as a catalyst to drive progress.
Technology-driven innovation is rapidly transforming the markets CFTC oversees, and the way market participants operate and interact. Examples include automated trading, which now constitutes up to 70 percent of trading on regulated futures markets,
For market participants, new technologies can improve operational efficiencies, create better workflows, increase transparency, and strengthen compliance. Indeed, emerging financial technologies ranging from blockchain to machine learning to predictive data analytics are already changing the way financial markets operate. And, importantly, for regulators too, including the CFTC, RegTech can help drive more effective and efficient internal operations, as well as surveillance and oversight of regulated markets.
The SPCA authorizes the Chairman of the CFTC to carry out a program to award prizes competitively to stimulate innovation that has the potential to advance the mission of the agency.
A competition may have a cash prize purse or a non-cash prize award.
The SPCA includes guidelines concerning liability and insurance,
Beyond the basic requirements specified in the SPCA, the Commission has a great deal of flexibility in defining and structuring a competition.
The Commission believes that science prize competitions offer an exciting opportunity to encourage and spotlight innovation that can benefit the quality, transparency, and integrity of our markets, the market participants who depend on them, the operations and activities of the CFTC, and broader American public. The Commission has begun considering potential competition topics and potential ways to structure competitions under the auspices of its LabCFTC initiative. The SPCA encourages broad consultation in and outside of government when selecting topics.
FinTech is rapidly evolving, and there are many areas where innovation and technology have the potential for significant impact. Accordingly, because the scope of FinTech is so broad, the range of potential FinTech prize competitions is expansive. The Commission would like to identify specific challenges and use cases where a prize competition is especially suited to spur the creation and demonstration of innovative solutions. Ideally, a prize competition would both highlight how new technology can benefit the CFTC as well as the derivatives markets we oversee, and also lead to actionable next
The Commission has given some preliminary consideration to several topics, described below, that may satisfy its stated objectives. These examples are just that: examples. There are many other potential areas where a prize competition or series of competitions under the SPCA might advance the development of beneficial solutions, which could improve market participants' ability to serve the needs of clients, enable the CFTC to better fulfill its mission, or enhance the overall quality and integrity of our markets. Therefore, in addition to feedback on any of the potential competition topics described below, the Commission would appreciate suggestions for additional competition topics.
The Commission emphasizes that, as noted, this Request for Input is meant to stimulate thinking about potential prize competitions. The Commission is not endorsing any particular topic, nor is the Commission committing to pursue a prize competition or engage in follow-on procurement to implement specific solutions.
Several potential topics relate to challenges around market data: transaction reporting by market participants, data dissemination by the CFTC, data management and analysis, and data cleansing and harmonization. In each case, innovation driven by new technology has the potential greatly to improve current processes and “output,” enabling both market participants and regulators to engage with data more effectively.
For example, standardization of forms and processes, simplified reporting mechanisms, shared, comprehensive data ontologies, and new modes of reporting all offer the potential to greatly enhance the accessibility, quality, and utility of market data that is reported to, and disseminated by, the CFTC. Disseminating data reports in machine readable format, new techniques in data visualization or new ways of combining data streams could help make sense of market activity, educate the public on the role of derivatives markets in the broader economy, identify opportunity and risks, and improve the overall quality of our markets. Likewise with respect to data management,
FinTech innovation may enhance market transparency and oversight in a number of ways. Already, the Internet of Things (IoT) is making new kinds of information available that may be relevant to pricing derivatives and assessing market risks. A prize competition could address, for example, how FinTech can be deployed in the derivatives markets to detect behavior or information that may assist the Commission in detecting fraud or abuse.
A more ambitious competition topic could address leveraging FinTech innovation to enhance the availability of accurate, timely transactional data, including trade prices. Commentators have noted that new technologies have the potential to improve market transparency and oversight at a lower cost.
The Commission believes it is critical to its core function to successfully monitor and prevent the build-up of systematic risk.
A longstanding critique of regulatory frameworks is their complexity. Over time, as regulations continue to evolve, rulesets tend to become more intricate. Updates may be difficult to track and engender unintended consequences. For regulated entities this presents a tremendous compliance challenge. Each entity must know which rules apply to it, understand what those rules require, structure an appropriate compliance program, and keep the program up to date. These challenges may be even more significant for relatively young or lean entities looking to scale their activities in an increasingly fast-moving market. For other market participants, regulators, and the public more broadly, complex regulations can obscure straightforward regulatory goals and impede meaningful review of the overall regulatory framework.
The Commission believes that technology may offer meaningful opportunities to make the regulatory framework more accessible, reduce burdens and enhance overall compliance.
• Coding rules to make them machine readable,
• Creating common ontologies to make rules more understandable and
• Creating visual, interactive representations of the regulatory framework, that enable linking of related rules and mapping of regulatory requirements to specific function, teams and individuals within a regulated entity, and
• Developing machines that “digest” rules to determine data and other requirements, as well as ideal compliance approaches for specific entities.
Technology-based solutions geared to address regulation, regulatory process, and the day-to-day operations of market regulators present the CFTC a meaningful opportunity to leverage innovative FinTech directly. For example, as a market regulator the CFTC's rulemaking process is of vital importance. A key element of that process is the opportunity for public comment. But when the CFTC puts out a rule proposal, the agency may receive hundreds, sometime thousands, of comment letters. While the Commission currently uses some technology solutions, the review process remains labor intensive and could benefit from automation. How can innovative technology make the notice-and-comment process “smarter,” more dynamic, and more effective?
In addition to comment on potential competition topics, the Commission also seeks public input on the administration of any prize competition. The SPCA provides significant flexibility to agencies in how a prize competition is conducted. The Commission wishes to structure prize competitions to attract broad interest, to be fair to all participants, and to encourage market-enhancing innovation. Broadly, the Commission is interested in how these goals can best be accomplished through a prize competition. We are particularly interested in the following areas:
The SPCA requires that prize competition winners be, in the case of entities, U.S. based or, in the case of individuals, U.S. citizens. The Commission seeks input on what additional requirements, if any, should govern participation in a CFTC-sponsored FinTech prize competition.
Prize competitions may take many forms. Hackathons, for example, may take place over a short period: one or perhaps a few days.
The Commission is considering what, if any, conditions of participation it should impose around a potential prize competition.
The Commission is interested in reaching the widest range of potential participants that it can in regard to CFTC-sponsored FinTech prize competitions.
Once entries are submitted as part of a competition, they must be reviewed and evaluated to determine a prize winner. The Commission seeks public input on the evaluation process and appropriate standards of evaluation (
As part of a prize competition, judges must be selected to evaluate entries and select the winner(s). The Commission seeks input on the judge selection process and the appropriate mix of judges from among various stakeholder groups: financial market participants, commercial end-users, researchers and academics, FinTech innovators, specialists and experts (
The Commission seeks feedback on the selection of a suitable prize. For example, the Commission could offer a “CFTC Market Innovator of the Year” award to recognize select competition participants. Generally, the Commission seeks input on what type of prize may best encourage meaningful participation that results in real-world solutions relevant to the competition topic. As noted, the Commission does not at this time anticipate providing a cash purse, but notes that under the SPCA, an agency may partner with outside entities which may sponsor cash awards.
As noted, the Commission seeks feedback on candidate prize competition topics and on the administration of a prize competition. The Commission's broad goal is to stimulate thinking and highlight efforts to apply new technology in ways that may enhance our markets. In addition to any general input, the Commission is interested in responses to the following:
Regarding prize competition topic selection:
1. Are there subject matter areas or specific topics that the Commission should particularly consider or focus on for a potential prize competition?
In each case, what is the relevant challenge to be addressed?
In what ways can FinTech innovation potentially address this challenge?
How would a prize competition spur development, interest, or broader adoption? Please be specific as possible or provide examples where appropriate.
2. What criteria should the Commission use to select prize competition topics?
3. Are there subject matter areas or specific topics that are not suitable for a prize competition? Please be specific as possible or provide examples where appropriate.
4. What competition topics may help illuminate areas where new technology can reduce costs or improve services for market participants and end-users who depend on these markets to manage risk?
5. What competition topics may highlight areas where the regulatory framework could work better or needs significant revision to accommodate market-enhancing FinTech?
6. Which existing regulatory compliance or regulatory reporting processes do you feel would most
Regarding administration of a prize competition:
7. What ground rules should govern participation in a CFTC-sponsored FinTech prize competition?
For example, are there particular eligibility requirements that the agency should adopt?
Should competition entries be designated “open source,” or should each participant retain full control of its entry and any decision about its availability?
Should any different rules apply to winning entries?
8. How should prize competition judges be selected?
Should the Commission select a single judge or panel to evaluate prize competition submissions?
If a panel, how large?
And what is the appropriate mix of stakeholders?
What additional requirements, if any, should apply to judges?
9. What general evaluation standards or criteria may be appropriate in the context of a CFTC-sponsored FinTech prize competition? Regarding the evaluation process, are there models or protocols that the Commission might adapt with regard to prize competitions it sponsors?
10. What type of prize is likely to encourage the greatest participation from a broad range of innovators? What factors should the Commission consider? If the prize is other than a cash purse, what type of prize may be suitable?
11. Generally, are there any rules, policies, or practices that the Commission should adopt to facilitate a prize competition or encourage participation? For example, what modes of advertising and publicity may be most effective? And, likewise, are there any rules, policies, or practices that could impede participation in a prize completion?
In providing your responses, please be as specific as possible, and offer examples where appropriate. The Commission encourages all relevant comments; commenters need not address every item.
The Commission appreciates your time and effort responding to this Request for Input on potential CFTC-sponsored FinTech prize competitions. The information provided by stakeholders will help us refine our understanding and future approach, and identify how the Commission can best structure prize competitions to maximize their positive impact.
More broadly, the input from this request will further aid the Commission in identifying FinTech trends and areas where emerging technologies and innovation may offer significant potential benefit.
In that respect, we look forward to continuing to engage proactively with the innovator community and market participants to promote market-enhancing FinTech, to identify opportunities to update our regulatory framework, and to implement new technology-based approaches to fulfill the CFTC's mission on behalf of the American people.
On this matter, Chairman Giancarlo and Commissioners Quintenz and Behnam voted in the affirmative. No Commissioner voted in the negative.
Denali Commission.
Notice.
The Denali Commission (Commission) is an independent Federal agency based on an innovative federal-state partnership designed to provide critical utilities, infrastructure and support for economic development and training in Alaska by delivering federal services in the most cost-effective manner possible. The Commission was created in 1998 with passage of the October 21, 1998 Denali Commission Act (Act). The Act requires that the Commission develop proposed work plans for future spending and that the annual work plan be published in the
Comments and related material to be received by May 31, 2018.
Submit comments to the Denali Commission, Attention: Corrine Eilo, 510 L Street, Suite 410, Anchorage, AK 99501.
Corrine Eilo, Denali Commission, 510 L Street, Suite 410, Anchorage, AK 99501. Telephone: (907) 271-1414. Email:
The Denali Commission's mission is to partner with tribal, federal, state, and local governments and collaborate with all Alaskans to improve the effectiveness and efficiency of government services, to build and ensure the operation and maintenance of Alaska's basic infrastructure, and to develop a well-trained labor force employed in a diversified and sustainable economy.
By creating the Commission, Congress mandated that all parties involved partner together to find new and innovative solutions to the unique infrastructure and economic development challenges in America's most remote communities. Pursuant to the Act, the Commission determines its own basic operating principles and funding criteria on an annual federal fiscal year (October 1 to September 30) basis. The Commission outlines these priorities and funding recommendations in an annual work plan. The FY 2019 Work Plan was developed in the following manner.
• A workgroup comprised of Denali Commissioners and Commission staff developed a preliminary draft work plan.
• The preliminary draft work plan was published on Denali.gov for review by the public in advance of public testimony.
• A public hearing was held to record public comments and recommendations on the preliminary draft work plan.
• Written comments on the preliminary draft work plan were accepted for another ten days after the public hearing.
• All public hearing comments and written comments were provided to Commissioners for their review and consideration.
• Commissioners discussed the preliminary draft work plan in a public meeting and then voted on the work plan during the meeting.
• The Commissioners forwarded their recommended work plan to the Federal Co-Chair, who then prepared the draft work plan for publication in the
• At the conclusion of the
• If no revisions are made to the draft, the Federal Co-Chair provides notice of approval of the work plan to the Commissioners, and forwards the work plan to the Secretary of Commerce for approval; or, if there are revisions the Federal Co-Chair provides notice of modifications to the Commissioners for their consideration and approval, and upon receipt of approval from Commissioners, forwards the work plan to the Secretary of Commerce for approval.
• The Secretary of Commerce approves the work plan.
• The Federal Co-Chair then approves grants and contracts based upon the approved work plan.
The Commission has historically received federal funding from several sources. The two primary sources at this time include the Energy & Water Appropriation Bill (“base” or “discretionary” funds) and an annual allocation from the Trans-Alaska Pipeline Liability (TAPL) fund. The proposed FY 2019 Work Plan assumes the Commission will receive $15,000,000 of base funds, which is the amount referenced in the reauthorization of the Commission passed by Congress in 2016 (ref: Pub. L. 114-322), and a $1,900,000 TAPL allocation based on discussions with the Office of Management and Budget (OMB). Approximately $4,000,000 of the base funds will be used for administrative expenses and non-project program support, leaving $11,000,000 available for program activities. The total base funding shown in the Work Plan also includes an amount typically available from project closeouts and other de-obligations that occur in any given year. Approximately $200,000 of the TAPL funds will be utilized for administrative expenses and non-project program support, leaving $1,700,000 available for program activities. Absent any new specific direction or limitations provided by Congress in the current Energy & Water Appropriations Bill, these funding sources are governed by the following general principles, either by statute or by language in the Work Plan itself:
• Funds from the Energy & Water Appropriation are eligible for use in all programs.
• TAPL funds can only be used for bulk fuel related projects and activities.
• Appropriated funds may be reduced due to Congressional action, rescissions by OMB, and other federal agency actions.
• All Energy & Water and TAPL investment amounts identified in the work plan, are “up to” amounts, and may be reassigned to other programs included in the current year work plan, if they are not fully expended in a program component area or a specific project.
• Energy & Water and TAPL funds set aside for administrative expenses that subsequently become available, may be used for program activities included in the current year work plan.
FY 2019 Denali Commission investments in Energy and Bulk Fuel may include:
In order to fulfill its role as lead federal coordinating agency the Commission staff, in consultation with State, Federal, and other partners, and the referenced communities in particular, proposes the following investments in support of the new Village Infrastructure Protection (VIP) Program. United States Government Accountability Office (GAO) Report 09-551 (
The community of Newtok has initiated its relocation to Mertarvik and has started building infrastructure at Mertarvik. The Commission funds summarized above may be used for the following activities:
Shishmaref has voted to relocate and is now working to select a new site. The Commission funds summarized above may be used for the following activities:
The community of Shaktoolik has decided to protect the community in place for now. The Commission funds summarized above may be used for the following activities:
Kivalina is considering relocation and has selected a site for a new school. The Commission funds summarized above may be used for the following activities:
The $500,000 referenced above for this line item in the Workplan may be used for activities such as the following.
Office of Elementary and Secondary Education, Department of Education.
Notice.
The Department of Education (Department) is issuing a notice announcing availability of funds and application deadlines for the Temporary Emergency Impact Aid for Displaced Students (Emergency Impact Aid) and the Assistance for Homeless Children and Youth programs under the Division B, Subdivision 1, Title VIII, “Hurricane Education Recovery,” of Public Law 115-123, the “Bipartisan Budget Act of 2018.”
Applications Available: April 25, 2018.
Deadline for Transmittal of State educational agency (SEA) Application for the Emergency Impact Aid program: May 25, 2018.
Deadline for Transmittal of State educational agency (SEA) Application for the Homeless Children and Youth program: May 25, 2018.
Deadline for local educational agencies (LEAs) to submit applications to SEAs under the Emergency Impact Aid program: May 15, 2018.
Deadline for LEAs to submit applications to SEAs under the Assistance for Homeless Children and Youth program: There is no statutory deadline for LEA applications under this program. Each eligible SEA will set a reasonable deadline for the submission of LEA applications.
For the addresses for obtaining and submitting an application, please refer to our Common Instructions for Applicants to Department of Education Discretionary Grant Programs, published in the
For additional information on the Emergency Impact Aid program, please contact Francisco Ramirez. Telephone (202) 260-1541. 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.
An SEA seeking funding under Emergency Impact Aid and Assistance for Homeless Children and Youth programs must submit a separate application for each program. The data that the SEA provides in each application will be used by the Department to determine allocations under the respective programs.
The open licensing requirement in 2 CFR 3474.20 does not apply for these programs.
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SEAs must submit enrollment data for all four quarters of the 2017-18 school year, which may include estimated data for the fourth quarter, in their initial Emergency Impact Aid applications. SEAs that meet the initial deadline must provide any updated enrollment data generally and any unreported fourth quarter data for the 2017-18 school year by June 29, 2018.
We will use the enrollment data that are included in the SEA applications to make initial payments under the Emergency Impact Aid program.
We also are aware that it may take some time for SEAs and LEAs to count, retroactively for all four quarters of the 2017-18 school year, all eligible students, including students who subsequently may have moved to other States or LEAs. Therefore, SEAs and LEAs are encouraged to provide their best available estimates of eligible students for each count date in their initial applications, and, in the event that they collect more satisfactory data that were not available at the time of their initial application, to amend their applications if they need to make upward or downward revisions to their initial child counts. The Secretary will make appropriate upward or downward revisions to subsequent payments, or request a refund for any overpayment, based on the final data provided by an SEA. SEAs must submit any application amendments affecting allocations under the Emergency Impact Aid program to the Department no later than June 29, 2018.
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We will use the data included in the SEA application to determine funding amounts.
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LEAs must make Emergency Impact Aid payments to accounts on behalf of displaced non-public school students within 14 calendar days of receiving payments from their SEAs.
The Secretary may solicit from any applicant at any time additional information needed to process an application for either program.
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In calculating funding under the Impact Aid Basic Support Payments program, authorized under section 7003 of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 7703) for an eligible LEA that receives an Emergency Impact Aid payment, the Secretary shall not count displaced students served by such agency for whom an Emergency Impact Aid payment is received under this section, nor shall such students be counted for the purpose of calculating the total number of children in average daily attendance at the schools served by such agency as provided in section 7003(b)(3)(B)(i) of such Act (20 U.S.C. 7703(b)(3)(B)(i)).
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(b) At the end of your project period, you must submit a final performance report, including financial information, as directed by the Secretary. The Secretary may also require more frequent performance reports under 34 CFR 75.720(c).
You may also access documents of the Department published in the
U.S. Energy Information Administration (EIA), U.S. Department of Energy (DOE).
Notice.
EIA submitted an information collection request for extension as required by the Paperwork Reduction Act of 1995. The information collection requests a three-year extension, with no changes, of its
Comments on this information collection must be received no later than May 25, 2018. If you anticipate any difficulties in submitting your comments by the deadline, contact the DOE Desk Officer at 202-395-4718.
Written comments should be sent to DOE Desk Officer: James Tyree, Office of Information and Regulatory Affairs, Office of Management and Budget, New Executive Office Building, Room 9249, 735 17th Street NW, Washington, DC 20503,
Requests for additional information or copies of the information collection instrument and instructions, send your request to Tim Shear at 202-586-0403 or email it to
This information collection request contains:
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Section 13(b) of the Federal Energy Administration Act of 1974, Pub. L. 93-275, codified as 15 U.S.C. 772(b) and the DOE Organization Act of 1977, Pub. L. 95-91, codified at 42 U.S.C. 7101
The Federal Energy Regulatory Commission hereby gives notice that members of the Commission and/or Commission staff may attend the following meetings:
The Ritz-Carlton, Pentagon City, 1250 South Hayes Street, Arlington, VA 22202.
Further information regarding these meetings may be found at:
The discussions at the meetings, which are open to the public, may address matters at issue in the following Commission proceedings:
For further information, please contact Jonathan First, 202-502-8529, or
On February 6, 2017, in Docket No. CP17-40-000, the Commission issued public notice of Spire STL Pipeline, LLC's (Spire) application requesting approval to construct and operate a pipeline project, which would include: (i) The construction of approximately 59 miles of a new greenfield, 24-inch diameter pipeline; (ii) the acquisition of approximately seven miles of existing
On May 1, 2017, in Docket No. CP17-40-001, the Commission issued public notice of Spire's amendment to its application to propose a route alternative. Instead of acquiring and refurbishing Spire Missouri's Line 880, Spire's amended application proposes to construct a new six-mile, 24-inch diameter pipeline for the final segment of its proposal (referred to as the North County Extension). This notice set May 22, 2017, as the deadline for motions to intervene.
Multiple motions to intervene out of time were filed between the intervention deadlines and December 19, 2017. Here, because the deadline for filing a timely intervention passed before the Commission announced its new policy governing late interventions in
Take notice that an informal technical conference concerning the above-captioned proceedings will be convened by phone on May 2, 2018, at 2:00 p.m. (EDT). The purpose of the teleconference will be to discuss comments filed in the proceeding.
All interested parties are invited to participate by phone. Please email Deirdra Archie at
Federal Energy Regulatory Commission, Department of Energy.
Comment request.
In compliance with the requirements of the Paperwork Reduction Act of 1995, the Federal Energy Regulatory Commission (Commission or FERC) is submitting its information collection FERC-725X (Mandatory Reliability Standards: Voltage and Reactive (VAR) Standards) to the Office of Management and Budget (OMB) for review of the information collection requirements. Any interested person may file comments directly with OMB and should address a copy of those comments to the Commission as explained below. The Commission previously issued a Notice in the
Comments on the collection of information are due by May 25, 2018.
Comments filed with OMB, identified by the OMB Control No. 1902-0278, should be sent via email to the Office of Information and Regulatory Affairs:
A copy of the comments should also be sent to the Commission, in Docket No. IC18-9-000, by either of the following methods:
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Ellen Brown may be reached by email at
Reliability Standard VAR-001-4 contains the following requirements:
• Specify a system-wide voltage schedule (which is either a range or a target value with an associated tolerance band) as part of its plan to operate within SOLs and IROLs, and to provide the voltage schedule to its Reliability Coordinator and adjacent Transmission Operators upon request (Requirement R1);
• Schedule sufficient reactive resources to regulate voltage levels (Requirement R2);
• Operate or direct the operation of devices to regulate transmission voltage and reactive flows (Requirement R3);
• Develop a set of criteria to exempt generators from certain requirements under Reliability Standard VAR-002-3 related to voltage or Reactive Power schedules, automatic voltage regulations, and notification (Requirement R4);
• Specify a voltage or Reactive Power schedule (which is either a range or a target value with an associated tolerance band) for generators at either the high or low voltage side of the generator step-up transformer, provide the schedule to the associated Generator Operator, direct the Generator Operator to comply with that schedule in automatic voltage control mode, provide the Generator Operator the notification requirements for deviating from the schedule, and, if requested, provide the Generator Operator the criteria used to develop the schedule (Requirement R5); and
• Communicate step-up transformer tap changes, the time frame for completion, and the justification for these changes to Generator Owners (Requirement R6).
Reliability Standard VAR-002-3 contains the following requirements:
• Operate each of its generators connected to the interconnected transmission system in automatic voltage control mode or in a different control mode as instructed by the Transmission Operator, unless the Generator Operator (1) is exempted pursuant to the criteria developed under VAR-001-4, Requirement R4, or (2) makes certain notifications to the Transmission Operator specifying the reasons it cannot so operate (Requirement R1);
• Maintain the Transmission Operator's generator voltage or Reactive Power schedule, unless the Generator Operator (1) is exempted pursuant to the criteria developed under VAR-001-4, Requirement R4, or (2) complies with the notification requirements for deviations as established by the Transmission Owner pursuant to Requirement R5 in VAR-001-4 (Requirement R2);
• Notify the Transmission Operator of a change in status of its voltage controlling device within 30 minutes, unless the status is restored within that time period (Requirement R3);
• Notify the Transmission Operator of a change in reactive capability due to factors other than those described in VAR-002-3, Requirement R3 within 30 minutes unless the capability has been restored during that time period (Requirement R4).
• Provide information on its step-up transformers and auxiliary transformers within 30 days of a request from the Transmission Operator or Transmission Planner (Requirement R5); and
• Comply with the Transmission Operator's step-up transformer tap change directives unless compliance would violate safety, an equipment rating, or applicable laws, rules or regulations (Requirement R6).
Federal Energy Regulatory Commission, Department of Energy.
Notice of Inquiry.
In this Notice of Inquiry, the Federal Energy Regulatory Commission (Commission) seeks information and stakeholder perspectives to help the
Comments are due June 25, 2018.
Comments, identified by docket number, may be filed in the following ways:
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1. In this Notice of Inquiry, the Commission seeks information and stakeholder perspectives to help the Commission explore whether, and if so how, it should revise its approach under its currently effective policy statement on the certification of new natural gas transportation facilities (Policy Statement)
2. Nineteen years have passed since the Commission issued the Policy Statement to describe the criteria and analytical steps that the Commission uses to balance a proposed natural gas pipeline project's public benefits against its potential adverse consequences. That period has seen significant changes, such as: (1) A revolution in natural gas production technology leading to dramatic increases in production; (2) new areas of major natural gas production; (3) flows on pipeline systems becoming bidirectional or reversing; (4) customers routinely entering into long-term precedent agreements for firm service during the formative stage of potential projects and the use of those precedent agreements as applicants' principal evidence of the need for their projects; (5) the increased use of natural gas as a fuel source for electric generation, resulting in a closer relationship between natural gas transportation and natural gas-fired electric generation; (6) increased concerns expressed by landowners and communities potentially affected
3. The Commission's aim in this proceeding is the same as in the Policy Statement: “to appropriately consider the enhancement of competitive transportation alternatives, the possibility of over building, the avoidance of unnecessary disruption of the environment, and the unneeded exercise of eminent domain.”
4. During the pendency of this proceeding, the Commission intends to continue to process natural gas facility matters before it consistent with the Policy Statement, and to make determinations on the issues raised in those proceedings on a case-by-case basis.
5. The NGA declares “that the business of transporting and selling natural gas for ultimate distribution to the public is affected with a public interest, and that Federal regulation in matters relating to the transportation of
6. The public convenience and necessity standard encompasses all factors bearing on the public interest.
in order to give content and meaning to the words `public interest' as used in the [Federal] Power and [Natural] Gas Acts, it is necessary to look to the purposes for which the Acts were adopted. In the case of the Power and Gas Acts it is clear that the principal purpose of those Acts was to encourage the orderly development of plentiful supplies of electricity and natural gas at reasonable prices.
7. As part of its decision-making process, the Commission, in accord with the Policy Statement, determines whether there is a need for a proposed project. This analysis is distinct from that required by the Council on Environmental Quality (CEQ) regulations, which specify that environmental documents contain a “purpose and need statement” used to determine the objectives of the proposed action and then to identify and consider reasonable alternative actions.
8. The Commission's powers under NGA section 7 are limited. The Commission can issue a certificate for a proposed project, subject to “such reasonable terms and conditions as the public convenience and necessity may require.”
9. The Commission's consideration of an application triggers environmental review under NEPA.
10. An agency's environmental document must include a statement to “briefly specify the underlying purpose and need to which the agency is responding in proposing the alternatives including the proposed action.”
11. Commission documents under NEPA first address the scope of the project (
12. Historically, the Commission established prices for natural gas sales and transportation, and there was little competition for gas supply or transportation capacity. Interstate pipelines, operating as merchants, produced and/or purchased natural gas at the wellhead, transported it to a city gate, and sold it to a local distribution company (LDC) at a Commission-regulated price that reflected combined (
13. As natural gas commodity and transportation markets were becoming more competitive, the 1990s saw significant growth in natural gas consumption in the industrial and electric generation segments. This prompted jurisdictional natural gas companies to urge the Commission to expeditiously authorize new projects to meet anticipated growth in demand. Due to the lower capital costs and shorter construction times of advanced combined-cycle gas-fired plants in comparison with conventional coal-fired plants, and the relative environmental benefits of natural gas compared to coal combustion, industry forecasts at the time showed natural gas-fired electric generation demand tripling in the following twenty years and overall gas demand reaching 32 Trillion Cubic Feet (Tcf) by 2020.
14. In addition, in the 1990s, many LDCs were going through significant changes as they implemented retail unbundling programs, also known as customer choice programs, on their systems. Prior to retail unbundling, LDCs, similar to interstate pipelines, provided a composite bundled service to customers that included the bundled price of the gas and associated pipeline capacity and the price of the distribution service. Retail unbundling programs provided residential and commercial customers with access to competitive markets through the ability to purchase gas supplies from retail marketers that may be different from their LDCs. As a result, LDCs were not certain to what degree they would continue to be responsible for purchasing gas supplies and pipeline capacity in order to provide service for their core retail customers. Because of
15. In response to the concerns described above, the Commission issued the Notice of Proposed Rulemaking (NOPR),
16. Information received in these proceedings, as well as experience evaluating proposals for new pipeline construction, persuaded the Commission to revisit its policy for certificating new construction.
17. These objectives were realized primarily by a shift from rolled-in pricing to incremental pricing. Under incremental pricing, existing customers using existing facilities do not contribute to, and thereby do not subsidize, the cost of constructing and operating new projects.
18. The Policy Statement stated that the Commission will approve an application for a new project only if its public benefits outweigh its residual adverse effects.
19. Over the last decade, the United States has seen an unprecedented change in the dynamics of the natural gas market and the supply and demand forces driving it. Led by advancements in production technologies, primarily in accessing shale reserves, natural gas supplies have increased dramatically. Domestic natural gas production has increased from 21.3 Tcf in 2010 to 26.9 Tcf in 2017.
20. As natural gas production has increased, so has demand, rising from
21. Increases in both domestic and international demand for natural gas produced in the United States, combined with the availability of competitively-priced gas from shale reserves and associated gas extracted in tandem with oil, have reduced prices and price volatility and shifted the emphasis of the types of proposed natural gas infrastructure projects from storage to transportation and exports, leading to the Commission receiving and approving an increased number of pipeline and LNG export terminal applications since 2010.
22. In addition, contracting patterns are changing significantly as a result of the supply growth. In the past, LDCs contracted for a large percentage of the total interstate pipeline capacity, transporting supplies from the production area to their customers. Increasingly, however, LDCs are purchasing gas supplies further downstream at market area pooling points or their citygates as other parties increasingly contract for pipeline capacity. Natural gas producers are now contracting for an increasing amount of firm pipeline capacity on expansion projects in an effort to provide a secured commercial outlet for their supplies. For many of these projects, producers are interested in transporting their natural gas to the nearest pooling point on the pipeline system, where the gas can be sold to other parties serving downstream markets. Therefore, an increasing number of projects are being designed to transport gas to a point of distribution on the interstate pipeline grid, which may not correspond to a defined market or end use.
23. On August 15, 2017, President Trump issued Executive Order 13807 “Establishing Discipline and Accountability in the Environmental Review and Permitting Process for Infrastructure Projects” to “ensure that the Federal environmental review and permitting process for infrastructure projects is coordinated, predictable, and transparent.”
24. The Policy Statement explained that the Commission will consider whether a proposed project's anticipated public benefits outweigh its residual adverse effects on economic interests. If so, the Commission will then complete an analysis of the project's environmental impacts and incorporate those findings in reaching a conclusion on whether a project is required by the public convenience and necessity. If not, an application will be denied and there will be no reason to consider environmental impacts.
25. Because the NEPA review typically takes longer than the review of the non-environmental aspects of a proposed project, in practice the Commission often initiates its study of environmental impacts at the applicant's request during pre-filing and before an application is filed. Also, most natural gas projects require approvals from numerous other federal, state, and local agencies or federally recognized Indian tribes.
26. The Policy Statement's threshold requirement is that an applicant financially support the project without relying on subsidization from its existing customers.
27. When the no-subsidy threshold requirement is met, the next step in the Commission's analysis is to determine whether the applicant has eliminated or minimized any residual adverse effects the project might have on: (1) The applicant's existing customers, (2) existing pipelines in the market and their captive customers, and (3) landowners and communities affected by the proposed project.
28. The Policy Statement recognized that the interests of an applicant's existing customers may be adversely affected if the proposed expansion results in a degradation in service for existing customers.
29. The Commission has historically taken a pro-competitive approach in approving new projects, believing that potential adverse impacts on existing competitors through the potential future loss of load are likely to be outweighed by the economic and reliability benefits to natural gas consumers that come from increased access to new supply sources of competitively-priced natural gas.
30. Finally, under the Policy Statement, the Commission looks at adverse impacts on landowners and communities affected by a proposed project. The Policy Statement noted that “[t]raditionally, the interests of the landowners and the surrounding community have been considered synonymous with the environmental impacts of a project,” but explains that “[l]andowner property rights issues are different in character from other environmental issues considered under [NEPA].”
31. The Policy Statement identified various public benefits including: (1) Meeting unserved demand (2) eliminating bottlenecks; (3) providing access to new supplies; (4) lowering costs to consumers; (5) providing new interconnects that improve the interstate pipeline network; (6) providing competitive alternatives; (7) increasing electric reliability; and (8) advancing clean air objectives.
32. The Policy Statement recognized that, in the context of balancing public benefits against adverse effects, it is difficult to construct bright line standards or tests, as such tests are unlikely to be flexible enough to resolve specific cases and to allow the Commission to take into account different relevant interests. The Policy Statement described a sliding scale approach where the “more interests adversely affected or the more adverse impact a project would have on a particular interest, the greater the showing of public benefits from the project required to balance the adverse impact.”
33. The Policy Statement provided two examples of the sliding scale approach. First, if an applicant is able to acquire all or substantially all of the necessary rights-of-way by negotiation prior to filing the application, and the proposal is to serve a new, previously unserved market, it would not adversely impact the applicant's existing shippers, competing companies or their existing shippers, or affected landowners and communities.
34. The Policy Statement observed that a few holdout landowners cannot veto a project if the applicant provides evidence of project benefits sufficient to justify a finding of public convenience and necessity and issuance of a certificate.
35. Prior to adopting the Policy Statement, the Commission required applicants to show that some percentage of proposed capacity was subscribed under long-term firm service agreements.
36. Stakeholders in some proceedings have raised questions as to whether precedent agreements continue to be an appropriate indicator of project need and whether the Commission should reconsider its approach to examining project need. This includes both the question of the overall need for the proposed project within the energy marketplace, as well as the need for the capacity of individual project shippers. Specific concerns raised have included: (1) Whether existing infrastructure can accommodate the incremental service to be provided by proposed project; (2) whether anticipated demand in the project's markets will truly materialize; (3) the potential for renewable energy to meet future demand for electricity generation and its potential impacts on projects designed to serve natural gas-fired generators; (4) the need for the Commission to evaluate the new natural gas pipeline infrastructure on a region-wide basis; and (5) whether agreements with affiliates constitute a showing of market need.
37. Since the early 2000s, the Commission has encouraged jurisdictional natural gas companies to use a voluntary pre-filing program for natural gas pipeline projects.
38. In reviewing an application, the Commission currently performs a lengthy NEPA review, including numerous opportunities for public involvement, consultation with other federal, state, and local agencies, and an independent evaluation of the environmental impacts of a proposed project. In July 2015, the Commission issued guidance on best practices for stakeholder outreach programs for natural gas projects.
39. Commission staff performs a thorough independent review of the environmental impacts of a proposed project through verifying submitted information and comments, issuing information requests to clarify inaccuracies or obtain additional information, and consulting with federal, state, and local agencies and federally recognized tribes. Commission NEPA documents address impacts on various environmental resources, including geology, soils, groundwater, surface water, wetlands, aquatic resources, vegetation, wildlife, special status species, cultural resources, land use, recreation, aesthetics, socioeconomics, air quality, climate change, noise, and reliability and safety.
40. Over the past decade there has been a marked increase in the involvement of federally recognized tribes, affected landowners, and environmental organizations in proposed natural gas project proceedings. Concerns raised have primarily focused on the need for new projects, alternatives, cumulative impacts, and the effects related to the production and consumption of natural gas (particularly the contribution of GHG emissions to global climate change).
41. The Commission's NEPA documents address a wide variety of alternatives. These include the no-action alternative (
42. Should the Commission find that there is insufficient support for the need for a project, it could select the no-action alternative by rejecting the proposed project. However, the Commission has neither authority to require the construction of any alternative other than the project proposed, nor does it have authority to require the development of nonjurisdictional actions or projects (
43. GHG emissions are unique in that, unlike other environmental impacts studied in pipeline proceedings that have localized effects, emissions from around the globe accumulate in the atmosphere and contribute to climate change impacts worldwide.
44. Since CEQ issued its initial draft guidance, Commission staff has addressed climate change in its NEPA documents. Over the past seven years, Commission staff has expanded its efforts to address GHG emissions and climate change by including GHG emission estimates from project construction (
45. To the extent there exist relevant federal, regional, state, tribal, or local plans, policies, or laws for GHG emissions reductions or climate adaptations, the Commission's NEPA documents address the consistency of a proposed project's direct impacts (
46. Historically, CEQ recognized the difficulty in identifying the extent to which a specific action or project may contribute to overall climate change, given that climate change results from the cumulative buildup of carbon dioxide and other GHGs, rather than from the incremental emissions of any one project. Additionally, there is no standard established by international or federal policy, or by a recognized scientific body that the Commission could rely on in determining whether project-specific GHG emissions are significant. Thus, the Commission has stated that, given the information available to date, any attempt by the Commission to create a significance threshold would be arbitrary.
47. In recent years, commenters began raising GHG issues on an increasingly frequent basis in Commission proceedings and on appellate review, with emphasis on upstream and downstream GHG emissions.
48. The Commission has generally declined to consider the upstream or downstream GHG emissions impacts of natural gas production or end use as indirect impacts of the proposed project because the Commission found no requisite causation and/or because the impacts of such production or end use were speculative and unknown, and therefore not reasonably foreseeable.
49. In late 2016 the Commission began providing the public with additional information, beyond the requirements of NEPA and its implementing regulations, regarding potential impacts associated with upstream unconventional natural gas production and downstream natural gas combustion even where the criteria of causation and reasonable foreseeability
Consequently, it is unlikely that this total amount of GHG emissions would occur, and emissions are likely to be significantly lower than the above estimate.”).
50. As for the use of the Social Cost of Carbon tool, the Commission has found that although this tool is appropriate to use as part of cost-benefit analyses associated with certain rulemakings, it is not useful or appropriate to apply in its NEPA documents.
51. As part of ensuring that the Commission continues to meet its statutory obligations, the Commission, on occasion, engages in public inquiry to gauge whether there is a need to add to, modify, or eliminate certain policies or regulatory requirements. In this proceeding, the Commission seeks comments on potential modifications to its approach to determining whether a proposed project is required by the public convenience and necessity. The Commission has identified four general areas of examination in this inquiry: (1) The reliance on precedent agreements to demonstrate need for a proposed project; (2) the potential exercise of eminent domain and landowner interests; (3) the Commission's evaluation of alternatives and environmental effects under NEPA and the NGA; and (4) the efficiency and effectiveness of the Commission's certificate processes. The Commission seeks comment on the questions set forth below, organized according to these four broad categories. Commenters need not answer every question enumerated below.
52. In practice, the Commission does not look “behind” or “beyond” precedent agreements when making a determination about the need for new projects or the needs of the individual shippers. The United States Court of Appeals for the District of Columbia Circuit recently found “nothing in the policy statement or in any precedent construing it to suggest that it requires, rather than permits, the Commission to assess a project's benefits by looking beyond the market need reflected by the applicant's existing contracts with shippers.”
53. In retail gas distribution markets, state regulators review LDC commodity and capacity purchases. State regulators also may review electric distribution company fuel purchases. Thus, in these regions, state regulators may review the purchases to determine the prudence of expenditures by the utilities they regulate. For parties purchasing interstate transportation capacity who are not subject to state regulatory oversight, the fact that a purchaser is fully at risk for the cost of the capacity and cannot directly pass through the costs to another party has lessened the need to scrutinize such agreements.
To date, the Commission has not distinguished between affiliate and non-affiliate precedent agreements in considering the need for a proposed project.
54. However, recent changes in the gas industry, whereby producers are contracting for an increasing amount of transportation capacity as well as an increase in the number of shippers that are affiliated with the pipeline companies, have raised questions among some entities as to whether precedent agreements remain an appropriate indicator of need and whether the Commission should examine additional information in evaluating the need for proposed pipeline infrastructure projects. Accordingly, comments are requested on the following questions.
55. The Policy Statement described how the Commission takes into account the extent to which an applicant expects to acquire property rights by relying on eminent domain in determining whether a proposed project is needed. Although Commission authorization of a project through the issuance of a certificate of public convenience and necessity under the NGA conveys the right of eminent domain, the Commission itself does not grant the use of eminent domain across specific properties. Only after the Commission authorizes a project can the project sponsor assert the right of eminent domain for outstanding lands for which it could not negotiate an easement.
56. Recently, the Commission has been seeing more proposed projects where applicants are unable to access potential rights-of-way prior to the Commission's decision on an application, which limits the information that can be included in an application.
57. Historically, an applicant's inability to complete on-site survey work has not precluded the Commission from completing a meaningful review of a proposal since partial on-site surveys, in combination with aerial overflight and data from other sources, can provide an adequate basis for the Commission to reach an informed decision. The Commission's NEPA documents are based on the best available data at the time of development.
58. Among the goals in the Policy Statement is the avoidance of unnecessary disruption of the environment. The Commission incorporates a proposed project's environmental impacts into the balance of factors under the public convenience and necessity standard. Although the Commission performs a comprehensive and independent NEPA review, as described above, there has been increased stakeholder interest regarding the alternatives that the Commission evaluates in its public interest determination, how the Commission addresses climate change, and the evolving science behind GHG emissions and climate change. Therefore, the Commission invites comments on the following ways that the Commission could review its environmental evaluations within the bounds of NEPA and the NGA:
59. It is the Commission's desire to improve the transparency, timing, and predictability of the Commission's certification process.
60. The Commission seeks comment on the following questions regarding its certificate application review process:
61. The Commission invites interested persons to submit comments on the matters and issues proposed in this notice, including any related matters or alternative proposals that commenters may wish to discuss. Comments are due June 25, 2018. Comments must refer to Docket No. PL18-1-000, and must include the commenter's name, the organization they represent, if applicable, and their address in their comments.
62. The Commission encourages comments to be filed electronically via the eFiling link on the Commission's website at
63. 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.
64. 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.
65. In addition to publishing the full text of this document in the
66. 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.
67. 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
By direction of the Commission.
Take notice that the Commission has received the following Natural Gas Pipeline Rate and Refund Report filings:
The filings are accessible in the Commission's eLibrary system by clicking on the links or querying the docket number.
Any person desiring to intervene or protest in any of the above proceedings must file in accordance with Rules 211 and 214 of the Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.
eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, service, and qualifying facilities filings can be found at:
Take notice that the Commission received the following electric corporate filings:
Take notice that the Commission received the following exempt wholesale generator filings:
Take notice that the Commission received the following electric rate filings:
The filings are accessible in the Commission's eLibrary system by clicking on the links or querying the docket number.
Any person desiring to intervene or protest in any of the above proceedings must file in accordance with Rules 211 and 214 of the Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.
eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, service, and qualifying facilities filings can be found at:
Environmental Protection Agency (EPA).
Notice; request for comments.
This action provides public notice and solicits comment on the alternative means of emission limitation (AMEL) requests from ExxonMobil Corporation; Marathon Petroleum Company, LP (for itself and on behalf of its subsidiary, Blanchard Refining, LLC); and Chalmette Refining, LLC, under the Clean Air Act (CAA), to operate flares at several refineries in Texas and Louisiana, as well as the AMEL request from LACC, LLC to operate flares at a chemical plant in Louisiana.
Do not submit electronically any information you consider to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statue. See the
The EPA may publish any comment received to its public docket. Multimedia submissions (audio, video, etc.) must be accompanied by a written comment. The written comment is considered the official comment and should include discussion of all points you wish to make. The EPA will generally not consider comments or comment contents located outside of the primary submission (
The EPA will make every effort to accommodate all speakers who arrive and register. If a hearing is held at a U.S. government facility, individuals planning to attend should be prepared to show a current, valid state- or federal-approved picture identification to the
For questions about this action, contact Ms. Angie Carey, Sector Policies and Programs Division (E143-01), Office of Air Quality Planning and Standards (OAQPS), U.S. Environmental Protection Agency, Research Triangle Park, North Carolina 27711; telephone number: (919) 541-2187; fax number: (919) 541-0516; and email address:
In this action, the U.S. Environmental Protection Agency (EPA) is soliciting comment on all aspects of these AMEL
Alternative Means of Emission Limitation requests were submitted to the EPA for flares that cannot comply with the applicable flare tip velocity requirements in the Petroleum Refinery MACT, 40 CFR part 63, subpart CC and General Provisions to parts 60 and 63. These maximum flare tip velocity requirements ensure that the flame does not “lift off” or separate from the flare tip, which could cause flame instability and/or potentially result in a portion of the flare gas being released without proper combustion. Proper combustion for flares is considered to be 98-percent destruction efficiency or greater for organic HAP and VOC. The flares in these requests are designed to operate with tip exit velocities greater than those allowed in 40 CFR 60.18, 63.11, and 63.670 while achieving ≥96.5-percent combustion efficiency and 98-percent destruction efficiency. Requests from ExxonMobil Corporation, Marathon Petroleum Company, LP, Blanchard Refining, LLC, and Chalmette Refining, LLC were submitted to the EPA on November 7, 2017; October 7, 2016; September 20, 2017; and August 10, 2017, respectively. These requests, which seek AMEL for flares to be used at certain refineries subject to the Petroleum Refinery MACT, 40 CFR part 63, subpart CC, followed the AMEL framework specified in 40 CFR part 63, subpart CC at 40 CFR 63.670(r).
The ExxonMobil Corporation Baytown Refinery in Baytown, Texas, is seeking an AMEL to operate a gas-assisted flare during periods of startup, shutdown, upsets, and emergency events, as well as during fuel gas imbalance events. Marathon Petroleum Company, LP's Garyville, Louisiana Refinery, and Blanchard Refining, LLC's Galveston Bay Refinery (GBR) in Texas City, Texas, are seeking AMELs to operate their flares only during periods of startup, shutdown, upsets, and emergency events. Chalmette Refining, LLC in Chalmette, Louisiana, is seeking an AMEL to operate its flare during periods of upset and emergency events. LACC, LLC is seeking an AMEL to operate flares at its chemical plant in Lake Charles, Louisiana, during startups, shutdowns, upsets, and emergency events. See Table 1 for a list of regulations, by subparts, that each refinery and chemical plant has identified as applicable to the flares described above.
The provisions in each NSPS and NESHAP cited above, which ensure that flares meet certain specific operating requirements when used to satisfy the requirements of the NSPS or NESHAP were established as work practice standards pursuant to CAA sections 111(h)(1) or 112(h)(1). For standards established according to these provisions, CAA sections 111(h)(3) and 112(h)(3) allow the EPA to permit the use of an AMEL by a source if, after notice and opportunity for comment,
ExxonMobil, Marathon, Blanchard, Chalmette, and LACC submitted AMEL requests to operate above the applicable maximum permitted velocity requirements for flares in the General Provisions in 40 CFR parts 60 and 63 and/or in 40 CFR 63.670. ExxonMobil, Marathon, Blanchard, Chalmette, and LACC provided information that the flare designs achieve a reduction in emissions at least equivalent to the reduction in emissions for flares complying with the applicable General Provisions and/or MACT subpart CC requirements. For further information on ExxonMobil's, Marathon's, Blanchard's, Chalmette's, and LACC's AMEL requests, see supporting materials from ExxonMobil, Marathon, Blanchard, Chalmette, and LACC at Docket ID No. EPA-HQ-OAR-2010-0682 and EPA-HQ-OAR-2014-0738.
ExxonMobil submitted an AMEL for Flare 26 at the ExxonMobil Baytown Refinery. Flare 26 is an elevated flare, with an approximate height of 284 feet. Flare 26 will be modified to install a 52-inch gas-assisted flare tip. Gas-assisted means that natural gas is discharged near or at the flare tip exit and is used to improve the combustion efficiency in the combustion zone, but it is not part of the vent gas, and, as such, does not contribute to the vent gas volume that determines the exit tip velocity. Still, this flare cannot meet the exit velocity limitation in 40 CFR 63.670(d). Flare 26 receives low BTU gas (LBG) from episodic and maintenance events from the Flexicoking LBG system during startup, shutdown, and other non-routine operations. Flare 26 will also accept flow from the Flexicoking LBG system during normal operations where there is a fuel gas imbalance.
Marathon submitted an AMEL for their two MPGFs at their Garyville refinery and also for one MPGF at their subsidiary, Blanchard Refining's GBR. These three MPGFs were included in a single AMEL request because the principle is the same for each MPGF. All three MPGFs are designed to operate with tip exit velocities greater than those allowed in 40 CFR 60.18, 63.11, and 63.670, while achieving >96.5-percent combustion efficiency and 98-percent destruction efficiency. The scope of the AMELs include steam-assisted steam kinetic energy combustors (SKEC burners) at Garyville, pressure-assisted linear relief gas oxidizers (LRGO burners) at Garyville and GBR, and an air-assisted burner (LH burner) at GBR. All three of the MPGFs covered in this AMEL request were manufactured by John Zink Company, LLC (John Zink). Marathon is seeking AMELs to operate these flares during periods of startup, shutdown, upsets, and emergency events.
Chalmette Refining, LLC submitted an AMEL for their No. 1 Flare. The No. 1 Flare was designed by John Zink and constructed in 1982. The flare is an 8-stage candelabra style raised pressure-assisted flare with multiple flare tips comprised of two designs. The flare is elevated 171.92 feet above ground. Stage one is equipped with John Zink LRGO-Spider model burners. All other stages have John Zink model LRGO-FF burners. The gases being flared can range in composition and flow, but the flare only operates during upset and emergency conditions.
LACC, LLC submitted an AMEL for two MPGF operating in series. This system consists of an enclosed ground flare and a high-pressure ground flare that operates as a cascading system whereby the enclosed ground flare serves as the primary relief control device and the high-pressure ground flare serves as the secondary relief control device should the enclosed ground flare approach burner utilization capacity. The high-pressure header portion of these ground flares are MPGF and utilize two different types of pressure assisted burners; LRGO-HC (both flares) and INDAIR (enclosed ground flare only). Both are designed and produced by John Zink. The high‐pressure header MPGFs will be used for destruction of vent streams
As mentioned above, ExxonMobil, Marathon, Blanchard, and Chalmette provided the information specified in the flare AMEL framework at 40 CFR 63.670(r) to support their AMEL requests. LACC provided the information specified in the flare AMEL framework finalized on April 21, 2016 (81 FR 23486), to support its AMEL request. The information specified in both frameworks includes, but is not limited to: (1) Details on the project scope and background; (2) information on regulatory applicability; (3) flare test data on destruction efficiency/combustion efficiency; (4) flare stability testing data; (5) flare cross-light testing data; (6) information on flare reduction considerations; and (7) information on appropriate flare monitoring and operating conditions. (For further information on the supporting materials provided, see Docket ID No. EPA-HQ-OAR-2010-0682 and EPA-HQ-OAR-2014-0738.)
Information supplied by these companies indicates that the flares can achieve adequate combustion efficiency if operated under certain conditions. Generally, testing of burners for the vent gas mixture determined to be representative of the flare operation was used to set the appropriate combustion zone net heating value (
Chalmette Refining submitted required information and requested a minimum
Finally, LACC requested two separate limits to account for the two sets of burners on their MPGF, LRGO, and INDAIR burners operating on waste gas from ethylene and downstream chemical manufacturing (ethylene oxide and monoethylene glycol) processes. LACC cited previous combustion efficiency information for the LRGO burners and successful cross light and stability at 800 BTU/scf for the representative waste gas composition. The combustion efficiencies for the INDAIR burners testing showed that a minimum of 1,067 BTU/scf for
Based upon our review of the AMEL requests, we have concluded that, by complying with the proposed AMEL specified in Table 2 and accompanying paragraphs, the flares will achieve emission reductions at least equivalent to reduction in emissions being controlled by flares complying with the flare requirements under the applicable NESHAP and NSPS identified in Table 1. We are seeking the public's input on the requests that the EPA approve AMELs for these flares. Specifically, the EPA seeks the public's input on the conditions specified in this document in the following paragraphs. The EPA's proposed AMEL for Chalmette Refining does not include the requested provision to allow a source not to meet the limits in Table 2 as long as evidence of cross light and combustion exists.
(1) All flares must be operated such that the combustion zone gas net heating value (
(i) If an owner or operator elects to use a monitoring system capable of continuously measuring (
(ii) If the owner or operator uses a continuous net heating value monitor, the owner or operator may, at their discretion, install, operate, calibrate, and maintain a monitoring system capable of continuously measuring, calculating, and recording the hydrogen concentration in the flare vent gas. The owner or operator shall use the following equation to determine
(iii) For non-assisted flare burners,
(i) The owner or operator shall determine
(ii) For non-assisted flare burners,
For the ExxonMobil flexicoker flare (F-26), the owner or operator shall calculate the 15-minute block average
(d) For all flare systems specified in this document, the operator shall install, operate, calibrate, and maintain a monitoring system capable of continuously measuring the volumetric flow rate of flare vent gas (
(i) The flow rate monitoring systems must be able to correct for the temperature and pressure of the system and output parameters in standard conditions (
(ii) Mass flow monitors may be used for determining volumetric flow rate of flare vent gas provided the molecular weight of the flare vent gas is determined using compositional analysis so that the mass flow rate can be converted to volumetric flow at standard conditions using the following equation:
(e) For each measurement produced by the monitoring system used to comply with (1)(a)(ii), the operator shall determine the 15-minute block average as the arithmetic average of all measurements made by the monitoring system within the 15-minute period.
(f) The operator must follow the calibration and maintenance procedures according to Table 4. Maintenance periods, instrument adjustments, or checks to maintain precision and accuracy and zero and span adjustments may not exceed 5 percent of the time the flare is receiving regulated material.
(2) The flare system shall be operated with a flame present at all times when in use. Additionally, each stage that cross-lights must have at least two pilots with a continuously lit pilot flame, except for Chalmette Refining, which has one pilot for each stage, excluding stages 8A and 8B. Each pilot flame must be continuously monitored by a thermocouple or any other equivalent device used to detect the presence of a flame. The time, date, and duration of any complete loss of pilot flame on any of the burners must be recorded. Each monitoring device must be maintained or replaced at a frequency in accordance with the manufacturer's specifications.
(3) Flares at refineries shall comply with the requirements of 40 CFR 63.670(h). For LACC, LLC, the flare system shall be operated with no visible emissions except for periods not to exceed a total of 5 minutes during any 2 consecutive hours. A video camera that is capable of continuously recording (
(4) For the MPGF and the Chalmette elevated multi-point flare, the operator of a flare system shall install and operate pressure monitor(s) on the main flare header, as well as a valve position indicator monitoring system capable of monitoring and recording the position for each staging valve to ensure that the flare operates within the range of tested conditions or within the range of the manufacturer's specifications. The pressure monitor shall meet the requirements in Table 4. Maintenance periods, instrument adjustments or checks to maintain precision and accuracy, and zero and span adjustments may not exceed 5 percent of the time the flare is receiving regulated material.
(5) Recordkeeping Requirements
(a) All data must be recorded and maintained for a minimum of 3 years or for as long as required under applicable rule subpart(s), whichever is longer.
(6) Reporting Requirements
(a) The information specified in section III (6)(b) and (c) below must be reported in the timeline specified by the applicable rule subpart(s) for which the flare will control emissions.
(b) Owners or operators shall include the final AMEL operating requirements for each flare in their initial Notification of Compliance status report.
(c) The owner or operator shall notify the Administrator of periods of excess emissions in their Periodic Reports. The notification shall include:
(i) Records of each 15-minute block for all flares during which there was at least 1 minute when regulated material was routed to the flare and a complete loss of pilot flame on a stage of burners occurred, and for all flares, records of each 15-minute block during which there was at least 1 minute when regulated material was routed to the flare and a complete loss of pilot flame on an individual burner occurred.
(ii) Records of visible emissions events (including the time and date stamp) that exceed more than 5 minutes in any 2-hour consecutive period.
(iii) Records of each 15-minute block period for which an applicable combustion zone operating limit (
(iv) Records of when the pressure monitor(s) on the main flare header show the flare burners are operating outside the range of tested conditions or outside the range of the manufacturer's specifications. Indicate the date and time for each period, the pressure measurement, the stage(s) and number of flare burners affected, and the range of tested conditions or manufacturer's specifications.
(v) Records of when the staging valve position indicator monitoring system indicates a stage of the flare should not be in operation and is or when a stage of the flare should be in operation and is not. Indicate the date and time for each period, whether the stage was supposed to be open, but was closed, or vice versa, and the stage(s) and number of flare burners affected.
We solicit comments on all aspects of ExxonMobil's, Marathon's, Blanchard's, Chalmette's, and LACC's requests for approval of an AMEL for flares to be used to comply with the standards specified in Table 1. We specifically seek comment regarding whether or not the alternative operating requirements listed in section III above will achieve emission reductions at least equivalent to emissions being controlled by flares complying with the applicable flare requirements in 40 CFR 60.18(b), 63.11(b), and/or 63.670.
Environmental Protection Agency (EPA).
Notification of request for comments.
This action provides public notice and solicits comment on an alternative work practice (AWP) request under the Clean Air Act, to use new technology and work practices developed for removal and replacement of asbestos cement (A/C) pipe. In this action, the Environmental Protection Agency (EPA) is soliciting comment on all aspects of this request for an AWP that, in order to be approved, should be at least environmentally equivalent to the existing work practices in the National Emission Standards for Hazardous Air Pollutants for Asbestos (Asbestos NESHAP), which applies to the removal and replacement of A/C pipe.
Do not submit electronically any information you consider to be confidential business information (CBI) or other information whose disclosure is restricted by statute. Send or deliver information identified as CBI only to the following address. OAQPS Document Control Officer (C404-02), Office of Air Quality Planning and Standards, Environmental Protection Agency, Research Triangle Park, North Carolina 27711, Attention Docket ID No. EPA-HQ-OAR-2017-0427.
The EPA may publish any comment received to its public docket. Multimedia submissions (audio, video, etc.) must be accompanied by a written comment. The written comment is considered the official comment and should include discussion of all points you wish to make. The EPA will generally not consider comments or comment contents located outside of the primary submission (
The EPA will make every effort to accommodate all speakers who arrive and register. If a hearing is held at a U.S. government facility, individuals planning to attend should be prepared to show a current, valid state- or federal-approved picture identification to the security staff in order to gain access to the meeting room. An expired form of identification will not be permitted. Please note that the Real ID Act, passed by Congress in 2005, established new requirements for entering federal facilities. If your driver's license is issued by a noncompliant state, you must present an additional form of identification to enter a federal facility. Acceptable alternative forms of identification include: Federal employee badge, passports, enhanced driver's licenses, and military identification cards. Additional information on the Real ID Act is available at
For questions about this action, contact Ms. Susan Fairchild, Sector Policies and Programs Division (D-243-04), Office of Air Quality Planning and Standards (OAQPS), U.S. Environmental Protection Agency, Research Triangle Park, North Carolina 27711; telephone number: (919) 541-5167; fax number: (919) 541-4991; and email address:
Categories and entities potentially affected by this reconsideration action include those listed in Table 1 of this preamble.
This table is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be affected by this proposed action. To determine whether your A/C pipe replacement project (ACPRP) would be affected by this proposed action, you should examine the applicability criteria in the Asbestos NESHAP (40 CFR part 61, subpart M). If you have any questions regarding the applicability of any aspect of this proposed action, please contact the person listed in the preceding
The docket number for this proposed action regarding the Asbestos NESHAP is Docket ID No. EPA-HQ-OAR-2017-0427. In addition to being available in the docket, an electronic copy of this document will also be available on the internet. The EPA will post a copy of this proposed action at
Following publication in the
Drinking water, waste water, and storm water are handled by a system of pipes which deliver water to residences, commercial, institutional, and industrial users; transfer waste water from users to wastewater treatment plants; and carry untreated storm water to streams and lakes. As the infrastructure of municipalities age, utilities serving the population need to replace deteriorated water pipes. Existing water pipes can be made of various components, such as clay, iron, polyvinyl chloride (PVC), concrete, and A/C. These A/C pipes are potentially subject to regulation under the Asbestos NESHAP when replaced.
When A/C pipes age, the cementitious bonds in the pipe matrix weaken, primarily due to the pH of the water, particulate in suspension, acidic gases in sewage, and the scrubbing effect of sandy soil caused by movement, such as tidal changes against the outside of the pipe (
Once pipes begin to leak, the environment can be harmed in several ways. Leaking waste water pipes can pollute nearby waterways, such as oceans, rivers, and lakes. Compromised storm water pipes can allow excess ground water, produced during high volume storm events, to seep into the
Because existing water pipes of all types run beneath and beside major roadways, beneath buildings, and overlap other utilities (
The Asbestos NESHAP is a set of work practice standards designed to minimize the release of asbestos, prescribed for the handling, processing, and disposal of asbestos-containing materials (ACM). The purpose of these work practices is to minimize the release of asbestos into the environment.
Asbestos is a known human carcinogen and the primary route of exposure is through inhalation of asbestos fibers. The potential for exposure to asbestos fibers is directly linked to ACM's potential to become friable, and, thus, for fibers to become airborne. Certain ACM can readily release asbestos fibers when they are disturbed or damaged. Asbestos fibers can then become entrained into the ambient air where they become available for inhalation. More information on the health effects of asbestos may be found at
The Asbestos NESHAP defines friable asbestos material as any material containing more than 1-percent asbestos as determined using the method specified in 40 CFR part 763, subpart E, appendix E, section 1, Polarized Light Microscopy (PLM), that, when dry, can be crumbled, pulverized, or reduced to powder by hand pressure. If the asbestos content is less than 10 percent, as determined by a method other than point counting by PLM, the asbestos content must be verified by point counting using PLM.
In the preamble to the 1990 Asbestos NESHAP amendments (55 FR 48406, November 20, 1990), the EPA stated in response to comments on the definition of “friable” as it applied to the demolition and renovation of ACM, that the EPA's intention was to distinguish between materials that would readily release asbestos fibers when damaged or disturbed and those materials that were unlikely to result in the release of significant amounts of asbestos fibers. The Asbestos NESHAP test to determine if ACM is friable is to attempt to crush the dry material by hand. If the dry ACM can be crumbled, pulverized, or crushed to powder by hand pressure, it is friable, and is regulated under the Asbestos NESHAP.
Asbestos-contaminated material regulated under the Asbestos NESHAP is termed regulated asbestos-containing material (RACM). RACM is defined in 40 CFR 61.141 of the Asbestos NESHAP and includes: (1) Friable
Thus, the purpose of the work practices required for the removal ofA/C pipe in the Asbestos NESHAP is to minimize the release of asbestos fibers into the atmosphere, either at the time the material is removed, or at a later date, as a result of friable materials left in the soil. Therefore, in evaluating under 40 CFR 61.12(d) whether an AWP will achieve a reduction in emissions of asbestos fibers at least equivalent to the reduction achieved under the Asbestos NESHAP work practices, the EPA will evaluate whether the AWP minimizes the release of asbestos fibers to the atmosphere.
The 40 CFR part 61 General Provisions explain under what circumstances the EPA may approve an alternative means of emission limitation. At 40 CFR 61.12(d)(1) and (2), the General Provisions require that the alternative means of emission limitation must achieve a reduction in emissions at least equivalent to the reduction achieved by the work practices required under the existing standard, and that the
Additionally, the Asbestos NESHAP itself contains specific provisions under which the EPA may receive applications for prior written approval of an alternative emission control and waste treatment method. For example, 40 CFR 61.150(a)(4) authorizes “[u]se [of] an alternative emission control and waste treatment method that has received prior approval by the Administrator according to the procedure described in 40 CFR 61.149(c)(2).” As required by 40 CFR 61.150(a)(4) and 40 CFR 61.149(c)(2), before approval may be granted for an AWP, a written application must be submitted to the Administrator demonstrating that the following criteria are met: (i) The alternative method will control asbestos emissions equivalent to currently required methods; (ii) the suitability of the alternative method for the intended application; (iii) the alternative method will not violate other regulations; and (iv) the alternative method will not result in increased water pollution, land pollution, or occupational hazards.
In order to be approved, the proposed AWP must meet all requirements for no visible emissions (VE), adequate wetting, waste handling, and disposal under the Asbestos NESHAP. The EPA is proposing that this AWP is equivalent to the work practice in the Asbestos NESHAP: It removes A/C pipe while replacing it with non-asbestos materials; converts friable ACM, and ACM that may become friable when disturbed into nonfriable ACM during the replacement
To the extent A/C pipe is either friable ACM or Category II nonfriable ACM that has a high probability of becoming or has become crumbled, pulverized, or reduced to powder by the forces expected to act on it during the pipe replacement process, the A/C pipes meet the RACM definition. If Category II nonfriable A/C pipes do not have a high probability of becoming and have not become crumbled, pulverized, or reduced to powder by the forces expected to act on them during the pipe replacement process, those pipes would not be regulated as RACM under the Asbestos NESHAP.
For renovations such as a regulated underground ACPRP, if the total amount of RACM for the project over the course of a single calendar year to be stripped, removed, dislodged, cut, drilled, or similarly disturbed during the activity is less than 260 linear feet, the renovation work practices found in 40 CFR 61.145 of the NESHAP do not apply, regardless of the pipe replacement method to be used, the type of material (Category I or II), or its condition (friable versus nonfriable). See 40 CFR 61.145(a)(4). The waste disposal requirements found in 40 CFR 61.150 and 61.154 apply to any source regulated under 40 CFR 61.145.
It is important to note that projects may not be broken up to avoid regulation under the Asbestos NESHAP, and the EPA has clarified the requirements of the Asbestos NESHAP as they relate to a project on several occasions. In our 1995
The work practices for asbestos control under the Asbestos NESHAP exist to minimize the release of asbestos into the ambient air. When a facility component that contains, is covered with, or is coated with RACM is being removed from a facility
The work practices in the Asbestos NESHAP that apply to the removal and replacement of A/C pipe include procedures for emission control, handling of asbestos waste, and asbestos waste disposal. These work practices are discussed in the sections below.
The principal controls in the Asbestos NESHAP for renovations such as pipe replacement operations include requirements that the RACM be adequately wetted to minimize VE during pipe replacement operations involving RACM, and that asbestos waste be handled, collected, and disposed of properly. The emission control requirements must meet the standard for no VE. “Adequately wet” means to sufficiently mix or penetrate with liquid to prevent the release of particulates. If VE are observed coming from RACM, then that material has not been adequately wetted. However, the absence of VE is not sufficient evidence of being adequately wet. Typically, the emission controls used to achieve adequate wetting include a fine water spray (or a mist).
The Asbestos NESHAP specifies at 40 CFR 61.150(a)(5) that the asbestos-containing waste material (ACWM) handling requirements do not apply to Category I nonfriable ACM waste (asbestos-containing packings, gaskets, resilient floor covering, and asphalt roofing products containing more than 1-percent asbestos) and Category II nonfriable ACM waste (any other nonfriable ACM containing more than 1-percent asbestos) that did
Asbestos containing waste materials from activities regulated by 40 CFR 61.145 must be handled, collected, and disposed of in accordance with 40 CFR 61.150. No VE may be discharged to the outside air during the collection, processing, packaging, or transportation of any ACWM. All ACWM must be kept adequately wet and sealed in leak-tight
The Asbestos NESHAP requires all ACWM to be deposited as soon as is practical in a waste disposal site operated in accordance with the provisions of 40 CFR 61.154 or an EPA-approved site that converts RACM and ACWM into nonasbestos (asbestos-free) material according to the provisions of 40 CFR 61.155.
Even A/C pipes in good condition (which would be Category II nonfriable ACM) become regulated ACM, if the pipe has a high probability of becoming or has become crumbled, pulverized, or reduced to powder by the forces expected to act on the pipe during the renovation activities. Moreover, most of the A/C pipe being replaced by municipalities is likely to be in poor condition (
The EPA has previously determined
The accepted technique to remove and replace A/C pipes is known as “open trench replacement.” In open trench replacement, the pipe is located, cleaned, and inspected. Because pipes run beneath and cross transportation corridors, traffic is rerouted to available detours. Temporary water and sewer service is installed to handle the water supply and/or wastewater handling affected by the disruption of service. Other utilities (electricity, cable, optical fiber) that may obstruct or interfere with pipe replacement are also identified. Once the location of the pipe and all utilities are identified, the road surfacing, and other structures, such as sidewalks, medians, etc., are removed and an open trench is dug to expose the length of pipe to be replaced. A pipe cutter is clamped around the A/C pipe being replaced, and it is scored along the outside of its circumference while water is applied to prevent emissions of asbestos to the atmosphere, which may occur along the line of cutting. The pipe is snapped along the cut and the process is repeated to produce transportable 6- to 8-foot sections of pipe. Asbestos cement pipe in poor condition may resemble wet cardboard in the way it responds to these removal activities. It can simply collapse and tear into smaller pieces, rather than snap, as A/C pipe in good condition is known to do. Each pipe section is removed, wrapped in plastic, and placed on a truck labelled according to regulations for asbestos waste disposal. This process of snap cutting and removal is repeated for the entire length of A/C pipe to be replaced.
No AWPs for the replacement of A/C pipes have yet been approved.
The EPA received a request from Trenchless Consulting, LLC, in July 2017, for approval of an AWP, known as the “Close Tolerance Pipe Slurrification” (CTPS) method, for the removal and replacement of A/C pipes. This is one of two AWPs requested. The second one, which involves a technique commonly known as “pipe bursting” is still under consideration. We are not discussing “pipe bursting” in this
Documentation for CTPS is found in the Docket, and includes photographs and video of the CTPS process demonstration on clay pipe,
The EPA is proposing to consider the slurry that is formed by the CTPS AWP for A/C pipe to be nonfriable once hardened. This is important because the typical A/C pipe that is replaced is usually friable in many places and in poor condition. The proposed CTPS AWP converts all the ACM of the A/C pipe into a nonfriable material which is disposed of in a landfill permitted to receive ACWM. A skim coat of the nonfriable cementitious ACM remains on the outer rim of the new pipe.
Because disposal takes place before the slurry hardens, and the test to determine friability takes place after the slurry hardens, the slurry must be sealed in containment at disposal (rather than disposed openly pending the outcome of the test). Although the Asbestos NESHAP does not require containment of nonfriable ACM, this AWP must ensure the ACWM is contained because the test indicating the ACWM is nonfriable would not yet have been conducted at the time of disposal (the friability test is done on a sample of the material that has cured and hardened over a period of 48 to 56 hours).
In contrast to the Asbestos NESHAP work practices for ACPRPs conducted in temperatures below freezing, the CTPS method may only be used when temperatures are above 32 °F (0 °C) to prevent freezing the slurry, drilling fluids, and/or the amended water needed to maintain adequate wetting.
The EPA believes that the CTPS work practices are “consistent with the EPA's intent to distinguish between material that could release significant amounts of asbestos fibers during demolition and renovation operations and those that would not, and to prevent significant emissions of asbestos fibers to the atmosphere.” (see 55 FR 48408, November 20, 1990 Asbestos NESHAP final notice, in our statements in response to comments on friable vs. nonfriable materials). The EPA is proposing that, for the following five reasons, CTPS is at least equivalent to
First, this technique of replacement only exposes a small portion of the A/C pipe, thereby preventing significant emissions of asbestos to the atmosphere, a part of the overall reduction in emissions potential. As described in more detail below, the CTPS approach only excavates the A/C pipe at predetermined points along the pipe's path. Vertical access cuts are made to remove A/C pipe only at the beginning and end of the length of pipe to be removed and in designated vertical access points to reduce pressure buildup of the slurry. This limited excavation reduces the level of exposure to asbestos emissions from the A/C pipe remediation project.
Second, during periods where ACM is exposed, it is in the liquid slurry form and is considered adequately wet and, thus, does not become airborne, where it could be available for inhalation. The slurry is pumped out of these points into an enclosed tank to be taken to a waste disposal site approved to receive asbestos.
Third, the CTPS AWP uses amended water to improve dust suppression at all cuts, trenches, and vertical access points where A/C pipe may be exposed to the ambient air. The pipe is otherwise not exposed to the air.
Fourth, a skim coat of slurry, which contains ACM and remains on the new pipe, is not loose in the soil, but adheres to the surface of the new pipe. The skim coat fills the annular space created by the close tolerance drill through the ground as it pulls the new pipe through. Therefore, it has a structural support preventing the thin coating from being crushed, and also is not free to migrate to the surface as a result of soil movement, such as frost heaves.
Fifth, once hardened, the skim coat is nonfriable and has properties of cement: Similar to light-weight flowable fill (concrete) purchased from concrete plants, the skim coat has a strength of 50-150 pounds per square inch. Once hardened, the skim coat has static properties such that it does not settle or compress further. Once the skim coat is in place, it can only be removed by force,
The Asbestos NESHAP focuses on asbestos containing materials and their decline into friable material. Since the advent of new methods which were not available at the time of the last amendment to the rule, this may be a procedure whereby friable A/C pipe in poor condition is partially remediated back to a nonfriable state, and its properties are similar to the properties of other cement products such as flowable fill concrete.
Close tolerance pipe slurrification differs from the conventional work practices in which the entire pipe, much of which is in poor condition and may be friable, is excavated and exposed, cut into numerous 6- to 8-foot transportable sections, sealed in leak-tight wrapping, labeled, and transported to an approved asbestos waste disposal site. Five A/C pipe replacement guidance documents from state and local agencies (from Massachusetts, Maine, Oregon, Utah, and the city of Richmond, Virginia) are available in the docket for reference on the conventional work practices.
Consequently, the EPA believes that by following the CTPS AWP, adequately wet and no VE protocols, and exposing only small sections of A/C pipe to the air, asbestos emissions to the atmosphere are minimized, and the AWP would achieve an emission reduction at least equivalent to the current Asbestos NESHAP.
While the Asbestos NESHAP (and associated applicability determinations) contemplate and provide direction on a number of situations for handling and managing asbestos, the situation whereby friable ACM is turned into nonfriable ACM is not one that is contemplated under the rule. The EPA is proposing that when the CTPS work practices are adhered to as described in this document, and when the test for friability confirms that the resulting hardened slurry (skim coating) is nonfriable ACM, the resulting material can be regulated as nonfriable ACM. Under 40 CFR 61.145(c)(1)(iv) of the Asbestos NESHAP, under certain conditions nonfriable ACM need not be removed, if they are Category II nonfriable ACM and the probability is low that materials will become crumbled, pulverized, or reduced to powder during demolition. We are proposing that the nonfriable skim coating of ACM left on the outer rim of the new pipe be allowed to also remain in place.
The EPA is proposing that when CTPS is used to remove the underground A/C pipe, while maintaining no VE and the adequately wet requirements of 40 CFR 61.145 and 40 CFR 61.150(a), removing the old A/C pipe, converting all A/C pipe to Category II nonfriable ACM, and replacing the underground A/C pipe with new pipe, then CTPS is at least equivalent, in terms of emission reductions, to the work practices in the Asbestos NESHAP as they apply to renovations.
The Asbestos NESHAP waste disposal requirements include deed notations for inactive asbestos waste disposal sites, where ACWM (
The EPA is proposing that the nonfriable ACM resulting from CTPS would not be subject to deed notations. However, as is current practice, the EPA proposes that owner/operators (
The EPA is also proposing that the other requirements in the Asbestos NESHAP that apply to renovations, including notification requirements found in 40 CFR 61.145(b), would apply to the CTPS AWPs. Additionally, the EPA is proposing that the waste handling and disposal requirements found in 40 CFR 61.150 and 61.154 would apply to the slurry that is removed at the ACPRP.
The EPA is seeking the public's input on Trenchless Consulting's request that the EPA approve the CTPS approach as an AWP under the Asbestos NESHAP. We are seeking comments on whether
Based upon our initial review of the proposed AWP request, the demonstrations of the work practice, and written materials including equipment, materials, slurry characteristics, testing, and waste specifications, we propose that, by complying with the following list of requirements, this proposed AWP will achieve emission reductions at least equivalent to emission reductions achieved under 40 CFR 61.145, 40 CFR 61.150, and 40 CFR 61.154, as required by the applicable Asbestos NESHAP, provided that adequate wetting accompanies all vertical access points, access trenches, and manholes to prevent VE, and that the A/C cementitious material resulting from this process is properly handled and contained during and after removal and properly disposed of as required by the Asbestos NESHAP.
The patent related to this process, “Method of Replacing an Underground Pipe Section,” is available from the U.S. Patent Office, patent number US8,641,326B2; February 4, 2014, and a copy is available in the docket. That patent deals with the replacement of low-pressure sewer pipes and indicates some parameters that may be different from the work practices in this notice, depending on the soil composition, depth of pipe, and serviceable use of the pipe (
The proposed CTPS AWP is as follows:
Vertical access points (
At the starting and terminal points, and at designated intervals along the length of pipe replacement, sections of pipe are cut and removed at the vertical access points (
The CTPS technique should use a drilling head train with a slightly larger diameter than the pipe being replaced. This technology must use a heavy duty four-stage cutting and wetting train, made of hardened carbon steel, which is able to be fed directly around the pipe to be replaced. The cutting head must be drawn around the existing pipe and must be capable of grinding the oldA/C pipe to a fine powder using a liquid delivery system as described in section IV.A.4 of this preamble. The process must return the A/C pipe to a cementitious slurry that is a homogenous mixture and stays adequately wet through disposal according to the requirements of 40 CFR 61.145. The owner/operator must ensure that the CTPS train pulls the replacement pipe behind it, and that no ACM contacts the inside of the new pipe.
The horizontal drilling train must be equipped with ports to deliver liquid materials to the drilling head. Drilling fluids and bentonite clay should also be delivered through these ports to reduce frictional drag on the line, and to lubricate the interface along the soil to pipe line.
The owner/operator would be required to ensure that the new pipeline is trackable by steel cable (or other durable trackable material) laid with the new pipe.
The owner/operator would be required to ensure that no visible emissions are discharged to the air from the slurry, and that the slurry is a homogenous mixture comprised of finely ground A/C pipe, drilling fluids, bentonite clay, and other materials suspended in solution that, when cured (a period of 48-56 hours), re-hardens so that it meets the sample friability test in section IV.D.2 of this preamble. The slurry must meet the no visible emissions requirements of 40 CFR 61.145 and 61.150.
The A/C pipe slurry is removed at vertical access points using a vacuum attached to a tank (
Any opening to the atmosphere along the pipe is a potential source of asbestos emissions to the outside (ambient) air. The owner/operator would be required to ensure that dust suppression equipment (
If an underground ACPRP meets the applicability and threshold requirements under the NESHAP, then the EPA (or the delegated agency) must be notified in advance of the replacement in accordance with the requirements of the Asbestos NESHAP at 40 CFR 61.145(b). See 40 CFR 61.145 for more information on the notification requirements.
Prior to using the CTPS for an ACPRP, the owner/operator would conduct underground pipe inspections (
The owner/operator of a CTPS method system is required to install, operate, and maintain the drilling head train, CTPS liquid delivery system, and all equipment used to deliver adequate wetting at all vertical access points and cut lengths of pipe in accordance with their written standard operating procedures. The records must be kept in accordance with section IV.F.1 of this preamble.
After the slurry has been pumped from the vertical access points, but before disposal, the owner/operator of a CTPS method system is required to collect a 2-inch roughly spherical wet sample of the slurry. A single sample must be collected for each project discharging to a single enclosed tank. The owner/operator would be required to seal the sample in leak-tight wrapping and allow the sample to harden and dry (usually 48-56 hours).
When the sample is hardened and dry, the owner/operator would be required to attempt to crush the sample by hand. The sample that cannot be crumbled, pulverized, or reduced to powder by hand pressure is nonfriable, and the remaining slurry from that pipe replacement job is likewise nonfriable. After testing, the owner/operator would be required to ensure that the sample is packaged in leak-tight wrapping for storage, labeled “Asbestos Containing Material. Do not break or damage this sealed package,” dated according to the ACPRP date of generation, stored in a secure location that is inaccessible to the general public (such as a locked storage unit), and is maintained by the owner/operator for a period of 2 years. After this 2-year retention period, the sample may be disposed of in a landfill permitted to accept ACWM.
a. If the sample cannot be crushed, crumbled, or reduced to powder by hand pressure, the owner/operator would be required to certify this as follows: “The hardened slurry sample from the ACPRP conducted on (date) at (location) could not be crushed, crumbled, or reduced to powder by hand pressure. I am aware it is unlawful to knowingly submit incomplete, false, and/or misleading information and there are significant criminal penalties for such unlawful conduct, including the possibility of fine and imprisonment.” The owner/operator would be required to maintain a signed certificate of this statement so that it is available to the EPA Administrator, local, and state agency officials upon demand.
b. If the sample can be crushed, crumbled, or reduced to powder by hand pressure, the owner/operator would be required to follow the malfunction reporting requirements in IV.F. 2 below.
Owner/operators would be required to note utility maps according to the actual location identified by the 6-digit latitude and longitude coordinates of the newly laid line. Notations would have to be maintained for the life of the new pipe by the owner/operator (
Because all A/C pipe being replaced using the CTPS technique is converted to a nonfriable state during the replacement, it would be categorized as Category II ACM and would need to be labeled and transported in accordance with the corresponding requirements of 40 CFR 61.145 and 40 CFR 61.150 in the Asbestos NESHAP.
1. The owner/operator would be required to record and maintain for a period of 2 years the following data:
a. Date(s) from beginning to end of each ACPRP;
b. Location(s) of the A/C pipe(s) replaced using CTPS, identified by 6-digit latitudinal and longitudinal coordinates for each ACPRP;
c. Diameter and length of A/C pipe replaced at the ACPRP;
d. Total amount of slurry generated at the ACPRP;
e. Total amount of slurry disposed by the owner/operator from the ACPRP;
f. Slurry disposal site;
g. Manifest of ACM slurry disposal; and
h. Malfunction records (if applicable).
i. Records of VE events and their duration (including the time and date stamp) of any VE event;
ii. Records of when and how each VE event was resolved. Indicate the date and time for each VE period, whether the VE event occurred at an exposed manhole, trench, or other vertical access point, and the number of openings to the ambient air affected;
iii. Procedure used to resolve each VE event; and
iv. Results of each sample friability test that indicates the slurry is friable, as required by IV.D.1 and 2 above.
i. Records of the standard operation procedures for the installation, operation, and maintenance of the drilling head train, CTPS liquid delivery system, and all equipment used to deliver adequate wetting at all vertical access points and cut lengths of pipe.
2. Each owner/operator is required to submit the following reports to the Administrator after each occurrence, as follows:
a. Malfunction Report. The malfunction report must include the records in section IV.F.1.h.i.-iv of this preamble. The malfunction report must be submitted as soon as practical after the occurrence, but in no case later than 30 days.
b. ACPRP Report. The ACPRP report must be submitted to the Asbestos NESHAP program office within the EPA Regional office in which the ACPRP is located. The report may be submitted electronically when the means to do so are available. The EPA Regional office may, at their discretion, waive this requirement and delegate this reporting to the state and municipality. If the EPA Regional office has waived the reporting, and if the state or municipality is unable to receive electronic reports, then only a hard copy is required to be submitted. These reports must be postmarked or electronically submitted within 30 calendar days of completion of the ACPRP.
We solicit comments on all aspects of this request for approval of CTPS as an AWP for the work practice standards specified in 40 CFR part 61, subpart M, the Asbestos NESHAP. We specifically seek comments regarding whether the AWPs, as described in section IV above, will achieve emission reductions at least equivalent to the work practices in the
Environmental Protection Agency (EPA).
Notice.
EPA is seeking applications for the 2018 Safer Choice Partner of the Year Awards. In 2015, EPA developed the Partner of the Year Awards to recognize Safer Choice stakeholders who have advanced the goals of the Pollution Prevention Act by reducing pollution at its source through safer chemistry. At the 2018 Partner of the Year Awards, Safer Choice will recognize stakeholder organizations from five broad categories: Formulators/Product Manufacturers of both Consumer and Institutional/Industrial products, Purchasers and Distributors, Retailers, Supporters (
Linda Rutsch, Chemistry, Economics and Sustainable Strategies Division, Office of Pollution Prevention and Toxics, Environmental Protection Agency, 1200 Pennsylvania Ave. NW, Washington, DC 20460-0001; telephone number: (202) 343-9924; email address:
You may be potentially affected by this action if you are a Safer Choice program partner or stakeholder. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:
The full Safer Choice Partner of the Year Awards announcement and award application materials can be found at:
The docket for this action, identified by docket information (ID) number EPA-HQ-OPPT-2015-0785, is available at
EPA is seeking applications for the 2018 Safer Choice Partner of the Year Awards. In 2015, EPA developed the Partner of the Year Awards to recognize Safer Choice stakeholders who have advanced the goals of the Pollution Prevention Act by reducing pollution at its source through safer chemistry. The Safer Choice Partner of the Year Awards recognize program participants for advancing the goal of chemical safety through exemplary participation in or promotion of the Safer Choice program. Safer Choice program participants are continually driving innovation to make chemical products safer. The program currently certifies approximately 2,000 products, used by consumers, institutions and industry that meet the Safer Choice Standard. The 2018 Partner of the Year Awards will be the fourth annual event, with recognition for Safer Choice stakeholder organizations from five broad categories: (1) Formulators/Product Manufacturers of both Consumer and Institutional/Industrial products, (2) Purchasers and Distributors, (3) Retailers, (4) Supporters (
The award application and instructions are available at
15 U.S.C. 2601.
Environmental Protection Agency (EPA).
Notice.
The Environmental Protection Agency is planning to submit an information collection request (ICR),
Comments must be submitted on or before June 25, 2018.
Submit your comments, referencing Docket ID No. EPA-HQ-OARM-2018-0124 online using
EPA's policy is that all comments received will be included in the public docket without change including any personal information provided, unless the comment includes profanity, threats, information claimed to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statute.
Thomas Valentino, Policy Training and Oversight Division, Office of Acquisition Management (3802R), Environmental Protection Agency, 1200 Pennsylvania Ave. NW, Washington, DC 20460; telephone number: (202) 564-4522; email address:
Supporting documents which explain in detail the information that the EPA will be collecting are available in the public docket for this ICR. The docket can be viewed online at
Pursuant to section 3506(c)(2)(A) of the PRA, EPA is soliciting comments and information to enable it to: (i) Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the Agency, including whether the information will have practical utility; (ii) evaluate the accuracy of the Agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (iii) enhance the quality, utility, and clarity of the information to be collected; and (iv) 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,
Equal Employment Opportunity Commission.
Notice of Information Collection—Extension Without Change: State and Local Government Information Report (EEO-4).
In accordance with the Paperwork Reduction Act, the Equal Employment Opportunity Commission (EEOC) announces that it is submitting to the Office of Management and Budget (OMB) a request for a three-year extension without change of the State and Local Government Information Report (EEO-4 Report, Form 164).
Written comments on this notice must be submitted on or before May 25, 2018.
Comments on this notice must be submitted to Joseph B. Nye, Policy Analyst, Office of Information and Regulatory Affairs, Office of Management and Budget, 725 17th Street NW, Washington, DC 20503, email
Benita Marsh, Director of Surveys, Office of Research, Information and Planning, Equal Employment Opportunity Commission, 131 M Street NE, Room 4SW32H, Washington, DC 20507; (202) 663-7197 (voice) or by email at
State and local governments with 100 or more employees have been required to submit EEO-4 reports since 1974 (biennially in odd-numbered years since 1993). A notice that EEOC would be submitting this request was published in the
EEO-4 data are used by the EEOC to investigate charges of discrimination against state and local governments and to provide information on the employment status of minorities and women. The data are shared with several other Federal agencies. Pursuant to section 709(d) of Title VII of the Civil Rights Act of 1964, U.S.C. 2000e-8(d), as amended, EEO-4 data are shared with State and Local Fair Employment Practices Agencies (FEPAs). Aggregated data are also used by researchers and the general public.
The cost estimates are based on the assumption that filers use online reporting. For the 2015 EEO-4 report, 85% of EEO-4 filers submitted their report via online reporting and 5% of EEO-4 reports were submitted using the data upload method. The remaining 10% of filers submitted reports via the paper method. The EEOC has made electronic filing much easier for employers required to file the EEO-4 Report. As a result, more jurisdictions are using this filing method. This development, along with the greater availability of human resource information software, is expected to have significantly reduced the actual burden of reporting.
For the Commission.
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 staff of the Federal Accounting Standards Advisory Board (FASAB) will convene a public meeting on May 9, 2018, from 9:00 a.m. until 11:00 a.m. to discuss proposed draft Staff Implementation Guidance 6.1:
Those interested in attending should contact Ms. Melissa Batchelor, Assistant Director, by contacting (202) 512-5976 or
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.
Federal Communications Commission.
Notice and request for comments.
As part of its continuing effort to reduce paperwork burdens, and as required by the Paperwork Reduction Act (PRA) of 1995, the Federal Communications Commission (FCC or the Commission) invites the general public and other Federal agencies to take this opportunity to comment on the following information collection. Comments are requested concerning: whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information shall have practical utility; the accuracy of the Commission's burden estimate; ways to enhance the quality, utility, and clarity of the information collected; ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology; and ways to further reduce the information collection burden on small business concerns with fewer than 25 employees. The FCC may not conduct or sponsor a collection of information unless it displays a currently valid control number. No person shall be subject to any penalty for failing to comply with a collection of information subject to the PRA that does not display a valid Office of Management and Budget (OMB) control number.
Written PRA comments should be submitted on or before June 25, 2018. If you anticipate that you will be submitting comments, but find it difficult to do so within the period of time allowed by this notice, you should advise the contact listed below as soon as possible.
Direct all PRA comments to Nicole Ongele, FCC, via email
For additional information about the information collection, contact Nicole Ongele at (202) 418-2991.
As part of its continuing effort to reduce paperwork burdens, and as required by the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501-3520), the Federal Communications Commission (FCC or Commission) invites the general public and other Federal agencies to take this opportunity to comment on the following information collections. Comments are requested concerning: Whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information shall have practical utility; the accuracy of the Commission's burden estimate; ways to enhance the quality, utility, and clarity of the information collected; ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology; and ways to further reduce the information collection burden on small business concerns with fewer than 25 employees.
Federal Communications Commission.
Notice and request for comments.
As part of its continuing effort to reduce paperwork burdens, and as required by the Paperwork Reduction Act of 1995 (PRA), the Federal Communications Commission (FCC or Commission) invites the general public and other Federal agencies to take this opportunity to comment on the following information collections. Comments are requested concerning: Whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information shall have practical utility; the accuracy of the Commission's burden estimate; ways to enhance the quality, utility, and clarity of the information collected; ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology; and ways to further reduce the information collection burden on small business concerns with fewer than 25 employees.
The FCC may not conduct or sponsor a collection of information unless it displays a currently valid Office of Management and Budget (OMB) control number. No person shall be subject to any penalty for failing to comply with a collection of information subject to the PRA that does not display a valid OMB control number.
Written PRA comments should be submitted on or before June 25, 2018. If you anticipate that you will be submitting comments, but find it difficult to do so within the period of time allowed by this notice, you should advise the contact listed below as soon as possible.
Direct all PRA comments to Cathy Williams, FCC, via email to
For additional information about the information collection, contact Cathy Williams at (202) 418-2918.
The national do-not-call registry supplements the company-specific do-not-call rules for those consumers who wish to continue requesting that particular companies not call them. Any company that is asked by a consumer, including an existing customer, not to call again must honor that request for five (5) years.
A provision of the Commission's rules, however, allows consumers to give specific companies permission to call them through an express written agreement. Nonprofit organizations, companies with whom consumers have an established business relationship, and calls to persons with whom the telemarketer has a personal relationship are exempt from the “do-not-call” registry requirements.
On September 21, 2004, the Commission released the
On December 4, 2007, the Commission released the
On June 17, 2008, in accordance with the Do-Not-Call Improvement Act of 2007, the Commission revised its rules to minimize the inconvenience to consumers of having to re-register their preferences not to receive telemarketing calls and to further the underlying goal of the National Do-Not-Call Registry to protect consumer privacy rights. The Commission released a
On February 15, 2012, the Commission released a
Finally, the Commission also exempted from the Telephone Consumer Protection Act requirements prerecorded calls to residential lines made by health care-related entities governed by the Health Insurance Portability and Accountability Act of 1996.
Federal Election Commission.
Notice of filing dates for special election.
Mississippi has scheduled a special general election on November 6, 2018, to fill the U.S. Senate seat vacated by Senator Thad Cochran. Under Mississippi law, a majority winner in a nonpartisan special election is declared elected. Should no candidate achieve a majority vote, a Special Runoff Election will be held on November 27, 2018, between the top two vote-getters.
Committees participating in the Mississippi special elections are required to file pre- and post-election reports. Filing dates for these reports are affected by whether one or two elections are held.
Ms. Elizabeth S. Kurland, Information Division, 1050 First Street NE, Washington, DC 20463; Telephone: (202) 694-1100; Toll Free (800) 424-9530.
All principal campaign committees of candidates who participate in the Mississippi Special General and Special Runoff Elections shall file a 12-day Pre-General Report on October 25, 2018; a 12-day Pre-Runoff Report on November 15; and a 30-day Post-Runoff Report on December 27, 2018. (See charts below for the closing date for each report.)
If only one election is held, all principal campaign committees of candidates in the Special General Election shall file a 12-day Pre-General Report on October 25, 2018; and a 30-day Post-General Report on December 6, 2018. (See charts below for the closing date for each report.)
Note that these reports are in addition to the campaign committee's regular quarterly filings. (See charts below for the closing date for each report).
Political committees filing on a quarterly basis in 2018 are subject to special election reporting if they make previously undisclosed contributions or expenditures in connection with the Mississippi Special General or Special Runoff Elections by the close of books for the applicable report(s). (See chart below for the closing date for each report.)
Committees filing monthly that make contributions or expenditures in connection with the Mississippi Special General or Special Runoff Elections will continue to file according to the monthly reporting schedule.
Additional disclosure information in connection with the Mississippi Special General Elections may be found on the FEC website at
Principal campaign committees, party committees and Leadership PACs that are otherwise required to file reports in connection with the special elections must simultaneously file FEC Form 3L if they receive two or more bundled contributions from lobbyists/registrants or lobbyist/registrant PACs that aggregate in excess of $18,200 during the special election reporting periods. (See charts below for closing date of each period.) 11 CFR 104.22(a)(5)(v), (b).
On behalf of the Commission,
The companies listed in this notice have applied to the Board for approval, pursuant to the Bank Holding Company Act of 1956 (12 U.S.C. 1841
The applications listed below, as well as other related filings required by the Board, are available for immediate inspection at the Federal Reserve Bank indicated. The applications will also be available for inspection at the offices of the Board of Governors. Interested persons may express their views in writing on the standards enumerated in the BHC Act (12 U.S.C. 1842(c)). If the proposal also involves the acquisition of a nonbanking company, the review also includes whether the acquisition of the nonbanking company complies with the standards in section 4 of the BHC Act (12 U.S.C. 1843). Unless otherwise noted, nonbanking activities will be conducted throughout the United States.
Unless otherwise noted, comments regarding each of these applications must be received at the Reserve Bank indicated or the offices of the Board of Governors not later than May 21, 2018.
A. Federal Reserve Bank of Cleveland (Nadine Wallman, Vice President) 1455 East Sixth Street, Cleveland, Ohio 44101-2566. Comments can also be sent electronically to
1
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 May 15, 2018.
A. Federal Reserve Bank of St. Louis (David L. Hubbard, Senior Manager) P.O. Box 442, St. Louis, Missouri 63166-2034. Comments can also be sent electronically to
1. J.
Federal Trade Commission (FTC).
Notice of a modified system of records.
The FTC is publishing in final form a routine use that would permit disclosure of the agency's Freedom of Information Act (“FOIA”) request and appeal records to the Office of Government Information Services (“OGIS”), in order for OGIS to assist FOIA requesters, as needed, in processing and resolving their FOIA requests and appeals. In addition, the FTC is updating the records disposition section of the Privacy Act system of records notice for these records.
April 25, 2018, except that the new routine use shall be applicable May 25, 2018.
If you have general questions about the system, contact Dione Stearns, FOIA/PA Supervisor, Office of General Counsel, Federal Trade Commission, 600 Pennsylvania Avenue NW, Washington, DC 20580, (202) 326-2735. For specific questions about these amendments to the system notice, contact G. Richard Gold and Alex Tang, Attorneys, Office of the General Counsel, FTC, 600 Pennsylvania Avenue NW, Washington, DC 20580, (202) 326-2424.
In a document previously published in the
The OPEN Government Act of 2007 amended the Freedom of Information Act and created OGIS within the National Archives and Records Administration (“NARA”). The 2007 FOIA amendments require OGIS to review agency FOIA policies, procedures, and compliance, and to offer mediation services to resolve disputes between FOIA requesters and agencies.
In order for OGIS to fulfill its statutory responsibilities, it requires access to FOIA request files originated and maintained by federal agencies including the FTC. However, because the FOIA request and appeal records (FTC-V-1) are governed by the Privacy Act, their disclosure normally requires the prior written consent of the individual to whom the records pertain (including, for example, an individual filing a FOIA request), unless the agency has published a routine use authorizing disclosure.
The Privacy Act authorizes the agency to adopt routine uses that are consistent with the purpose for which information is collected. 5 U.S.C. 552a(b)(3);
In addition, to correct some technical deficiencies identified by Office of Management and Budget (OMB) staff in the previously published notice, the FTC is publishing this updated notice: (1) To clarify that the text of Appendices I-III, cited in this system of records notice (SORN), is publicly available on the FTC's website and previously published in the
The FTC is also making a technical revision that updates the records disposition section of FTC-V-1. During January 2017, NARA issued General Records Schedule 4.2, Records of Information Access and Protection, in part superseding and rescinding General Records Schedule 14, which previously covered FOIA-related records across the federal government. FTC-V-1's records disposition section has been updated accordingly.
Other than the new routine use for disclosure to OGIS, for which the FTC has already provided a public comment period and notice to OMB and Congress, the technical changes described above are not considered significant under the Privacy Act and implementing OMB
In light of the updated SORN template set forth in the newly revised OMB Circular A-108, the FTC is reprinting the text of the entire SORN, including the new routine use, for the public's benefit, to read as follows:
Freedom of Information Act Requests and Appeals-FTC (FTC-V-1).
Unclassified.
Federal Trade Commission, 600 Pennsylvania Avenue NW, Washington, DC 20580. For other locations where records may be maintained or accessed, see Appendix III (Locations of FTC Buildings and Regional Offices), available on the FTC's website at
FOIA/PA Supervisor, Office of General Counsel, Federal Trade Commission, 600 Pennsylvania Avenue NW, Washington, DC 20580, email:
Federal Trade Commission Act, 15 U.S.C. 41
To consider requests and appeals for access to records under the Freedom of Information Act; to determine the status of requested records; to respond to the requests and appeals; to make copies of FOIA requests and frequently requested records available publicly, under the FTC's Rules of Practice and FOIA; to maintain records, documenting the consideration and disposition of the requests for reporting, analysis, and recordkeeping purposes.
Individuals filing requests for access to information under the Freedom of Information Act (FOIA); individuals named in the FOIA request; FTC staff assigned to help process, consider, and respond to such requests, including any appeals.
Communications (
Individual about whom the record is maintained and agency staff assigned to help process, review, or respond to the access request, including any appeal.
(1) Request and appeal letters, and agency letters responding thereto, are placed on the FTC's public record and available to the public for routine inspection and copying. See FTC-I-6 (Public Records-FTC).
(2) As required by the FOIA, records that have been “frequently requested” and disclosed under the FOIA within the meaning of that Act, as determined by the FTC, are made available to the public for routine inspection and copying. See FTC-I-6 (Public Records-FTC).
(3) Disclosure to the National Archives and Records Administration, Office of Government Information Services (OGIS), to the extent necessary to fulfill its responsibilities in 5 U.S.C. 552(h), to review administrative agency policies, procedures, and compliance with the Freedom of Information Act (FOIA), and to facilitate OGIS's offering of mediation services to resolve disputes between persons making FOIA requests and administrative agencies.
For other ways that the Privacy Act permits the FTC to use or disclose system records outside the agency, see Appendix I (Authorized Disclosures and Routine Uses Applicable to All FTC Privacy Act Systems of Records), available on the FTC's website at
Records are maintained electronically using a commercial software application run on the agency's internal servers. Temporary paper files are destroyed once the request is complete.
Indexed by name of requesting party and subject matter of request. Records can also be searched by name, address, phone number, fax number, and email of the requesting party, subject matter of the request, requestor organization, FOIA number, and staff member assigned to the request.
Records are retained and disposed of in accordance with General Records Schedule 4.2, issued by the National Archives and Records Administration.
Requests, appeals, and responses available to the public, as described above. Access to nonpublic system records is restricted to FTC personnel or contractors whose responsibilities require access. Nonpublic paper records are temporary, maintained in lockable file cabinets or offices, and destroyed once the request is complete. Access to electronic records is controlled by “user ID” and password combination and other electronic access or network controls (
See § 4.13 of the FTC's Rules of Practice, 16 CFR 4.13. For additional guidance, see also Appendix II (How To Make A Privacy Act Request), available on the FTC's website at
See § 4.13 of the FTC's Rules of Practice, 16 CFR 4.13. For additional guidance, see also Appendix II (How To Make A Privacy Act Request), available on the FTC's website at
See § 4.13 of the FTC's Rules of Practice, 16 CFR 4.13. For additional guidance, see also Appendix II (How To Make A Privacy Act Request), available on the FTC's website at
Records contained in this system that have been placed on the FTC public record are available upon request, as discussed above. However, pursuant to 5 U.S.C. 552a(k)(2), records in this system, which reflect records that are contained in other systems of records that are designated as exempt, are
82 FR 27483-27485 (June 15, 2017).
82 FR 10012-10014 (February 9, 2017).
73 FR 33592-33634 (June 12, 2008).
Federal Trade Commission (“FTC” or “Commission”).
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 three years the current PRA clearance for information collection requirements pertaining to the Commission's administrative activities. That clearance expires on April 30, 2018, and consists of: (a) Requests to the Commission primarily under Parts I and IV of the Commission's Rules of Practice; (b) the FTC's consumer complaint systems; and (c) the FTC's program evaluation activities.
Comments must be filed by May 25, 2018.
Interested parties may file a comment online or on paper, by following the instructions in the Request for Comment part of the
For purposes specific to this
On January 22, 2018, the FTC sought public comment on the information collection requirements associated with the Commission's administrative activities (“January 22, 2018 Notice”
Most comments on the January 22, 2018
The agency conducts surveys to determine consumer satisfaction with the complaint intake systems. The agency uses the American Consumer Satisfaction Index (ACSI) to conduct its survey of the Consumer Response Center. ACSI uses random samples of customer interviews as input to a multi-equation econometric model. Such sampling is a practical measure given the vast volume of consumer complaints entering Sentinel and the limited number of consumers who provide substantive feedback.
For the ftc.gov complaint sites, the FTC uses a full-measure survey called ForeSee on the Complaint Assistant. When consumers complete the complaint form and hit “Submit,” they are given the invitation to take the survey. The consumer can choose to take the survey or not. The survey is not presented to anyone who does not complete and submit the complaint form. The survey's key goal is to enable a smooth consumer complaint reporting experience that will result in a consumer complaint entering Sentinel.
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 Reduction Act: FTC File No. P072108” 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,
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 May 25, 2018. For information on the Commission's privacy policy, including routine uses permitted by the Privacy Act, see
Comments on the information collection requirements subject to review under the PRA should additionally be submitted to OMB. If sent by U.S. mail, they should be addressed to Office of Information and Regulatory Affairs, Office of Management and Budget, Attention: Desk Officer for the Federal Trade Commission, New Executive Office Building, Docket Library, Room 10102, 725 17th Street NW, Washington, DC 20503. Comments sent to OMB by U.S. postal mail, however, are subject to delays due to heightened security precautions. Thus, comments instead can also be sent by email to
Federal Trade Commission.
Proposed consent agreement.
The consent agreement in this matter settles alleged violations of federal law prohibiting unfair or deceptive acts or practices. The attached Analysis To Aid Public Comment describes both the allegations in the complaint and the terms of the consent order—embodied in the consent agreement—that would settle these allegations.
Comments must be received on or before May 14, 2018.
Interested parties may file a comment online or on paper, by following the instructions in the Request for Comment part of the
Ben Rossen (202-326-3679) and James Trilling (202-326-3497), Bureau of Consumer Protection, 600 Pennsylvania Avenue NW, Washington, DC 20580.
Pursuant to Section 6(f) of the Federal Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34, notice is hereby given that the above-captioned consent agreement containing a consent order to cease and desist, having been filed with and accepted, subject to final approval, by the Commission, has been placed on the public record for a period of thirty (30) days. The following Analysis to Aid Public Comment describes the terms of the consent agreement, and the allegations in the complaint. An electronic copy of the full text of the consent agreement package can be obtained from the FTC Home Page (for April 12, 2018), on the World Wide Web, at
You can file a comment online or on paper. For the Commission to consider your comment, we must receive it on or before May 14, 2018. Write “Uber Technologies, Inc.” 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. To make sure that the Commission considers your online comment, you must file it at
If you prefer to file your comment on paper, write “Uber Technologies, Inc.” on your comment and on the envelope, and mail your comment to the following
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.
Visit the FTC website at
The Federal Trade Commission has withdrawn its acceptance of the agreement containing consent order from Uber Technologies, Inc. (“Uber”) that the Commission released for public comment in this proceeding on August 15, 2017 (“August 2017 proposed consent agreement”), and has accepted, subject to final approval, a new agreement containing consent order from Uber (“April 2018 proposed consent agreement”).
The April 2018 proposed consent agreement has been placed on the public record for thirty (30) days for receipt of comments by interested persons. All comments received during this period will become part of the public record. Interested persons who submitted comments during the public comment period for the August 2017 proposed consent agreement should resubmit their original comments, or submit new comments, during the new comment period if they would like the Commission to consider their comments when the Commission decides whether to make final the April 2018 proposed consent agreement. After thirty (30) days, the Commission again will review the April 2018 proposed consent agreement, and the comments received, and will decide whether it should withdraw from the agreement or make final the agreement's proposed order.
Since 2010, Uber has operated a mobile application (the “App”) that connects consumers who are transportation providers (“Drivers”) with consumers seeking those services (“Riders”). Riders book transportation or delivery services through a publicly-available version of the App that can be downloaded to a smartphone. When a Rider requests transportation through the App, the request is conveyed to a nearby Uber Driver signed into the App.
Drivers use the App to determine which ride requests they will accept. Uber collects a variety of personal information from Drivers, including names, email addresses, phone numbers, postal addresses, Social Security numbers, driver's license numbers, bank account information, vehicle registration information, and insurance information. With respect to Riders, Uber collects names, email addresses, postal addresses, and detailed trip records with precise geolocation information, among other things.
In November 2014, Uber was the subject of various news reports describing improper access and use of consumer personal information, including geolocation information, by Uber employees. One article reported that an Uber executive had suggested that Uber should hire “opposition researchers” to look into the “personal lives” of journalists who criticized Uber's practices. Another article described an aerial tracking tool known as “God View” that displayed the personal information of Riders using Uber's services. These reports led to considerable consumer uproar. In an effort to respond to consumer concerns, Uber issued a statement describing its policies concerning access to Rider and Driver data. As part of that statement, Uber promised that all “access to rider and driver accounts is being closely monitored and audited by data security specialists on an ongoing basis, and any violations of the policy will result in disciplinary action, including the possibility of termination and legal action.”
As alleged in the proposed complaint, Uber has not monitored or audited its employees' access to Rider and Driver personal information on an ongoing basis since November 2014. In fact, between approximately August 2015 and May 2016, Uber did not timely follow up on automated alerts concerning the potential misuse of consumer personal information, and for approximately the first six months of this period only monitored access to account information belonging to a set of internal high-profile users, such as Uber executives. During this time, Uber did not otherwise monitor internal access to personal information unless an employee specifically reported that a co-worker had engaged in improper access. Count one of the proposed complaint alleges that Uber's representation that it closely monitored and audited internal access to consumers' personal information was false or misleading in violation of Section 5 of the FTC Act in light of Uber's subsequent failure to
The proposed complaint also alleges that Uber failed to provide reasonable security for consumer information stored in a third-party cloud storage service provided by Amazon Web Services (“AWS”) called the Amazon Simple Storage Service (the “Amazon S3 Datastore”). Uber stores in the Amazon S3 Datastore a variety of files that contain sensitive personal information, including full and partial back-ups of Uber databases. These back-ups contain a broad range of Rider and Driver personal information, including, among other things, names, email addresses, phone numbers, driver's license numbers, and trip records with precise geolocation information.
From July 13, 2013 to July 15, 2015, Uber's privacy policy described the security measures Uber used to protect the personal information it collected from consumers, stating that such information “is securely stored within our databases, and we use standard, industry-wide commercially reasonable security practices such as encryption, firewalls and SSL (Secure Socket Layers) for protecting your information—such as any portions of your credit card number which we retain . . . and geo-location information.” Additionally, Uber's customer service representatives offered assurances about the strength of Uber's security practices to consumers who were reluctant to submit personal information to Uber.
As described below, count two of the proposed complaint alleges that the above statements violated Section 5 of the FTC Act because Uber engaged in a number of practices that, taken together, failed to provide reasonable security to prevent unauthorized access to Rider and Driver personal information in the Amazon S3 Datastore.
• Failed to implement reasonable access controls to safeguard data stored in the Amazon S3 Datastore. For example, Uber (1) until approximately September 2014, permitted engineers to access the Amazon S3 Datastore with a single, shared AWS access key that provided full administrative privileges over all data stored there; (2) until approximately September 2014, failed to restrict access to systems based on employees' job functions; and (3) until approximately September 2015, failed to require multi-factor authentication for individual account access, and until at least November 2016, failed to require multi-factor authentication for programmatic service account access, to the Amazon S3 Datastore;
• Until at least September 2014, failed to implement reasonable security training and guidance;
• Until approximately September 2014, failed to have a written information security program; and
• Until at least November 2016, stored sensitive personal information in the Amazon S3 Datastore in clear, readable text, rather than encrypting the information.
As a result of these failures, intruders accessed Uber's Amazon S3 Datastore multiple times using access keys that Uber engineers had posted to GitHub, a code-sharing site used by software developers.
First, on or about May 12, 2014, an intruder accessed Uber's Amazon S3 Datastore using an access key that was publicly posted and granted full administrative privileges to all data and documents stored within Uber's Amazon S3 Datastore (the “2014 data breach”). The intruder accessed one file that contained sensitive personal information belonging to Uber Drivers, including over 100,000 unencrypted names and driver's license numbers, 215 unencrypted names and bank account and domestic routing numbers, and 84 unencrypted names and Social Security numbers. Uber did not discover the breach until September 2014. Uber sent breach notification letters to affected Uber Drivers in February 2015. Uber later learned of more affected Uber Drivers in May and July 2016 and sent breach notification letters to those Drivers in June and August 2016.
Second, between October 13, 2016 and November 15, 2016, intruders accessed Uber's Amazon S3 Datastore using an AWS access key that was posted to a private GitHub repository (“the 2016 data breach”). Uber granted its engineers access to Uber's GitHub repositories through engineers' individual GitHub accounts, which engineers generally accessed through personal email addresses. Uber did not have a policy prohibiting engineers from reusing credentials, and did not require engineers to enable multi-factor authentication when accessing Uber's GitHub repositories. The intruders who committed the 2016 breach said that they accessed Uber's GitHub page using passwords that were previously exposed in other large data breaches, whereupon they discovered the AWS access key they used to access and download files from Uber's Amazon S3 Datastore. The intruders downloaded sixteen files that contained unencrypted consumer personal information relating to U.S. Riders and Drivers, including approximately 25.6 million names and email addresses, 22.1 million names and mobile phone numbers, and 607,000 names and driver's license numbers. Nearly all of the exposed personal information was collected before July 2015 and stored in unencrypted database backup files.
Uber discovered the 2016 data breach on or about November 14, 2016, when one of the attackers contacted Uber claiming to have compromised Uber's “databases” and demanding a six-figure payout. Uber paid the attackers $100,000 through the third party that administers Uber's “bug bounty” program. Respondent created the bug bounty program to pay financial rewards in exchange for the responsible disclosure of serious security vulnerabilities. However, the attackers who committed the 2016 data breach were fundamentally different from legitimate bug bounty recipients. Instead of responsibly disclosing a vulnerability, the attackers maliciously exploited the vulnerability and acquired millions of consumers' personal information.
Uber failed to disclose the 2016 data breach to affected consumers until November 21, 2017, more than a year after discovering it. Uber also failed to disclose the 2016 data breach to the Commission until November 2017 despite the fact that the breach occurred in the midst of a nonpublic Commission investigation relating to Uber's data security practices, including, specifically, the security of Uber's Amazon S3 Datastore.
The proposed consent order contains provisions designed to prevent Uber from engaging in acts and practices in the future similar to those alleged in the proposed complaint.
Part I of the proposed order prohibits Uber from making any misrepresentations about the extent to which Uber monitors or audits internal access to consumers' personal information or the extent to which Uber protects the privacy, confidentiality, security, or integrity of consumers' personal information. This Part is identical to Part I of the August 2017 proposed consent agreement.
Part II of the proposed order requires Uber to implement a mandated comprehensive privacy program that is reasonably designed to (1) address privacy risks related to the development and management of new and existing products and services for consumers, and (2) protect the privacy and confidentiality of consumers' personal information. Part II.B includes new language that requires Uber's mandated privacy risk assessments to include consideration of risks and safeguards related to (a) secure software design, development, and testing, including access key and secret key management and secure cloud storage; (b) review, assessment, and response to third-party security vulnerability reports, including through a “bug bounty” or similar program; and (c) prevention, detection, and response to attacks, intrusions, or systems failures.
Part III of the proposed order requires Uber to undergo biennial assessments of its mandated privacy program by a third party. Part III has been revised from the August 2017 proposed consent agreement to require Uber to submit to the Commission each of its assessments rather than only its initial assessment.
Part IV of the proposed order requires Uber to submit a report to the Commission if Uber discovers any “covered incident” involving unauthorized access or acquisition of consumer information. This Part is new.
Parts V through IX of the proposed order are reporting and compliance provisions. Part V requires dissemination of the order now and in the future to all current and future principals, officers, directors, and managers, and to persons who participate in conduct related to the subject matter of the order, including all employees, agents, and representatives who regularly access personal information. Part VI mandates that Uber submit a compliance report to the FTC one year after issuance of the order and submit additional notices as specified. Parts VII and VIII require Uber to retain documents relating to its compliance with the order, and to provide such additional information or documents as are necessary for the Commission to monitor compliance. Part IX states that the order will remain in effect for 20 years.
These provisions include modifications from the August 2017 proposed consent agreement. Part V expands the acknowledgement of order provision to require Uber to obtain signed acknowledgements from all employees, agents, and representatives who regularly access personal information that Uber collects or receives from or about consumers, rather than limiting the requirement to employees with managerial responsibility related to the order. And Part VII contains modified recordkeeping provisions and new recordkeeping provisions relating to Uber's bug bounty program and its subpoenas and communications with law enforcement.
The purpose of this analysis is to aid public comment on the proposed order. It is not intended to constitute an official interpretation of the complaint or proposed order, or to modify in any way the proposed order's terms.
By direction of the Commission.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended, notice is hereby given of the following meetings.
The meetings will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
This notice is being published less than 15 days prior to the meeting due to the timing limitations imposed by the review and funding cycle.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended, notice is hereby given of the following meetings.
The meetings will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
This notice is being published less than 15 days prior to the meeting due to the timing limitations imposed by the review and funding cycle.
This notice is being published less than 15 days prior to the meeting due to the timing limitations imposed by the review and funding cycle.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended, notice is hereby given of the following meeting.
The meeting will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The contract proposals and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the contract proposals, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Notice is hereby given of a change in the meeting of the National Advisory Council for Biomedical Imaging and Bioengineering, May 23, 2018, 08:30 a.m. to May 23, 2018, 03:00 p.m., The William F. Bolger Center, Bolger Center Hotel Lobby, 9600 Newbridge Drive, Overland Room, Potomac, MD 20854 which was published in the
The meeting notice is amended to change the location of the meeting from the Overland Room to the Stained Glass Hall in the Osgood Building at the Bolger Center. The meeting is partially closed to the public.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended, notice is hereby given of the following meeting.
The meeting will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial
Federal Emergency Management Agency, DHS.
Notice.
Flood hazard determinations, which may include additions or modifications of Base Flood Elevations (BFEs), base flood depths, Special Flood Hazard Area (SFHA) boundaries or zone designations, or regulatory floodways on the Flood Insurance Rate Maps (FIRMs) and where applicable, in the supporting Flood Insurance Study (FIS) reports have been made final for the communities listed in the table below.
The FIRM and FIS report are the basis of the floodplain management measures that a community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in the Federal Emergency Management Agency's (FEMA's) National Flood Insurance Program (NFIP). In addition, the FIRM and FIS report are used by insurance agents and others to calculate appropriate flood insurance premium rates for buildings and the contents of those buildings.
The date of August 2, 2018 has been established for the FIRM and, where applicable, the supporting FIS report showing the new or modified flood hazard information for each community.
The FIRM, and if applicable, the FIS report containing the final flood hazard information for each community is available for inspection at the respective Community Map Repository address listed in the tables below and will be available online through the FEMA Map Service Center at
Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 400 C Street SW, Washington, DC 20472, (202) 646-7659, or (email)
The Federal Emergency Management Agency (FEMA) makes the final determinations listed below for the new or modified flood hazard information for each community listed. Notification of these changes has been published in newspapers of local circulation and 90 days have elapsed since that publication. The Deputy Associate Administrator for Insurance and Mitigation has resolved any appeals resulting from this notification.
This final notice is issued in accordance with section 110 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and 44 CFR part 67. FEMA has developed criteria for floodplain management in floodprone areas in accordance with 44 CFR part 60.
Interested lessees and owners of real property are encouraged to review the new or revised FIRM and FIS report available at the address cited below for each community or online through the FEMA Map Service Center at
The flood hazard determinations are made final in the watersheds and/or communities listed in the table below.
Federal Emergency Management Agency, DHS.
Notice.
Comments are requested on proposed flood hazard determinations, which may include additions or modifications of any Base Flood Elevation (BFE), base flood depth, Special Flood Hazard Area (SFHA) boundary or zone designation, or regulatory floodway on the Flood Insurance Rate Maps (FIRMs), and where applicable, in the supporting Flood Insurance Study (FIS) reports for the communities listed in the table below. The purpose of this notice is to seek general information and comment regarding the preliminary FIRM, and where applicable, the FIS report that the Federal Emergency Management Agency (FEMA) has provided to the affected communities. The FIRM and FIS report are the basis of the floodplain management measures that the community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP). In addition, the FIRM and FIS report, once effective, will be used by insurance agents and others to calculate appropriate flood insurance premium rates for new buildings and the contents of those buildings.
Comments are to be submitted on or before July 24, 2018.
The Preliminary FIRM, and where applicable, the FIS report for each community are available for inspection at both the online location
You may submit comments, identified by Docket No. FEMA-B-1819, to Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 400 C Street SW, Washington, DC 20472,
Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 400 C Street SW, Washington, DC 20472, (202) 646-7659, or (email)
FEMA proposes to make flood hazard determinations for each community listed below, in accordance with section 110 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and 44 CFR 67.4(a).
These proposed flood hazard determinations, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities. These flood hazard determinations are used to meet the floodplain management requirements of the NFIP and also are used to calculate the appropriate flood insurance premium rates for new buildings built after the FIRM and FIS report become effective.
The communities affected by the flood hazard determinations are provided in the tables below. Any request for reconsideration of the revised flood hazard information shown on the Preliminary FIRM and FIS report that satisfies the data requirements outlined in 44 CFR 67.6(b) is considered an appeal. Comments unrelated to the flood hazard determinations also will be considered before the FIRM and FIS report become effective.
Use of a Scientific Resolution Panel (SRP) is available to communities in support of the appeal resolution process. SRPs are independent panels of experts in hydrology, hydraulics, and other pertinent sciences established to review conflicting scientific and technical data and provide recommendations for resolution. Use of the SRP only may be exercised after FEMA and local communities have been engaged in a collaborative consultation process for at least 60 days without a mutually acceptable resolution of an appeal. Additional information regarding the SRP process can be found online at
The watersheds and/or communities affected are listed in the tables below. The Preliminary FIRM, and where applicable, FIS report for each community are available for inspection at both the online location
Federal Emergency Management Agency, DHS.
Notice.
Comments are requested on proposed flood hazard determinations, which may include additions or modifications of any Base Flood Elevation (BFE), base flood depth, Special Flood Hazard Area (SFHA) boundary or zone designation, or regulatory floodway on the Flood Insurance Rate Maps (FIRMs), and where applicable, in the supporting Flood Insurance Study (FIS) reports for the communities listed in the table below. The purpose of this notice is to seek general information and comment regarding the preliminary FIRM, and where applicable, the FIS report that the Federal Emergency Management Agency (FEMA) has provided to the affected communities. The FIRM and FIS report are the basis of the floodplain management measures that the community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP). In addition, the FIRM and FIS report, once effective, will be used by insurance agents and others to calculate appropriate flood insurance premium rates for new buildings and the contents of those buildings.
Comments are to be submitted on or before July 24, 2018.
The Preliminary FIRM, and where applicable, the FIS report for each community are available for inspection at both the online location
You may submit comments, identified by Docket No. FEMA-B-1820, to Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 400 C Street SW, Washington, DC 20472, (202) 646-7659, or (email)
Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 400 C Street SW, Washington, DC 20472, (202) 646-7659, or (email)
FEMA proposes to make flood hazard determinations for each community listed below, in accordance with section 110 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and 44 CFR 67.4(a).
These proposed flood hazard determinations, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities. These flood hazard determinations are used to meet the floodplain management requirements of the NFIP and also are used to calculate the appropriate flood insurance premium rates for new buildings built after the FIRM and FIS report become effective.
The communities affected by the flood hazard determinations are provided in the tables below. Any request for reconsideration of the revised flood hazard information shown on the Preliminary FIRM and FIS report that satisfies the data requirements outlined in 44 CFR 67.6(b) is considered an appeal. Comments unrelated to the flood hazard determinations also will be considered before the FIRM and FIS report become effective.
Use of a Scientific Resolution Panel (SRP) is available to communities in support of the appeal resolution process. SRPs are independent panels of experts in hydrology, hydraulics, and other pertinent sciences established to review conflicting scientific and technical data and provide recommendations for resolution. Use of the SRP only may be exercised after FEMA and local communities have been engaged in a collaborative consultation process for at least 60 days without a mutually acceptable resolution of an appeal. Additional information regarding the SRP process can be found online at
The watersheds and/or communities affected are listed in the tables below. The Preliminary FIRM, and where applicable, FIS report for each community are available for inspection at both the online location
Office of the Chief Information Officer, HUD.
Notice.
HUD is seeking approval from the Office of Management and Budget (OMB) for the information collection described below. In accordance with the Paperwork Reduction Act, HUD is requesting comment from all interested parties on the proposed collection of information. The purpose of this notice is to allow for 30 days of public comment.
Interested persons are invited to submit comments regarding this proposal. Comments should refer to the proposal by name and/or OMB Control Number and should be sent to: HUD Desk Officer, Office of Management and Budget, New Executive Office Building, Washington, DC 20503; fax:202-395-5806, Email:
Anna P. Guido, Reports Management Officer, QMAC, Department of Housing and Urban Development, 451 7th Street SW, Washington, DC 20410; email Anna P. Guido at
This notice informs the public that HUD is seeking approval from OMB for the information collection described in Section A.
The
This notice is soliciting comments from members of the public and affected parties concerning the collection of information described in Section A on the following:
(1) Whether the proposed 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 the burden of the proposed collection of information;
(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 collection techniques or other forms of information technology,
HUD encourages interested parties to submit comment in response to these questions.
Section 3507 of the Paperwork Reduction Act of 1995, 44 U.S.C. Chapter 35.
Office of the Assistant Secretary for Housing—Federal Housing Commissioner, Department of Housing and Urban Development (“HUD”).
Notice.
In compliance with Section 202(c)(5) of the National Housing Act, this notice advises of the cause and description of administrative actions taken by HUD's Mortgagee Review Board against HUD-approved mortgagees.
Nancy A. Murray, Secretary to the Mortgagee Review Board, 451 Seventh Street SW, Room B-133/3150, Washington, DC 20410-8000; telephone (202) 708-2224 (this is not a toll-free number). Persons with hearing or speech impairments may access this number through TTY by calling the toll-free Federal Information Service at (800) 877-8339.
Section 202(c)(5) of the National Housing Act (12 U.S.C. § 1708(c)(5)) requires that HUD “publish a description of and the cause for administrative action against a HUD-approved mortgagee” by HUD's Mortgagee Review Board (“Board”). In compliance with the requirements of Section 202(c)(5), this notice advises of actions that have been taken by the Board in its meetings from October 1, 2016 to September 30, 2017.
Fish and Wildlife Service, Interior.
Notice of initiation of reviews; request for information.
We, the U.S. Fish and Wildlife Service, are initiating 5-year status reviews under the Endangered Species Act of 1973, as amended, for five animal species. A 5-year status review is based on the best scientific and commercial data available at the time of the review; therefore, we are requesting submission of any such information that has become available since the last review for the species.
To ensure consideration, please send your written information by June 25, 2018. However, we will continue to accept new information about any listed species at any time.
For instructions on how to submit information for each species, see the table in the
To request information, contact the appropriate person in the table in the
We are initiating 5-year status reviews under the Endangered Species Act of 1973, as amended (16 U.S.C. 1531
Under the ESA (16 U.S.C. 1531
A 5-year review considers the best scientific and commercial data that have become available since the current listing determination or most recent status review of each species, such as:
(A) Species biology, including but not limited to population trends, distribution, abundance, demographics, and genetics;
(B) Habitat conditions, including but not limited to amount, distribution, and suitability;
(C) Conservation measures that have been implemented that benefit the species;
(D) Threat status and trends in relation to the five listing factors (as defined in section 4(a)(1) of the ESA); and
(E) Other new information, data, or corrections, including but not limited to taxonomic or nomenclatural changes, identification of erroneous information contained in the List, and improved analytical methods.
New information will be considered in the 5-year review and ongoing recovery programs for the species.
This notice announces our active 5-year status reviews of the species in the following table.
To ensure that a 5-year review is complete and based on the best available scientific and commercial information, we request new information from all sources. See “What Information Do We Consider in Our Review?” for specific criteria. If you submit information, please support it with documentation such as maps, bibliographic references, methods used to gather and analyze the data, and/or copies of any pertinent publications, reports, or letters by knowledgeable sources.
If you wish to provide information for any species listed above, please submit your comments and materials to the appropriate contact in the table above. You may also direct questions to those contacts. Individuals who are hearing impaired or speech impaired may call the Federal Relay Service at 800-877-8339 for TTY assistance.
Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment—including your personal identifying information—may be made publicly available at any time.
Comments and materials received will be available for public inspection, by appointment, during normal business hours at the offices where the comments are submitted.
We publish this notice under the authority of the Endangered Species Act of 1973, as amended (16 U.S.C. 1531
Fish and Wildlife Service, Interior.
Notice of receipt of application and proposed incidental harassment authorization; request for comments.
We, the U.S. Fish and Wildlife Service (Service), have received an application from the United States Coast Guard (USCG) for authorization to take small numbers of marine mammals by harassment incidental to the replacement of pier piles and the potable water line at USCG Station Monterey in Monterey County, California. In accordance with provisions of the Marine Mammal Protection Act of 1972, as amended, we request comments on our proposed authorization for the applicant to incidentally take, by harassment, small numbers of southern sea otters during a 1-year authorization period beginning on or before June 15, 2018. We anticipate no take by injury or death and include none in this proposed authorization, which would be for take by harassment only.
Comments and information must be received by May 25, 2018.
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Lilian Carswell, Southern Sea Otter Recovery & Marine Conservation Coordinator, (805) 677-3325, or by email at
Sections 101(a)(5)(A) and (D) of the Marine Mammal Protection Act of 1972, as amended (MMPA; 16 U.S.C. 1371 (a)(5)(A) and (D)), authorize the Secretary of the Interior to allow, upon request, the incidental, but not intentional, taking of small numbers of marine mammals by U.S. citizens who engage in a specified activity (other than commercial fishing) within a specified geographical region, provided that we make certain findings and either issue regulations or, if the taking is limited to harassment, provide a notice of a proposed authorization to the public for review and comment.
We may grant authorization to incidentally take small numbers of marine mammals if we find that the taking will have a negligible impact on the species or stock(s) and will not have an unmitigable adverse impact on the availability of the species or stock(s) for subsistence uses. As part of the authorization process, we prescribe permissible methods of taking and other means of effecting the least practicable impact on the species or stock and its habitat, and requirements pertaining to the monitoring and reporting of such takings.
The term “take,” as defined by the MMPA, means to harass, hunt, capture, or kill, or to attempt to harass, hunt, capture, or kill, any marine mammal. Harassment, as defined by the MMPA, means “any act of pursuit, torment, or annoyance which (i) has the potential to injure a marine mammal or marine mammal stock in the wild [the MMPA calls this Level A harassment], or (ii) has the potential to disturb a marine mammal or marine mammal stock in the wild by causing disruption of behavioral patterns, including, but not limited to, migration, breathing, nursing, breeding, feeding, or sheltering [the MMPA calls this Level B harassment].”
The statutory terms “negligible impact,” “small numbers,” and “unmitigable adverse impact” are defined in the Code of Federal Regulations at 50 CFR 18.27, the Service's regulations governing take of small numbers of marine mammals incidental to specified activities. “Negligible impact” is defined as “an impact resulting from the specified activity that cannot be reasonably expected to, and is not reasonably likely to, adversely affect the species or stock through effects on annual rates of recruitment or survival.” The term “small numbers” is also defined in the regulations as “a portion of a marine mammal species or stock whose taking would have a negligible impact on that species or stock.” However, we do not rely on the definition of “small numbers” here, as it conflates the terms “small numbers” and “negligible impact,” which we recognize as two separate and distinct requirements.
“Unmitigable adverse impact” is determined in reference to impacts on the availability of the species or stock(s) for subsistence uses. It is defined as “an impact resulting from the specified activity (1) that is likely to reduce the availability of the species to a level insufficient for a harvest to meet subsistence needs by (i) causing the marine mammals to abandon or avoid hunting areas, (ii) directly displacing subsistence users, or (iii) placing physical barriers between the marine mammals and the subsistence hunters; and (2) that cannot be sufficiently mitigated by other measures to increase the availability of marine mammals to allow subsistence needs to be met.” Because this subsistence provision applies only to the taking of any marine mammal by any Indian, Aleut, or Eskimo who resides in Alaska and who dwells on the coast of the North Pacific
In February 2017, we received a request from the USCG (Applicant) for MMPA authorization to take by harassment southern sea otters (
The proposed action would involve removing the existing timber deck, timber stringers, steel pile caps, steel support beams, and hardware to access the 17 timber piles that need to be replaced. The timber piles, which are approximately 16 to 18 inches (in) (41 to 46 centimeters (cm)) in diameter and covered with polyvinyl chloride (PVC) wraps, would be removed by means of a vibratory extractor. Each timber pile would be replaced with a steel pipe pile 14 in (36 cm) in diameter installed using a vibratory hammer. Each steel pipe pile would be positioned and installed in the footprint of the extracted timber pile. Pile proofing would be conducted via impact hammer. If, due to substrate or breakwater armor, a pipe pile is unable to be driven to 30 feet (ft) (9 meters (m)) below the mud line using a vibratory hammer, then an impact hammer would be used. If the pile cannot be driven with an impact hammer, the pipe pile would be posted onto the armor stone. The steel pipe piles would not be filled with concrete. Materials and hardware removed to allow access to conduct pile work would be replaced with in-kind materials.
Sound attenuation measures, including implementation of a bubble curtain and cushion pads during impact pile driving, would be used. Pile extraction and driving equipment would be located on a barge. No staging would be located on the existing wharf. To facilitate supplementary monitoring of effects on sea otters in or near the project area, the Service has requested, and the USCG has agreed to provide, 24-hour advance notice of pile-driving activity and a record of the start and stop times of all pile-driving activities once they are completed.
Project construction would require a maximum of 60 work days. Pile extraction and driving activities would occur between June 15 and October 15. Pile-driving activities are expected to require 3 to 8 days of the total construction time, with an average of 2 to 3 piles removed and installed per day. Driving time would be approximately 20 minutes per pile for vibratory or impact pile driving. Vibratory extraction of the existing piles would take approximately 10 minutes per pile. In total, approximately 510 minutes (8.5 hours) of underwater and airborne noise are anticipated to be generated by pile driving/extraction activities over the course of the project.
The USCG Station Monterey is located at 100 Lighthouse Avenue, in the city and county of Monterey, California. The Pier is on the eastern portion of the USCG Station's waterfront facility, along a jetty that extends approximately 1,300 ft (396 m) east into Monterey Harbor. The Pier and floating docks are on the southern side of the jetty.
Several species of marine mammals occur in the proposed construction area, including the Pacific harbor seal (
Southern sea otters are listed as threatened under the Endangered Species Act of 1973, as amended (ESA) (42 FR 2965; January 14, 1977), and, because of their threatened status, are automatically considered “depleted” under the MMPA (16 U.S.C. 1362(1)(C)). The State of California also recognizes the sea otter as a fully protected mammal (Fish and Game Code section 4700) and as a protected marine mammal (Fish and Game Code section 4500). All members of the sea otter population in California are descendants of a small group that survived the fur trade and persisted near Big Sur, California. Historically ranging from at least as far north as Oregon (Valentine et al. 2008) to Punta Abreojos, Baja California, Mexico, in the south, sea otters currently occur in only two areas of California. The mainland population ranges from San Mateo County to Santa Barbara County, and a translocated population exists at San Nicolas Island, Ventura County. The 2017 California-wide index of abundance is 3,186 individuals (
Sea otters occur in the Monterey Bay Harbor area year round. Census data indicate that there are, on average, 5.4 sea otters per 1,640 ft (500 m) of coastline within Monterey Harbor and in adjacent shoreline areas from Mussel Point to Del Monte Beach (ATOS 371-382; U.S. Geological Survey (USGS) 2017). The number of sea otters present at any one time in a particular location depends on a number of factors, including the availability of kelp canopy, the location of rafting sites, and individual sea otters' behavior. Sea otters typically use the harbor area to rest and to forage, with some sea otters feeding on mussels under the pier at or near the project location. Sea otters also occasionally use a passage through the rocks near the project location to access the kelp beds north of the jetty from the harbor (M. Staedler, Monterey Bay Aquarium Sea Otter Research and Conservation Program, pers. comm. 2014, 2017).
In this section we provide a qualitative discussion of the potential impacts of the proposed project. The “Estimated Take by Incidental Harassment” section later in this document includes a quantitative analysis of the number of individuals that may be taken by Level B harassment as a result of this activity.
Marine mammals exposed to high-intensity sound repeatedly or for prolonged periods can experience hearing threshold shift (TS), which is the loss of hearing sensitivity at certain frequency ranges (Kastak et al. 1999; Schlundt et al. 2000; Finneran et al. 2002, 2005). A permanent threshold shift (PTS) is said to occur when the loss of hearing sensitivity is unrecoverable, whereas a temporary threshold shift (TTS) is said to occur when the animal's hearing threshold recovers over time (Southall et al. 2007). Noise exposures resulting in TTS can cause PTS if repeated over time. Chronic exposure to excessive, but not high-intensity, noise can cause masking at the frequency band that some animals utilize for vital biological functions (Clark et al. 2009). Noise can also cause other forms of disturbance when marine mammals alter their normal patterns of behavior to move away from the source.
Many marine mammals depend on acoustic cues for vital biological functions, such as orientation, communication, locating prey, and avoiding predators. Sea otter vocalizations include in-air screams used by mothers and pups to maintain contact when separated and a suite of other low-intensity, short-range, in-air signals that are likely used in close-range social interactions (Kenyon 1969, McShane et al. 1995). However, sea otters are not known to communicate underwater, nor are they known to use acoustic information to orient or to locate prey. Ghoul and Reichmuth (2014) conducted controlled laboratory hearing tests to obtain aerial and underwater audiograms for a captive adult male sea otter and to evaluate his hearing in the presence of ambient noise. In air, the sea otter's hearing was similar to that of a sea lion but less sensitive to high-frequency (greater than 22 kHz) and low-frequency (less than 2 kHz) sounds than terrestrial mustelids. Under water, the sea otter was able to detect signals as low as 0.125 kHz (at 116 dB re 1 µPa) and as high as 38.1 kHz (at 141 dB re 1 µPa), with best hearing sensitivity in the range of 8 and 16 kHz.
Although the sea otter's hearing was most similar to that of a sea lion, the sea otter had a narrower bandwidth of best hearing sensitivity (3.7 octaves) than either the sea lion (6.7 octaves) or harbor seal (8.6 octaves) and a pronounced reduction in sensitivity at frequencies below 1 kHz, where sounds could not be detected at levels below 100 dB re 1 µPa. At frequencies of 2 kHz or lower, the auditory threshold (level at which a sound becomes audible) was 12 to 34 dB higher for the sea otter than for the sea lion. In studies of auditory masking, signal-to-noise ratios required for signal detection (critical ratios) were 25 to 34 dB, more than 10 dB above those measured in pinnipeds, suggesting that sea otters have a poor capacity to detect acoustic signals in background noise relative to other marine carnivores. In particular, critical ratios for the sea otter at frequencies below 2 kHz indicate that low-frequency sounds are likely to be more difficult for sea otters to detect above low-frequency noise relative to other marine mammals.
Controlled behavioral studies of responses of sea otters to noise have not been conducted, but observational studies have not indicated any particular behavioral sensitivity to noise, (Riedman 1983, 1984). Observed responses of wild sea otters to disturbance are highly variable, probably reflecting the level of noise and activity to which they have been exposed and become acclimated over time and the particular location and social or behavioral state of that individual. Sea otters appeared to be relatively undisturbed by pile-driving activities in Elkhorn Slough during the construction of the Parsons Slough Sill, with many showing no response to pile driving and generally reacting more strongly to passing vessels associated with construction than to the sounds of machinery (Elkhorn Slough National Estuarine Research Reserve (ESNERR) 2011). However, these animals were likely acclimated to loud noises, as they occupied an area near an active railroad track, which produced in-air sound levels comparable to those produced by the vibratory driving of H piles (ESNERR 2011).
The most likely effect of the proposed project on sea otters is behavioral disturbance due to pile-driving noise and activity. Potentially affected areas include the harbor and the area immediately north of the jetty. Underwater and airborne noise generated by pile replacement work may cause sea otters that rest or forage within or near the harbor to relocate temporarily to nearby areas. Behavioral changes resulting from disturbance could include startle responses, the interruption of resting behaviors (while in water or hauled out on nearby docks), and changes in foraging patterns. Most likely, sea otters would move away from the noise source and would be temporarily displaced from the pile replacement work area.
NMFS has developed acoustic exposure criteria to define Level A harassment (injury) and Level B harassment (disturbance) resulting from project-related noise for the marine mammals under its jurisdiction (
For otariid pinnipeds exposed to impulsive underwater noise (such as impact hammering of piles), NMFS uses an unweighted peak sound pressure level of 232 dB re 1 µPa or cumulative 24-hour sound exposure level of 203 dB re 1 µPa
In the absence of formal noise exposure thresholds specific to sea otters, but in light of evidence suggesting that the hearing of sea otters is generally comparable to that of other marine carnivores (
Gray whales are in the group of marine mammals (baleen whales) believed to be most sensitive to low-frequency sounds, with an estimated audible frequency range of approximately 10 Hz to 30 kHz (Finneran 2016). In contrast, sea otters have relatively poor hearing sensitivity at frequencies below 2 kHz (Ghoul and Reichmuth 2014). Most of the acoustic energy generated by vibratory pile driving is limited to frequencies lower than 2 kHz, with greatest pressure spectral densities at frequencies below 1 kHz (Dahl et al. 2015). As a result, much of the noise generated by vibratory pile driving is expected to be inaudible or marginally audible to sea otters. During a previous project that occurred in Elkhorn Slough, Monterey County, project-related monitoring of sea otter behavior in areas exposed to underwater sound levels ranging from approximately 135-165 dB re 1 µPa during vibratory pile driving (ESNERR 2011) showed no clear pattern of disturbance or avoidance in relation to these levels of underwater sound exposure.
Based on the lack of disturbance or any other reaction by sea otters to the 1980s playback studies and the absence of a clear pattern of disturbance or avoidance behaviors attributable to underwater sound levels up to about 160 dB re 1 µPa resulting from vibratory pile driving, we use 160 dB re 1 µPa as the threshold for Level B harassment underwater for both impulsive and non-impulsive sources. For Level A harassment resulting from non-impulsive underwater noise, we use a threshold of 219 dB re 1 µPa
Underwater and airborne sound levels expected to be produced during the proposed project are analyzed in Appendix A to Amec Foster Wheeler (2017). Figures 5-1 and 5-2 of Amec Foster Wheeler (2017) approximate the modeled extent of underwater noise resulting from vibratory pile driving and extraction and impact pile driving. This analysis has been revised slightly to reflect the following changes: The source sound pressure level has been revised downward to 182 dB for impact hammering (originally 195 dB, but 187 dB was determined to be more representative for 14-in (36-cm) piles based on WSDOT (2010), which is further reduced by 5 dB by use of a sound curtain) and to 162 dB for vibratory extraction/driving (originally 168 dB, but 162 dB was determined to be more representative for 14-in (36-cm) piles based on Caltrans (2015)). The distance to the 160-dB threshold (
Expected levels of airborne noise are based on measurements made during the Navy Test Pile Project in Bangor, Washington, for 18-in (46-cm) piles. Because airborne noise data for 14-in (36-cm) piles were not available, the modeled distances to the Level B 100-dB guideline (66 ft (20 m) for vibratory pile driving and 197 ft (60 m) for impact driving) (Amec Foster Wheeler 2017) are overestimates. Nevertheless, anticipated maximum noise levels based on 18-in (46-cm) piles (102 dB for vibratory driving and extraction and 112 dB for impact driving at a distance of 33 ft (10 m)) are well below the noise levels that may cause injury to sea otters. Noise thresholds and the modeled extent of sound pressure levels for underwater and airborne noise are summarized in Table 1.
No permanent impacts on habitat are proposed or would occur as a result of this project. The Proposed Action would not increase the Pier's existing footprint, and no new structures would be installed that would result in the loss of additional habitat. Therefore, no restoration of habitat would be necessary. A temporary, small-scale loss of foraging habitat may occur if sea otters leave the area during pile extraction and driving activities.
The subsistence provision of the MMPA does not apply.
The USCG has proposed the following measures to prevent Level A harassment (injury) and to reduce the extent of potential effects from Level B harassment (disturbance) to marine mammals.
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The USCG would implement two detailed monitoring plans prior to and during pile replacement activities: An acoustic monitoring plan and a marine mammal monitoring plan. The acoustic monitoring plan would ensure that measurements are recorded to provide data on actual noise levels during construction and to ensure that the marine mammal exclusion zone and Level B harassment zone are sized appropriately relative to acoustic thresholds. Specifically, USCG would conduct in-situ monitoring during the installation of five piles and removal of five piles (see the acoustic monitoring plan for more details). The marine mammal monitoring plan would provide details on data collection for each marine mammal species observed in the project area during the construction period.
Monitoring would be conducted by Service-approved observers who are familiar with sea otters and their behavior. The observers would conduct baseline monitoring for 2 days during the week prior to pile removal and driving. During pile removal and driving activities, three observers would monitor the exclusion zone and Level B harassment zone from the best vantage point possible (the Pier itself, the jetty, or adjacent boat docks in the harbor) to determine if sea otters were approaching the exclusion zone and to record behavioral responses to noise within the Level B harassment zone. The exclusion zone would be monitored for 30 minutes prior to, during, and after pile removal and driving. If a sea otter is within the exclusion zone, the start of extraction or driving would be delayed until no sea otters were sighted within the zone for a minimum of 15 minutes. If a sea otter approached the exclusion zone, the observation would be reported to the construction manager, and the individual would be watched closely. If the sea otter entered the exclusion zone, a stop-work order would be issued. The lead monitor would not allow work to re-commence until the sea otter was sighted well outside of the exclusion zone or was not observed for at least 15 minutes.
The following information would be documented for each sea otter observed at any range while pile driving or extraction activities are occurring:
(A) Date and time that monitored activity begins and ends;
(B) Construction activities occurring during each observation period;
(C) Weather parameters (
(D) Water conditions (
(E) Numbers of individuals, sex and age class (if possible), and flipper tag color and location;
(F) Description of behavioral patterns, including bearing and direction of travel, distance from pile-driving activity, and specific activity (swimming at surface, swimming below surface, spyhopping, foraging, grooming, interacting with another sea otter, resting on water, resting while hauled out, etc.);
(G) Distance from pile-driving activities to sea otters and distance from the sea otters to the observation point;
(H) Locations of all marine mammal observations; and
(I) Other human activity in the area.
Daily observation sheets would be compiled on a weekly basis and submitted with a weekly monitoring report that summarized the monitoring results, construction activities, and environmental conditions. USCG would be required to submit a draft marine mammal monitoring report within 90 days after completion of the in-water construction work or the expiration of
In the unanticipated event that the specified activity clearly causes the take of a sea otter in a manner prohibited by the IHA (if issued), such as an injury (Level A harassment), serious injury, or mortality, USCG would immediately cease the specified activities and immediately report the incident to the Service's Southern Sea Otter Recovery Coordinator and Monterey Bay Aquarium's sea otter 24-hour emergency line. The report would be required to include the following information:
• Time, date, and location (latitude/longitude) of the incident;
• Description of the incident;
• Status of all sound source use in the 24 hours preceding the incident;
• Water depth;
• Environmental conditions (
• Description of all marine mammal observations in the 24 hours preceding the incident;
• Description of the animal(s) involved;
• Fate of the animal(s); and
• Photographs or video footage of the animal(s).
Activities would not resume until the Service reviewed the circumstances of the prohibited take. The Service would work with USCG to determine what is necessary to minimize the likelihood of additional prohibited take and ensure MMPA compliance. USCG would not be permitted to resume activities until it implemented any necessary measures to minimize the likelihood of additional prohibited take and received notification by the Service via letter, email, or telephone.
In the event that the USCG discovered an injured or dead sea otter, and the lead monitor determined that the cause of the injury or death was unknown or unrelated to the specified activities, USCG would immediately report the incident to the Service's Southern Sea Otter Recovery Coordinator and Monterey Bay Aquarium's sea otter 24-hour emergency line. The report would be required to include the same information identified in the paragraph above. Activities would be permitted to continue while the Service reviewed the circumstances of the incident. The Service would work with USCG to provide for the implementation of measures, if appropriate, to minimize the likelihood of prohibited take.
Based on the proposed construction methodology and mitigation, including use of an exclusion zone, no Level A harassment is anticipated as a result of the proposed project. Behavioral harassment (Level B) will be considered to have occurred when sea otters enter the Level B harassment zone. We use the greatest modeled extent of sound pressure levels from Table 1 (the Level B zone for impulsive underwater noise) as the area within which to estimate the maximum number of sea otters that could be exposed to noise exceeding Level B thresholds during the estimated maximum 8 days of pile extraction and removal. An average of two or three piles would be installed and removed per day, totaling an estimated 60 to 70 minutes of pile driving per day. Assuming that an individual sea otter can be taken only once during a 24-hour period, we calculate the number of takes using the following formula: Take Estimate =
The area of influence encompasses the harbor area and the area immediately to the north and northeast of the breakwater, less than one linear km of coastline. Because, on average, 5.4 sea otters are expected per 1,640 ft (500 m) of coastline (USGS 2017), a maximum of 11 sea otters are expected to be exposed to pile-driving noise per day over 8 days, for a total of 88 takes.
We propose the following findings regarding this action:
We find that any incidental take by harassment that is reasonably likely to result from the proposed project would not adversely affect the sea otter by means of effects on rates of recruitment or survival and would, therefore, have no more than a negligible impact on the stock. In making this finding, we considered the best available scientific information, including: (1) The biological and behavioral characteristics of the species; (2) information on distribution and abundance of sea otters within the area of the proposed activity; (3) the potential sources of disturbance during the proposed activity; and (4) the potential response of sea otters to disturbance.
The estimated 88 takes (for approximately 11 sea otters) are expected to result in negligible impact because sea otters do not appear to be particularly sensitive to noise (and often do not react visibly to it) and because any behavioral reactions to noise are expected to be temporary and of short duration.
The mitigation measures outlined above are intended to minimize the number of sea otters that could be harassed by the proposed activity. Any impacts to individuals are expected to be limited to Level B harassment of short duration. Responses of sea otters to project-related noise would most likely be common behaviors such as diving and/or swimming away from the source of the disturbance. No take by injury or death is anticipated. Because any Level B harassment that occurs would be of short duration, and because no take by injury or death is anticipated, we find that the anticipated harassment caused by the proposed activities is not expected to adversely affect the species or stock through effects on annual rates of recruitment or survival.
Our finding of negligible impact applies to incidental take associated with the proposed activity as mitigated through this authorization process. This authorization establishes monitoring and reporting requirements to evaluate the potential impacts of the authorized activities, as well as mitigation measures designed to minimize interactions with, and impacts to, sea otters.
For small numbers take analysis, the statute and legislative history do not expressly require a specific type of numbers analysis, leaving the determination of “small” to the agency's discretion. The sea otter population in California consists of approximately 3,186 animals. The number of sea otters that could potentially be taken by harassment in association with the proposed project is approximately 11 animals (0.3 percent of the population size). While many of the same sea otters are likely to remain in the area throughout the duration of pile-driving activities, some turnover may occur, particularly if the 8 days of pile-driving activity are interspersed over several
The subsistence provision of the MMPA does not apply to southern sea otters.
The proposed activity will occur within the range of the southern sea otter, which is listed as threatened under the ESA. The Applicant has initiated interagency consultation under section 7 of the ESA with the Service's Ventura Fish and Wildlife Office. We will complete intra-Service section 7 consultation on our proposed issuance of the IHA.
The impacts associated with the project are described in a draft supplemental environmental assessment (EA) prepared on behalf of the USCG. The Service will review the EA and decide either to adopt it or prepare its own NEPA document before making a determination on the issuance of an IHA. Our analysis will be completed prior to issuance or denial of the IHA and will be available at
In accordance with the President's memorandum of April 29, 1994, “Government-to-Government Relations with Native American Tribal Governments” (59 FR 22951), Executive Order 13175, Secretarial Order 3206, the Department of the Interior's manual at 512 DM 2, and the Native American Policy of the Service (January 20, 2016), we readily acknowledge our responsibility to communicate meaningfully with federally recognized Tribes on a Government-to-Government basis. We have evaluated possible effects on federally recognized Indian Tribes and have determined that there are no effects.
The Service proposes to issue an IHA for small numbers of sea otters harassed incidentally by the Applicant while the Applicant is completing waterfront repairs at USCG Station Monterey during a 1-year authorization period beginning on or before June 15, 2018. Authorization for incidental take beyond this period would require a request for renewal.
The final IHA would incorporate the mitigation, monitoring, and reporting requirements discussed in this proposal. The Applicant would be responsible for following those requirements. These authorizations would not allow the intentional taking of sea otters.
If the level of activity exceeded that described by the Applicant, or the level or nature of take exceeded those projected here, the Service would reevaluate its findings. The Secretary may modify, suspend, or revoke an authorization if the findings are not accurate or the conditions described in this notice are not being met.
The Service requests interested persons to submit comments and information concerning this proposed IHA. Consistent with section 101(a)(5)(D)(iii) of the MMPA, we are opening the comment period on this proposed authorization for 30 days (see
Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment—including your personal identifying information—may be made publicly available at any time. While you can ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so.
U.S. Geological Survey, Interior.
Notice of information collection; request for comment.
In accordance with the Paperwork Reduction Act of 1995, we, the U.S. Geological Survey (USGS) are proposing a new information collection.
Interested persons are invited to submit comments on or before May 25, 2018.
Send written comments on this information collection request (ICR) to the Office of Management and Budget's Desk Officer for the Department of the Interior by email at
To request additional information about this ICR, contact Clint Moore, Research Wildlife Biologist, U.S. Geological Survey, Georgia Cooperative Fish and Wildlife Research Unit, Warnell School of Forestry and Natural Resources, University of Georgia, Athens, GA 30602 (mail); 706-542-1166 (phone); or
We, the USGS, in accordance with the Paperwork Reduction Act of 1995, provide the general public and other Federal agencies with an opportunity to comment on proposed, revised, and continuing collections of information. This helps us assess the impact of our information collection requirements and minimize the public's reporting burden. It also helps the public understand our information collection requirements and provide the requested data in the desired format.
A
We are again soliciting comments on the proposed ICR that is described below. We are especially interested in public comment addressing the following issues: (1) Is the collection necessary to the proper functions of the USGS; (2) will this information be processed and used in a timely manner; (3) is the estimate of burden accurate; (4) how might the USGS enhance the quality, utility, and clarity of the information to be collected; and (5) how might the USGS minimize the burden of
Comments that you submit in response to this notice are a matter of public record. Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment—including your personal identifying information—may be made publicly available at any time. While you may ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so.
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.
The authority for this action is the Paperwork Reduction Act of 1995 (44 U.S.C. 3501,
U.S. Geological Survey, Interior.
Notice of Information Collection; request for comment.
In accordance with the Paperwork Reduction Act of 1995, we, the U.S. Geological Survey (USGS) are proposing a new information collection.
Interested persons are invited to submit comments on or before June 25, 2018.
Send your comments on the information collection request (ICR) by mail to the U.S. Geological Survey, Information Collections Clearance Officer, 12201 Sunrise Valley Drive MS 159, Reston, VA 20192; or by email to
To request additional information about this ICR, contact Noel B. Pavlovic by email at
In accordance with the Paperwork Reduction Act of 1995, we provide the general public and other Federal agencies with an opportunity to comment on proposed, revised, and continuing collections of information. This helps us assess the impact of our information collection requirements and minimize the public's reporting burden. It also helps the public understand our information collection requirements and provide the requested data in the desired format.
We are soliciting comments on the proposed ICR that is described below. We are especially interested in public comment addressing the following issues: (1) Is the collection necessary to the proper functions of the research being conducted by the USGS; (2) will this information be processed and used in a timely manner; (3) is the estimate of burden accurate; (4) how might the information gathered enhance the quality, utility, and clarity of the research being conducted; and (5) how might the researchers minimize the burden of this collection on the respondents, including through the use of information technology.
Comments that you submit in response to this notice are a matter of public record. We will include or summarize each comment in our request to OMB to approve this ICR. Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment—including your personal identifying information—may be made publicly available at any time. While you may ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so.
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. The authorities for this action are the Paperwork Reduction Act of 1995 (44 U.S.C. 3501,
National Park Service, Interior.
Notice.
The National Park Service intends to award a temporary concession contract to a qualified person for the conduct of certain visitor services within the Hite area of Glen Canyon National Recreation Area for a term not to exceed 3 years. The visitor services include fuel sales, convenience retail merchandise, RV, campground and other land-based services.
Jennifer Parker, Chief of Concessions, Intermountain Region, (303) 969-2661, 12795 W Alameda Parkway, Lakewood, CO 80228, or by email at
The National Park Service intends to award a temporary concession contract, TC-GLCA006-18, to a qualified person (as defined in 36 CFR 51.3). The National Park Service has determined that a temporary concession contract not to exceed 3 years is necessary in order to avoid interruption of visitor services, and has taken all reasonable and appropriate steps to consider alternatives to avoid an interruption of visitor services.
This action is issued pursuant to 36 CFR 51.24(a). This is not a request for proposals.
United States International Trade Commission.
May 1, 2018 at 11:00 a.m.
Room 101, 500 E Street SW, Washington, DC 20436, Telephone: (202) 205-2000.
Open to the public.
1.
2. Minutes.
3. Ratification List.
4. Vote in Inv. Nos. 701-TA-573-574 and 731-TA-1350-1351, 1354-1355, and 1358 (Final) (Carbon and Certain Alloy Steel Wire Rod from Italy, Korea, Spain, Turkey, and the United Kingdom). The Commission is currently scheduled to complete and file its determinations and views of the Commission by May 11, 2018.
5. Vote in Inv. No. 731-TA-472 (Fourth Review) (Silicon Metal from China). The Commission is currently scheduled to complete and file its determination and views of the Commission by May 15, 2018.
6.
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.
May 3, 2018 at 11:00 a.m.
Room 101, 500 E Street SW, Washington, DC 20436, Telephone: (202) 205-2000.
Open to the public.
1.
2. Minutes.
3. Ratification List.
4. Vote in Inv. Nos. 701-TA-487 and 731-TA-1197-1198 (Review)(Steel Wire Garment Hangers from Taiwan and Vietnam). The Commission is currently scheduled to complete and file its determinations and views of the Commission by May 15, 2018.
5.
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.
Occupational Safety and Health Administration (OSHA), Labor.
Notice.
In this notice, OSHA announces its final decision to grant recognition to Applied Research Laboratories of South Florida, LLC, as a Nationally Recognized Testing Laboratory (NRTL).
Recognition as a NRTL becomes effective on April 25, 2018.
Information regarding this notice is available from the following sources:
Many of OSHA's workplace standards require that a NRTL test and certify certain types of equipment as safe for use in the workplace. NRTLs are independent laboratories that meet OSHA's requirements for performing safety testing and certification of products used in the workplace. To obtain and retain OSHA recognition, the NRTLs must meet the requirements in the NRTL Program regulations at 29 CFR 1910.7. More specifically, to be recognized by OSHA, an organization must: (1) Have the appropriate capability to test, evaluate, and approve products to assure their safe use in the workplace; (2) be completely independent of employers subject to the tested equipment requirements, and manufacturers and vendors of products for which OSHA requires certification; (3) have internal programs that ensure proper control of the testing and certification process; and (4) have effective reporting and complaint handling procedures. Recognition is an acknowledgement by OSHA that the NRTL has the capabilities to perform independent safety testing and certification of the specific products covered within the NRTL's scope of recognition. Recognition of a NRTL by OSHA also allows employers to use products certified by that NRTL to meet those OSHA standards that require product testing and certification.
The Agency processes applications for initial recognition following requirements in Appendix A of 29 CFR 1910.7. This appendix requires OSHA to publish two notices in the
OSHA hereby gives notice of the Agency's decision to grant recognition to Applied Research Laboratories of South Florida, LLC (ARL), as a NRTL. According to its public information (see
Each NRTL's scope of recognition has three elements: (1) The type of products the NRTL may test, with each type specified by its applicable test standard; (2) the recognized site(s) that have the technical capability to perform the product-testing and product-certification activities for the applicable test standards within the NRTL's scope of recognition; and (3) the supplemental program(s) that the NRTL may use, each of which allows the NRTL to rely on other parties to perform activities necessary for testing and certification. ARL applied on March 5, 2014, for initial recognition as a NRTL. In its initial application, ARL requested recognition for two test standards, one site, and two supplemental programs (OSHA-2007-0083-0050). This application was amended on December 1, 2014, to add one additional test standard (OSHA-2007-0083-0051).
OSHA published the preliminary notice announcing ARL's application for recognition in the
To obtain or review copies of all public documents pertaining to ARL's application, go to
OSHA staff performed a detailed analysis of ARL's application packet and reviewed other pertinent information. OSHA staff also performed three comprehensive on-site assessments of ARL's testing facilities on February 25-26, 2015, March 30, 2016, and November 28-29, 2017. Based on a review of this evidence, OSHA finds that ARL meets the requirements of 29 CFR 1910.7 for recognition as a NRTL, subject to the specified limitation and conditions outlined in this notice. OSHA, therefore, is proceeding with this final notice to grant recognition to ARL as a NRTL. The following sections set forth the scope of recognition included in ARL's grant of recognition.
OSHA limits ARL's scope of recognition to testing and certification of products for demonstration of conformance to the test standards listed in Table 1.
OSHA's recognition of any NRTL for a particular test standard is limited to equipment or materials for which OSHA standards require third-party testing and certification before using them in the workplace. Consequently, if a test standard also covers any products for which OSHA does not require such testing and certification, a NRTL's scope of recognition does not include these products.
The American National Standards Institute (ANSI) may approve the test standards listed above as American National Standards. However, for convenience, we may use the designation of the standards-developing organization for the standard as opposed to the ANSI designation. Under the NRTL Program's policy (see OSHA Instruction CPL 1-0.3, Appendix C, paragraph XIV), any NRTL recognized for a particular test standard may use either the proprietary version of the test standard or the ANSI version of that standard. Contact ANSI to determine whether a test standard is currently ANSI-approved.
OSHA limits ARL's scope of recognition to include the site at:
Applied Research Laboratories of South Florida, LLC, 5371 NW 161 Street, Miami, Florida 33014.
OSHA's recognition of this site limits ARL to performing product testing and certifications only to the test standards for which the site has the proper capability and programs, and for test standards in ARL's scope of recognition. This limitation is consistent with the recognition that OSHA grants to other NRTLs that operate multiple sites.
OSHA limits ARL's scope of recognition to include the following supplemental programs:
In addition to those conditions already required by 29 CFR 1910.7, ARL must abide by the following conditions of the recognition:
1. ARL must inform OSHA as soon as possible, in writing, of any change of ownership, facilities, or key personnel, and of any major change in its operations as an NRTL, and provide details of the change(s);
2. In response to a proposed corrective action to the February 2015 on-site assessment, OSHA Proposed and ARL agrees to increased OSHA oversight of its operations including
• More frequent on-site assessments of ARL facilities;
• ARL providing OSHA with periodic reports listing the products that have been certified under the NRTL Program; and
3. Confirmation from ARL that products with ARL Listings (non-NRTL) will undergo re-evaluation and re-testing and/or a thorough documented review of previously gathered evaluation and testing results prior to NRTL certification.
4. ARL must meet all the terms of its recognition and comply with all OSHA policies pertaining to this recognition; and
5. ARL must continue to meet the requirements for recognition, including all previously published conditions on ARL's scope of recognition, in all areas for which it has recognition.
Pursuant to the authority in 29 CFR 1910.7, OSHA hereby grants recognition to ARL as a NRTL, subject to these limitations and conditions specified above.
Loren Sweatt, Deputy Assistant Secretary of Labor for Occupational Safety and Health, authorized the preparation of this notice. Accordingly, the Agency is issuing this notice pursuant to 29 U.S.C. 657(g)(2), Secretary of Labor's Order No. 1-2012 (77 FR 3912, Jan. 25, 2012), and 29 CFR 1910.7.
National Aeronautics and Space Administration (NASA).
Notice of meeting.
In accordance with the Federal Advisory Committee Act, as amended, the National Aeronautics and Space Administration announces a forthcoming meeting of the Aerospace Safety Advisory Panel.
Thursday, May 17, 2017, 10:30 a.m. to 11:45 a.m., Local Time.
NASA Kennedy Space Center, Headquarters Building, Room 3201, Kennedy Space Center, FL 32899.
Ms. Evette Whatley, Administrative Officer, Aerospace Safety Advisory Panel, NASA Headquarters, Washington, DC 20546, (202) 358-4733 or
The Aerospace Safety Advisory Panel (ASAP) will hold its Second Quarterly Meeting for 2018. This discussion is pursuant to carrying out its statutory duties for which the Panel reviews, identifies, evaluates, and advises on those program activities, systems, procedures, and management activities that can contribute to program risk. Priority is given to those programs that involve the safety of human flight. The agenda will include:
The meeting will be open to the public up to the seating capacity of the room. Seating will be on a first-come basis. This meeting is also available telephonically. Any interested person may call the USA toll free conference call number (888) 390-5183; pass code 8820288 and then the # sign. Attendees will be required to sign a visitor's register and to comply with NASA KSC security requirements, including the presentation of a valid picture ID and a secondary form of ID, before receiving an access badge. All U.S. citizens desiring to attend the ASAP 2018 Second Quarterly Meeting at the Kennedy Space Center must provide their full name, date of birth, place of birth, social security number, company affiliation and full address (if applicable), residential address, telephone number, driver's license number, email address, country of citizenship, and naturalization number (if applicable) to the Kennedy Space Center Protective Services Office no later than close of business on May 7, 2018. All non-U.S. citizens must submit their name; current address; driver's license number and state (if applicable); citizenship; company affiliation (if applicable) to include address, telephone number, and title; place of birth; date of birth; U.S. visa information to include type, number, and expiration date; U.S. social security number (if applicable); Permanent Resident (green card) number and expiration date (if applicable); place and date of entry into the U.S.; and passport information to include country of issue, number, and expiration date to the Kennedy Space Center Protective Services Office no later than close of business on May 1, 2018.
If the above information is not received by the noted dates, attendees should expect a minimum delay of two (2) hours. All visitors to this meeting will be required to process in through the KSC Badging Office, Building M6-0224, located just outside of KSC Gate 3, on SR 405, Kennedy Space Center, Florida. Please provide the appropriate data required above by email to Tina Delahunty at
At the beginning of the meeting, members of the public may make a verbal presentation to the Panel on the subject of safety in NASA, not to exceed 5 minutes in length. To do so, members of the public must contact Ms. Evette Whatley at
National Archives and Records Administration (NARA).
Office of Government Information Services (OGIS) Annual Open Meeting.
In accordance with the Freedom of Information Act, OGIS is conducting an open meeting during which we will discuss OGIS's reviews and reports and allow interested people from the public to present oral or written statements.
The meeting will be Friday, May 18, from 10:00 a.m. to 12:00 p.m. EDT. Please register for the meeting no later than 5:00 p.m. EDT on May 16, 2018.
Amy Bennett, by mail at National Archives and Records Administration; Office of Government Information Services; 8601 Adelphi Road—OGIS; College Park, MD 20740-6001, by telephone at 202-741-5782, or by email at
You can find summaries of OGIS's work in our Annual Reports. OGIS's Fiscal Year 2017 Annual Report was published during Sunshine Week (March 11-17, 2018).
This program will be live-streamed on the U.S. National Archives' YouTube channel,
National Endowment for the Humanities, National Foundation on the Arts and the Humanities.
Notice; request for comment.
Pursuant to the Paperwork Reduction Act of 1995, the National Endowment for the Humanities (NEH) will submit to the Office of Management and Budget (OMB) a request for approval of the information collection request (ICR) described below.
Comments on this ICR must be submitted on or before May 25, 2018.
Submit written comments to the Office of Information and Regulatory Affairs, Office of Management and Budget, 725 17th Street NW, Washington, DC 20503, Attention: Desk Officer for the National Endowment for the Humanities; or by email to
Contact Mr. Joel Schwartz, Chief Guidelines Officer, National Endowment for the Humanities, at
NEH first published notice of its intent to seek OMB approval for this ICR in the
This Notice also lists the following information:
Comments submitted in response to this notice will become a matter of public record.
Nuclear Regulatory Commission.
Interim staff guidance; issuance.
The U.S. Nuclear Regulatory Commission (NRC) is issuing the final Revision 2 to Japan Lessons-Learned Division Interim Staff Guidance (JLD-ISG), JLD-ISG-2012-01, “Compliance with Order EA-12-049, Order Modifying Licenses with Regard to Requirements for Mitigation Strategies for Beyond-Design-Basis External Events.” This ISG provides guidance and clarification to assist nuclear power reactor licensees with the identification of measures needed to comply with requirements to mitigate challenges to key safety functions. These requirements are contained in Order EA-12-049, “Order Modifying Licenses with Regard to Requirements for Mitigation Strategies for Beyond-Design-Basis External Events.”
This guidance is effective on April 25, 2018.
Please refer to Docket ID NRC-2012-0068 when contacting the NRC about the availability of information regarding this document. You may obtain publicly-available information related to this document using any of the following methods:
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•
•
•
Eric Bowman, Office of Nuclear Reactor Regulation, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001; telephone: 301-415-2963, email:
The original Final Japan Lessons-Learned Project Directorate Interim Staff Guidance, JLD-ISG-2012-01 (ADAMS Accession No. ML12229A174) dated August 29, 2012, was issued to describe to the public methods acceptable to the NRC for complying with Order EA-12-049 issued March 12, 2012 (ADAMS Package Accession No. ML12054A736). This ISG endorsed the methodologies described in the industry guidance document, Nuclear Energy Institute (NEI) 12-06, “Diverse and Flexible Coping Strategies (FLEX) Implementation Guide,” Revision 0, (ADAMS Accession No. ML12242A378), submitted on August 21, 2012. Revision 1 to JLD-ISG-2012-01 (ADAMS Accession No. ML15357A163) was issued on January 22, 2016, and endorsed NEI 12-06, Revision 2 (ADAMS Accession No. ML16005A625), issued in December 2015. The NRC staff is now issuing Revision 2 to JLD-ISG-2012-01, which incorporates additional guidance related to reevaluated seismic hazard information and some additional changes based on lessons learned in the implementation of Order EA-12-049. This revision endorses NEI 12-06, Revision 4 (ADAMS Accession No. ML16354B421), issued in December 2016.
The NRC issued Order EA-12-049 following evaluation of the Japan earthquake and tsunami and resulting nuclear accident at the Fukushima Dai-
The original version of this ISG, which endorsed the original NEI 12-06, was issued on August 29, 2012. Revision 1 to JLD-ISG-2012-01 incorporated acceptable alternative approaches to compliance proposed by licensees, as well as the NRC's review strategy described in COMSECY-14-0037, “Integration of Mitigating Strategies for Beyond-Design Basis External Events and the Reevaluation of Flooding Hazards” (ADAMS Accession No. ML14238A616), which clarified the NRC's position on the interdependency of the mitigating strategies responses and the responses to the seismic and flooding reevaluations. The NRC has further revised this ISG in Revision 2 in order to include additional guidance regarding reevaluated seismic hazard information and changes based on lessons learned related to mitigating strategies implementation. This revised guidance will be publicly available and used by members of the industry to help develop their responses to Order EA-12-049, including impacts of the reevaluated seismic and flooding information, and by the NRC in its reviews of licensee strategies. On November 10, 2016 (81 FR 79056), the NRC requested public comments on draft Revision 2 to JLD-ISG-2012-01. The NRC received comments from seven stakeholders, which were considered in the development of the final Revision 2 to JLD-ISG-2012-01. The questions, comments, and NRC resolutions of those comments are contained in “NRC Responses to Public Comments: Revision 2 to JLD-ISG-2012-01, Compliance with Order EA-12-049, `Order Modifying Licenses with Regard to Requirements for Mitigation Strategies for Beyond-Design-Basis External Events'” (ADAMS Accession No. ML17005A187).
This ISG revision is a rule as defined in the Congressional Review Act (5 U.S.C. 801-808). However, the Office of Management and Budget has not found it to be a major rule as defined in the Congressional Review Act.
This ISG provides guidance on an acceptable method for implementing the requirements contained in Order EA-12-049. Licensees may voluntarily use the guidance in Revision 2 to JLD-ISG-2012-01 to demonstrate compliance with Order EA-12-049. Methods or solutions that differ from those described in this ISG may be deemed acceptable if they provide sufficient basis and information for the NRC to verify that the proposed alternative demonstrates compliance with Order EA-12-049.
Issuance of this ISG does not constitute backfitting as defined in section 50.109 of title 10 of the
For the Nuclear Regulatory Commission.
Nuclear Regulatory Commission
Notice of intent to enter into a modified indemnity agreement.
The U.S. Nuclear Regulatory Commission (NRC) is issuing a notice of intent to enter into a modified indemnity agreement with Florida Power & Light Company (FPL) to operate Turkey Point Units 6 and 7. The NRC is publishing notice of its intent to enter into an indemnity agreement which contains provisions different from the general form found in the NRC's regulations. A modification to the general form is necessary to accommodate the unique timing provisions of a combined license (COL).
On April 5, 2018, the Commission authorized the Director of the Office of New Reactors to issue COLs to FPL to construct and operate Turkey Point Units 6 and 7. The modified indemnity agreement would be effective upon issuance of the COLs.
Please refer to Docket ID NRC-2009-0337 when contacting the NRC about the availability of information regarding this document. You may obtain publicly-available information related to this document using any of the following methods:
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Manny Comar, Office of New Reactors, U.S. Nuclear Regulatory Commission, Washington DC 20555-0001; telephone: 301-415-3863, email:
On April 5, 2018, the Commission authorized issuance of COLs to FPL for Turkey Point Units 6 and 7. These COLs would include a license pursuant to part 70 of title 10 of the
Pursuant to 10 CFR 140.9, the NRC is publishing notice of its intent to enter into an indemnity agreement that contains provisions different from the general form found in 10 CFR 140.92. Modifications to the general indemnity agreement are addressed in the following discussion.
The provisions of the general form of indemnity agreement in 10 CFR 140.92 address insurance and indemnity for a licensee that is authorized to operate as soon as an operating license is issued pursuant to 10 CFR part 50, “Domestic Licensing of Production and Utilization Facilities.” FPL, however, has requested a COL pursuant to 10 CFR part 52, “Licenses, Certifications, and Approvals for Nuclear Power Plants,” to construct and operate Turkey Point Units 6 and 7. Unlike an operating license, which authorizes operation of the facility as soon as the license is issued, a COL authorizes the construction and operation of the facility, and also includes a condition that bars operation until the Commission makes a finding pursuant to 10 CFR 52.103(g) that the acceptance criteria in the COL are met (also called a “§ 52.103(g) finding”). The COL holders are not required to maintain financial protection in the amount specified in 10 CFR 140.11(a)(4) before the § 52.103(g) finding is made, but must maintain financial protection in the amount specified by 10 CFR 140.13 upon receipt of a COL because the COL includes a license issued pursuant to 10 CFR part 70. Therefore, the provisions in the general form of indemnity agreement must be modified to address the timing differences applicable to COLs.
Modifications to the general form of indemnity agreement will reflect the timing distinctions applicable to COLs. In addition, other modifications and their intent are described below:
(1) References to Mutual Atomic Energy Liability Underwriters have been removed because this entity no longer exists.
(2) Monetary amounts have been updated to reflect changes that have been made to Section 170, “Indemnification and Limitation of Liability,” of the Atomic Energy Act of 1954, as amended (42 U.S.C. 2210).
Accordingly, for the reasons discussed in this notice, and in accordance with 10 CFR 140.9, the NRC hereby provides notice of its intent to enter into an agreement of indemnity with FPL for Turkey Point Units 6 and 7 with the described modifications to the general form of indemnity.
For the Nuclear Regulatory Commission.
Nuclear Regulatory Commission.
Combined licenses and record of decision; issuance.
The U.S. Nuclear Regulatory Commission (NRC) has issued Combined License (COL) Nos. NPF-104 and NPF-105 to Florida Power & Light Company (FPL) for Turkey Point Units 6 and 7. In addition, the NRC has prepared a Summary Record of Decision (ROD) that supports the NRC's decision to issue the above-named COLs.
Combined License Nos. NPF-104 and NPF-105, became effective on April 12, 2018.
Please refer to Docket ID NRC-2009-0337 when contacting the NRC about the availability of information regarding this document. You may obtain publicly-available information related to this document using any of the following methods:
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Manny Comar, telephone: 301-415-3863, email:
Under section 2.106 of title 10 of the
Accordingly, the COLs were issued on April 12, 2018, and became effective immediately.
The NRC has prepared a Final Safety Evaluation Report (FSER) and Final Environmental Impact Statement (FEIS) that document the information reviewed and the NRC's conclusion. The Commission has also issued its Memorandum and Order documenting its final decision on the uncontested hearing held on December 12, 2017, which serves as the ROD in this proceeding. The NRC also prepared a document summarizing the ROD to accompany its actions on the COL application; this “Summary ROD” incorporates by reference materials contained in the FEIS. The FSER, FEIS, Summary ROD, and accompanying documentation included in the COL package, as well as the Commission's hearing decision and ROD, are available online in the ADAMS Public Document collection at
The ADAMS accession numbers for the documents related to this notice are listed below.
The documents identified in the following table are available to interested persons through the ADAMS Public Documents collection. A copy of the combined license application is also available for public inspection at the NRC's PDR and at
For the Nuclear Regulatory Commission.
Postal Regulatory Commission.
Notice.
The Commission is noticing a recent Postal Service filing for the Commission's consideration concerning negotiated service agreements. This notice informs the public of the filing, invites public comment, and takes other administrative steps.
Submit comments electronically via the Commission's Filing Online system at
David A. Trissell, General Counsel, at 202-789-6820.
The Commission gives notice that the Postal Service filed request(s) for the Commission to consider matters related to negotiated service agreement(s). The request(s) may propose the addition or removal of a negotiated service agreement from the market dominant or the competitive product list, or the modification of an existing product currently appearing on the market dominant or the competitive product list.
Section II identifies the docket number(s) associated with each Postal Service request, the title of each Postal Service request, the request's acceptance date, and the authority cited by the Postal Service for each request. For each request, the Commission appoints an officer of the Commission to represent the interests of the general public in the proceeding, pursuant to 39 U.S.C. 505 (Public Representative). Section II also establishes comment deadline(s) pertaining to each request.
The public portions of the Postal Service's request(s) can be accessed via the Commission's website (
The Commission invites comments on whether the Postal Service's request(s) in the captioned docket(s) are consistent with the policies of title 39. For request(s) that the Postal Service states concern market dominant product(s), applicable statutory and regulatory requirements include 39 U.S.C. 3622, 39 U.S.C. 3642, 39 CFR part 3010, and 39 CFR part 3020, subpart B. For request(s) that the Postal Service states concern competitive product(s), applicable statutory and regulatory requirements include 39 U.S.C. 3632, 39 U.S.C. 3633, 39 U.S.C. 3642, 39 CFR part 3015, and 39 CFR part 3020, subpart B. Comment deadline(s) for each request appear in section II.
1.
This Notice will be published in the
Postal Service
Notice.
The Postal Service gives notice of filing a request with the Postal Regulatory Commission to add a domestic shipping services contract to the list of Negotiated Service Agreements in the Mail Classification Schedule's Competitive Products List.
Elizabeth Reed, 202-268-3179.
The United States Postal Service® hereby gives notice that, pursuant to 39 U.S.C. 3642 and 3632(b)(3), on April 19, 2018, it filed with the Postal Regulatory Commission a
Pursuant to Section 19(b)(1)
The Exchange proposes to modify Rule 904 (Position Limits), Commentary .07 to expand position limits for options on certain Exchange-Traded Funds (ETFs). The proposed rule change is available on the Exchange's website at
In its filing with the Commission, the self-regulatory organization included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements.
The Exchange proposes to amend Rule 904, Commentary .07 to expand position limits for options on certain ETFs. Specifically, the Exchange proposes to expand the position limits for options on the following ETFs: iShares China Large-Cap ETF (“FXI”), iShares MSCI EAFE ETF (“EFA”), iShares MSCI Emerging Markets ETF (“EEM”), iShares Russell 2000 ETF (“IWM”), iShares MSCI Brazil Capped ETF (“EWZ”), iShares 20+ Year Treasury Bond Fund ETF (“TLT”), PowerShares QQQ Trust (“QQQQ”), and iShares MSCI Japan ETF (“EWJ”). This is a competitive filing that is based on a proposal recently submitted by the Chicago Board Options Exchange Incorporated (“Cboe”) and approved by the Securities and Exchange Commission (“Commission”).
Position limits are designed to address potential manipulative schemes and adverse market impact surrounding the use of options, such as disrupting the market in the security underlying the options. The potential manipulative schemes and adverse market impact are balanced against the potential of setting the limits so low as to discourage participation in the options market. The level of those position limits must be balanced between curtailing potential manipulation and the cost of preventing potential hedging activity that could be used for legitimate economic purposes. Position limits for options on ETFs, such as those subject to this proposal, are determined pursuant to Rule 904, and vary according to the number of outstanding shares and the trading volume of the underlying stocks or ETFs over the past six-months. Pursuant to Rule 904, the largest in capitalization and the most frequently traded stocks and ETFs have an option position limit of 250,000 contracts (with adjustments for splits, re-capitalizations, etc.) on the same side of the market; and smaller capitalization stocks and ETFs have position limits of 200,000, 75,000, 50,000 or 25,000 contracts (with adjustments for splits, re-capitalizations, etc.) on the same side of the market. Options on FXI, EFA, EWZ, TLT, and EWJ are currently subject to the standard position limit of 250,000 contracts as set forth in Rule 904.
• Options on EEM are 500,000 contracts;
• Options on IWM are 500,000 contracts; and
• Options on QQQQ are 900,000 contracts.
The purpose of this proposal is to amend Rule 904, Commentary .07 to double the position and exercise limits for FXI, EEM, IWM, EFA, EWZ, TLT, QQQQ, and EWJ.
As such, options on FXI, EFA, EWZ, TLT, and EWJ would no longer be subject to the standard position limits set forth under Rule 904. Accordingly, Commentary .07(f) would be amended to set forth that the position limits for options on FXI, EFA, EWZ, TLT, and EWJ would be 500,000 contracts. These position limits equal the current position limits for option on IWM and EMM and are similar to the current position limit for options on QQQQ set forth in Rule 904, Commentary .07. Further, Rule 904 would also be amended to increase the position limits for the remaining options subject to this proposal as follows:
• The position limits for options on EEM would be increased from 500,000 contracts to 1,000,000 contracts;
• The position limits on options on IWM would be increased from 500,000 contracts to 1,000,000 contracts;
• The position limits on options on QQQQ would be increased from 900,000 contracts to 1,800,000 contracts.
In support of this proposal, the Exchange represents that the above listed ETFs qualify for either: (i) The initial listing criteria set forth in Rule 915, Commentary .06(b) for ETFs holding non-U.S. component securities; or (ii) for ETFs listed pursuant to generic listing standards for series of portfolio depository receipts and index fund shares based on international or global indexes under which a comprehensive surveillance agreement (“CSA”) is not required.
The Exchange represents that more than 50% of the weight of the securities held by the options subject to this proposal are also subject to a CSA.
In seeking to expand position limits for the same ETFs at issue in this proposal, Cboe represented that market participants have increased their demand for options on FXI, EFA, EWZ, TLT, and EWJ for hedging and trading purposes and, in support of this claim, presented the trading statistics set forth in the table below.
The Exchange agrees and believes the current position limits are too low and may be a deterrent to successful trading of options on these securities. The analysis that follows was likewise conducted by Cboe in support of its proposal. The Exchange agrees with Cboe's analysis discussed below.
In support of its proposal to increase the position limits for QQQQ to 1,800,000 contracts, Cboe compared the trading characteristics of QQQQ to that of SPY, which has no position limits. As shown in Cboe's above table, the average daily trading volume through August 14, 2017 for QQQQ was 26.25 million shares compared to 64.63 million shares for SPY. The total shares outstanding for QQQQ are 351.6 million compared to 976.23 million for SPY. The fund market cap for QQQQ is $50,359.7 million compared to $240,540 million for SPY. SPY is one of the most actively trading ETFs and is subject to no position limits. QQQQ is also very actively traded, and while not to the level of SPY, should be subject to the proposed higher position limits based its trading characteristics when compared to SPY. The proposed position limit coupled with QQQQ's trading behavior would continue to address potential manipulative schemes and adverse market impact surrounding the use of options and trading in securities underlying the options.
In support of its proposal to increase the position limits for EEM and IWM from 500,000 contracts to 1,000,000 contracts, Cboe also compared the trading characteristics of EEM and IWM to that of QQQQ, which currently has a position limit of 900,000 contracts. As shown in the above table, the average daily trading volume through July 31, 2017 for EEM was 52.12 million shares and IWM was 27.46 million shares compared to 26.25 million shares for QQQQ. The total shares outstanding for EEM are 797.4 million and for IWM are 253.1 million compared to 351.6 million for QQQQ. The fund market cap for EEM is $34,926.1 million and IWM is $35,809 million compared to $50,359.7 million for QQQQ. EEM, IWM and QQQQ have similar trading characteristics and subjecting EEM and IWM to the proposed higher position limit would continue be designed to address potential manipulative schemes that may arise from trading in the options and their underlying securities. These above trading characteristics for QQQQ when compared to EEM and IWM also justify increasing the position limit for QQQQ. QQQQ has a higher options ADV than EEM and IWM, a higher number of shares outstanding than IWM and a much higher market cap than EEM and IWM which justify doubling the position limit for QQQQ. Based on these statistics, and as stated above, the proposed position limit coupled with QQQQ's trading behavior would continue to address potential manipulative schemes and adverse market impact surrounding the use of options and trading in the securities underlying the options.
In support of its proposal to increase the position limits for FXI, EFA, EWZ, TLT, and EWJ from 250,000 contracts to 500,000 contracts, Cboe compared the trading characteristics of FXI, EFA, EWZ, TLT and EWJ to that of EEM and IWM, both of which currently have a position limit of 500,000 contracts. As shown in the above table, the average daily trading volume through July 31, 2017 for FXI is 15.08 million shares, EFA is 19.42 million shares, EWZ is 17.08 million shares, TLT is 8.53 million shares, and EWJ is 6.06 million shares compared to 52.12 million shares for EEM and 27.46 million shares for IWM. The total shares outstanding for FXI is 78.6 million, EFA is 1178.4 million, EWZ is 159.4 million, TLT is 60 million and EWJ is 303.6 million compared to 797.4 million for EEM and 253.1 million for IWM. The fund market cap for FXI is $3,343.6 million, EFA is $78,870.3 million, EWZ is $6,023.4 million, TLT is $7,442.4 million, and EWJ is $16,625.1 million compared to $34,926.1 million for EEM and $35,809.1 million for IWM. The above trading characteristics of FXI, EFA, EWZ, TLT and EWJ is either similar to that of EEM and IWM or sufficiently active enough so that the proposed limit would continue to address potential manipulation that may arise. EFA has far more shares outstanding and a larger fund market cap than EEM, IWM, and QQQQ. EWJ has a more shares outstanding than IWM and only slightly less shares outstanding than QQQQ.
On the other hand, while FXI, EWZ, and TLT do not exceed EEM, IWM or QQQQ in any of the specified areas, they are all actively trading so that market participant's trading activity has been impacted by them being restricted by the current position limits. The Exchange believes that the trading activity and these securities being based on a broad basket of underlying securities alleviates any potential manipulative activity that may arise. In addition, as discussed in more detail below, the Exchange's existing surveillance procedures and reporting requirements at the Exchange, other options exchanges, and at several clearing firms are capable of properly identifying unusual and/or illegal trading activity.
According to Cboe, market participants' trading activity has been adversely impacted by the current position limits for FXI, EFA, EWZ, TLT, and EWJ and such limits have caused options trading in these symbols to move from exchanges to the over-the-counter market.
The Exchange notes that the ETFs that underlie options subject to this proposal are highly liquid, and are based on a broad set of highly liquid securities and other reference assets.
The proposed position limits set forth in the proposal would continue to address potential manipulative activity while allowing for potential hedging activity for appropriate economic purposes. The creation and redemption process for these ETFs also lessen the potential for manipulative activity. When an ETF company wants to create more ETF shares, it looks to an Authorized Participant, which is a market maker or other large financial institution, to acquire the securities the ETF is to hold. For instance, IWM is designed to track the performance of the Russell 2000 Index, the Authorized Participant will purchase all the Russell 2000 constituent securities in the exact same weight as the index, then deliver those shares to the ETF provider. In exchange, the ETF provider gives the Authorized Participant a block of
The ETF creation and redemption seeks to keep ETF share prices trading in line with the ETF's underlying net asset value. Because an ETF trades like a stock, its price will fluctuate during the trading day, due to simple supply and demand. If demand to buy an ETF is high, for instance, the ETF's share price might rise above the value of its underlying securities. When this happens, the Authorized Participant believes the ETF may now be overpriced, and can buy the underlying shares that compose the ETF and then sell ETF shares on the open market. This should help drive the ETF's share price back toward fair value. Likewise, if the ETF starts trading at a discount to the securities it holds, the Authorized Participant can buy shares of the ETF and redeem them for the underlying securities. Buying undervalued ETF shares should drive the price of the ETF back toward fair value. This arbitrage process helps to keep an ETF's price in line with the value of its underlying portfolio.
Some of the ETFs underlying options subject to the proposal are based on broad-based indices that underlie cash settled options that are economically equivalent to the ETF options that are the subject of the proposal and have no position limits. Other ETFs are based on broad-based indexes that underlie cash-settled options with position limits reflecting notional values that are larger than the current position limits for ETF analogues (EEM, EFA). Where there was no approved index analogue, the Exchange believes, based on the liquidity, breadth and depth of the underlying market, that the index referenced by the ETF would be considered a broad-based index.
For example, the PowerShares QQQ Trust or QQQQ is an ETF that tracks the Nasdaq 100 Index or NDX, which is an index composed of 100 of the largest non-financial securities listed on the Nasdaq Stock Market LLC (“Nasdaq”). Options on NDX are currently subject to the standard position limit of 25,000 contracts for broad-based index options but share similar trading characteristics as QQQQ.
The iShares Russell 2000 ETF or IWM, is an ETF that also tracks the Russell 2000 Index or RUT, which is an index that composed of 2,000 small-cap domestic companies in the Russell 3000 index. Options on RUT are currently subject to the standard position limit of 25,000 contracts for broad-based index options but share similar trading characteristics as IWM.
EEM tracks the performance of the MSCI Emerging Markets Index or MXEF, which is composed of approximately 800 component securities following 21 emerging market country indices: Brazil, Chile, China, Colombia, Czech Republic, Egypt, Hungary, India, Indonesia, Korea, Malaysia, Mexico, Morocco, Peru, Philippines, Poland, Russia, South Africa, Taiwan, Thailand, and Turkey. Below makes the same notional value comparison as made above. Based on EEM's share price of $47.06 and MXEF's index level of 1,136.45, approximately 24 contracts of EEM equals one contract of MXEF. MXEF is currently subject to the standard position limit of 25,000 contracts for Broad Stock Index Group options under Rule 904C(b). Based on the above comparison of notional values, this would result in a position limit economically equivalent to 604,000 contracts for EEM as MXEF's
EFA tracks the performance of MSCI EAFE Index or MXEA, which has over 900 component securities designed to represent the performance of large and mid-cap securities across 21 developed markets, including countries in Europe, Australasia and the Far East, excluding the U.S. and Canada. Below makes the same notional value comparison as made above. Based on EFA's share price of $69.16 and MXEA's index level of 1,986.15, approximately 29 contracts of EFA equals one contract of MXEA. MXEA is currently subject to the standard position limit of 25,000 contracts for Broad Stock Index Group options under Rule 904C(b). Based on the above comparison of notional values, this would result in a position limit economically equivalent to 721,000 contracts for EFA as MXEA's analogue. Furthermore, MXEA currently has a market capitalization of $18.7 trillion and EFA has a market capitalization of $78,870.3 million, and the component securities of MXEA, in aggregate, have traded an average of 4.6 billion shares per day in 2017, both large enough to absorb any price movement cause by a large trade in the EEM. However, MXEA has an average daily trading volume of 270 contracts. EFA is currently subject to a position limit of 250,000 contracts but has a much higher average daily trading volume of 98,844 contracts. Based on the above comparisons, the Exchange believes it is reasonable to increase the position limit for options on the EFA from 250,000 to 500,000 contracts.
FXI tracks the performance of the FTSE China 50 Index, which is composed of the 50 largest Chinese stocks. There is currently no index analogue for FXI approved for options trading. However, the FTSE China 50 Index currently has a market capitalization of $1.7 trillion and FXI has a market capitalization of $2,623.18 million, both large enough to absorb any price movement cause by a large trade in FXI. The components of the FTSE China 50 Index, in aggregate, have an average daily trading volume of 2.3 billion shares. FXI is currently subject to a position limit of 000 contracts but has a much higher average daily trading volume of 15.08 million shares. Based on the above comparisons, the Exchange believes it is reasonable to increase the position limit for options on the FXI from 250,000 to 500,000 contracts.
EWZ tracks the performance of the MSCI Brazil 25/50 Index, which is composed of shares of large and mid-size companies in Brazil. There is currently no index analogue for EWZ approved for options trading. However, the MSCI Brazil 25/50 Index currently has a market capitalization of $700 billion and EWZ has a market capitalization of $6,023.4 million, both large enough to absorb any price movement cause by a large trade in EWZ. The components of the MSCI Brazil 25/50 Index, in aggregate, have an average daily trading volume of 285 million shares. EWZ is currently subject to a position limit of 250,000 contracts but has a much higher average daily trading volume of 17.08 million shares. Based on the above comparisons, the Exchange believes it is reasonable to increase the position limit for options on the EWZ from 250,000 to 500,000 contracts.
TLT tracks the performance of ICE U.S. Treasury 20+ Year Bond Index, which is composed of long-term U.S. Treasury bonds. There is currently no index analogue for TLT approved for options trading. However, the U.S. Treasury market is one of the largest and most liquid markets in the world, with over $14 trillion outstanding and turnover of approximately $500 billion per day. TLT currently has a market capitalization of $7,442.4 million, both large enough to absorb any price movement cause by a large trade in TLT. Therefore, the potential for manipulation will not increase solely due the increase in position limits as set forth in this proposal. Based on the above comparisons, the Exchange believes it is reasonable to increase the position limit for options on the TLT from 250,000 to 500,000 contracts.
EWJ tracks the MSCI Japan Index, which tracks the performance of large and mid-sized companies in Japan. There is currently no index analogue for EWJ approved for options trading. However, the MSCI Japan Index has a market capitalization of $3.5 trillion and EWJ has a market capitalization of $16,625.1 million, and the component securities of the MSCI Japan Index, in aggregate, have traded an average of 1.1 billion shares per day in 2017, both large enough to absorb any price movement caused by a large trade in EWJ. EWJ is currently subject to a position limit of 250,000 contracts and has an average daily trading volume of 6.6 million shares. Based on the above comparisons, the Exchange believes it is reasonable to increase the position limit for options on EWJ from 250,000 to 500,000 contracts.
The Exchange believes that increasing the position limits for the options subject to this proposal would lead to a more liquid and competitive market environment for these options, which will benefit customers interested in this product. Under the proposal, the reporting requirement for the above options would be unchanged. Thus, the Exchange would still require that each ATP Holder that maintains a position in the options on the same side of the market, for its own account or for the account of a customer, report certain information to the Exchange. This information would include, but would not be limited to, the options' position, whether such position is hedged and, if so, a description of the hedge, and the collateral used to carry the position, if applicable. Exchange Market Makers
The Exchange believes that the existing surveillance procedures and reporting requirements at the Exchange, other options exchanges, and at the several clearing firms are capable of properly identifying unusual and/or illegal trading activity. In addition, routine oversight inspections of the Exchange's regulatory programs by the Commission have not uncovered any material inconsistencies or shortcomings in the manner in which the Exchange's market surveillance is conducted. These procedures utilize daily monitoring of market movements via automated surveillance techniques to identify unusual activity in both options and underlying stocks.
Furthermore, large stock holdings must be disclosed to the Commission by way of Schedules 13D or 13G.
The Exchange believes that the current financial requirements imposed by the Exchange and by the Commission adequately address concerns that an ATP Holder or its customer may try to maintain an inordinately large un-hedged position in the options subject to this proposal. Current margin and risk-based haircut methodologies serve to limit the size of positions maintained by any one account by increasing the margin and/or capital that an ATP Holder must maintain for a large position held by itself or by its customer.
The Exchange believes the proposed rule change is consistent with Section 6(b) of the Act
The current position limits for the options subject to this proposal have inhibited the ability of Market Makers to make markets on the Exchange. Specifically, the proposal is designed to encourage Market Makers to shift liquidity from over the counter markets onto the Exchange, which will enhance the process of price discovery conducted on the Exchange through increased order flow. The proposal will also benefit institutional investors as well as retail traders, and public customers, by providing them with a more effective trading and hedging vehicle. In addition, the Exchange believes that the structure of the ETFs subject to this proposal and the considerable liquidity of the market for options on those ETFs diminishes the opportunity to manipulate this product and disrupt the underlying market that a lower position limit may protect against. Increased position limits for select actively traded options, such as that proposed herein, is not novel and has been previously approved by the Commission. For example, the Commission has previously approved, on a pilot basis, eliminating position limits for options on SPY.
Lastly, the Commission expressed the belief that removing position and exercise limits may bring additional depth and liquidity without increasing concerns regarding intermarket manipulation or disruption of the options or the underlying securities.
The Exchange does not believe that the proposed rule change would impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange believes that the proposed rule change will result in additional opportunities to achieve the investment and trading objectives of market participants seeking efficient trading and hedging vehicles, to the benefit of investors, market participants, and the marketplace in general.
Further, the Exchange notes that the rule change is being proposed as a competitive response to a filing submitted by Cboe that was recently approved by the Commission.
No written comments were solicited or received with respect to the proposed rule change.
Because the proposed rule change does not (i) significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act
A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the Act
At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1)
The Exchange proposes to modify Rule 6.8-O (Position Limits), Commentary .06 to expand position limits for options on certain Exchange-Traded Funds (ETFs). The proposed rule change is available on the Exchange's website at
In its filing with the Commission, the self-regulatory organization included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements.
The Exchange proposes to amend Rule 6.8-O, Commentary .06 to expand position limits for options on certain ETFs. Specifically, the Exchange proposes to expand the position limits for options on the following ETFs: iShares China Large-Cap ETF (“FXI”), iShares MSCI EAFE ETF (“EFA”), iShares MSCI Emerging Markets ETF (“EEM”), iShares Russell 2000 ETF (“IWM”), iShares MSCI Brazil Capped ETF (“EWZ”), iShares 20+ Year Treasury Bond Fund ETF (“TLT”), PowerShares QQQ Trust (“QQQQ”), and iShares MSCI Japan ETF (“EWJ”). This is a competitive filing that is based on a proposal recently submitted by the Chicago Board Options Exchange Incorporated (“Cboe”) and approved by the Securities and Exchange Commission (“Commission”).
Position limits are designed to address potential manipulative schemes and adverse market impact surrounding the use of options, such as disrupting the market in the security underlying the options. The potential manipulative schemes and adverse market impact are balanced against the potential of setting the limits so low as to discourage participation in the options market. The level of those position limits must be balanced between curtailing potential manipulation and the cost of preventing potential hedging activity that could be used for legitimate economic purposes. Position limits for options on ETFs, such as those subject to this proposal, are determined pursuant to Rule 6.8-O, and vary according to the number of outstanding shares and the trading volume of the underlying stocks or ETFs over the past six-months. Pursuant to Rule 6.8-O, the largest in capitalization and the most frequently traded stocks and ETFs have an option position limit of 250,000 contracts (with adjustments for splits, re-capitalizations, etc.) on the same side of the market; and smaller capitalization stocks and ETFs have position limits of 200,000, 75,000, 50,000 or 25,000 contracts (with adjustments for splits, re-capitalizations, etc.) on the same side of the market. Options on FXI, EFA, EWZ, TLT, and EWJ are currently subject to the standard position limit of 250,000 contracts as set forth in Rule 6.8-O.
• Options on EEM are 500,000 contracts;
• Options on IWM are 500,000 contracts; and
• Options on QQQQ are 900,000 contracts.
The purpose of this proposal is to amend Rule 6.8-O, Commentary .06 to double the position and exercise limits for FXI, EEM, IWM, EFA, EWZ, TLT, QQQQ, and EWJ.
As such, options on FXI, EFA, EWZ, TLT, and EWJ would no longer be subject to the standard position limits set forth under Rule 6.8-O. Accordingly, Commentary .06 would be amended to set forth that the position limits for options on FXI, EFA, EWZ, TLT, and EWJ would be 500,000 contracts. These position limits equal the current position limits for option on IWM and EMM and are similar to the current position limit for options on QQQQ set forth in Rule 6.8-O, Commentary .06. Further, Rule 6.8-O would also be amended to increase the position limits for the remaining options subject to this proposal as follows:
• The position limits for options on EEM would be increased from 500,000 contracts to 1,000,000 contracts;
• The position limits on options on IWM would be increased from 500,000 contracts to 1,000,000 contracts;
• The position limits on options on QQQQ would be increased from 900,000 contracts to 1,800,000 contracts.
In support of this proposal, the Exchange represents that the above listed ETFs qualify for either: (i) The initial listing criteria set forth in Rule 5.3-O(g)(2) for ETFs holding non-U.S. component securities; or (ii) for ETFs listed pursuant to generic listing standards for series of portfolio depository receipts and index fund shares based on international or global indexes under which a comprehensive surveillance agreement (“CSA”) is not required.
The Exchange represents that more than 50% of the weight of the securities held by the options subject to this proposal are also subject to a CSA.
In seeking to expand position limits for the same ETFs at issue in this proposal, Cboe represented that market participants have increased their demand for options on FXI, EFA, EWZ, TLT, and EWJ for hedging and trading purposes and, in support of this claim, presented the trading statistics set forth in the table below.
The Exchange agrees and believes the current position limits are too low and may be a deterrent to successful trading of options on these securities. The analysis that follows was likewise conducted by Cboe in support of its proposal. The Exchange agrees with Cboe's analysis discussed below.
In support of its proposal to increase the position limits for QQQQ to 1,800,000 contracts, Cboe compared the trading characteristics of QQQQ to that of SPY, which has no position limits. As shown in Cboe's above table, the average daily trading volume through August 14, 2017 for QQQQ was 26.25 million shares compared to 64.63 million shares for SPY. The total shares outstanding for QQQQ are 351.6 million compared to 976.23 million for SPY. The fund market cap for QQQQ is $50,359.7 million compared to $240,540 million for SPY. SPY is one of the most actively trading ETFs and is subject to no position limits. QQQQ is also very actively traded, and while not to the level of SPY, should be subject to the proposed higher position limits based its trading characteristics when compared to SPY. The proposed position limit coupled with QQQQ's trading behavior would continue to address potential manipulative schemes and adverse market impact surrounding the use of options and trading in securities underlying the options.
In support of its proposal to increase the position limits for EEM and IWM from 500,000 contracts to 1,000,000 contracts, Cboe also compared the trading characteristics of EEM and IWM to that of QQQQ, which currently has a position limit of 900,000 contracts. As shown in the above table, the average daily trading volume through July 31, 2017 for EEM was 52.12 million shares and IWM was 27.46 million shares compared to 26.25 million shares for QQQQ. The total shares outstanding for EEM are 797.4 million and for IWM are 253.1 million compared to 351.6 million for QQQQ. The fund market cap for EEM is $34,926.1 million and IWM is $35,809 million compared to $50,359.7 million for QQQQ. EEM, IWM and QQQQ have similar trading characteristics and subjecting EEM and IWM to the proposed higher position limit would continue be designed to address potential manipulative schemes that may arise from trading in the options and their underlying securities. These above trading characteristics for QQQQ when compared to EEM and IWM also justify increasing the position limit for QQQQ. QQQQ has a higher options ADV than EEM and IWM, a higher number of shares outstanding than IWM and a much higher market cap than EEM and IWM which justify doubling the position limit for QQQQ. Based on these statistics, and as stated above, the proposed position limit coupled with QQQQ's trading behavior would continue to address potential manipulative schemes and adverse market impact surrounding the use of options and trading in the securities underlying the options.
In support of its proposal to increase the position limits for FXI, EFA, EWZ, TLT, and EWJ from 250,000 contracts to 500,000 contracts, Cboe compared the trading characteristics of FXI, EFA, EWZ, TLT and EWJ to that of EEM and IWM, both of which currently have a position limit of 500,000 contracts. As shown in the above table, the average daily trading volume through July 31, 2017 for FXI is 15.08 million shares, EFA is 19.42 million shares, EWZ is 17.08 million shares, TLT is 8.53 million shares, and EWJ is 6.06 million shares compared to 52.12 million shares for EEM and 27.46 million shares for IWM. The total shares outstanding for FXI is 78.6 million, EFA is 1178.4 million, EWZ is 159.4 million, TLT is 60 million and EWJ is 303.6 million compared to 797.4 million for EEM and 253.1 million for IWM. The fund market cap for FXI is $3,343.6 million, EFA is $78,870.3 million, EWZ is $6,023.4 million, TLT is $7,442.4 million, and EWJ is $16,625.1 million compared to $34,926.1 million for EEM and $35,809.1 million for IWM. The above trading characteristics of FXI, EFA, EWZ, TLT and EWJ is either similar to that of EEM and IWM or sufficiently active enough so that the proposed limit would continue to address potential manipulation that may arise. EFA has far more shares outstanding and a larger
On the other hand, while FXI, EWZ, and TLT do not exceed EEM, IWM or QQQQ in any of the specified areas, they are all actively trading so that market participant's trading activity has been impacted by them being restricted by the current position limits. The Exchange believes that the trading activity and these securities being based on a broad basket of underlying securities alleviates any potential manipulative activity that may arise. In addition, as discussed in more detail below, the Exchange's existing surveillance procedures and reporting requirements at the Exchange, other options exchanges, and at several clearing firms are capable of properly identifying unusual and/or illegal trading activity.
According to Cboe, market participants' trading activity has been adversely impacted by the current position limits for FXI, EFA, EWZ, TLT, and EWJ and such limits have caused options trading in these symbols to move from exchanges to the over-the-counter market.
The Exchange notes that the ETFs that underlie options subject to this proposal are highly liquid, and are based on a broad set of highly liquid securities and other reference assets.
The proposed position limits set forth in the proposal would continue to address potential manipulative activity while allowing for potential hedging activity for appropriate economic purposes. The creation and redemption process for these ETFs also lessen the potential for manipulative activity. When an ETF company wants to create more ETF shares, it looks to an Authorized Participant, which is a market maker or other large financial institution, to acquire the securities the ETF is to hold. For instance, IWM is designed to track the performance of the Russell 2000 Index, the Authorized Participant will purchase all the Russell 2000 constituent securities in the exact same weight as the index, then deliver those shares to the ETF provider. In exchange, the ETF provider gives the Authorized Participant a block of equally valued ETF shares, on a one-for-one fair value basis. The price is based on the net asset value, not the market value at which the ETF is trading. This process can also work in reverse where the ETF company seeks to decrease the number of shares that are available to trade. The creation and redemption process, therefore, creates a direct link to the underlying components of the ETF, and serves to mitigate potential price impact of the ETF shares that might otherwise result from increased position limits.
The ETF creation and redemption seeks to keep ETF share prices trading in line with the ETF's underlying net asset value. Because an ETF trades like a stock, its price will fluctuate during the trading day, due to simple supply and demand. If demand to buy an ETF is high, for instance, the ETF's share price might rise above the value of its underlying securities. When this happens, the Authorized Participant believes the ETF may now be overpriced, and can buy the underlying shares that compose the ETF and then sell ETF shares on the open market. This should help drive the ETF's share price back toward fair value. Likewise, if the ETF starts trading at a discount to the securities it holds, the Authorized Participant can buy shares of the ETF and redeem them for the underlying securities. Buying undervalued ETF shares should drive the price of the ETF back toward fair value. This arbitrage process helps to keep an ETF's price in line with the value of its underlying portfolio.
Some of the ETFs underlying options subject to the proposal are based on broad-based indices that underlie cash settled options that are economically equivalent to the ETF options that are the subject of the proposal and have no position limits. Other ETFs are based on broad-based indexes that underlie cash-settled options with position limits reflecting notional values that are larger than the current position limits for ETF analogues (EEM, EFA). Where there was no approved index analogue, the Exchange believes, based on the liquidity, breadth and depth of the underlying market, that the index referenced by the ETF would be considered a broad-based index.
For example, the PowerShares QQQ Trust or QQQQ is an ETF that tracks the Nasdaq 100 Index or NDX, which is an index composed of 100 of the largest non-financial securities listed on the Nasdaq Stock Market LLC (“Nasdaq”). Options on NDX are currently subject to the standard position limit of 25,000 contracts for broad-based index options but share similar trading characteristics as QQQQ.
The iShares Russell 2000 ETF or IWM, is an ETF that also tracks the Russell 2000 Index or RUT, which is an index that composed of 2,000 small-cap domestic companies in the Russell 3000 index. Options on RUT are currently subject to the standard position limit of 25,000 contracts for broad-based index options but share similar trading characteristics as IWM.
EEM tracks the performance of the MSCI Emerging Markets Index or MXEF, which is composed of approximately 800 component securities following 21 emerging market country indices: Brazil, Chile, China, Colombia, Czech Republic, Egypt, Hungary, India, Indonesia, Korea, Malaysia, Mexico, Morocco, Peru, Philippines, Poland, Russia, South Africa, Taiwan, Thailand, and Turkey. Below makes the same notional value comparison as made above. Based on EEM's share price of $47.06 and MXEF's index level of 1,136.45, approximately 24 contracts of EEM equals one contract of MXEF. MXEF is currently subject to the standard position limit of 25,000 contracts for broad-based index options under Rule 5.15-O(a). Based on the above comparison of notional values, this would result in a position limit economically equivalent to 604,000 contracts for EEM as MXEF's analogue. However, MXEF has an average daily trading volume of 180 contracts. EEM is currently subject to a position limit of 500,000 contracts but has a much higher average daily trading volume of 287,357 contracts. Furthermore, MXEF currently has a market capitalization of $5.18 trillion and EEM has a market capitalization of $34,926.1 million, and the component securities of MXEF, in aggregate, have traded an average of 33.6 billion shares per day in 2017, both large enough to absorb any price movement caused by a large trade in the EEM. Therefore, based on the comparison of average daily trading volume, the Exchange believes it is reasonable to increase the position limit for options on the EEM from 500,000 to 1,000,000 contracts.
EFA tracks the performance of MSCI EAFE Index or MXEA, which has over 900 component securities designed to represent the performance of large and mid-cap securities across 21 developed markets, including countries in Europe, Australasia and the Far East, excluding the U.S. and Canada. Below makes the same notional value comparison as made above. Based on EFA's share price of $69.16 and MXEA's index level of 1,986.15, approximately 29 contracts of EFA equals one contract of MXEA. MXEA is currently subject to the standard position limit of 25,000 contracts for broad-based index options under Rule 5.15-O(a). Based on the above comparison of notional values, this would result in a position limit economically equivalent to 721,000 contracts for EFA as MXEA's analogue. Furthermore, MXEA currently has a market capitalization of $18.7 trillion and EFA has a market capitalization of $78,870.3 million, and the component securities of MXEA, in aggregate, have traded an average of 4.6 billion shares per day in 2017, both large enough to absorb any price movement cause by a large trade in the EEM. However, MXEA has an average daily trading volume of 270 contracts. EFA is currently subject to a position limit of 250,000 contracts but has a much higher average daily trading volume of 98,844 contracts. Based on the above comparisons, the Exchange believes it is reasonable to increase the position limit for options on the EFA from 250,000 to 500,000 contracts.
FXI tracks the performance of the FTSE China 50 Index, which is composed of the 50 largest Chinese stocks. There is currently no index analogue for FXI approved for options trading. However, the FTSE China 50 Index currently has a market capitalization of $1.7 trillion and FXI has a market capitalization of $2,623.18 million, both large enough to absorb any price movement caused by a large trade in FXI. The components of the FTSE China 50 Index, in aggregate, have an average daily trading volume of 2.3 billion shares. FXI is currently subject to a position limit of 000 contracts but has a much higher average daily trading volume of 15.08 million shares. Based on the above comparisons, the Exchange believes it is reasonable to increase the position limit for options on the FXI from 250,000 to 500,000 contracts.
EWZ tracks the performance of the MSCI Brazil 25/50 Index, which is composed of shares of large and mid-size companies in Brazil. There is currently no index analogue for EWZ approved for options trading. However, the MSCI Brazil 25/50 Index currently has a market capitalization of $700 billion and EWZ has a market capitalization of $6,023.4 million, both large enough to absorb any price movement caused by a large trade in EWZ. The components of the MSCI Brazil 25/50 Index, in aggregate, have an average daily trading volume of 285 million shares. EWZ is currently subject to a position limit of 250,000 contracts but has a much higher average daily trading volume of 17.08 million shares. Based on the above comparisons, the Exchange believes it is reasonable to
TLT tracks the performance of ICE U.S. Treasury 20+ Year Bond Index, which is composed of long-term U.S. Treasury bonds. There is currently no index analogue for TLT approved for options trading. However, the U.S. Treasury market is one of the largest and most liquid markets in the world, with over $14 trillion outstanding and turnover of approximately $500 billion per day. TLT currently has a market capitalization of $7,442.4 million, both large enough to absorb any price movement caused by a large trade in TLT. Therefore, the potential for manipulation will not increase solely due the increase in position limits as set forth in this proposal. Based on the above comparisons, the Exchange believes it is reasonable to increase the position limit for options on the TLT from 250,000 to 500,000 contracts.
EWJ tracks the MSCI Japan Index, which tracks the performance of large and mid-sized companies in Japan. There is currently no index analogue for EWJ approved for options trading. However, the MSCI Japan Index has a market capitalization of $3.5 trillion and EWJ has a market capitalization of $16,625.1 million, and the component securities of the MSCI Japan Index, in aggregate, have traded an average of 1.1 billion shares per day in 2017, both large enough to absorb any price movement cause by a large trade in EWJ. EWJ is currently subject to a position limit of 250,000 contracts and has an average daily trading volume of 6.6 million shares. Based on the above comparisons, the Exchange believes it is reasonable to increase the position limit for options on EWJ from 250,000 to 500,000 contracts.
The Exchange believes that increasing the position limits for the options subject to this proposal would lead to a more liquid and competitive market environment for these options, which will benefit customers interested in this product. Under the proposal, the reporting requirement for the above options would be unchanged. Thus, the Exchange would still require that each OTP Holder or OTP Firm that maintains a position in the options on the same side of the market, for its own account or for the account of a customer, report certain information to the Exchange. This information would include, but would not be limited to, the options' position, whether such position is hedged and, if so, a description of the hedge, and the collateral used to carry the position, if applicable. Exchange Market Makers
The Exchange believes that the existing surveillance procedures and reporting requirements at the Exchange, other options exchanges, and at the several clearing firms are capable of properly identifying unusual and/or illegal trading activity. In addition, routine oversight inspections of the Exchange's regulatory programs by the Commission have not uncovered any material inconsistencies or shortcomings in the manner in which the Exchange's market surveillance is conducted. These procedures utilize daily monitoring of market movements via automated surveillance techniques to identify unusual activity in both options and underlying stocks.
Furthermore, large stock holdings must be disclosed to the Commission by way of Schedules 13D or 13G.
The Exchange believes that the current financial requirements imposed by the Exchange and by the Commission adequately address concerns that an OTP Holder or OTP Firm or its customer may try to maintain an inordinately large un-hedged position in the options subject to this proposal. Current margin and risk-based haircut methodologies serve to limit the size of positions maintained by any one account by increasing the margin and/or capital that an OTP Holder or OTP Firm must maintain for a large position held by itself or by its customer.
The Exchange believes the proposed rule change is consistent with Section 6(b) of the Act
The current position limits for the options subject to this proposal have inhibited the ability of Market Makers to make markets on the Exchange. Specifically, the proposal is designed to encourage Market Makers to shift liquidity from over the counter markets onto the Exchange, which will enhance the process of price discovery conducted on the Exchange through increased order flow. The proposal will also benefit institutional investors as well as retail traders, and public customers, by providing them with a more effective trading and hedging vehicle. In addition, the Exchange believes that the structure of the ETFs subject to this proposal and the considerable liquidity of the market for options on those ETFs diminishes the opportunity to manipulate this product and disrupt the underlying market that a lower position limit may protect against. Increased position limits for
Lastly, the Commission expressed the belief that removing position and exercise limits may bring additional depth and liquidity without increasing concerns regarding intermarket manipulation or disruption of the options or the underlying securities.
The Exchange does not believe that the proposed rule change would impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange believes that the proposed rule change will result in additional opportunities to achieve the investment and trading objectives of market participants seeking efficient trading and hedging vehicles, to the benefit of investors, market participants, and the marketplace in general.
Further, the Exchange notes that the rule change is being proposed as a competitive response to a filing submitted by Cboe that was recently approved by the Commission.
No written comments were solicited or received with respect to the proposed rule change.
Because the proposed rule change does not (i) significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act
A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the Act
At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
ICE Clear Europe proposes revisions to its CDS End-of-Day Price Discovery Policy (“Price Discovery Policy”) related to the bid-offer width (“BOW”) methodology for credit default swap (“CDS”) contracts.
In its filing with the Commission, ICE Clear Europe included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. ICE Clear Europe has prepared summaries, set forth in sections (A), (B), and (C) below, of the most significant aspects of such statements.
ICE Clear Europe proposes revising its Price Discovery Policy to enhance the methodology used to determine bid-offer widths (“BOWs”) for CDS Contracts to incorporate a new variability band methodology, and to make certain other updates and clarifications.
Each business day, ICE Clear Europe determines end-of-day (“EOD”) levels for CDS Contracts through its Price Discovery Policy, based on EOD submissions from its CDS Clearing Members. ICE Clear Europe uses these levels for mark-to-market and risk management purposes. As part of this price discovery process, ICE Clear Europe determines BOWs for each eligible CDS Contract. The BOW is intended to estimate the bid-offer width for the two-way market available for each clearing-eligible instrument at the specified determination time on each business day. The BOWs are then used in ICE Clear Europe's price discovery process as inputs in the determination of EOD levels and firm trades, and other risk management matters.
The current methodology for determining BOWs is based on observed intraday quotes and an assessment of the current level of market variability. Based on this information, ICE Clear Europe determines a consensus BOW for each relevant instrument. The amendments remove from the Price Discovery Policy an alternative approach for calculating consensus BOWs using exponentially weighting moving averages that was planned but never implemented. The amendments restate the current methodology in use (which is based on specified averages of BOW time series).
The amendments also adopt a new variability band approach for widening BOWs in certain market conditions. Under volatile or fast-moving market conditions, BOWs may temporarily be wider than observed in intraday quotes. Currently, ICE Clear Europe's clearing risk department monitors market conditions and may apply manual adjustments to BOWs as appropriate to take into account such conditions. ICE Clear Europe proposes to capture such market conditions in a more comprehensive and automated way through a methodology that computes a variability level and a variability band for each of the main risk factors based on a time series of intraday quote mid-levels for the most actively traded instrument (“MATI”) of the considered risk factor. The BOW will be automatically adjusted based on the variability band, as discussed herein.
For index instruments, under the revised approach, ICE Clear Europe will compute a variability level for each of the main index risk factors. For each instrument, ICE Clear Europe's systems establish a time series of intraday quote mid-levels for the MATI. If the last mid-level in the time series is below the prior day's EOD level by more than one pre-defined BOW for regime 3, the variability level is the difference between the prior day's EOD level and the minimum mid-level in the time series, divided by the pre-defined BOW. For intraday mid-levels falling within one pre-defined regime 3 BOW from the prior day's EOD level, the variability level is set to 1.0 if the range of mid-levels in the time series is less than or equal to the pre-defined regime 3 BOW, and set to 1.2 if the range of mid-levels in the time series is greater than the pre-defined regime 3 BOW.
Under the revised policy, ICE Clear Europe will establish variability bands (from zero to three) that correspond to specific ranges of variability level (with band zero having the lowest range of variability level). ICE Clear Europe will then group index risk factors into specific market-proxy groups, CDX (covering the North American investment grade and high yield index risk factors) and iTraxx (covering the
For index instruments, ICE Clear Europe will continue to maintain three different predefined BOWs, each of which corresponds to one of three specific market regimes (regime 1, regime 2 and regime 3, with the BOW for regime 1 being the smallest and regime 3 the largest). As under the current approach, ICE Clear Europe first selects the market regime for each index risk sub-factor based on its MATI. Under the revised approach, ICE Clear Europe will then adjust the regime for each index risk sub-factor's MATI depending on the applicable market proxy variability band for the instrument. The adjustment (referred to as an index variability increment) can be none, one regime (moving from Regime 1 to Regime 2 or from Regime 2 to Regime 3), or two regimes (moving from Regime 1 to Regime 3 or from Regime 2 to Regime 3). Higher market proxy variability bands result in a larger adjustment. The clearing risk department has the discretion to adjust market regimes as it determines best reflects current market conditions.
For single-name instruments, the revised policy applies a new scaling factor, referred to as an SN variability factor, to the consensus EOD BOWs for single name instruments calculated under the existing methodology. The SN variability factor will be determined based on a market proxy variability band. ICE Clear Europe will assign each single name risk factor to a specific market proxy group (CDX for standard North American corporates, iTraxx for standard European corporates and standard Western European sovereigns). The scaling factor will range from 1 to 1.5, depending on the market proxy variability band (with higher bands having a higher variability factor). The clearing risk department also has discretion to override the scaling actor with any factor it deems appropriate to best reflect market conditions.
In connection with these changes, ICE Clear Europe is removing from the policy an alternative approach to variability adjustments that was planned but had not been implemented.
The amendments also contain various typographical corrections, updates to cross-references and similar clarifications.
ICE Clear Europe believes that the proposed amendments are consistent with the requirements of Section 17A of the Act
ICE Clear Europe does not believe the proposed rule changes would have any impact, or impose any burden, on competition not necessary or appropriate in furtherance of the purpose of the Act. The proposed changes to the Price Discovery Policy, and in particular the revised BOW variability methodology for Single Name and Index instruments, will apply uniformly across all CDS Clearing Members and market participants. ICE Clear Europe does not believe the amendments will adversely affect competition among CDS Clearing Members, the cost of clearing, or the ability of market participants to clear CDS Contracts generally. Similarly, the Clearing House does not believe the amendments will reduce access to clearing of CDS Contracts or limit market participants' choices for clearing CDS Contracts. Therefore, ICE Clear Europe does not believe the proposed rule changes impose any burden on competition that is inappropriate in furtherance of the purposes of the Act.
Written comments relating to the proposed amendments have not been solicited or received by ICE Clear Europe. ICE Clear Europe will notify the Commission of any comments received with respect to the proposed rule change.
Within 45 days of the date of publication of this notice in the
(A) By order approve or disapprove the proposed rule change or
(B) institute proceedings to determine whether the proposed rule change should be disapproved.
The proposal shall not take effect until all regulatory actions required with respect to the proposal are completed.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All comments received will be posted without change. Persons submitting comments are cautioned that we do not redact or edit personal identifying information from comment submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-ICEEU-2018-006 and should be submitted on or before May 16, 2018.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On February 23, 2018, ICE Clear Credit LLC (“ICC”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Framework details ICC's program of operational risk assessment and oversight.
The proposed rule change would remove from the risk assessment process all references to the ORM and assign to the ERM the ORM's responsibilities under the identify, monitor, mitigate, and report components of the Operational Risk Lifecycle.
The proposed rule change would revise the “Vendor Assessment” risk focus area of the Framework to clarify that the ICC BCP and DR Oversight Committee will replace the ORM in performing the following functions: (1) Reviewing and recommending that the ICC Compliance Committee approve the inventory of critical vendors and (2) conducting a service provider risk assessment for each critical vendor.
The proposed rule change would modify the “ICE Information Security” risk focus area of the Framework to refer to the ICE Information Security Department's overall governing document and to reflect changes to the membership of the Department's governance committee.
Finally, the proposed rule change would make clarifying edits to the Framework to reflect current practices and other non-material changes.
Section 19(b)(2)(C) of the Act directs the Commission to approve a proposed rule change of a self-regulatory organization if it finds that such proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder applicable to such organization.
Section 17A(b)(3)(F) of the Act requires, among other things, that the rules of a registered clearing agency be designed to promote the prompt and accurate clearance and settlement of securities transactions, assure the safeguarding of securities and funds which are in the custody or control of the clearing agency or for which it is responsible and, in general, to protect investors and the public interest.
The Commission believes the proposed rule change will enhance ICC's ability to control its operational risk, and consequently promote the prompt and accurate clearance and settlement of securities transactions, by ensuring that the Framework accurately reflects the current assignment of responsibilities among ICC and ICE, Inc. personnel. It also will add to the Framework procedures for the assessment of critical vendors, which will both increase ICC's ability to identify critical vendors and enable ICC to manage the risks posed by its critical vendors. Finally, by eliminating the ORM from, and incorporating the ERM Department into, the oversight process for the management of the Framework, the personnel overseeing the management of the Framework will no longer be limited to the ICC organization, but instead will have a broad view of how the Framework interacts with and is affected by the ICE, Inc. organization as a whole. This will, among other things, allow ICC to rely on the ERM Department in responding to broad risks that affect ICC as part of the larger ICE, Inc. organization while simultaneously focusing on operational risks unique to ICC.
Taken together, the Commission believes these proposed changes will improve ICC's ability to assess and manage operational risks, including by identifying sources of operational risk and minimizing them through the development of appropriate systems, controls, and procedures, thereby enhancing ICC's ability to promote the prompt and accurate clearance and settlement of securities transactions, assure the safeguarding of securities and funds which are in the custody or control of ICC or for which it is responsible and, in general, protect investors and the public interest. Therefore, the Commission finds that the proposed rule change is designed to promote the prompt and accurate clearance and settlement of securities transactions, assure the safeguarding of securities and funds which are in the custody or control of ICC or for which it is responsible and, in general, protect investors and the public interest, consistent with Section 17A(b)(3)(F) of the Act.
Rule 17Ad-22(d)(4) requires that a registered clearing agency that is not a covered clearing agency establish, implement, maintain and enforce written policies and procedures reasonably designed to identify sources of operational risk and minimize them through the development of appropriate systems, controls, and procedures.
Rule 17Ad-22(d)(8) requires that a registered clearing agency that is not a covered clearing agency establish, implement, maintain and enforce written policies and procedures reasonably designed to have governance arrangements that are clear and transparent to fulfill the public interest requirements in Section 17A of the Act
On the basis of the foregoing, the Commission finds that the proposal is consistent with the requirements of the Act and in particular with the requirements of Section 17A of the Act
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange proposes to amend the rules of the Exchange, at Chapter VIII, Exercises and Deliveries.
The text of the proposed rule change is available on the Exchange's website at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange proposes to correct Chapter VIII, Exercises and Deliveries, Section 1, Exercise of Options Contracts, to clarify the requirements for delivery of a Contrary Exercise Advice. Section 1(b) currently provides that option holders desiring to exercise or not exercise expiring options must either (i) take no action and allow exercise determinations to be made in accordance with the Options Clearing Corporation's Ex-by- Ex procedure where applicable, or (ii) submit a “Contrary Exercise Advice” to the Options Clearing Corporation through the participant's clearing firm. In actual practice, however, an option holder delivers a Contrary Exchange Advice to the Exchange, not to the Options Clearing Corporation. The Exchange therefore proposes to replace the words “Options Clearing Corporation through the participants clearing firm” in Section 1(b)(ii) with a reference to the Exchange and make similar, conforming changes to Section 1(e)(i). As amended, Section 1(b) would be consistent with Nasdaq ISE Rule 1100(b) which directs option holders to submit Contrary Exercise Advices to the Exchange (not to the Options Clearing Corporation).
The Exchange proposes to further replace the words “by the deadline specified in paragraph (d) below” with the words “as specified in paragraph (d) below” given that paragraph (d) contains a number of requirements associated with submission of Contrary Exercise Advices in addition to the deadline. As revised, Section (b)(ii) tracks the language of ISE Rule 1100(b)(ii) which permits an options holder desiring to exercise or not exercise expiring options to “submit a “Contrary Exercise Advice” to the Exchange as specified in paragraph (d) . . . .” (which, like the counterpart BX paragraph (d) rule, specifies various requirements associated with submitting Contrary Exercise Advices).
Finally, the Exchange proposes to make a number of minor nonsubstantive revisions to Chapter VIII which are designed simply to facilitate administration of the rules. References to “BX” and to “BX Regulation” are proposed to be replaced with references to “the Exchange.”
The Exchange believes that its proposal is consistent with Section 6(b) of the Act,
The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. The proposed rule changes will apply equally to all option holders desiring to exercise options under the BX rules. Further, the proposed changes merely correct an incorrect reference to OCC and conform the wording of the rule more closely to that of a Nasdaq ISE rule for the sake of administrative convenience. The Exchange does not
No written comments were either solicited or received.
Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A)(iii) of the Act
At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is: (i) Necessary or appropriate in the public interest; (ii) for the protection of investors; or (iii) otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
U.S. Small Business Administration.
Notice.
This is a Notice of the Presidential declaration of a major disaster for Public Assistance Only for the State of
OHIO (FEMA-4360-DR), dated 04/17/2018.
Issued on 04/17/2018.
Submit completed loan applications to: U.S. Small Business Administration, Processing and Disbursement Center, 14925 Kingsport Road, Fort Worth, TX 76155.
A. Escobar, Office of Disaster Assistance, U.S. Small Business Administration, 409 3rd Street SW, Suite 6050, Washington, DC 20416, (202) 205-6734.
Notice is hereby given that as a result of the President's major disaster declaration on 04/17/2018, Private Non-Profit organizations that provide essential services of a governmental nature may file disaster loan applications at the address listed above or other locally announced locations.
The following areas have been determined to be adversely affected by the disaster:
The Interest Rates are:
The number assigned to this disaster for physical damage is 154956 and for economic injury is 154960.
U.S. Small Business Administration.
Notice.
This is a Notice of the Presidential declaration of a major disaster for Public Assistance Only for the State of WEST VIRGINIA (FEMA-4359-DR), dated 04/17/2018.
Issued on 04/17/2018.
Submit completed loan applications to: U.S. Small Business Administration, Processing and Disbursement Center, 14925 Kingsport Road, Fort Worth, TX 76155.
A. Escobar, Office of Disaster Assistance, U.S. Small Business Administration, 409 3rd Street SW, Suite 6050, Washington, DC 20416, (202) 205-6734.
Notice is hereby given that as a result of the President's major disaster declaration on 04/17/2018, Private Non-Profit organizations that provide essential services of a governmental nature may file disaster loan applications at the address listed above or other locally announced locations.
The following areas have been determined to be adversely affected by the disaster:
The Interest Rates are:
The number assigned to this disaster for physical damage is 154936 and for economic injury is 154940.
U.S. Small Business Administration.
Notice.
This is a Notice of the Presidential declaration of a major disaster for Public Assistance Only for the State of KENTUCKY (FEMA-4358-DR), dated 04/12/2018.
Issued on 04/12/2018.
Submit completed loan applications to: U.S. Small Business Administration, Processing and Disbursement Center, 14925 Kingsport Road, Fort Worth, TX 76155.
A. Escobar, Office of Disaster Assistance, U.S. Small Business Administration, 409 3rd Street SW, Suite 6050, Washington, DC 20416, (202) 205-6734.
Notice is hereby given that as a result of the President's major disaster declaration on 04/12/2018, Private Non-Profit organizations that provide essential services of a governmental nature may file disaster loan applications at the address listed above or other locally announced locations.
The following areas have been determined to be adversely affected by the disaster:
The Interest Rates are:
The number assigned to this disaster for physical damage is 154856 and for economic injury is 154860.
Notice.
Notice is hereby given that the Department of State has imposed statutory debarment under the International Traffic in Arms Regulations (“ITAR”) on persons convicted of violating, or conspiracy to violate, Section 38 of the Arms Export Control Act (AECA).
Debarment imposed as of April 25, 2018.
Jae E. Shin, Acting Chief Compliance and Civil Enforcement, Office of Defense Trade Controls Compliance, Bureau of Political-Military Affairs, Department of State. (202) 632-2107.
Section 38(g)(4) of the AECA, 22 U.S.C. 2778(g)(4), restricts the Department of State from issuing licenses for the export of defense articles or defense services where the applicant, or any party to the export, has been convicted of violating certain statutes, including section 38 of the AECA. The statute permits the President to make certain exceptions on a case-by-case basis. Section 127.7(b) of the ITAR also provides for “statutory debarment” of any person who has been convicted of violating or conspiring to violate the AECA. Under this policy, persons
Statutory debarment is based solely upon conviction in a criminal proceeding, conducted by a United States court, and as such the administrative debarment procedures outlined in Part 128 of the ITAR are not applicable.
It is the policy of the Department of State that statutory debarment lasts for a three year period following conviction. Unless export privileges are reinstated, however, the person remains debarred. Reinstatement is not automatic, and in all cases the debarred person must submit a request for reinstatement to the Department of State and be approved for reinstatement before engaging in any activities subject to this subchapter.
Department of State policy permits debarred persons to apply to the Director, Office of Defense Trade Controls Compliance, for reinstatement beginning one year after the date of the debarment. Any decision to grant reinstatement can be made only after the statutory requirements of Section 38(g)(4) of the AECA have been satisfied.
Certain exceptions, known as transaction exceptions, may be made to this debarment determination on a case-by-case basis. However, such an exception would be granted only after a full review of all circumstances, paying particular attention to the following factors: Whether an exception is warranted by overriding U.S. foreign policy or national security interests; whether an exception would further law enforcement concerns that are consistent with the foreign policy or national security interests of the United States; or whether other compelling circumstances exist that are consistent with the foreign policy or national security interests of the United States, and that do not conflict with law enforcement concerns. Even if exceptions are granted, the debarment continues until subsequent reinstatement.
Pursuant to Section 38(g)(4) of the AECA and Section 127.7(c) of the ITAR, the following persons, having been convicted in a U.S. District Court, are statutorily debarred as of the date of this notice (Name; Date of Judgment; Judicial District; Case No.; Month/Year of Birth):
As noted above, at the end of the three-year period following the date of this notice, the above named persons/entities remain debarred unless export privileges are reinstated.
Debarred persons are generally ineligible to participate in activity regulated under the ITAR (see
This notice is provided for purposes of making the public aware that the persons listed above are prohibited from participating directly or indirectly in activities regulated by the ITAR, including any brokering activities and any export from or temporary import into the United States of defense articles, technical data, or defense services in all situations covered by the ITAR. Specific case information may be obtained from the Office of the Clerk for the U.S. District Courts mentioned above and by citing the court case number where provided.
Notice is hereby given of the following determinations: I hereby determine that certain objects to be included in the exhibition “The Chiaroscuro Woodcut in Renaissance Italy,” imported from abroad for temporary exhibition within the United States, are of cultural significance. The objects are imported pursuant to loan agreements with the foreign owners or custodians. I also determine that the exhibition or display of the exhibit objects at the Los Angeles County Museum of Art, Los Angeles, California, from on or about June 3, 2018, until on or about September 16, 2018, at the National Gallery of Art, Washington, District of Columbia, from on or about October 14, 2018, until on or about January 20, 2019, and at possible additional exhibitions or venues yet to be determined, is in the national interest. I have ordered that Public Notice of these determinations be published in the
Elliot Chiu, Attorney-Adviser, Office of the Legal Adviser, U.S. Department of State (telephone: 202-632-6471; email:
The foregoing determinations were made pursuant to the authority vested in me by the Act of October 19, 1965 (79 Stat. 985; 22 U.S.C. 2459), E.O. 12047 of March 27, 1978, the Foreign Affairs Reform and Restructuring Act of 1998 (112 Stat. 2681,
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 May 25, 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:
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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.
Individuals registering for the Foreign Service Officer Test will complete a Registration Form that consists of an application form. This includes information about their name, date of birth, Social Security Number, contact information, gender, race, national origin, disability status, education, work history, and military experience. The information will be used to prepare and issue admission to the Foreign Service Officer Test, to provide data useful for improving future tests, and to conduct research studies based on the test results.
The registration process, which includes concurrent application submission and seat selection, opens approximately four (4) weeks prior to each testing window. To register, individuals go to
Notice is hereby given of the following determinations: I hereby determine that a certain object to be included in the exhibition “Picture in Focus: Hugo van der Goes or a member of his circle's Virgin and Child with Saint Thomas, John the Baptist, Jerome, and Louis,” imported from abroad for temporary exhibition within the United States, is of cultural significance. The object is imported pursuant to a loan agreement with the foreign owner or custodian. I also determine that the exhibition or display of the exhibit object at The Art Institute of Chicago, in Chicago, Illinois, from on or about May 2, 2018, until on or about April 15, 2021, and at possible additional exhibitions or venues yet to be determined, is in the national interest. I have ordered that Public Notice of these determinations be published in the
Elliot Chiu, Attorney-Adviser, Office of the Legal Adviser, U.S. Department of State (telephone: 202-632-6471; email:
The foregoing determinations were made pursuant to the authority vested in me by the Act of October 19, 1965 (79 Stat. 985; 22 U.S.C. 2459), E.O. 12047 of March 27, 1978, the Foreign Affairs Reform and Restructuring Act of 1998 (112 Stat. 2681,
Notice is hereby given of the following determinations: I hereby determine that certain objects to be included in the exhibition “Art of Iron: Objects from the Musée Le Secq des Tournelles, Rouen, Normandy,” imported from abroad for temporary exhibition within the United States, are of cultural significance. The objects are imported pursuant to a loan agreement with the foreign owner or custodian. I also determine that the exhibition or display of the exhibit objects at The Sterling and Francine Clark Art Institute, Williamstown, Massachusetts, from on or about June 9, 2018, until on or about September 16, 2018, and at possible additional exhibitions or venues yet to be determined, is in the national interest. I have ordered that Public Notice of these determinations be published in the
Elliot Chiu, Attorney-Adviser, Office of the Legal Adviser, U.S. Department of State (telephone: 202-632-6471; email:
The foregoing determinations were made pursuant to the authority vested in me by the Act of October 19, 1965 (79 Stat. 985; 22 U.S.C. 2459), E.O. 12047 of March 27, 1978, the Foreign Affairs Reform and Restructuring Act of 1998 (112 Stat. 2681,
Susquehanna River Basin Commission.
Notice.
This notice lists the approved by rule projects rescinded by the Susquehanna River Basin Commission during the period set forth in
March 1-31, 2018.
Susquehanna River Basin Commission, 4423 North Front Street, Harrisburg, PA 17110-1788.
Jason E. Oyler, General Counsel, telephone: (717) 238-0423, ext. 1312; fax: (717) 238-2436; email:
This notice lists the projects, described below, being rescinded for the consumptive use of water pursuant to the Commission's approval by rule process set forth in 18 CFR 806.22(e) and 806.22(f) for the time period specified above:
1. Pennsylvania General Energy Company, L.L.C., Pad ID: SGL75 PAD C, ABR-201308005, McHenry Township, Lycoming County, Pa.; Rescind Date: March 1, 2018.
2. Pennsylvania General Energy Company, L.L.C., Pad ID: SGL75 PAD D, ABR-201308006, Pine Township, Lycoming County, Pa.; Rescind Date: March 1, 2018.
Pub. L. 91-575, 84 Stat. 1509
Susquehanna River Basin Commission.
Notice.
This notice lists the projects approved by rule by the Susquehanna River Basin Commission during the period set forth in
March 1-31, 2018.
Susquehanna River Basin Commission, 4423 North Front Street, Harrisburg, PA 17110-1788.
Jason E. Oyler, General Counsel, 717-238-0423, ext. 1312,
This notice lists the projects, described below, receiving approval for the consumptive use of water pursuant to the Commission's approval by rule process set forth in 18 CFR 806.22(e) and 806.22 (f) for the time period specified above:
Pub. L. 91-575, 84 Stat. 1509
Susquehanna River Basin Commission.
Notice.
This notice lists the minor modifications approved for a previously approved project by the Susquehanna River Basin Commission during the period set forth in
March 1-31, 2018.
Susquehanna River Basin Commission, 4423 North Front Street, Harrisburg, PA 17110-1788.
Jason E. Oyler, General Counsel, telephone: (717) 238-0423, ext. 1312; fax: (717) 238-2436; email:
This notice lists previously approved projects, receiving approval of minor modifications, described below, pursuant to 18 CFR 806.18 for the time period specified above:
1. Panda Hummel Station LLC, Docket No. 20081222-4, Shamokin Dam Borough and Monroe Township, Snyder County, Pa.; approval to add Shamokin Dam Borough public water supply as an additional source of water for consumptive use; Approval Date: March 1, 2018.
2. Sugar Hollow Water Services LLC (Bowman Creek), Docket No. 20140612-1, Eaton Township, Wyoming County, Pa.; approval to changes in the authorized water uses; Approval Date: March 30, 2018.
3. Sugar Hollow Water Services LLC (Martins Creek), Docket No. 20150304-1, Hop Bottom Borough, Susquehanna County, Pa.; approval to changes in the authorized water uses; Approval Date: March 30, 2018.
4. Sugar Hollow Water Services LLC (Susquehanna River), Docket No. 20151204-1, Eaton Township, Wyoming County, Pa.; approval to changes in the authorized water uses; Approval Date: March 30, 2018.
Pub. L. 91-575, 84 Stat. 1509
Tennessee Valley Authority (TVA).
Renewal of Federal Advisory Committee.
Pursuant to the Federal Advisory Committee Act (FACA), the TVA Board of Directors has renewed the Regional Resource Stewardship Council (RRSC) charter for an additional two-year period beginning on April 27, 2018.
Barbie Perdue, 865-632-6113,
Pursuant to FACA and its implementing regulations, and following consultation with the Committee Management Secretariat, General Services Administration (GSA) in accordance with 41 CFR 102-3.60(a), notice is hereby given that the RRSC has been renewed for a two-year period beginning April 27, 2018. The RRSC will provide advice to TVA on its issues affecting natural resource stewardship activities. The RRSC was originally established in 1999 to advise TVA on its natural resource stewardship activities through balanced and broad range of diverse views and interests. Numerous public and private entities are traditionally involved in the stewardship of the natural resources of the Tennessee Valley region. It has been determined that the RRSC continues to be needed to provide an additional mechanism for public input regarding stewardship issues.
Federal Aviation Administration (FAA), 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 May 15, 2018.
Send comments identified by docket number FAA-2017-0789 using any of the following methods:
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Brent Hart (202) 267-4034, 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 May 15, 2018.
Send comments identified by docket number FAA-2016-9358 using any of the following methods:
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Brenda Robeson, (202) 267-4712, Office of Rulemaking, Federal Aviation Administration, 800 Independence Avenue SW, Washington, DC 20591.
This notice is published pursuant to 14 CFR 11.85.
Federal Highway Administration (FHWA), DOT.
Notice and request for comments.
In compliance with the Paperwork Reduction Act (PRA) of 1995, this notice announces that FHWA will submit the collection of information described below to the Office of Management and Budget (OMB) for review and comment. The
Please submit comments by May 25, 2018.
You may submit comments identified by DOT Docket ID 2018-0028 by any of the following methods:
Mr. Peter Clark, 703-404-6306, Realty Specialist, FHWA-HEPR-10, Federal Highway Administration, Department of Transportation, 1200 New Jersey Ave., Washington DC. Office hours are from 7:30 a.m. to 4:00 p.m., Monday through Friday, except Federal holidays.
Government agencies that acquire real property for a Federal-aid highway program typically consider the cost of many alternatives for a potential project. As a part of this consideration, estimates of the cost of right-of-way needed for potential highway alignments must be determined and documented. Agencies may use several different methods to determine the estimate and document these costs. The methods range from a process using only paper and pencil, all the way to a process utilizing Geographic Information System (GIS) mapping and electronic data capture methods. The electronic methods presumably include an electronic calculation method which tabulates and calculates total costs, area to be acquired, and the numbers of relocations of residential and business property owners and tenants. Utilizing the paper-based method necessarily requires manual collection, organization and calculation which are likely expensive and inefficient, both in terms of dedicated staff time and dollars spent.
The Paperwork Reduction Act of 1995; 44 U.S.C. Chapter 35, as amended; and 49 CFR 1.48.
Federal Transit Administration (FTA), DOT.
Notice of funding opportunity (NOFO).
The Federal Transit Administration (FTA) announces the opportunity to apply for $84,450,000 in competitive grants under the fiscal year (FY) 2018 Low or No Emission Grant Program (Low-No Program; Catalog of Federal Domestic Assistance (CFDA) number: 20.526). In addition to $55 million authorized by federal transit law, the Consolidated Appropriations Act, 2018 authorizes an additional $29,450,000 for the Low-No Program for FY 2018. As required by Federal transit law, funds will be awarded competitively for the purchase or lease of low or no emission vehicles that use advanced technologies for transit revenue operations, including related equipment or facilities. Projects may include costs incidental to the acquisition of buses or to the construction of facilities, such as the costs of related workforce development and training activities, and project administration expenses. FTA may award additional funding that is made available to the program prior to the announcement of project selections.
Complete proposals must be submitted electronically through the
Tara Clark, FTA Office of Program Management, 202-366-2623, or
Section 5339(c) of Title 49, United States Code, as amended by the Fixing America's Surface Transportation (FAST) Act, (Pub. L. 114-94, Dec. 4, 2015), authorizes FTA to award grants for low or no emission buses through a competitive process, as described in this notice. The Low or No Emission Bus Program (Low-No Program) provides funding to State and local governmental authorities for the purchase or lease of zero-emission and low-emission transit buses, including acquisition, construction, and leasing of required supporting facilities such as recharging, refueling, and maintenance facilities. FTA recognizes that a significant transformation is occurring in the transit
Federal transit law authorizes $55 million in FY 2018 for grants under the Low-No Program. The Consolidated Appropriations Act, 2018 authorizes an additional $29,450,000 for the Low-No Program for FY 2018, for a total authorization of $84,450,000. In FY 2017, the program received applications for 129 projects requesting a total of $515 million. Fifty-one projects were funded at a total of $55 million.
FTA will grant pre-award authority starting on the date of project announcement for the FY 2018 awards. Funds are available for obligation until September 30, 2021. Funds are only available for projects that have not incurred costs prior to the announcement of project selections.
Eligible applicants include designated recipients, States, local governmental authorities, and Indian Tribes. Except for projects proposed by Indian Tribes, proposals for funding projects in rural (non-urbanized) areas must be submitted as part of a consolidated State proposal. To be considered eligible, applicants must be able to demonstrate the requisite legal, financial and technical capabilities to receive and administer Federal funds under this program. States and other eligible applicants also may submit consolidated proposals for projects in urbanized areas. Proposals may contain projects to be implemented by the recipient or its eligible subrecipients. Eligible subrecipients are entities that are otherwise eligible recipients under this program.
An eligible recipient may submit an application in partnership with other entities that intend to participate in the implementation of the project, including, but not limited to, specific vehicle manufacturers, equipment vendors, owners or operators of related facilities, or project consultants. If an application that involves such a partnership is selected for funding, the competitive selection process will be deemed to satisfy the requirement for a competitive procurement under 49 U.S.C. 5325(a) for the named entities. Applicants are advised that any changes to the proposed partnership will require advanced FTA written approval, must be consistent with the scope of the approved project, and may necessitate a competitive procurement.
All eligible expenses under the Low-No Program are attributable to compliance with the Clean Air Act. Therefore, under the provisions of 49 U.S.C. 5323(i), the maximum Federal participation in the costs of leasing or acquiring a transit bus financed under the Low-No Program is 85 percent of the total transit bus cost. Further, the maximum Federal participation in the cost of leasing or acquiring low or no emission bus-related equipment and facilities under the Low-No Program, such as recharging or refueling facilities, is 90 percent of the net project cost of the equipment or facilities that are attributable to compliance with the Clean Air Act. FTA may prioritize projects proposed with a higher local share.
Eligible sources of local match include the following: cash from non-Government sources other than revenues from providing public transportation services; revenues derived from the sale of advertising and concessions; amounts received under a service agreement with a State or local social service agency or private social service organization; revenues generated from value capture financing mechanisms; funds from an undistributed cash surplus; replacement or depreciation cash fund or reserve; new capital; or in-kind contributions. In addition, transportation development credits or documentation of in-kind match may substitute for local match if identified in the application.
Under 49 U.S.C. 5339 (c)(1)(B), eligible projects include projects or programs of projects in an eligible area for: (1) Purchasing or leasing low or no emission buses; (2) acquiring low or no emission buses with a leased power source; (3) constructing or leasing facilities and related equipment for low or no emission buses; (4) constructing new public transportation facilities to accommodate low or no emission buses; (5) or rehabilitating or improving existing public transportation facilities to accommodate low or no emission buses. As specified under 49 U.S.C. 5339(c)(5)(A), FTA will only consider eligible projects relating to the acquisition or leasing of low or no emission buses or bus facilities that make greater reductions in energy consumption and harmful emissions than comparable standard buses or other low or no emission buses. As specified under 49 U.S.C. 5339(c)(5)(B), all proposed projects must be part of the intended recipient's long-term integrated fleet management plan.
If a single project proposal involves multiple public transportation providers, such as when an agency acquires vehicles that will be operated by another agency, the proposal must include a detailed statement regarding the role of each public transportation provider in the implementation of the project.
Under 49 U.S.C. 5339(c)(1)(E), a low or no-emission bus is defined as “a passenger vehicle used to provide public transportation that significantly reduces energy consumption or harmful emissions, including direct carbon emissions, when compared to a standard vehicle.” The statutory definition includes zero-emission transit buses, which are defined as buses that produce no direct carbon emissions and no particulate matter emissions under any and all possible operational modes and conditions. Examples of zero emission bus technologies include, but are not limited to, hydrogen fuel-cell buses and battery-electric buses. All new transit bus models procured with funds awarded under the Low-No Program must complete FTA bus testing for production transit buses pursuant to 49 U.S.C. 5318. All transit vehicles must be procured from certified transit vehicle manufacturers in accordance with the Disadvantaged Business Enterprise (DBE) regulations at 49 CFR part 26. The development or deployment of prototype vehicles is not eligible for funding under the Low-No program.
Recipients are permitted to use up to 0.5 percent of their requested grant award for workforce development activities eligible under 49 U.S.C 5314(b) and an additional 0.5 percent for costs associated with training at the National Transit Institute. Applicants must identify the proposed use of funds for these activities in the project proposal and identify them separately in the project budget.
Applications must be submitted electronically through
A complete proposal submission consists of two forms: (1) The SF424 Application for Federal Assistance; and (2) the supplemental form for the FY 2018 Low-No Program. The supplemental form and any supporting documents must be attached to the “Attachments” section of the SF-424. The application must include responses to all sections of the SF424 Application for Federal Assistance and the supplemental form, unless indicated as optional. The information on the supplemental form will be used to determine applicant and project eligibility for the program, and to evaluate the proposal against the selection criteria described in part E of this notice.
FTA will accept only one supplemental form per SF-424 submission. FTA encourages States and other applicants to consider submitting a single supplemental form that includes multiple activities to be evaluated as a consolidated proposal. If a State or other applicant chooses to submit separate proposals for individual consideration by FTA, each proposal must be submitted using a separate SF-424 and supplemental form. Applicants may attach additional supporting information to the SF-424 submission, including but not limited to letters of support, project budgets, fleet status reports, or excerpts from relevant planning documents. Any supporting documentation must be described and referenced by file name in the appropriate response section of the supplemental form, or it may not be reviewed.
Information such as proposer name, Federal amount requested, local match amount, description of areas served, etc. may be requested in varying degrees of detail on both the SF424 and Supplemental Form. Proposers must fill in all fields unless stated otherwise on the forms. If information is copied into the supplemental form from another source, applicants should verify that pasted text is fully captured on the supplemental form and has not been truncated by the character limits built into the form. Proposers should use both the “Check Package for Errors” and the “Validate Form” validation buttons on both forms to check all required fields on the forms, and ensure that the federal and local amounts specified are consistent.
The SF424 Application for Federal Assistance and the Supplemental Form will prompt applicants for the required information, including:
Each applicant is required to: (1) Be registered in SAM before submitting an application; (2) provide a valid unique entity identifier in its application; and (3) continue to maintain an active SAM registration with current information at all times during which the applicant has an active Federal award or an application or plan under consideration by FTA. These requirements do not apply if the applicant: (1) Is an individual; (2) is excepted from the requirements under 2 CFR 25.110(b) or (c); or (3) has an exception approved by FTA under 2 CFR 25.110(d). FTA may not make an award until the applicant has complied with all applicable unique entity identifier and SAM requirements. If an applicant has not fully complied with the requirements by the time FTA is ready to make an award, FTA may determine that the applicant is not qualified to receive an award and use that determination as a basis for making a Federal award to another applicant. All applicants must provide a unique entity identifier provided by SAM. Registration in SAM may take as little as 3-5 business days, but since there could be unexpected steps or delays (for example, if you need to obtain an Employer Identification Number), FTA recommends allowing ample time, up to several weeks, for completion of all steps. For additional information on obtaining a unique entity identifier, please visit
Project proposals must be submitted electronically through
Within 48 hours after submitting an electronic application, the applicant should receive two email messages from
FTA urges proposers to submit applications at least 72 hours prior to the due date to allow time to receive the validation messages and to correct any problems that may have caused a rejection notification.
Proposers are encouraged to begin the process of registration on the
Funds under this NOFO cannot be used to reimburse applicants for otherwise eligible expenses incurred prior to FTA award of a Grant Agreement until FTA has issued pre-award authority for selected projects.
Applicants are encouraged to identify scaled funding options in case insufficient funding is available to fund a project at the full requested amount. If an applicant indicates that a project is scalable, the applicant must provide an appropriate minimum funding amount that will fund an eligible project that achieves the objectives of the program and meets all relevant program requirements. The applicant must provide a clear explanation of how the project budget would be affected by a reduced award. FTA may award a lesser amount whether a scalable option is provided.
Projects will be evaluated primarily on the responses provided in the supplemental form. Additional information may be provided to support the responses; however, any additional documentation must be directly referenced on the supplemental form, including the file name where the additional information can be found. FTA will evaluate proposals for the Low-No Program based on the criteria described in this notice.
Since the purpose of this program is to fund vehicles and facilities, applications will be evaluated based on the quality and extent to which they demonstrate how the proposed project will address an unmet need for capital investment in vehicles and/or supporting facilities. For example, an applicant may demonstrate that it requires additional or improved charging or maintenance facilities for low or no emission vehicles, that it intends to replace existing vehicles that have exceeded their minimum useful life, or that it requires additional vehicles to meet current ridership demands. FTA will consider an applicant's responses to the following criteria when assessing need for capital investment underlying the proposed project:
Applicants must demonstrate how the proposed project will support statutory requirements of 49 U.S.C 5339(c)(5)(A). In particular, FTA will consider the quality and extent to which applications demonstrate how the proposed project will: (1) Reduce Energy Consumption; (2) Reduce Harmful Emissions; and (3) Reduce Direct Carbon Emissions.
Applicants must demonstrate how the proposed project is consistent with local and regional long range planning documents and local government priorities. FTA will evaluate applications based on the quality and extent to which they assess whether the project is consistent with the transit priorities identified in the long range plan; and/or contingency/illustrative projects included in that plan; or the locally developed human services public transportation coordinated plan. Applicants are not required to submit copies of such plans, but FTA will consider how the project will support regional goals and applicants may submit support letters from local and regional planning organizations attesting to the consistency of the proposed project with these plans.
Evidence of additional local or regional prioritization may include letters of support for the project from local government officials, public agencies, and non-profit or private sector partners.
Applicants must identify the source of the local cost share and describe whether such funds are currently available for the project or will need to be secured if the project is selected for funding. FTA will consider the availability of the local cost share as evidence of local financial commitment to the project. Applicants should submit evidence of the availability of funds for the project, for example by including a
FTA will rate projects higher if grant funds can be obligated within 12 months of selection and the project can be implemented within a reasonable time frame. In assessing when funds can be obligated FTA will consider whether the project qualifies for a Categorical Exclusion (CE), or whether the required environmental work has been initiated or completed for projects that require an Environmental Assessment (EA) or Environmental Impact Statement (EIS) under the National Environmental Policy Act of 1969 (NEPA), as amended. The proposal must state when grant funds can be obligated and indicate the timeframe under which the Metropolitan Transportation Improvement Program (TIP) and/or Statewide Transportation Improvement Program (STIP) can be amended to include the proposed project.
In assessing whether the proposed implementation plans are reasonable and complete, FTA will review the proposed project implementation plan, including all necessary project milestones and the overall project timeline. For projects that will require formal coordination, approvals or permits from other agencies or project partners, the applicant must demonstrate coordination with these organizations and their support for the project, such as through letters of support.
For project proposals that involve a partnership with a manufacturer, vendor, consultant, or other third party, applicants must identify by name any project partners, including but not limited to other transit agencies, bus manufacturers, owners or operators of related facilities, or any expert consultants. FTA will evaluate the experience and capacity of the named project partners to successfully implement the proposed project based on the partners' experience and qualifications. Applicants are advised to submit information on the partners' qualification and experience as a part of the application. Entities involved in the project that are not named in the application will be required to be selected through a competitive procurement.
For project proposals that will require a competitive procurement, applicants must demonstrate familiarity with the current market availability of the proposed advanced vehicle propulsion technology.
Applicants must demonstrate that they have the technical, legal and financial capacity to undertake the project. FTA will review relevant oversight assessments and records to determine whether there are any outstanding legal, technical, or financial issues with the applicant that would affect the outcome of the proposed project.
In addition to other FTA staff that may review the proposals, a technical evaluation committee will evaluate proposals based on the published evaluation criteria. Members of the technical evaluation committee and other FTA staff may request additional information from applicants, if necessary. Based on the findings of the technical evaluation committee, the FTA Administrator will determine the final selection of projects for program funding. FTA may consider geographic diversity, diversity in the size of the transit systems receiving funding, and/or the applicant's receipt of other competitive awards in determining the allocation of program funds. FTA may consider capping the amount a single applicant may receive and prioritizing investments in rural areas. Projects that have a higher local financial commitment may also be prioritized.
After applying the above preferences, the FTA Administrator will consider the following key Departmental objectives:
(A) Supporting economic vitality at the national and regional level;
(B) Utilizing alternative funding sources and innovative financing models to attract non-Federal sources of infrastructure investment;
(C) Accounting for the life-cycle costs of the project to promote the state of good repair;
(D) Using innovative approaches to improve safety and expedite project delivery; and,
(E) Holding grant recipients accountable for their performance and achieving specific, measurable outcomes identified by grant applicants.
Prior to making an award, FTA is required to review and consider any information about the applicant that is in the designated integrity and performance system accessible through SAM (currently FAPIIS). An applicant, at its option, may review information in the designated integrity and performance systems accessible through SAM and comment on any information about itself that a Federal awarding agency previously entered and is currently in the designated integrity and performance system accessible through SAM. FTA will consider any comments by the applicant, in addition to the other information in the designated integrity and performance system, in making a judgment about the applicant's integrity, business ethics, and record of performance under Federal awards when completing the review of risk posed by applicants as described in the 2 CFR 200.205 Federal awarding agency review of risk posed by applicants.
The FTA Administrator will announce the final project selections on the FTA website. Recipients should contact their FTA Regional Offices for additional information regarding allocations for projects under the Low-No Program. At the time the project selections are announced, FTA will extend pre-award authority for the selected projects. There is no blanket pre-award authority for these projects before announcement.
Funds under the Low-No Program are available to States, designated recipients, local governmental authorities and Indian Tribes. There is no minimum or maximum grant award amount; however, FTA intends to fund as many meritorious projects as possible. Only proposals from eligible recipients for eligible activities will be considered for funding. Due to funding limitations, proposers that are selected for funding may receive less than the amount originally requested. In those cases, applicants must be able to demonstrate that the proposed projects are still viable and can be completed with the amount awarded.
FTA will issue specific guidance to recipients regarding pre-award authority at the time of selection. FTA does not provide pre-award authority for discretionary funds until projects are selected, and even then there are Federal requirements that must be met before costs are incurred. For more information about FTA's policy on pre-award authority, please see the FY 2017 Apportionment Notice published on January 19, 2017.
If selected, awardees will apply for a grant through FTA's Transit Award Management System (TrAMS). All Low-No Emission recipients are subject to the grant requirements of Section 5307 Urbanized Area Formula Grant program, including those of FTA Circular 9030.1E. All recipients must follow the Grants Management Requirements of FTA Circular 5010.1 and the labor protections of 49 U.S.C. 5333(b). Technical assistance regarding these requirements is available from each FTA regional office.
FTA requires that all capital procurements meet FTA's Buy America requirements, which require that all iron, steel, or manufactured products be produced in the U.S. These requirements help create and protect manufacturing jobs in the U.S. The Low-No Program will have a significant economic impact on meeting the objectives of the Buy America law. Federal transit law amended the Buy America requirements to provide for a phased increase in the domestic content for rolling stock. For FY 2018 and FY 2019, the cost of components and subcomponents produced in the United States must be more than 65 percent of the cost of all components. For FY 2020 and beyond, the cost of components and subcomponents produced in the United States must be more than 70 percent of the cost of all components. There is no change to the requirement that final assembly of rolling stock must occur in the United States. FTA issued guidance on the implementation of the phased increase in domestic content on September 1, 2016. A copy of the policy guidance may be found in 81
FTA requires that its recipients receiving planning, capital and/or operating assistance that will award prime contracts exceeding $250,000 in FTA funds in a Federal fiscal year comply with the Disadvantaged Business Enterprise (DBE) program regulations at 49 CFR part 26. Applicants should expect to include any funds awarded, excluding those to be used for vehicle procurements, in setting their overall DBE goal. Note, however, that projects including vehicle procurements remain subject to the DBE program regulations. The rule requires that, prior to bidding on any FTA-assisted vehicle procurement, entities that manufacture vehicles, perform post-production alterations or retrofitting must submit a DBE Program plan and goal methodology to FTA. Further, to the extent that a vehicle remanufacturer is responding to a solicitation for new or remanufactured vehicles with a vehicle to which the remanufacturer has provided post-production alterations or retro-fitting (
The FTA will then issue a transit vehicle manufacturer (TVM) concurrence/certification letter. Grant recipients must verify each entity's compliance with these requirements before accepting its bid. A list of compliant, certified TVMs is posted on FTA's web page at
FTA encourages proposers to notify the appropriate State Departments of Transportation and MPOs in areas likely to be served by the project funds made available under these initiatives and programs. Selected projects must be incorporated into the long-range plans and transportation improvement programs of States and metropolitan areas before they are eligible for FTA funding. As described under the evaluation criteria, FTA may consider whether a project is consistent with or already included in these plans when evaluating a project.
The applicant assures that it will comply with all applicable Federal statutes, regulations, executive orders, directives, FTA circulars, and other Federal administrative requirements in carrying out any project supported by the FTA grant. The applicant acknowledges that it is under a continuing obligation to comply with the terms and conditions of the grant agreement issued for its project with FTA. The applicant understands that Federal laws, regulations, policies, and administrative practices might be modified from time to time and may affect the implementation of the project. The applicant agrees that the most recent Federal requirements will apply to the project, unless FTA issues a written determination otherwise. The applicant must submit the Certifications and Assurances before receiving a grant if it does not have current certifications on file.
Post-award reporting requirements include the electronic submission of Federal Financial Reports and Milestone Progress Reports in FTA's electronic grants management system.
This program is not subject to Executive Order 12372, “Intergovernmental Review of Federal Programs.” FTA will consider applications for funding only from eligible recipients for eligible projects listed in Section C. Complete applications must be submitted through
For further information concerning this notice, please contact the Low-No Program manager Tara Clark by phone at 202-366-2623, or by email at
Pipeline and Hazardous Materials Safety Administration (PHMSA), DOT.
Notice of public meeting.
This notice is designed to inform the interested public that the Office of Hazardous Materials Safety (OHMS) of the Pipeline and Hazardous Materials Safety Administration (PHMSA) will hold a public Research and Development Forum that will be held May 16 and 17, 2018, in Washington, DC. OHMS will host the forum to present the results of recently completed projects, brief new project plans with stakeholder input, and discuss the direction of current and future research projects.
During the meeting, OHMS will solicit comments related to new research topics that may be considered for inclusion in its future work. OHMS also reviews research needs statements from industry, academia, and other stakeholders. OHMS is particularly interested in the research gaps associated with energetic materials characterization and transport, safe transport of energy products, safe containment and transportation of compressed gasses, safe packaging and transportation of charge storage devices, and others. One focus will be a discussion on the safety gaps recently identified in a 2017 cooperative research report completed by the National Academy of Sciences titled “
May 16 and 17, 2018 from 8:30 a.m. to 4:30 p.m. Eastern Standard Time on both days.
The meeting will be held at the National Transportation Safety Board Boardroom and Conference Center at 420 10th Street SW, Washington, DC 20594.
Conference call-in and “live meeting” capability will be provided. Specific information about conference call-in and live meeting access will be posted, when available, at:
Eva Rodezno or Rick Boyle, Office of Hazardous Materials Safety, Research and Development, Pipeline and Hazardous Materials Safety Administration, U.S. Department of Transportation, Washington, DC. Telephone: (202) 366-8799 and (202) 366-2993. Email:
Office of the Comptroller of the Currency (OCC), Treasury.
Notice and request for comment.
The OCC, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other federal agencies to take this opportunity to comment on a continuing information collection as required by the Paperwork Reduction Act of 1995 (PRA).
In accordance with the requirements of the PRA, the OCC may not conduct or sponsor, and the respondent is not required to respond to, an information collection unless it displays a currently valid Office of Management and Budget (OMB) control number. The OCC is soliciting comment concerning the renewal of its information collection titled “Credit Risk Retention.” The OCC also is giving notice that it has sent the collection to OMB for review.
You should submit written comments by May 25, 2018.
Commenters are encouraged to submit comments by email, if possible. You may submit comments by any of the following methods:
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Additionally, please send a copy of your comments by mail to: OCC Desk
You may review comments and other related materials that pertain to this information collection
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• For assistance in navigating
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OCC Clearance Officer, (202) 649-5490 or, for persons who are deaf or hearing impaired, TTY, (202) 649-5597, Legislative and Regulatory Activities Division, Office of the Comptroller of the Currency, 400 7th Street SW, Suite 3E-218, Washington, DC 20219.
Under the PRA (44 U.S.C. 3501-3520), federal agencies must obtain approval from the OMB for each collection of information that they conduct or sponsor. “Collection of information” is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3(c) to include agency requests or requirements that members of the public submit reports, keep records, or provide information to a third party. The OCC is asking OMB to extend its approval of the following information collection.
Part 43 sets forth permissible forms of risk retention for securitizations that involve issuance of asset-backed securities. Section 15G of the Exchange Act also exempts certain types of securitization transactions from these risk retention requirements and authorizes the agencies to exempt or establish a lower risk retention requirement for other types of securitization transactions. Section 15G also states that the agencies must permit a securitizer to retain less than five percent of the credit risk of commercial mortgages, commercial loans, and automobile loans that are transferred, sold, or conveyed through the issuance of ABS by the securitizer if the loans meet underwriting standards established by the federal banking agencies.
Part 43 sets forth permissible forms of risk retention for securitizations that involve issuance of asset-backed securities, as well as exemptions from the risk retention requirements, and contains requirements subject to the PRA.
Section 43.4 sets forth the conditions that must be met by sponsors electing to use the standard risk retention option, which may consist of an eligible vertical interest or an eligible horizontal residual interest, or any combination thereof. Sections 43.4(c)(1) and 43.4(c)(2) specify the disclosures required with respect to eligible horizontal residual interests and eligible vertical interests, respectively.
A sponsor retaining any eligible horizontal residual interest (or funding a horizontal cash reserve account) is required to disclose: The fair value (or a range of fair values and the method used to determine such range) of the eligible horizontal residual interest that the sponsor expects to retain at the closing of the securitization transaction (§ 43.4(c)(1)(i)(A)); the material terms of the eligible horizontal residual interest (§ 43.4(c)(1)(i)(B)); the methodology used to calculate the fair value (or range of fair values) of all classes of ABS interests (§ 43.4(c)(1)(i)(C)); the key inputs and assumptions used in measuring the estimated total fair value (or range of fair values) of all classes of ABS interests (§ 43.4(c)(1)(i)(D)); the reference data set or other historical information used to develop the key inputs and assumptions (§ 43.4(c)(1)(i)(G)); the fair value of the eligible horizontal residual interest retained by the sponsor (§ 43.4(c)(1)(ii)(A)); the fair value of the eligible horizontal residual interest required to be retained by the sponsor (§ 43.4(c)(1)(ii)(B)); a description of any material differences between the methodology used in calculating the fair value disclosed prior to sale and the methodology used to calculate the fair value at the time of closing (§ 43.4(c)(1)(ii)(C)); and the amount placed by the sponsor in the horizontal cash reserve account at closing, the fair value of the eligible horizontal residual interest that the sponsor is required to fund through such account, and a description of such account (§ 43.4(c)(1)(iii)).
For eligible vertical interests, the sponsor is required to disclose: The form of the eligible vertical interest (§ 43.4(c)(2)(i)(A)); the percentage that the sponsor is required to retain (§ 43.4(c)(2)(i)(B)); a description of the material terms of the vertical interest and the amount the sponsor expects to retain at closing(§ 43.4(c)(2)(i)(C)); and the amount of vertical interest retained by the sponsor at closing ((§ 43.4(c)(2)(ii)).
Section 43.4(d) requires a sponsor to retain the certifications and disclosures required in paragraphs (a) and (c) of this section in its records and must provide the disclosures upon request to the SEC and the sponsor's appropriate federal
Section 43.5(k) requires sponsors relying on the master trust (or revolving pool securitization) risk retention option to disclose: The material terms of the seller's interest and the percentage of the seller's interest that the sponsor expects to retain at the closing of the transaction (§ 43.5(k)(1)(i)); the percentage of the seller's interest that the sponsor retained at closing (§ 43.5(k)(1)(ii)); the material terms of any horizontal risk retention offsetting the seller's interest under § 43.5(g), § 43.5(h) and § 43.5(i) (§ 43.5(k)(1)(iii)); and the fair value of any horizontal risk retention retained by the sponsor (§ 43.5(k)(1)(iv)). Additionally, a sponsor must retain the disclosures required in § 43.5(k)(1) in its records and must provide the disclosures upon request to the SEC and the sponsor's appropriate federal banking agency, if any, until three years after all ABS interests are no longer outstanding (§ 43.5(k)(3)).
Section 43.6 addresses the requirements for sponsors utilizing the eligible ABCP conduit risk retention option. The requirements for the eligible ABCP conduit risk retention option include disclosure to each purchaser of ABCP and periodically to each holder of commercial paper issued by the ABCP conduit of the name and form of organization of the regulated liquidity provider that provides liquidity coverage to the eligible ABCP conduit, including a description of the material terms of such liquidity coverage, and notice of any failure to fund; and with respect to each ABS interest held by the ABCP conduit, the asset class or brief description of the underlying securitized assets, the standard industrial category code for each originator-seller that retains an interest in the securitization transaction, and a description of the percentage amount and form of interest retained by each originator-seller (§ 43.6(d)(1)). An ABCP conduit sponsor relying upon this section shall provide, upon request, to the SEC and the sponsor's appropriate Federal banking agency, if any, the information required under § 43.6(d)(1) in addition to the name and form of organization of each originator-seller that retains an interest in the securitization transaction (§ 43.6(d)(2)).
A sponsor relying on the eligible ABCP conduit risk retention option shall maintain and adhere to policies and procedures to monitor compliance by each originator-seller which is satisfying a risk retention obligation in respect to ABS interests acquired by an eligible ABCP conduit (§ 43.6(f)(2)(i)). If the ABCP conduit sponsor determines that an originator-seller is no longer in compliance, the sponsor must promptly notify the holders of the ABCP, and upon request, the SEC and the sponsor's appropriate federal banking agency, in writing of the name and form of organization of any originator-seller that fails to retain, and the amount of ABS interests issued by an intermediate SPV of such originator-seller and held by the ABCP conduit (§ 43.6(f)(2)(ii)(A)(1)); the name and form of organization of any originator-seller that hedges, directly or indirectly through an intermediate SPV, its risk retention in violation of the rule, and the amount of ABS interests issued by an intermediate SPV of such originator-seller and held by the ABCP conduit (§ 43.6(f)(2)(ii)(A)(2)); and any remedial actions taken by the ABCP conduit sponsor or other party with respect to such ABS interests (§ 43.6(f)(2)(ii)(A)(3)).
Section 43.7 sets forth the requirements for sponsors relying on the commercial mortgage-backed securities risk retention option, and includes disclosures of: The name and form of organization of each initial third-party purchaser (§ 43.7(b)(7)(i)); each initial third-party purchaser's experience in investing in commercial mortgage-backed securities (§ 43.7(b)(7)(ii)); other material information (§ 43.7(b)(7)(iii)); the fair value and purchase price of the eligible horizontal residual interest retained by each third-party purchaser, and the fair value of the eligible horizontal residual interest that the sponsor would have retained if the sponsor had relied on retaining an eligible horizontal residual interest under the standard risk retention option (§ 43.7(b)(7)(iv) and (v)); a description of the material terms of the eligible horizontal residual interest retained by each initial third-party purchaser, including the same information as is required to be disclosed by sponsors retaining horizontal interests pursuant to § 43.4 (§ 43.7(b)(7)(vi)); the material terms of the applicable transaction documents with respect to the Operating Advisor (§ 43.7(b)(7)(vii)); and representations and warranties concerning the securitized assets, a schedule of any securitized assets that are determined not to comply with such representations and warranties, and the factors used to determine that such securitized assets should be included in the pool notwithstanding that they did not comply with the representations and warranties (§ 43.7(b)(7)(viii)). A sponsor relying on the commercial mortgage-backed securities risk retention option is also required to provide in the underlying securitization transaction documents certain provisions related to the Operating Advisor (§ 43.7(b)(6)), to maintain and adhere to policies and procedures to monitor compliance by third-party purchasers with regulatory requirements (§ 43.7(c)(2)(A)), and to notify the holders of the ABS interests in the event of noncompliance by a third-party purchaser with such regulatory requirements (§ 43.7(c)(2)(B)).
Section 43.8 requires that a sponsor relying on the Federal National Mortgage Association and Federal Home Loan Mortgage Corporation risk retention option must disclose a description of the manner in which it has met the credit risk retention requirements (§ 43.8(c)).
Section 43.9 sets forth the requirements for sponsors relying on the open market CLO risk retention option, and includes disclosures of a complete list of, and certain information related to, every asset held by an open market CLO (§ 43.9(d)(1)), and the full legal name and form of organization of the CLO manager (§ 43.9(d)(2)).
Section 43.10 sets forth the requirements for sponsors relying on the qualified tender option bond risk retention option, and includes disclosures of the name and form of organization of the qualified tender option bond entity, a description of the form and subordination features of the retained interest in accordance with the disclosure obligations in § 43.4(d), the fair value of any portion of the retained interest that is claimed by the sponsor as an eligible horizontal residual interest, and the percentage of ABS interests issued that is represented by any portion of the retained interest that is claimed by the sponsor as an eligible vertical interest (§ 43.10(e)(1)-(4)). In addition, to the extent any portion of the retained interest claimed by the sponsor is a municipal security held outside of the qualified tender option bond entity, the sponsor must disclose the name and form of organization of the qualified tender option bond entity, the identity of the issuer of the municipal securities, the face value of the municipal securities deposited into the qualified tender option bond entity, and the face value of the municipal securities retained outside of the qualified tender option bond entity by the sponsor or its majority-owned affiliates (§ 43.10(e)(5)).
Section 43.11 sets forth the conditions that apply when the sponsor of a securitization allocates to originators of securitized assets a portion of the credit risk the sponsor is required to retain, including disclosure of the name and form of organization of any originator
Sections 43.13 and 43.19(g) provide exemptions from the risk retention requirements for qualified residential mortgages and qualifying 3-to-4 unit residential mortgage loans that meet certain specified criteria, including that the depositor with respect to the securitization transaction certify that it has evaluated the effectiveness of its internal supervisory controls and concluded that the controls are effective (§§ 43.13(b)(4)(i) and 43.19(g)(2)), and that the sponsor provide a copy of the certification to potential investors prior to sale of asset-backed securities in the issuing entity (§§ 43.13(b)(4)(iii) and 43.19(g)(2)). In addition, §§ 43.13(c)(3) and 43.19(g)(3) provide that a sponsor that has relied upon the exemptions will not lose the exemptions if, after closing of the transaction, it is determined that one or more of the residential mortgage loans does not meet all of the criteria; provided that the depositor complies with certain specified requirements, including prompt notice to the holders of the asset-backed securities of any loan that is required to be repurchased by the sponsor, the amount of such repurchased loan, and the cause for such repurchase.
Section 43.15 provides exemptions from the risk retention requirements for qualifying commercial loans that meet the criteria specified in § 43.16, qualifying CRE loans that meet the criteria specified in § 43.17, and qualifying automobile loans that meet the criteria specified in § 43.18. Section 43.15 also requires the sponsor to disclose a description of the manner in which the sponsor determined the aggregate risk retention requirement for the securitization transaction after including qualifying commercial loans, qualifying CRE loans, or qualifying automobile loans with 0 percent risk retention (§ 43.15(a)(4)). In addition, the sponsor is required to disclose descriptions of the qualifying commercial loans, qualifying CRE loans, and qualifying automobile loans (“qualifying assets”), and descriptions of the assets that are not qualifying assets, and the material differences between the group of qualifying assets and the group of assets that are not qualifying assets with respect to the composition of each group's loan balances, loan terms, interest rates, borrower credit information, and characteristics of any loan collateral (§ 43.15(b)(3)). Additionally, a sponsor must retain the disclosures required in §§ 43.15(a) and (b) in its records and must provide the disclosures upon request to the SEC and the sponsor's appropriate federal banking agency, if any, until three years after all ABS interests are no longer outstanding (§ 43.15(d)).
Sections 43.16, 43.17 and 43.18 each require that: the depositor of the asset-backed security certify that it has evaluated the effectiveness of its internal supervisory controls and concluded that its internal supervisory controls are effective (§§ 43.16(a)(8)(i), 43.17(a)(10)(i), and 43.18(a)(8)(i)); the sponsor is required to provide a copy of the certification to potential investors prior to the sale of asset-backed securities in the issuing entity (§§ 43.16(a)(8)(iii), 43.17(a)(10)(iii), and 43.18(a)(8)(iii)); and the sponsor must promptly notify the holders of the asset-backed securities of any loan included in the transaction that is required to be cured or repurchased by the sponsor, including the principal amount of such loan and the cause for such cure or repurchase (§§ 43.16(b)(3), 43.17(b)(3), and 43.18(b)(3)). Additionally, a sponsor must retain the disclosures required in §§ 43.16(a)(8), 43.17(a)(10) and 43.18(a)(8) in its records and must provide the disclosures upon request to the SEC and the sponsor's appropriate Federal banking agency, if any, until three years after all ABS interests are no longer outstanding (§ 43.15(d)).
The OCC issued a notice for 60 days of comment regarding this collection on January 29, 2018, 83 FR 4121. No comments were received. Comments continue to be invited on:
(a) Whether the collection of information is necessary for the proper performance of the functions of the OCC, including whether the information has practical utility;
(b) The accuracy of the OCC's estimate of the information collection burden;
(c) Ways to enhance the quality, utility, and clarity of the information to be collected;
(d) Ways to minimize the burden of the collection on respondents, including through the use of automated collection techniques or other forms of information technology; and
(e) Estimates of capital or start-up costs and costs of operation, maintenance, and purchase of services to provide information.
Department of the Treasury.
Notice of availability; Request for comments.
The Board of Trustees of the Sheet Metal Workers Local Pension Plan, a multiemployer pension plan, has submitted an application to reduce benefits under the plan in accordance with the Multiemployer Pension Reform Act of 2014 (MPRA). The purpose of this notice is to announce that the application submitted by the Board of Trustees of the Sheet Metal Workers Local Pension Plan has been published on the website of the Department of the Treasury (Treasury), and to request public comments on the application from interested parties, including participants and beneficiaries, employee organizations, and contributing employers of the Sheet Metal Workers Local Pension Plan.
Comments must be received by June 11, 2018.
You may submit comments electronically through the Federal eRulemaking Portal at
Comments may also be mailed to the Department of the Treasury, MPRA Office, 1500 Pennsylvania Avenue NW, Room 1224, Washington, DC 20220, Attn: Eric Berger. Comments sent via facsimile and email will not be accepted.
For information regarding the application from the Sheet Metal Workers Local Pension Plan, please contact Treasury at (202) 622-1534 (not a toll-free number).
MPRA amended the Internal Revenue Code to permit a multiemployer plan that is projected to have insufficient funds to reduce pension benefits payable to participants and beneficiaries if certain conditions are satisfied. In order to reduce benefits, the plan sponsor is required to submit an application to the Secretary of the Treasury, which must be approved or denied in consultation with the Pension Benefit Guaranty Corporation (PBGC) and the Department of Labor.
On March 30, 2018, the Board of Trustees of the Sheet Metal Workers Local Pension Plan submitted an application for approval to reduce benefits under the plan. As required by MPRA, that application has been published on Treasury's website at
Comments are requested from interested parties, including participants and beneficiaries, employee organizations, and contributing employers of the Sheet Metal Workers Local Pension Plan. Consideration will be given to any comments that are timely received by Treasury.
Department of the Treasury.
Notice of availability; Request for comments.
The Board of Trustees of the Plasterers Local 82 Pension Fund, a multiemployer pension plan, has submitted an application to reduce benefits under the plan in accordance with the Multiemployer Pension Reform Act of 2014 (MPRA). The purpose of this notice is to announce that the application submitted by the Board of Trustees of the Plasterers Local 82 Pension Fund has been published on the website of the Department of the Treasury (Treasury), and to request public comments on the application from interested parties, including participants and beneficiaries, employee organizations, and contributing employers of the Plasterers Local 82 Pension Fund.
Comments must be received by June 11, 2018.
You may submit comments electronically through the Federal eRulemaking Portal at
Comments may also be mailed to the Department of the Treasury, MPRA Office, 1500 Pennsylvania Avenue NW, Room 1224, Washington, DC 20220, Attn: Eric Berger. Comments sent via facsimile and email will not be accepted.
For information regarding the application from the Plasterers Local 82 Pension Fund, please contact Treasury at (202) 622-1534 (not a toll-free number).
MPRA amended the Internal Revenue Code to permit a multiemployer plan that is projected to have insufficient funds to reduce pension benefits payable to participants and beneficiaries if certain conditions are satisfied. In order to reduce benefits, the plan sponsor is required to submit an application to the Secretary of the Treasury, which must be approved or denied in consultation with the Pension Benefit Guaranty Corporation (PBGC) and the Department of Labor.
On March 28, 2018, the Board of Trustees of the Plasterers Local 82 Pension Fund submitted an application for approval to reduce benefits under the plan. As required by MPRA, that application has been published on Treasury's website at
Comments are requested from interested parties, including participants and beneficiaries, employee organizations, and contributing employers of the Plasterers Local 82 Pension Fund. Consideration will be given to any comments that are timely received by Treasury.
Department of the Treasury.
Notice of availability; Request for comments.
The Board of Trustees of the Sheet Metal Workers Local Pension Plan, a multiemployer pension plan, has submitted an application to reduce benefits under the plan in accordance with the Multiemployer Pension Reform Act of 2014 (MPRA). The purpose of this notice is to announce that the application submitted by the Board of Trustees of the Sheet Metal Workers Local Pension Plan has been published on the website of the Department of the Treasury (Treasury), and to request public comments on the application from interested parties, including participants and beneficiaries, employee organizations, and contributing employers of the Sheet Metal Workers Local Pension Plan.
Comments must be received by June 11, 2018.
You may submit comments electronically through the Federal eRulemaking Portal at
Comments may also be mailed to the Department of the Treasury, MPRA Office, 1500 Pennsylvania Avenue NW, Room 1224, Washington, DC 20220, Attn: Eric Berger. Comments sent via facsimile and email will not be accepted.
Additional Instructions. All comments received, including attachments and other supporting materials, will be made available to the public. Do not include any personally identifiable information (such as your Social Security number, name, address, or other contact information) or any other information in your comment or supporting materials that you do not want publicly disclosed. Treasury will make comments available for public inspection and copying on
For information regarding the application from the Sheet Metal Workers Local Pension Plan, please contact Treasury at (202) 622-1534 (not a toll-free number).
MPRA amended the Internal Revenue Code to permit a multiemployer plan that is projected to have insufficient funds to reduce pension benefits payable to participants and beneficiaries if certain conditions are satisfied. In order to reduce benefits, the plan sponsor is required to submit an application to the Secretary of the Treasury, which must be approved or denied in consultation with the Pension Benefit Guaranty Corporation (PBGC) and the Department of Labor.
On March 30, 2018, the Board of Trustees of the Sheet Metal Workers Local Pension Plan submitted an application for approval to reduce benefits under the plan. As required by MPRA, that application has been published on Treasury's website at
Comments are requested from interested parties, including participants and beneficiaries, employee organizations, and contributing employers of the Sheet Metal Workers Local Pension Plan. Consideration will be given to any comments that are timely received by Treasury.
Veterans Benefits Administration, Department of Veterans Affairs.
Notice.
Veterans Benefits Administration, Department of Veterans Affairs (VA), is announcing an opportunity for public comment on the proposed collection of certain information by the agency. Under the Paperwork Reduction Act (PRA) of 1995, Federal agencies are required to publish notice in the
Written comments and recommendations on the proposed collection of information should be received on or before June 25, 2018.
Submit written comments on the collection of information through Federal Docket Management System (FDMS) at
Cynthia D. Harvey-Pryor at (202) 461-5870.
Under the PRA of 1995, Federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. This request for comment is being made pursuant to Section 3506(c)(2)(A) of the PRA.
With respect to the following collection of information, VBA invites comments on: (1) Whether the proposed collection of information is necessary for the proper performance of VBA's functions, including whether the information will have practical utility; (2) the accuracy of VBA's estimate of the burden of the proposed collection of information; (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 respondents, including through the use of automated collection techniques or the use of other forms of information technology.
38 CFR 36.4301; Public Law 104-13; 44 U.S.C. 3501-21.
By direction of the Secretary.
Veterans Benefits Administration, Department of Veterans Affairs
Notice
Veterans Benefits Administration, Department of Veterans Affairs (VA), is announcing an opportunity for public comment on the proposed collection of certain information by the agency. Under the Paperwork Reduction Act (PRA) of 1995, Federal agencies are required to publish notice in the
Written comments and recommendations on the proposed collection of information should be received on or before June 25, 2018.
Submit written comments on the collection of information through Federal Docket Management System (FDMS) at
Cynthia D. Harvey-Pryor at (202) 461-5870.
Under the PRA of 1995, Federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. This request for comment is being made pursuant to Section 3506 of the PRA.
With respect to the following collection of information, VBA invites comments on: (1) Whether the proposed collection of information is necessary for the proper performance of VBA's functions, including whether the information will have practical utility; (2) the accuracy of VBA's estimate of the burden of the proposed collection of information; (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 respondents, including through the use of automated collection techniques or the use of other forms of information technology.
By direction of the Secretary.
Federal Energy Regulatory Commission.
Final rule.
The Federal Energy Regulatory Commission is revising its regulations to improve transparency practices for regional transmission organizations (RTO) and independent system operators (ISO). The Commission requires that each RTO/ISO establish in its tariff: Requirements to report, on a monthly basis, total uplift payments for each transmission zone, broken out by day and uplift category; requirements to report, on a monthly basis, total uplift payments for each resource; requirements to report, on a monthly basis, for each operator-initiated commitment, the size of the commitment, transmission zone, commitment reason, and commitment start time; and the transmission constraint penalty factors used in its market software, as well as the circumstances under which those factors can set locational marginal prices, and any process by which they can be changed. The Commission is withdrawing its proposal to require that each RTO/ISO that currently allocates the costs of real-time uplift to deviations allocate such real-time uplift costs only to those market participants whose transactions are reasonably expected to have caused the real-time uplift costs.
This rule is effective July 9, 2018.
1. In this Final Rule, the Federal Energy Regulatory Commission (Commission) finds that current regional transmission organization (RTO) and independent system operator (ISO) practices with respect to reporting uplift payments and operator-initiated commitments,
2. We reach this conclusion for several reasons. RTO/ISO markets can be affected by a number of operational challenges such as unplanned transmission and generation outages and the need to maintain adequate voltage throughout the system. Limitations in the ability of the market software to incorporate all reliability considerations can at times result in prices that fail to reflect some of these challenges. In such situations, certain resources needed to reliably serve load may not economically clear the market and RTOs/ISOs must take out-of-market actions (
3. Because out-of-market actions and the resulting uplift costs are not reflected in market prices, these costs and the reasons for incurring such costs are inherently less transparent. Out-of-market actions can at times mask system conditions, which limits the ability of competitive electric markets to send appropriate price signals to compensate and financially encourage investment in resource attributes that respond to system needs. Lack of transparency concerning both uplift costs and operator-initiated actions can also limit valuable input from stakeholders, for example, during RTO/ISO transmission planning processes, or in committees that review RTO/ISO resource adequacy. Ensuring system needs are transparent to market participants is a critical step in finding cost-effective solutions to the operational challenges RTOs/ISOs face to support reliable operations and resilience. Reporting information about uplift and operator initiated commitments helps ensure these system needs are transparent to the marketplace.
4. Although all RTOs/ISOs provide some information regarding the locations and causes of uplift and operator-initiated commitments, the information is often highly aggregated or lacks detail, and is not consistently reported across markets. Current reporting practices regarding uplift and the reasons for making operator-initiated commitments do not provide adequate transparency for stakeholders to understand the needs of the system and recognize the resource attributes that are required to meet these needs. This lack of transparency hinders the ability of market participants to plan for and efficiently respond to system needs in a cost-effective manner, resulting in rates that are unjust and unreasonable. Improving the availability of information about the location and causes of uplift and operator-initiated commitments would enhance market participants' ability to evaluate the need for, and the value of investment in, transmission and generation. Increased transparency could also facilitate more informed stakeholder discussions that support capacity or transmission planning to address future reliability and resilience issues. Additionally, RTO/ISO practices with respect to transmission constraint penalty factors can significantly affect clearing prices. Improving transparency into such practices would enhance market participants' understanding of how energy prices are formed and thus would enhance their ability to hedge transactions and respond to market signals. Finally, increased transparency into uplift payments, operator-initiated commitments, and transmission constraint penalty factors will allow market participants to assess and advocate for improvements to RTO/ISO practices in these areas. Therefore, we set forth transparency requirements for each RTO/ISO in this Final Rule.
5. We are adopting the transparency proposal in the Notice of Proposed Rulemaking (NOPR)
6. The goals of the price formation proceeding are to: (1) Maximize market surplus for consumers and suppliers; (2) provide correct incentives for market participants to follow commitment and dispatch instructions, make efficient investments in facilities and equipment, and maintain reliability; (3) provide transparency so that market participants understand how prices reflect the actual marginal cost of serving load and the operational constraints of reliably operating the system; and (4) ensure that all suppliers have an opportunity to recover their costs.
7. The reforms in this Final Rule primarily address the third price formation goal listed above. Uplift payments reflect the portion of the cost of reliably serving load that is not
8. As discussed below, we require each RTO/ISO to submit a filing with the tariff changes needed to implement this Final Rule within 60 days of the Final Rule's effective date, and we require that tariff changes filed in response to this Final Rule become effective no more than 120 days after compliance filings are due.
9. Finally, in the NOPR the Commission also proposed to require that each RTO/ISO that currently allocates the costs of real-time uplift to deviations allocate such real-time uplift costs only to those market participants whose transactions are reasonably expected to have caused the real-time uplift costs. As discussed below, we withdraw the uplift cost allocation proposal and do not make any requirements related to uplift cost allocation in this Final Rule.
10. In November 2015, the Commission issued an order that directed each RTO/ISO to report on five price formation topics: Fast-start pricing; managing multiple contingencies; look-ahead modeling; uplift allocation; and transparency.
11. In the instant proceeding, on January 19, 2017, the Commission issued a NOPR proposing reforms to improve uplift cost allocation and to enhance transparency. As noted above, we withdraw the proposed uplift cost allocation reforms. With respect to transparency, the NOPR proposed to require that each RTO/ISO: (1) Report total uplift payments for each transmission zone on a monthly basis, broken out by day and uplift category; (2) report total uplift payments for each resource on a monthly basis; (3) report the megawatts (MW) of operator-initiated commitments in or near real-time and after the close of the day-ahead market, broken out by zone and commitment reason; and (4) list in its tariff the transmission constraint penalty factors, the circumstances under which they can set LMPs, and the procedure by which they can be changed temporarily.
12. In the NOPR, the Commission reviewed the current transparency practices of each of the RTOs/ISOs,
13. All RTOs/ISOs report information about uplift payments. However, the extent of the information reported varies widely. For example, ISO-NE and NYISO provide monthly uplift reports that are generally aggregated across zones and over the month as well as daily uplift reports aggregated across their entire systems.
14. RTO/ISO reporting practices are driven, in part, by the time needed to complete the settlement process. For example, ISO-NE and PJM report some uplift information within three to five business days based on their initial settlement periods, while CAISO provides uplift cost information based on its 12-business-day recalculation statement.
Because of this lag, RTOs/ISOs typically report uplift on a monthly basis, aggregated to a zonal or settlement area level.
15. Most RTOs/ISOs cite confidentiality issues as an additional reason for their current reporting practices, particularly in zones with few market participants.
16. Some uplift information is publicly available. For example, all public utilities and certain non-public utilities are required to report uplift payments in the Commission's Electric Quarterly Report (EQR) within 30 days following the end of a quarter. Most EQR filers report uplift payments with at least daily granularity. Depending on the granularity provided by the filer, and whether the filer reports its EQR as a single resource, EQR uplift information can also sometimes identify a specific unit and its location. EQR contains a single “uplift” category which does not differentiate between different types of uplift (
17. RTOs/ISOs also vary in the amount, granularity, and timing of information that is reported on operator-initiated commitments. For example, CAISO, MISO, and NYISO provide information regarding operator-initiated commitments either shortly after the operating day or in near real-time. MISO reports the hourly aggregated economic maximum MWs of committed resources by commitment reason and relevant constraint in near real-time,
18. In addition, all RTOs/ISOs provide summary reports of operator-initiated commitments over longer time periods. CAISO's monthly performance report provides metrics on exceptional dispatch and other operator actions organized by market (
19. PJM states that, although its confidentiality provisions prevent it from reporting individual operator-initiated commitments in real-time, it does provide regionally aggregated information on uneconomic commitments in the day-ahead market at the end of the business day. In addition, PJM posts total capacity committed during the Reliability Assessment and Commitment period to meet forecasted load and reserves, as well as resources committed for transmission constraints, voltage/reactive constraints, or conservative operations.
20. Transmission constraint penalty factors are the values at which an RTO's/ISO's market software will relax the flow-based limit on a transmission element to relieve a constraint caused by that limit rather than re-dispatch resources to relieve the constraint. The cost of re-dispatching resources can be described as the re-dispatch price. Transmission constraint penalty factors represent the maximum re-dispatch price that the system will pay before allowing flows to exceed a given transmission element's limit.
21. In the NOPR, the Commission preliminarily found that some existing RTO/ISO practices of reporting uplift and operator-initiated commitments are insufficiently transparent and may result in unjust and unreasonable rates. Specifically, the Commission stated that, while all RTOs/ISOs provide some information regarding the locations and causes of uplift and operator-initiated commitments, the information is often highly aggregated or lacks detail. The Commission posed, as an example, reports that aggregate uplift payments over the month, which can obscure daily trends that allow market participants to evaluate the effectiveness of current operating practices of RTOs/ISOs. The Commission stated that this lack of transparency hinders the ability of market participants to plan and efficiently respond to system needs. The Commission reasoned that improving the availability of information about the location and causes of uplift and operator-initiated commitments could allow market participants to evaluate the need for and the value of investment in transmission and generation, as well as assess operator-initiated commitment practices and raise any issues of concern through the stakeholder process. The Commission posed, as an example, the scenario of releasing information about
22. The Commission also preliminarily found that a lack of transparency with respect to transmission constraint penalty factors may result in unjust and unreasonable rates. Specifically, the Commission stated this lack of transparency may make it difficult for market participants to hedge transactions appropriately or to effectively assess RTO/ISO changes to transmission constraint penalty factors and raise concerns through the stakeholder process.
23. Several commenters agree with the Commission's preliminary finding in the NOPR that transparency reform is needed. Appian Way states that greater transparency will allow issues to be resolved more quickly and efficiently in the contexts of enforcement and stakeholder advocacy.
24. Several commenters express general support for the proposed transparency reforms, but do not comment in-depth on the need for reform.
25. CAISO states that it supports greater market transparency but argues that its existing reporting practices on uplift payments and exceptional dispatch provide sufficient transparency, and that additional reporting would be overly burdensome and problematic for CAISO.
26. The Commission also proposed in the NOPR to require that each RTO/ISO that currently allocates the costs of real-time uplift to deviations allocate such real-time uplift costs only to those market participants whose transactions are reasonably expected to have caused the real-time uplift costs. Although some commenters support the proposed uplift allocation reforms,
27. Based on our analysis of the record in this proceeding, we adopt the preliminary findings related to transparency in the NOPR and conclude that the existing RTO/ISO practices of reporting uplift, operator-initiated commitments, and transmission constraint penalty factors are insufficiently transparent, resulting in rates that are unjust and unreasonable. We find that the current reporting on uplift is insufficient because no RTO/ISO currently reports uplift on a resource-specific basis. Some RTOs/ISOs do not report uplift by zone, and some do not report in a machine-readable format. Additionally, reporting on operator-initiated commitments is insufficient because some RTOs/ISOs do not report the reasons for these commitments, the zones in which the
28. As described above, the transparency proposal received a broad level of support from commenters. CAISO is the singular commenter to oppose the proposed transparency reforms outright. CAISO states that its reporting practices are sufficient and that the burden of additional reporting would outweigh the benefits of the proposed reforms. As explained below, we disagree that existing transparency practices are sufficient. We do, however, modify the proposed transparency requirements to reduce the potential burden of the reforms and to address commenters' other concerns including the potential disclosure of commercially-sensitive information and the transparency value of consistent reporting. These modifications are discussed below in the subsections dealing with each requirement.
29. Based on our analysis of the record in this proceeding, we decline to adopt the preliminary finding related to uplift cost allocation in the NOPR. We continue to believe that uplift should ideally be allocated to those market participants whose transactions caused the uplift and that allocations of uplift costs should avoid penalizing behavior that can improve price formation. That said, some commenters raised substantial concerns about the uplift cost allocation reforms proposed in the NOPR. They expressed concern about the application of the NOPR proposal to certain RTOs/ISOs in light of the reasons for uplift in these markets, and whether certain RTOs/ISOs would be able to implement the generic uplift cost allocation reforms proposed in the NOPR. We find those concerns sufficiently persuasive to decline to take generic action at this time. Accordingly, we withdraw the NOPR proposal to require that each RTO/ISO that currently allocates the costs of real-time uplift to deviations allocate such real-time uplift costs only to those market participants whose transactions are reasonably expected to have caused the real-time uplift costs.
30. Having concluded that the existing transparency practices result in rates that are not just and reasonable, section 206 of the Federal Power Act requires that the Commission determine the practices that will result in rates that are just and reasonable.
31. Each RTO/ISO must post a monthly Zonal Uplift Report of all uplift, paid in dollars, and categorized by transmission zone, day, and uplift category. We define transmission zone as a geographic area that is used for the local allocation of charges, such as a load zone that is used to settle charges for energy. Transmission zones with fewer than four resources may be aggregated with one or more neighboring transmission zones, until each aggregated zone has at least four resources, and reported collectively. This report must be posted in machine-readable format on a publicly-accessible portion of the RTO's/ISO's website within 20 calendar days of the end of each month.
32. Each RTO/ISO must post a monthly Resource-Specific Uplift Report containing the resource name and total amount of uplift paid in dollars aggregated across the month to each resource that received uplift payments. This report must be posted in machine-readable format on a publicly-accessible portion of the RTO's/ISO's website within 90 calendar days of the end of each month.
33. Each RTO/ISO must post a monthly Operator-Initiated Commitment Report listing the commitment size, transmission zone, commitment reason, and commitment start time of each operator-initiated commitment. We define an operator-initiated commitment as a commitment made after the day-ahead market for a reason other than minimizing the total production costs of serving load. Commitment reasons shall include, but are not limited to, system-wide capacity, constraint management, and voltage support. This report must be posted in machine-readable format on a publicly accessible portion of the RTO's/ISO's website within 30 calendar days of the end of each month.
34. Each RTO/ISO must follow the Transmission Constraint Penalty Factor requirements to include, in its tariff, its transmission constraint penalty factor values; the circumstances, if any, under which the transmission constraint penalty factors can set LMPs; and the procedure, if any, for temporarily changing the transmission constraint penalty factor values. Any procedure for temporarily changing transmission constraint penalty factor values must provide for notice of the change to market participants as soon as practicable.
35. The Zonal Uplift Report is discussed in section IV.A. The Resource-Specific Uplift Report is discussed in section IV.B. The Operator-Initiated Commitment Report is discussed in section IV.C. The Transmission Constraint Penalty Factor Requirements are discussed in section IV.D.
36. In the NOPR, the Commission proposed to require each RTO/ISO to post a report of the uplift paid in dollars and categorized by transmission zone, day, and uplift category. The Commission proposed to define transmission zone as the geographic area that is used for the local allocation of charges. The Commission proposed to allow transmission zones with fewer than four resources to be aggregated with a neighboring zone and reported collectively. The Commission further proposed to allow RTOs/ISOs to omit a transmission zone from reporting in a given month if it is the only zone and contains fewer than four resources or if, when combined with a neighboring transmission zone, the combined zones still have fewer than four resources. The Commission proposed to require that each RTO/ISO post the report on a publicly accessible portion of its website within 20 calendar days of the end of each month.
37. The Commission reasoned that with more granular information on locations, amounts, and types of uplift, market participants would be able to better evaluate possible solutions to reduce the incurrence of uplift.
38. The Commission requested comments regarding: (1) The proposed definition of transmission zone, including the appropriate level of geographic granularity;
39. Numerous commenters support the proposed requirement for RTOs/ISOs to report daily uplift payments by transmission zone and uplift category.
40. Other commenters either do not support the proposed zonal uplift report requirement
41. Responding to the Commission's request for comment on the proposed definition of “transmission zone” as a geographic area that is used for the local allocation of charges,
42. Other commenters generally differ on the level of geographic granularity that should be reported. MISO Transmission Owners state that the proposed definition of “transmission zone” is unclear and could be susceptible to multiple interpretations. MISO Transmission Owners assert that the Commission should direct each RTO/ISO to develop a definition of transmission zone through its stakeholder process that considers regional needs and ensures that all zones are large enough to ensure that resource-specific uplift payments cannot be calculated based on daily uplift payment reports.
43. Commenters also differ on the proposal to allow RTOs/ISOs to aggregate and collectively report uplift in transmission zones with fewer than four resources.
44. As noted above, numerous commenters provide general support for the proposed zonal uplift report, including the proposed requirement to report by uplift category. Three RTOs/ISOs state that they already report uplift by category. NYISO states that it reports uplift cost on a monthly basis by uplift cost category in its Operations Performance Metrics Monthly Reports.
45. Several RTOs/ISOs discuss their existing uplift reporting practices and timing, as well as the level of additional burden that would be required to meet the proposed requirements. ISO-NE states that its existing reports appear to satisfy most of the proposed requirements and that implementation of any new requirements should be relatively simple. ISO-NE believes that 20 days is sufficient time for monthly uplift reporting.
46. XO Energy responds to several of CAISO's arguments. It notes that CAISO's current uplift reports contain only charts, with no mechanism to extract the raw data.
47. Direct Energy requests that the Commission clarify that the transparency provisions apply to all uplift costs, not just those resulting in allocations to deviations from day-ahead schedules.
48. EEI and MISO Transmission Owners assert that the proposed report would primarily benefit market participants, so in order to protect market participants' confidentiality, the information should be posted on a password-protected portion of an RTO's/ISO's website, rather than made publicly available.
49. Exelon suggests that, in addition to the proposed reporting requirements, the Commission also require RTOs/ISOs to submit a one-time report covering the years 2012 through 2016 that identifies uplift categories and provide the aggregate uplift cost associated with each category.
50. We adopt the proposal that each RTO/ISO report, in the Zonal Uplift Report, the total daily uplift payments
51. We address commenters' concerns regarding the Zonal Uplift Report below.
52. We adopt the definition proposed in the NOPR of “transmission zone” as a geographic area that is used for the local allocation of charges, such as a load zone that is used to settle charges for energy. We find that this level of geographic reporting will improve transparency by providing more specific information about the location of system needs. For instance, understanding that a particular category of uplift is concentrated in a limited area could provide information about the nature of the reliability need or could inform discussions about uplift cost allocation.
53. Some commenters argue that RTOs/ISOs should be permitted to define transmission zones more broadly because daily uplift payments in combination with other public information could be used to derive a resource's energy offer or cost information, which some characterize as confidential because it is commercially sensitive. Commenters assert that the revelation of cost or offer data could lead to collusion or gaming. We recognize that it may be possible, under specific circumstances, to deduce an individual resource's daily uplift payments by using the information provided in the Zonal Uplift Report and Resource-Specific Uplift Report. For instance, if the Resource-Specific Uplift Report makes clear that only one resource within a zone has received uplift during a given month, and if that resource has only one generating unit, then the Zonal Uplift Report would reveal the resource's daily uplift payments. This information could be used with knowledge of the resource's output and publicly-available data on LMPs to estimate the resource's energy offer or cost.
54. Out of an abundance of caution and as discussed below, we delay the timing of Resource-Specific Uplift report to allow a 90-day time lag in releasing the Resource-Specific Uplift Report
55. In the NOPR, we recognized that RTOs/ISOs may have very small transmission zones, and sought to balance the benefits of greater transparency with concerns about revealing daily resource-specific uplift information by (1) allowing RTOs/ISOs to aggregate any transmission zone containing fewer than four resources with a neighboring zone and report them collectively, and (2) exempting from reporting any combined transmission zone with fewer than four resources.
56. In response to comments, we clarify that any aggregation should be based on the number of resources located in the zone rather than the number of resources in the zone that receive uplift payments in a given reporting period. As noted by PJM and the PJM Market Monitor, aggregating based on the number of resources that receive uplift payments could lead to different zonal aggregations from month to month and inconsistent zonal reporting, which would add complexity and reduce transparency.
57. We also clarify that, for the purpose of zonal aggregation, the term “resource” refers to an entire generating facility and not each individual unit within a plant. We agree with EEI that if a transmission zone contained, for example, a single power plant with four units, aggregation with a neighboring
58. We also modify the permissible level of aggregation. The proposal in the NOPR to allow a transmission zone with fewer than four resources to be aggregated with a single neighboring zone and to exempt from the reporting requirement any aggregated zone that still contains fewer than four resources could result in a zone that is permanently exempted from reporting, in light of the clarification above. Instead, we will allow RTOs/ISOs to aggregate transmission zones containing fewer than four resources with
59. On balance, our definition of transmission zone and the associated aggregation protections provide the transparency benefits of geographically granular uplift information while minimizing the risk of harm to the market from the potential disclosure of commercially-sensitive information. However, we acknowledge that RTOs/ISOs may have multiple existing types of zones that could meet our definition. On compliance, we require each RTO/ISO to include in its tariff the type of zone that it proposes to use in its Zonal Uplift Report and explain how the chosen type of zone meets the definition of transmission zone adopted in this Final Rule, as well as explain any proposal to aggregate transmission zones that fits the characteristics described above. While our definition of transmission zone provides RTOs/ISOs a level of flexibility, we note that transmission zones are defined as areas that are used for the
60. We adopt the NOPR proposal to require the reporting of zonal uplift by category. As noted above, numerous commenters express support for this proposal, and several RTOs/ISOs already report such information. Reporting the causes of uplift in each transmission zone on each day will help market participants understand the relationship between system conditions, location, and reasons that uplift is incurred. Market participants will therefore be better equipped to raise concerns about RTO/ISO uplift payments and direct appropriate infrastructure investment to reduce the need for a given type of uplift payment. No commenters opposed including categories in the Zonal Uplift Report. As mentioned in the NOPR, we expect the categories to be based on the RTO/ISO uplift charge codes.
61. With respect to timeliness of reporting, we adopt the NOPR proposal to require that each RTO/ISO post this Zonal Uplift Report within 20 calendar days of the end of the month. However, in response to CAISO's concern on this issue, on compliance we will consider proposals with longer timelines if an RTO/ISO demonstrates that the 20-day deadline does not provide an RTO/ISO with sufficient time to compile the report given its existing uplift settlement and reporting timelines.
62. Regarding other issues raised by commenters with respect to this report, in response to Direct Energy we confirm that RTOs/ISOs must report all uplift payments to resources and not just those resulting from deviations from day-ahead schedules in both the Zonal Uplift Report and the Resource-Specific Uplift Report. We also confirm that RTOs/ISOs may choose to report more information and/or to report more promptly. We adopt the NOPR proposal to require each RTO/ISO to publish the two uplift reports, the Zonal Uplift Report and the Resource-Specific Uplift Report, in a machine-readable format on a publicly accessible, rather than password-protected, portion of its website. As discussed above, we are not persuaded that the potential revelation of a resource's uplift payments, subject to the discussed protections, would result in harm to competition or to market participants. Moreover, while we have discussed the benefits in the context of existing market participants, we find that other stakeholders such as third-party researchers, potential future market participants, and ratepayers may also benefit from public availability of this data. Finally, while we recognize the potential transparency benefits of the historical uplift report requested by Exelon, we find that it goes beyond the scope of this rulemaking and decline to require it here.
63. In the NOPR, the Commission proposed to require each RTO/ISO to post a monthly report containing the resource name and total amount of uplift paid in dollars aggregated across the month to each resource that received uplift payments. The Commission proposed to require that the report be posted on a publicly-accessible portion of each RTO's/ISO's website within 20 calendar days of the end of each month.
64. The Commission reasoned that with more granular information on the location and amounts of uplift, market participants may be able to better evaluate possible solutions to reduce the incurrence of uplift.
65. The Commission requested comments on: (1) Whether these resource-specific reports should also be broken out by uplift category, be reported using a different time duration, or contain other additional details;
66. Many commenters generally support
67. On the other hand, MISO and MISO Transmission Owners assert that the benefits of the resource-specific report are unclear. MISO Transmission Owners state the Commission does not explain why resource-level information is necessary and why the other transparency reforms are insufficient to meet the Commission's goals. Moreover, they contend market participants do not need to know resource-level information to understand RTO/ISO actions and react properly to them.
68. Some commenters highlight concerns around confidentiality and the release of data in a resource-specific monthly report. MISO Transmission Owners and Potomac Economics raise the concern that a resource-specific report could allow the discovery of a resource's sensitive cost information or lead to some form of collusion among suppliers.
69. Several commenters provide suggestions for protecting resources' confidential information. EEI and MISO Transmission Owners argue that because the Commission has only identified benefits for market participants, the resource-specific uplift information should be available only to market participants.
70. MISO Transmission Owners, EEI, and Potomac Economics all comment that if a resource-specific report is adopted, a final rule should increase the lag time for releasing the report or should aggregate the data over a longer time period. Potomac Economics asserts that an immediate release of uplift information does not improve transparency because uplift is a settlement process and market participants cannot take economic actions to reduce uplift costs. Potomac Economics also believes the proposed 20-day lag is too short to ensure competition will not be adversely affected and recommends at least a three-month lag, which it asserts will not diminish the transparency value of the report.
71. Multiple commenters argue that the proposed monthly aggregation for reporting is sufficient to reduce data and resource confidentiality concerns. R Street Institute finds that monthly aggregation is reasonable and provides sufficient masking of daily offer behavior.
72. Several commenters responded to the Commission's request for comment on whether the resource-specific reports should be broken out by uplift category or contain other additional details.
73. As discussed in more detail with respect to the zonal uplift report, CAISO argues that it already posts significant information on uplift payments monthly and contends the proposed reports and 20-day deadline would impose significant costs on CAISO. CAISO requests that the Commission allow CAISO to include any required additional uplift information in the monthly reports it already produces.
74. We adopt the NOPR proposal and require each RTO/ISO to report the resource name and the total amount of uplift paid in dollars to each resource that received uplift payments within the calendar month. We find that this Resource-Specific Uplift Report provides additional transparency benefits beyond those provided by the Zonal Uplift Report and existing uplift reporting requirements. Below, we discuss the benefits particular to this report and also address commenters' other concerns.
75. We find that the Resource-Specific Uplift Report will improve transparency into the causes of uplift. The Resource-Specific Uplift Report will complement the Zonal Uplift Report by providing more granular technology-type and geographic information, allowing market participants to identify potential system needs at specific locations that may not otherwise be revealed through price signals. The locational granularity of the required uplift report also mirrors the locational granularity of energy prices. We find that the two uplift reports in combination can improve market efficiency by providing information to market participants considering, for example, where to site new resources, transmission facilities, or demand response. In addition, as Appian Way notes, several RTOs/ISOs have previously indicated that uplift payments are concentrated and persistent among a few units, an observation corroborated by the Staff Analysis of Uplift.
76. MISO Transmission Owners argue that the Resource-Specific Uplift Report is duplicative with the requirement that public utilities report uplift payments in EQR. EQR serves as a reporting mechanism for public utilities to fulfill their responsibility under section 205(c) of the Federal Power Act to have their rates and charges on file in a convenient form and place.
77. Several commenters continue to express concern that the Resource-Specific Uplift Report could, in conjunction with other information, unintentionally reveal a resource's daily uplift payments, energy offer, or cost information, which some characterize as confidential because it is commercially sensitive. As noted above, it may be possible, under specific circumstances, for a market participant to estimate a resource's energy offer using the Resource-Specific Uplift Report in conjunction with the Zonal Uplift Report, and other information and assumptions. Commenters assert that the revelation of cost or offer data could lead to collusion or gaming.
78. Out of an abundance of caution, we address these concerns regarding revealing commercially-sensitive information by modifying the NOPR proposal to extend the deadline for the release of the Resource-Specific Uplift Report from 20 to 90 calendar days following the end of the reporting month, as several commenters recommend. An RTO/ISO can propose more timely reporting on compliance to the extent it believes that reporting more timely does not present the kinds of risks discussed above, for instance, because there are consistently enough
79. We also find that any inferred information regarding a resource's offers or costs becomes less likely to be used to harm competition or individual market participants with the passage of time, because fuel prices and other market conditions change. After 90 calendar days following the end of the reporting month, the report will be released in a different season from the incurrence of uplift, increasing the likelihood that transient issues will be resolved, and thus decreasing the likelihood that any deduced resource-specific cost or offer data can be used to harm to competition or individual market participants. Furthermore, as Appian Way suggests, transparency into resource-specific uplift payments can highlight potential instances of gaming and collusion for other market participants, and allow them to advocate for solutions and call attention to such issues more quickly and efficiently. Finally, some information about resource-specific uplift payments is already available or can be derived from EQR.
80. We find that monthly aggregation of uplift payments to each resource, combined with a reporting delay of 90 calendar days, strikes an appropriate balance between the goal of providing public information that is detailed enough to identify system needs and issues with RTO/ISO uplift payment practices while also preserving a reasonable level of protection of potentially commercially-sensitive information. We expect that the later deadline should also alleviate CAISO's concern with respect to the burden of releasing this report on time.
81. As with the Zonal Uplift Report, the Commission does not agree with commenters that argue that access to the Resource-Specific Uplift Report should be limited to certain market participants on a password-protected portion of the RTO/ISO website. Providing data only to certain market participants does not achieve the goals of this Final Rule. As stated earlier, we find that reporting resource-specific uplift cost information more broadly may benefit a range of stakeholders, and we require each RTO/ISO to publish the Resource-Specific Uplift Report in a machine-readable format on a publicly accessible portion of its website.
82. In the NOPR, the Commission requested comment regarding whether the Resource-Specific Uplift Report should include uplift categories or other additional details. While, as some commenters suggest, there may be additional value in reporting uplift categories on a resource-specific basis, we do not require RTOs/ISOs to report resource-specific uplift by category. We find that the requirement for RTOs/ISOs to report uplift categories in the Zonal Uplift Report provides sufficient transparency about the locations where specific types of uplift are incurred to address system needs. However, RTOs/ISOs may choose to include uplift categories or other information in the Resource-Specific Uplift Report, and must indicate on compliance whether they plan to do so.
83. In the NOPR, the Commission proposed to require each RTO/ISO to post operator-initiated commitments in MWs, categorized by transmission zone and commitment reason, to a publicly accessible portion of its website within four hours of the commitment. The Commission proposed to define transmission zone as a geographic area that is used for the local allocation of charges.
84. The Commission reasoned that transparency into operator-initiated commitments is necessary as such commitments can affect energy and ancillary service prices and can result in uplift. In addition, the Commission preliminarily found that greater transparency would allow stakeholders to better assess the RTO's/ISO's operator-initiated commitment practices and raise any issues of concern through the stakeholder process.
85. In the NOPR, the Commission defined an operator-initiated commitment as a commitment that is not associated with a resource clearing the day-ahead or real-time market on the basis of economics and that is not self-scheduled. The Commission added that this definition would include both manual and automated commitments made after the execution of the day-ahead market and outside of the real-time market. The Commission noted that the definition includes commitments made through residual unit commitment and look-ahead commitment processes, and manual commitments made in real-time. The Commission proposed that both manual and automated operator-initiated commitments be posted in order to help market participants better understand the drivers of uplift in each zone and the impact of such commitments on rates.
86. The Commission requested comments on: (1) The types of unit commitments that should be reported as operator-initiated commitments;
87. Several commenters support the proposed requirement that each RTO/ISO report operator-initiated commitments in or near real-time and after the close of the day-ahead market, with the report including the upper economic operating limit of the committed resource in MWs, the transmission zone in which the resource is located, and the reason for the commitment.
88. Three RTOs/ISOs, MISO, NYISO, and PJM, found elements of the proposed definition of operator-initiated commitments to be unclear and requested clarification as to whether or not certain types of commitments should be reported. MISO argues that the proposed definition of operator-initiated commitments as “commitments not associated with clearing the day-ahead or real-time market on the basis of economics” may contradict the statement in the NOPR that commitments made through residual unit commitment and look-ahead commitment processes should be reported. MISO requests clarification on whether to report residual unit commitments and look-ahead commitments because the NOPR specifically states that these commitments should be reported even though MISO considers costs when making these commitments. Similarly, NYISO requests confirmation that commitments made through its real-time commitment and dispatch processes are not intended to be included simply because they consider multiple time horizons and thus include look-ahead functionality. NYISO also states that its real-time dispatch software can economically evaluate commitments of certain offline resources that can respond to dispatch instructions within 10 minutes, but that subsequent action by the operator is needed to actually dispatch the resource. NYISO states that it does not believe the Commission intended these commitments to be considered operator-initiated commitments for the purposes of this NOPR.
89. PJM states that it does not have any automated commitments in either the real-time or day-ahead market; instead PJM has a variety of applications that provide commitment suggestions to PJM operators, who perform additional analyses prior to committing any unit. PJM interprets the proposal to require it to post all commitments made after the close of the day-ahead market. PJM states that it is able to accomplish this goal, but requests confirmation that this was the intent of the proposal.
90. Several RTOs/ISOs state that the proposed operator-initiated commitment reports could reveal resource-identifiable or competitive information, or lead to market power concerns.
91. Responding to SPP, XO Energy states that the proposed report would not require SPP to identify the unit that was committed.
92. ISO-NE and PJM raise concerns that the proposed operator-initiated commitment reports could reveal Critical Energy/Electric Infrastructure Information (CEII).
93. Several commenters responded to the request for comment on whether the Commission should define a common set of commitment reason categories and, if so, which categories should be included, or whether it is more appropriate to allow each RTO/ISO to establish a set of commitment reasons on compliance.
94. Conversely, PJM and EEI support the Commission defining a minimum set of categories to be used by RTOs/ISOs that identify the reasons for the commitment.
95. Several RTOs/ISOs discussed their current reporting practices and whether it is feasible to meet the proposed requirement to report real-time operator-initiated commitments within four hours.
96. On the other hand, CAISO states that it produces operator-initiated commitment reports manually because they require collecting operator log information and presenting it in a reporting format. Therefore, CAISO states that it cannot provide the required operator-initiated commitment information within the four-hour deadline.
97. In response to CAISO's concerns, XO Energy states that it disagrees with CAISO's assertion that expediting reporting of operator-initiated commitments is not feasible because these systems are already in place in other RTOs/ISOs. XO Energy asserts that the commitment of units must be recorded into a database because this information is used for settlement purposes and dispatch instructions are sent electronically to resources and incorporated into the next SCED calculation. XO Energy states that these commitments can and should be posted in real-time as they occur.
98. Some commenters suggest that RTOs/ISOs should be required to post other types of commitments or additional information. XO Energy asserts that there is a substantial amount of operator discretion in the day-ahead market and that all resources that contribute to day-ahead or real-time uplift should be reported.
99. We adopt the NOPR proposal and require each RTO/ISO to post all operator-initiated commitments on its website, subject to the modifications and clarifications discussed below. Operator-initiated commitments are made to address system needs, but because they are made outside of the market are inherently less transparent. As stated in the NOPR, transparency into operator-initiated commitments is important because such commitments can affect energy and ancillary service prices and can result in uplift. Greater transparency will allow stakeholders to better understand the drivers of uplift costs, assess an RTO's/ISO's operator-initiated commitment practices, and raise any issues of concern through the stakeholder process.
100. Based on the comments, we adopt a modified definition of an operator-initiated commitment for the purpose of this Final Rule. We agree with MISO and NYISO that the proposed definition of operator-initiated commitments as “commitments not associated with clearing the day-ahead or real-time market on the basis of economics” may contradict the clarification in the NOPR that the proposed definition includes commitments made through look-ahead processes,
101. PJM requests clarification that we intend to require PJM to report all commitments made by operators occurring after the close of the day-ahead market because it has no “automated” commitments. We clarify that when an automated process makes a recommendation to an operator who makes the final decision, the commitment must be reported if the underlying process did not minimize total production costs. However, we are aware that RTOs/ISOs have a variety of processes through which units can be committed. On compliance, we therefore require each RTO/ISO to indicate, for each commitment process (whether automated or manual) that executes after the day-ahead market, whether it believes our modified definition implicates some or all commitments from the process and justify any commitments that it does not plan to report.
102. After considering commenters' responses to the questions the Commission asked about the reporting timeframe, potential implementation challenges of reporting in real-time, and whether a different reporting timeframe would provide sufficient transparency,
103. We adopt the NOPR proposal to require RTOs/ISOs to report the size of each commitment. In the NOPR, we described this value as the upper economic operating limit of the committed resource in MW (
104. As with the Zonal Uplift Report discussed above, we adopt the NOPR proposal and define “transmission zone” as a geographic area that is used for the local allocation of charges and find that this definition balances the benefits of greater transparency with the desire to preserve a reasonable level of protection of potentially commercially-sensitive information. As discussed above, RTOs/ISOs may have multiple existing types of zones that could meet our definition. We believe that there are transparency benefits to using the same set of zones for the Zonal Uplift Report and the Operator-Initiated Commitment Report. However, we acknowledge that an RTO/ISO may have a legitimate reason for using a more or less granular set of zones for one or the other of the two reports and the decision to provide less granularity on one report does not necessitate less granularity for both reports simply to maintain consistency between reports. On compliance, we require each RTO/ISO to include in its tariff the type of zone that it proposes to use in its Operator-Initiated Commitment Report, explain how the chosen type of zone meets the definition of transmission zone adopted in this Final Rule, and provide justification for any differences between the sets of zones used for the two reports.
105. We adopt the NOPR proposal and require that the Operator-Initiated Commitment Reports include the reason for each commitment. In the NOPR, the Commission requested comment as to whether the Commission should define a common set of categories of commitment reasons for use across all RTOs/ISOs and, if so, what reasons should be included, or whether to allow each RTO/ISO to establish a set of appropriate operator-initiated commitment reasons on compliance. As EEI suggests, requiring a common set of commitment reasons will help ensure that RTOs/ISOs provide similar information to market participants. This consideration is balanced against the desire for a minimum set of commitment reasons that are not so broad as to provide limited inference about the nature of the reliability consideration addressed through the commitment. While no specific commitment reasons were suggested by commenters, the potential commitment reasons listed in the NOPR
106. We clarify that we are not requiring that RTOs/ISOs identify resource names or specific constraints in the Operator-Initiated Commitment Report. We also clarify, in response to concerns from PJM and ISO-NE that each RTO/ISO is permitted to propose, upon compliance, modifications to the report to avoid disclosing information that could be used to harm system security.
107. In response to NYISO's and ISO-NE's comments that it may be necessary to create new rules or procedures to address market power or anti-competitive behavior that may arise as a result of this report we note that any such rules or procedures would be outside the scope of this proceeding. RTOs/ISOs may propose any further changes they deem appropriate in a separate filing pursuant to section 205 of the Federal Power Act.
108. We also confirm that RTOs/ISOs may choose to report more information about operator-initiated commitments or other operator actions. However, we find that requests by several commenters to require reporting of other types of commitments or other operator actions that may affect uplift are beyond the scope of this proceeding, as this requirement only addresses operator-initiated commitments.
109. In the NOPR, the Commission proposed to require each RTO/ISO to include, in its tariff: Its transmission constraint penalty factor values; the circumstances, if any, under which the transmission constraint penalty factors can set LMPs; and the procedure, if any, for temporarily changing the transmission constraint penalty factor values. The Commission further proposed that any procedure for temporarily changing transmission constraint penalty factor values must provide for notice of the change to market participants.
110. The Commission reasoned that transparency into transmission constraint penalty factors and associated practices is important because the penalty factors and practices can affect prices. Without an understanding of the level of transmission constraint penalty factors or under what circumstances they can set LMPs or be temporarily changed, market participants may not be able to hedge transactions appropriately or raise concerns into RTO/ISO practices through the stakeholder process.
111. Many commenters support the proposed requirement that all RTOs/ISOs include provisions related to transmission constraint penalty factors in their tariffs.
112. Several RTOs/ISOs state that they currently comply, plan to comply, or could comply with the proposed requirements. MISO and MISO Transmission Owners assert that MISO's tariff is consistent with the proposal.
113. Several commenters explicitly support the proposal requiring RTOs/ISOs to explain in their tariffs when transmission constraint penalty factors can set LMPs, if ever.
114. R Street Institute argues that relaxing transmission constraints to prevent penalty factors from setting prices distorts congestion price formation, which undermines efficient commitment and dispatch in the short term and distorts market investments and retirements in the long term.
115. Potomac Economics suggests that the Commission not only require RTOs/ISOs to explain how penalty factors contribute to setting LMP, but require that penalty factors set shadow prices for violated constraints.
116. Multiple commenters explicitly support the proposed requirement that RTOs/ISOs include in their tariffs any procedures for changing penalty factors and provide notice of any such changes to market participants.
117. XO Energy states that MISO currently posts any overridden transmission constraint demand curves through its real-time market and provides reasons for such overrides in its next-day market reports.
118. Potomac Economics makes two recommendations to strengthen the requirement to file transmission constraint penalty factors. Potomac Economics states that the Commission should require or encourage RTOs/ISOs to file multi-point demand curves, as in MISO and NYISO, rather than single penalty values because demand curves demonstrate that the size of the violation matters from a reliability perspective. XO Energy also supports the implementation of the demand curve approach used in MISO.
119. Potomac Economics also suggests that the Commission clarify that penalty values should correspond to the reliability concerns that arise when constraints are violated. Potomac Economics states that, while estimating the reliability value of a transmission constraint can be challenging, reasonable values can be set that reflect the relative reliability concern associated with violating different constraints.
120. XO Energy states that RTO/ISO actions to affect the percentages of thermal limits used for controlling constraints also can mask violations of thermal limits and affect how high shadow prices can bind. XO Energy therefore suggests enhancing the transparency of operator actions surrounding Limit Controls.
121. We adopt the NOPR proposal and require that each RTO/ISO include in its tariff on an on-going basis: (1) The transmission constraint penalty factor values used in its market software;
122. We clarify that we are not requiring RTOs/ISOs to have procedures to temporarily change their transmission constraint penalty factor values. Rather, if an RTO/ISO currently has the flexibility to temporarily override transmission constraint penalty factor values, for example, to account for reliability concerns, the circumstances under which the factors may be changed and any procedures for doing so must be included in the RTO's/ISO's tariff. We appreciate requests that the Commission require RTOs/ISOs to adopt specific practices in developing transmission constraint penalty factors and specifications for how transmission constraint penalty factors can set LMPs. However, we find that such requests go beyond the scope of this rule, which is focused on transparency into current RTO/ISO practices related to transmission constraint penalty factors. Accordingly, we will not address those requests here. Further, RTOs/ISOs may propose any changes they deem appropriate to their current practices related to transmission constraint penalty factors in a separate filing pursuant to section 205 of the Federal Power Act.
123. In the NOPR, the Commission requested comment on whether additional reporting of transmission outages should be required, noting that transmission outages are an important facet of price formation because they can affect RTO/ISO commitment and dispatch decisions and resulting market clearing prices.
124. Most RTOs/ISOs state that they already provide information on transmission outages. MISO states that it posts all transmission outages on OASIS on an hourly basis.
125. Several commenters support additional transparency into transmission outages.
126. XO Energy contends that all RTOs/ISOs should be required to post all known transmission outages in real-time at the same frequency as real-time dispatch, using EMS model detail. XO Energy also contends that planned and emergency outages known and included in the day-ahead market solution should be included as an additional report posted with each RTO/ISO day-ahead market solution.
127. Diversified Trading/eXion Energy and XO Energy contend that RTOs/ISOs should be required to post all outages that are modified or cancelled after the close of the day-ahead market, as well as the impact of cancelled outages on prices and uplift. Diversified Trading/eXion Energy further contend that this posting should also include the reason for the cancellation or modification, the transmission owner, and the frequency with which the transmission owner has cancelled or modified outages after the cut-off.
128. EDF asserts that there is a need for RTOs/ISOs to incorporate economic assessments into their transmission outage scheduling practices and moves that the Commission establish a technical conference to address the impact of transmission outages on RTO/ISO commitment and dispatch decisions and resulting market clearing prices.
129. On the other hand, MISO and PJM contend that additional reporting requirements are unnecessary,
130. We appreciate the input from multiple commenters on the reporting of transmission outages. In the NOPR, the Commission sought comment on this topic but did not make a specific proposal. Accordingly, based on the record in this proceeding, we will not require additional reporting for transmission outages at this time.
131. In the NOPR, the Commission requested comment on whether certain classes of market participants are prohibited from obtaining the network models in certain RTOs/ISOs and the justification for any such restrictions. The Commission defined “network model” as “the RTO's/ISO's model used in its energy management system for the real-time operation of the transmission system (
132. Financial Marketers Coalition and XO Energy explain that there are several different types of market models and discuss the varying availability of different market models between market participant classes across RTOs/ISOs. XO Energy asserts that MISO and SPP provide a fair amount of detail and that PJM, NYISO, and CAISO provide the least amount of model detail.
133. ISO-NE and MISO state they provide network models to all market participants.
134. Some commenters argue against the wider dissemination of market models, noting confidentiality concerns.
135. We appreciate the input from multiple commenters on the availability of market models. In the NOPR, the Commission sought comment on this topic but did not make a specific proposal. Accordingly, based on the record in this proceeding, we will not require changes to the accessibility of market models at this time.
136. In the NOPR, the Commission proposed to require that each RTO/ISO submit a compliance filing within 90 days of the effective date of the Final
137. The Commission did not propose separate compliance and implementation deadlines for the uplift cost allocation and transparency reforms. Accordingly, most of the comments received on this subject understandably address compliance and implementation assuming that the Final Rule would address both proposed reforms. We do not discuss comments that solely addressed compliance and implementation of the proposed uplift cost allocation reform.
138. MISO requests that the Commission consider a compliance timeline of 120 days, citing a need to review existing protocols, refine current processes to reflect any changes stemming from the NOPR proposal, and discuss changes with stakeholders. MISO requests that the Commission consider an implementation timeline of 365 days, as MISO estimates that the coding and testing of new software will likely take a minimum of 60 to 90 days.
139. ISO-NE states that the 90-day compliance deadline is too short as it leaves insufficient time to consult with stakeholders, consider alternative compliance approaches and develop and file tariff changes. ISO-NE also asserts that the six-month deadline appears arbitrary. ISO-NE concludes that the Commission should allow RTOs/ISOs to submit a compliance proposal and schedule that reflects each region's unique circumstances, which may vary significantly.
140. Direct Energy states that the shorter the period for implementing the changes to transparency requirements the better, as the changes will only enhance RTO/ISO markets.
141. In the NOPR, the Commission did not propose separate compliance and implementation deadlines for the uplift cost allocation and transparency reforms. Most of the comments received on this subject address compliance and implementation assuming a Final Rule would address both initiatives, and in several cases, focused only on compliance and implementation related to the uplift cost allocation initiative. As this Final Rule only addresses the transparency initiative, we reason that some of the proposed compliance and implementation deadline concerns may be alleviated. We agree with Direct Energy that it is preferable that the transparency benefits of these reforms be realized as quickly as possible. Therefore, we require that each RTO/ISO submit a compliance filing within 60 days of the effective date of this Final Rule that establishes in its tariff the three reporting requirements and one requirement related to transmission constraint penalty factors as described herein. Further, we require tariff changes to become effective no more than 120 days after compliance filings are due.
142. The Paperwork Reduction Act (PRA)
143. In this Final Rule, we are amending the Commission's regulations to improve the operation of organized wholesale electric power markets operated by RTOs/ISOs. We require that each RTO/ISO: (1) Report, on a monthly basis, uplift payments for each transmission zone, broken out by day and uplift category (Zonal Uplift Report); (2) report, on a monthly basis, total uplift payments for each resource (Resource-Specific Uplift Report); (3) report, on a monthly basis, for each operator-initiated commitment, the size of the commitment, transmission zone, commitment reason, and commitment start time (Operator-Initiated Commitment Report); and (4) define in its tariff the transmission constraint penalty factors, as well as the circumstances under which those factors can set locational marginal prices (LMP), and any process by which they can be changed (Transmission Constraint Penalty Factor Requirements).
144. The reforms required in this Final Rule include a one-time tariff filing with the Commission due 60 days after the effective date of this Final Rule. The reforms will also require each RTO/ISO to maintain and post the three reports on an ongoing basis. We estimate this will require about 36 hours each year (three hours each month) for each RTO/ISO. We anticipate the reforms proposed in this Final Rule, once implemented, would not significantly change currently existing burdens on an ongoing basis. The Commission will submit the proposed reporting requirements to OMB for its review and approval under section 3507(d) of the Paperwork Reduction Act.
145. In the NOPR, the Commission requested comments on its need for this information, whether the information will have practical utility, the accuracy of burden and cost estimates, ways to enhance the quality, utility, and clarity of the information to be collected or retained, and any suggested methods for minimizing respondents' burden, including the use of automated information techniques. The comments and the Commission's determinations related to these issues are discussed above.
146. 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.
147. The Regulatory Flexibility Act of 1980 (RFA)
148. This rule would apply to six RTOs/ISOs (all of which are transmission organizations). The average estimated annual PRA-related cost to each of the RTOs/ISOs is $41,272 (one-time and ongoing costs) in Year 1, and $2,772 (ongoing cost) in Year 2 and beyond. This cost of implementing these changes is not significant. Additionally, the RTOs/ISOs are not small entities, as defined by the RFA.
149. In addition to publishing the full text of this document in the
150. 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.
151. User assistance is available for eLibrary and the FERC's website during normal business hours from FERC Online Support at (202) 502-6652 (toll free at 1-866-208-3676) or email at
152. These regulations are effective July 9, 2018. The Commission has determined, with the concurrence of the Administrator of the Office of Information and Regulatory Affairs of OMB, that this rule is not a “major rule” as defined in section 251 of the Small Business Regulatory Enforcement Fairness Act of 1996. The Final Rule will be provided to both Houses of Congress, the Government Accountability Office, and the Small Business Administration.
Electric power rates, Electric utilities, Reporting and recordkeeping requirements.
By the Commission.
In consideration of the foregoing, the Commission amends part 35, chapter I, title 18,
16 U.S.C. 791a-825r, 2601-2645; 31 U.S.C. 9701; 42 U.S.C. 7101-7352.
(g) * * *
(10)
(ii)
(iii)
The following appendix will not appear in the Code of Federal Regulations.
Board of Governors of the Federal Reserve System (Board).
Notice of proposed rulemaking with request for comment.
The Board is inviting comment on a notice of proposed rulemaking (proposal) that would integrate the Board's regulatory capital rule (capital rule) and the Board's Comprehensive Capital Analysis and Review (CCAR) and stress test rules in order to simplify the capital regime applicable to firms subject to the capital plan rule. The proposal would amend the Board's capital plan rule, capital rule, and stress testing rules, and make amendments to the Stress Testing Policy Statement that was proposed for public comment on December 15, 2017. Under the proposal, the Board's supervisory stress test would be used to establish the size of a stress capital buffer requirement and a stress leverage buffer requirement. The proposal would apply to bank holding companies with $50 billion or more in total consolidated assets and U.S. intermediate holding companies of foreign banking organizations established pursuant to Regulation YY. The proposal would not apply to any community bank, any bank holding company with total consolidated assets of less than $50 billion, or to any state member bank or savings and loan holding company. The proposal would be effective on December 31, 2018. Under the proposal, a firm's first stress capital buffer and stress leverage buffer requirements would generally be effective on October 1, 2019.
Comments must be received by June 25, 2018.
You may submit comments, identified by [Docket No. R-1603 and RIN 7100-AF 02] by any of the following methods:
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All public comments will be made available on the Board's website at
Lisa Ryu, Associate Director, (202) 263-4833, Constance Horsley, Deputy Associate Director, (202) 452-5239, (202) 475-6316, Juan Climent, Manager (202) 872-7526, Christine Graham, Senior Supervisory Financial Analyst, (202) 452-3005, Page Conkling, Senior Supervisory Financial Analyst, (202) 912-4647, Joseph Cox, Senior Supervisory Financial Analyst, (202) 452-3216, or Hillel Kipnis, Senior Financial Analyst, (202) 452-2924, Division of Banking Supervision and Regulation; Benjamin W. McDonough, Assistant General Counsel, (202) 452-2036, Julie Anthony, Counsel, (202) 475-6682, Mark Buresh, Senior Attorney, (202) 452-5270, Asad Kudiya, Senior Attorney, (202) 475-6358, or Mary Watkins, Attorney, (202) 452-3722, Legal Division, Board of Governors of the Federal Reserve System, 20th Street and Constitution Avenue NW, Washington, DC 20551. Users of Telecommunication Device for Deaf (TDD) only, call (202) 263-4869.
The resiliency of large financial institutions is critical to the stability of the financial sector. As shown in the 2007-2008 financial crisis, problems at large financial institutions can lead to significant market disruption, spread rapidly throughout the financial system, and cause a credit crunch, worsening economic downturns. To be resilient, a financial institution must maintain sufficient levels of capital to support the risks associated with its exposures and activities. In the years leading up to the financial crisis, neither the regulatory capital regime nor financial institutions' own models sufficiently captured the actual risk exposures of financial institutions, resulting in a level of capital that was inadequate to cover losses as conditions deteriorated, putting the economic activity at risk.
The risks to the ability of the financial system to support economic growth were exacerbated by actions taken by firms during the crisis. Rather than conserve loss-absorbing resources, many firms continued to distribute capital to shareholders in an attempt to reassure the market of their health and resiliency. Further, the lack of transparency into firms' actual risk profiles during the crisis increased uncertainty, left counterparties unable to distinguish between healthy and unhealthy banks, and prompted a large and sudden reaction from the markets as the full scale of risks was revealed. The systematic loss of confidence in the banking sector that ensued led to sharply tighter credit conditions for businesses and households and caused extreme strains in crucial markets; the economic consequences prompted
At the height of the crisis, the Board turned to stress testing, under the Supervisory Capital Assessment Program (SCAP), to determine potential losses at the largest firms if the prevailing stress severely worsened and to restore confidence in the financial sector.
The Board adopted the capital plan rule in 2011, which requires each bank holding company with $50 billion or more in total consolidated assets to submit an annual capital plan to the Board.
Section 165 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) requires the Board to adopt enhanced capital standards, including supervisory stress tests, company-run stress tests, and enhanced risk-based and leverage capital requirements, for bank holding companies with total consolidated assets of $50 billion or more. The enhanced prudential standards that the Board adopts pursuant to section 165 must increase in stringency based on the systemic importance of the firm. The Board's supervisory stress test conducted pursuant to the Dodd-Frank Act evaluates whether firms have sufficient capital to continue operations throughout times of economic and financial stress using firm-provided data and a common set of scenarios, models, and assumptions.
Similar to the Board's capital planning and stress testing rules, the Board's capital rule also addresses weaknesses observed during the 2007-2008 financial crisis. In 2013, the Board adopted a final rule that revised the Board's risk-based and leverage capital requirements for firms.
In July 2015, the Board adopted the GSIB surcharge rule as part of its implementation of section 165 of the Dodd-Frank Act.
The Board expects to release a proposal that would recalibrate the enhanced supplementary leverage ratio standards for GSIBs and their state member bank insured depository institution subsidiaries. The proposal would set the enhanced supplementary leverage ratio standards to 3 percent plus one half of the GSIB surcharge applicable to the bank holding company. That proposal would amend the Board's capital rule, as well as make conforming changes to the Board's total loss-absorbing capacity rule.
Strengthening the regulatory capital regime, including the introduction of capital planning and stress testing requirements, has been an important supervisory response to the financial crisis. Stress testing makes the capital regime more forward-looking, risk-sensitive, and firm-specific. As a result of this program and the enhancements made to the Board's regulatory capital regime, large U.S. bank holding companies are much more resilient to stress than in the past. Common equity capital levels among the nation's largest bank holding companies have risen by over $720 billion since 2009, making U.S. firms among the strongest in the world.
The Board periodically reevaluates its programs to ensure that they remain effective and that unintended consequences are minimized. Accordingly, the Board has reviewed the CCAR program to assess its effectiveness and to identify any areas that should be refined (CCAR review). The CCAR review included an internal assessment as well as a series of feedback meetings with outside parties. The participants in such meetings included senior management from firms currently subject to the capital plan rule, debt and equity market analysts,
Some participants in the CCAR review expressed support for increasing post-stress capital requirements by the amount of the GSIB surcharge and countercyclical capital buffer amount, arguing that such buffer requirements are intended to further macroprudential and countercyclical objectives in a manner that is not currently addressed directly in the supervisory post-stress capital assessment. On the other hand, some participants argued it would not be appropriate to increase post-stress minimum requirements by the GSIB surcharge because it would treat the GSIB surcharge as a minimum capital requirement rather than as a buffer as intended in the capital rule and because the supervisory post-stress capital assessment already includes scenario components that, historically, were only applicable to GSIBs.
Participants in the CCAR review also raised concerns about the interactions between the capital rule and the supervisory post-stress capital assessment. The supervisory post-stress capital assessment includes an assumption that a firm makes all planned capital distributions, reflecting the historical experience from the financial crisis in which the largest banking organizations continued to repurchase shares and pay dividends to shareholders well after the financial system came under severe stress.
Some participants in the CCAR review viewed other assumptions in the supervisory post-stress capital assessment as unrealistic and overly conservative. Since the 2014 CCAR cycle, in projecting a firm's balance sheet, the supervisory stress test has included the assumption that credit supply does not contract. This assumption furthered the Board's macroprudential objectives by evaluating whether firms could pass the supervisory post-stress capital assessment while continuing to lend and support the real economy. In implementing this assumption, the Board used a model calibrated to historical data that tended to project that a firm's balance sheet and risk-weighted assets would grow over the planning horizon, even in the severely adverse scenario.
The Board received other feedback from participants in the CCAR review regarding changes to its processes associated with CCAR. For example, participants recommended further enhancing the transparency of the supervisory post-stress capital assessment and eliminating the heightened supervisory scrutiny of a capital plan that includes a dividend payout ratio of more than 30 percent.
The Board has identified several areas where the capital plan rule and CCAR could be further refined or improved, including by reducing burden for non-GSIBs subject to CCAR; addressing the role of the GSIB surcharge in the supervisory post-stress capital assessment; addressing inconsistencies between the assumptions in the supervisory stress test and the distribution limitations in the capital rule; eliminating one or more post-stress capital ratio minimums in CCAR; and simplifying certain supervisory stress test assumptions.
In January 2017, the Board adopted a rule to reduce the burden associated with the qualitative aspects of CCAR for less complex firms. Under that rule, firms that are not identified as GSIBs and that have average total consolidated assets of $50 billion or more but less than $250 billion and total nonbank assets of less than $75 billion (large and noncomplex firms) are no longer subject to the provisions of the capital plan rule whereby the Board may object to a firm's capital plan on the basis of qualitative deficiencies in the firm's capital planning process.
Additionally, in December 2017, the Board released a package of proposals that would increase the transparency of the supervisory stress test.
The capital rule and capital plan rule each place separate limitations on firms' capital distributions to address the fact that many firms made significant distributions of capital in the lead up to and during the crisis without fully considering the effects that a prolonged economic downturn could have on their capital adequacy. Under the capital rule, a firm is subject to one or more buffer requirements above its minimum capital requirements and becomes subject to increasingly strict limitations on the distributions and bonus payments as its capital ratios decline below the buffer requirements toward the minimum capital requirements. Under the capital plan rule, a firm is required to follow the capital distributions included in its capital plan and, except in limited circumstances, seek the Board's approval before making additional capital distributions.
The proposal would use the results of the annual supervisory stress test to size specific buffer requirements above minimum capital requirements that restrict capital distributions under the capital rule and establish a single approach to capital distribution limitations, effectively integrating the capital rule and the capital plan rule. Integrating the two capital regimes would simplify the Board's overall approach to capital regulation. The proposal would replace the static 2.5 percent of risk-weighted assets portion of the capital conservation buffer requirement under the standardized approach with a stress capital buffer requirement, which is forward-looking, risk-sensitive, and firm-specific. The proposal would also establish a stress leverage buffer requirement in addition to the minimum 4 percent tier 1 leverage ratio requirement.
A firm would be required to maintain capital ratios above its minimum plus its buffer requirements in order to avoid restrictions on its capital distributions and discretionary bonus payments. A firm would be bound by the most stringent distribution limitations, if any, as determined by the firm's standardized approach capital conservation buffer requirement (as defined below), the firm's stress leverage buffer requirement and, if applicable, the firm's advanced approaches capital conservation buffer requirement and enhanced supplementary leverage ratio standard. The stress capital buffer and stress leverage buffer requirements (together, the stress buffer requirements) are described in greater detail in section II.
As noted, participants in the CCAR review observed an inconsistency between the distribution limitations of the capital rule and the distribution assumptions used in the supervisory post-stress capital assessment. To address this inconsistency, certain assumptions used in the supervisory stress test would be modified as part of the proposal. Specifically, in calculating the stress buffer requirements, the proposal would remove the current assumption that a firm would make all planned capital distributions over the planning horizon, including any planned common stock dividends and repurchases of common stock. Instead, the stress buffer requirements would include only four quarters of planned common stock dividends in order to preserve the current incentives for a firm to engage in disciplined, forward-looking dividend planning. The stress buffer requirements would include dividends—but not repurchases—based on the experience in the recent financial crisis, when large bank holding companies began to reduce share repurchases early in the crisis but continued to pay dividends at nearly the pre-crisis rate through 2008.
In addition, the Board would also adjust the methodology used in the supervisory stress test to assume that the firm takes actions to maintain a constant level of assets, including loans, trading assets, and securities over the planning horizon. As a related matter, the Board would assume that a firm's risk-weighted assets and leverage ratio denominator generally remain unchanged over the planning horizon.
The Board would further modify certain elements of CCAR to reflect the introduction of the proposed stress buffer requirements. Specifically, the proposal would remove the quantitative objection in CCAR and instead rely on the capital rule's automatic restrictions on capital distributions that are triggered if a firm breaches its buffer requirements. For firms subject to supervision by the Board's Large Institution Supervision Coordination Committee (LISCC firms) and other large and complex firms,
The proposal would continue to require a firm to describe its planned capital distributions in its capital plan and not exceed those planned capital distributions. Further, as described in section III.B of this preamble, a firm's planned capital distributions would need to be consistent with the effective capital distribution limitations that would apply under the firm's own baseline financial projections (BHC baseline scenario).
As discussed in detail in section II.D of this preamble, the Board estimates that non-GSIBs subject to CCAR would generally need to hold less capital under the proposal, as compared with the current supervisory post-stress capital assessment in CCAR, which is the binding constraint for most of these firms. In contrast, the Board estimates based on the most recent CCAR results the proposal would generally maintain or in some cases increase CET1 capital requirements for GSIBs. However, the Board's estimates suggest that no firm that participated in recent CCAR exercises would need to raise additional capital in order to avoid the proposal's limitations on capital distributions. The impact of the proposal will vary throughout the economic cycle.
As a general matter, capital buffer requirements are designed to help ensure that a firm maintains an adequate amount of loss-absorbing capital to stay above minimum regulatory requirements during stress. The capital buffer requirements restrict a firm's ability to distribute capital as the firm's actual capital levels approach minimum ratios.
Under the current capital rule, a firm's capital conservation buffer requirement is equal to 2.5 percent of risk-weighted assets plus any applicable GSIB surcharge and countercyclical capital buffer amount. The proposal would replace the 2.5 percent of risk-weighted assets with a stress capital buffer requirement, for firms subject to the supervisory stress test. A firm's stress capital buffer requirement would be tailored to its risk profile and potential vulnerability to stress. The firm's capital conservation buffer requirement under the standardized approach would be equal to its stress capital buffer and any applicable GSIB surcharge plus any applicable countercyclical capital buffer amount (standardized approach capital conservation buffer requirement).
Currently, a firm subject to the advanced approaches calculates a given risk-based capital ratio under both the standardized and advanced approaches, and uses the lower of the two ratios as its operative ratio. Under the proposal, a firm would continue to calculate a given risk-based capital ratio under both the standardized and advanced approaches, and would calculate a different capital conservation buffer requirement for each. The capital conservation buffer requirement under the advanced approaches would be equal to 2.5 percent of risk-weighted assets (rather than the stress capital buffer requirement) plus any applicable GSIB surcharge plus any applicable countercyclical capital buffer amount (advanced approaches capital conservation buffer requirement). To date, the Board has not used or required the use of the capital rule's advanced approaches in the supervisory stress test due to the significant resources required to implement the advanced approaches on a pro forma basis and due to the complexity and opaqueness associated with introducing the advanced approaches in supervisory stress test projections. In addition, both the supervisory stress test and the advanced approaches are calibrated to reflect tail-risks; thus it could be duplicative to require a firm to meet the requirements of the advanced approaches on a post-stress basis.
For firms subject to the capital plan rule, the proposal would introduce a stress leverage buffer requirement in addition to the 4 percent minimum tier 1 leverage ratio requirement. This stress leverage buffer requirement would help to maintain the current complementary relationship between the risk-based and leverage capital requirements in normal and stressful conditions. In addition, it would continue the current practice of evaluating a firm's vulnerability to declines in its leverage ratio under stressful conditions.
The proposal would not, however, extend the stress buffer concept to the supplementary leverage ratio. A single stress leverage buffer, applicable to all firms, would provide a sufficient backstop and avoid adding additional complexity.
A firm would need to maintain capital ratios above all minimum and buffer requirements to avoid restrictions on its capital distributions and discretionary bonus payments. A firm would be subject to the most stringent distribution limitations, if any, as determined by the firm's standardized approach capital conservation buffer requirement, the firm's stress leverage buffer requirement and, if applicable, the firm's advanced approaches capital conservation buffer requirement, and the enhanced supplementary leverage ratio standard.
The Board's supervisory stress test conducted under Regulation YY would be used to size each firm's stress buffer requirements. The stress buffer requirements would be calculated under the supervisory stress test's severely adverse scenario, designed in accordance with the Policy Statement on the Scenario Design Framework for Stress Testing. As described in appendix A to 12 CFR part 252, severely adverse scenarios are designed to be plausible, relevant, and guided in large part by historical experience in severe U.S. recessions.
As in the current supervisory post-stress capital assessment in CCAR, under the proposal, the supervisory stress test would continue to use a common set of scenarios, models, and assumptions across firms. The performance of each model used in the supervisory stress test is assessed using a variety of metrics and benchmarks, including benchmark model results, where applicable. Each model is validated annually by an independent supervisory model validation function. In December 2017, the Board issued a Stress Testing Policy Statement for public comment describing its approach to supervisory model development, implementation, use, and validation.
Each component of a firm's standardized approach capital conservation buffer requirement serves a distinct purpose and is calibrated and designed according to that purpose. The stress capital buffer requirement would be calibrated based on each firm's vulnerability to adverse economic or financial market conditions. As such, it would help ensure that the firm holds sufficient capital to continue to serve as a financial intermediary during a period of financial stress. The GSIB surcharge is designed to mitigate the risk posed to financial stability by certain large and systemic financial institutions, and is calibrated based on the externalities posed by these firms as measured by factors such as size, interconnectedness, and complexity. Finally, the countercyclical capital buffer is a macroprudential tool intended to strengthen the resiliency of financial firms and the financial system, by allowing the Board to raise capital standards when credit growth in the economy becomes excessive. Taken together, a firm's standardized approach capital conservation buffer requirement ensures that the firm has sufficient capital to continue to serve as a financial intermediary during stress, internalizes the cost that its failure would have on the broader economy, and builds capital when there is an elevated risk of above-normal losses.
In the CCAR review, certain discussion participants disagreed with the view that the supervisory post-stress capital assessment and the GSIB surcharge serve different purposes because two elements of the Board's supervisory post-stress capital assessment, the global market shock and the large counterparty default scenario component, apply only to GSIBs. However, the global market shock and large counterparty default scenario component apply to any firm that has material trading, derivatives, and securities financing transaction activities to capture direct losses stemming from these activities.
As described below in section II.B of this preamble, the proposed stress buffer requirements would incorporate different capital action assumptions than are currently used in the supervisory post-stress capital assessment in CCAR. Those revised capital action assumptions would also be incorporated in the Board's supervisory stress tests and the company-run stress tests conducted under Regulation YY, in order to harmonize the publicly disclosed supervisory and company-run stress test results with the stress buffer requirements.
Under the proposal, the Board would determine a firm's stress capital buffer requirement as the difference between the firm's starting and lowest projected CET1 capital ratios under the severely adverse scenario in the supervisory stress test, calculated under the standardized approach, plus the sum of the ratios of the dollar amount of the firm's planned common stock dividends to projected risk-weighted assets for each of the fourth through seventh quarters of the planning horizon. The stress capital buffer requirement would be floored at 2.5 percent of a firm's risk-weighted assets.
Under the current capital rule, all banking organizations are subject to a capital conservation buffer requirement. The capital rule's current static 2.5 percent of risk-weighted assets component of the capital conservation buffer requirement was calibrated to reflect how firms' capital positions were affected during periods of severe stress, including the most recent financial crisis.
The stress leverage buffer requirement would be determined based on the same annual supervisory stress test that the Board conducts to determine the stress capital buffer requirement. Under the proposal, the Board would determine a firm's stress leverage buffer requirement as the difference between the firm's starting and lowest projected Tier 1 leverage ratio under the severely adverse scenario in the supervisory stress test plus the sum of the ratios of the dollar amount of the firm's planned common stock dividends to projected leverage ratio denominator for each of the fourth through seventh quarters of the planning horizon. The stress leverage buffer requirement would not have a floor, as there is no generally applicable leverage buffer requirement today, and would apply to all firms subject to the capital plan rule.
For the supervisory stress test used to calculate the stress buffer requirements, the Board proposes to revise certain assumptions it currently uses in the supervisory post-stress capital assessment in CCAR. Currently, in the CCAR post-stress capital assessment, the Board assumes that a firm will make all of its planned capital actions, including dividends and repurchases, and issuances of regulatory capital instruments. The proposal would narrow the set of planned capital actions assumed to occur in the supervisory stress test.
The current CCAR capital distribution assumptions were introduced to assess whether a firm could meet minimum capital requirements during severe stress conditions even if the firm did not reduce its planned capital distributions. However, the stress buffer requirements would reduce the need for the assumption that a firm makes all common stock distributions in a stress scenario because the restriction on a firm's capital distributions on an ongoing basis would be a function of the firm's performance under stress. Accordingly, the Board would no longer assume that a firm makes any repurchases or redemptions of any capital instrument.
However, in order to preserve the current incentives for a firm to engage in disciplined, forward-looking dividend planning, a firm's stress buffer requirements would include four quarters of planned common stock dividends (in the fourth through seventh quarters of the planning horizon), added to the projected decline in the firm's capital under stress. Requiring a firm to pre-fund one year of planned dividends would preserve the current incentives for a firm to engage in disciplined, forward-looking dividend planning. As noted, this aspect of the proposal is based on the Board's experience with large bank holding companies' capital distribution practices during the recent financial crisis. Additionally, evidence in the academic literature generally indicates that repurchases are more flexible than
As in the current supervisory post-stress capital assessment, the Board would continue to assume in the supervisory stress test that a firm would make payments on any instrument that qualifies as additional tier 1 capital or tier 2 capital equal to the stated dividend, or contractual interest or principal due on such instrument during the quarter. Based on supervisory experience, reductions in these payments are generally viewed by market participants as a sign of material weakness and firms are therefore likely to make them even under stressful conditions.
The Board would also generally assume in the supervisory stress test that a firm does not make any planned issuance of regulatory capital instruments, parallel to the assumption that a firm does not repurchase any regulatory capital instruments. However, as under the current capital plan rule, the supervisory stress test would include issuances of common or preferred stock in connection with a planned merger or acquisition to the extent that the merger or acquisition is reflected in a firm's pro forma balance sheet estimates. Including such issuances, for purposes of the supervisory stress tests, would allow the Board to assess how a planned merger or acquisition would affect a firm's post-stress capital position.
The proposal would revise the required capital action assumptions in the company-run stress test rules to be consistent with the proposed capital actions used to calculate a firm's stress buffer requirements and would introduce those assumptions into the supervisory stress test rules.
Since the first CCAR exercise, any capital plan implying a common stock dividend payout ratio above 30 percent has received heightened scrutiny in the qualitative assessment of each firm's capital planning processes. Participants in the CCAR review expressed general opposition to any specific cap on dividends, and argued that if a cap were deemed necessary, it should be higher than 30 percent. Including four quarters of planned dividends in a firm's stress buffer requirements as proposed would foster an incentive for prudent dividend payouts, removing the need for heightened scrutiny based on a capital plan's dividend payout ratio. Accordingly, in connection with this proposal, in future CCAR exercises the Board would eliminate the 30 percent dividend payout ratio as a criterion for heightened supervisory scrutiny of a firm's capital plan.
In addition, in response to comments regarding the current assumption that a firm's credit supply does not contract, resulting in growth of a firm's balance sheet in stress scenarios, the Board is proposing to modify its Stress Testing Policy Statement to include the assumption that a firm takes actions to maintain its current level of assets, including its securities, trading assets, and loans, over the planning horizon (no growth assumption).
A firm's stress buffer requirements would be effective on October 1 of each year, and remain in effect until September 30 of the following year, unless the firm received updated stress buffer requirements from the Board.
The process for determining the stress buffer requirements would be codified in the Board's capital plan rule (discussed further in section III below), and the restrictions associated with these requirements would be codified in the Board's capital rule (discussed further in section IV below).
To avoid limitations on capital distributions under the Board's current rules, a firm must manage to two distinct capital regimes. Specifically, the firm must both (1) maintain risk-based capital ratios above the capital rule's minimum requirements plus the capital conservation buffer requirement (a GSIB must also maintain a supplementary leverage ratio above 5 percent), and (2) demonstrate an ability to maintain capital ratios above minimum regulatory capital requirements in the supervisory post-stress capital assessment in CCAR. This proposal would simplify and integrate these requirements, eliminating the need for firms to manage to both potential sources of limitations on capital distributions. In conjunction with the proposal, the Board would also modify certain assumptions used in the supervisory stress test. To assess the impact of both the integration and the modified assumptions, the Board reviewed the levels of capital currently required of each firm across the two current regimes to avoid limitations on capital distributions and compared the higher of those amounts to the estimated level of capital that would be required of each firm under the proposal.
For firms with over $50 billion in assets that are not GSIBs, the proposal would generally result in a reduction to a firm's required level of capital to avoid capital distribution limitations relative to what is required today.
All other things being equal, the proposal generally would lower the amount of tier 1 capital that a firm would need to maintain with respect to the assessment of the leverage ratio in stress. This is because the modified balance sheet and distribution assumptions in the supervisory stress test would reduce the stringency of the Tier 1 leverage ratio in stress and the stress leverage buffer requirement would not include a GSIB surcharge or any applicable countercyclical capital buffer amount.
The impact of the proposal would vary through the economic and credit cycle based on the risk profile and planned capital distributions of individual firms, as well as on the specific severely adverse stress scenario used in the supervisory stress test. Based on data from CCAR 2015, 2016, and 2017, the impact of the proposal would range from an aggregate reduction in CET1 capital requirements of about $35 billion (based on 2017 data) to an aggregate increase in CET1 capital requirements of about $40 billion (based on 2015 data). For GSIBs, this represents a corresponding increase in CET1 capital requirements of approximately $10 billion to $50 billion in aggregate, respectively, while non-GSIBs would have a decrease of approximately $45 billion to $10 billion, respectively. Had the proposal been in effect during recent CCAR exercises, analysis of those CCAR results and the current level of capital at participating firms indicates that no such firm would have needed to raise additional capital in order to avoid the proposal's limitations on capital distributions.
The proposal would remove the quantitative objection from the capital plan rule. Under the current capital plan rule, a firm may receive an objection to its capital plan if the firm does not demonstrate the ability to maintain capital ratios above the minimum requirements on a post-stress basis. The proposal would replace the quantitative objection with the stress buffer requirements.
A focus on firms' capital planning would continue to be a key element of the Board's regulatory and supervisory regime. The proposal would continue to require a firm to describe its planned capital distributions in its capital plan and not exceed those planned capital distributions. Firms should plan to maintain capital levels above their minimum requirements plus relevant buffer requirements during normal economic periods and also to plan for capital needs during adverse economic conditions. These practices allow firms to continue to lend and operate as viable financial intermediaries even during adverse periods.
To help ensure a firm engages in prudent capital planning, the firm would be required to limit its planned capital distributions for the fourth through seventh quarters of the planning horizon to those that would be consistent with any effective capital distribution limitations that would apply under the firm's own BHC baseline scenario projections.
In its capital plan, a firm would also be required to plan for all limitations on capital distributions in the Board's rules, except the advanced approaches capital conservation buffer requirement and total loss-absorbing capacity buffer requirement calculated using the advanced approaches.
For instance, a firm that became subject to a higher GSIB surcharge in its most recent annual surcharge calculation would use the higher surcharge beginning in the fifth quarter of the planning horizon (which would coincide with the quarter in which the higher GSIB surcharge would come into effect under the capital rule) and retain that amount through the end of the planning horizon. Otherwise, a firm would assume that its current GSIB surcharge applies for all quarters of the planning horizon (as it would not have knowledge of a decrease in its GSIB surcharge when it finalized its plan). With regard to the countercyclical capital buffer, a firm would reflect any applicable countercyclical capital buffer amount as established by the Board. For example, if the Board had established a countercyclical capital buffer amount beginning in the fifth quarter of the planning horizon that remained in effect for one year, the firm would reflect the countercyclical capital buffer amount in quarters five through eight of the planning horizon.
Under the proposal, a firm's planned capital distributions would be required to be consistent with effective capital distribution limitations that would apply in the firm's pro forma projections under the BHC baseline scenario. The BHC baseline scenario would be defined as a scenario that reflects the bank holding company's reasonable expectation of the economic and financial outlook, including expectations related to the bank holding company's capital adequacy and financial condition. The firm's projections under the BHC baseline scenario must incorporate the firm's expected performance, business plan, management actions, and all planned capital actions.
Basing capital distribution restrictions on a firm's projections in its BHC baseline scenario may create incentives for a firm to be overly optimistic about its baseline projections in order to increase the amount of permissible capital distributions. In order to maintain strong incentives for a firm to project realistic baseline earnings, the Board intends to monitor and evaluate a firm's quarterly performance relative to its baseline projections to help ensure that the firm adopts processes that realistically project performance and capital levels. A pattern of materially underperforming baseline projections for earnings, capital levels, or capital ratios may be indicative of weaknesses in the firm's capital planning and result in heightened scrutiny in the qualitative assessment. Additionally, as under the current rule, the Board may require a firm that materially underperforms its projected capital ratios to resubmit its capital plan if such underperformance results from material changes in the firm's risk exposures or operating conditions. Additionally, under the proposal, the Board would continue to be able to object to the capital plans of large and complex firms and LISCC firms on qualitative grounds.
Further, the proposal would provide that the Board would consider the results of any stress test conducted by the bank holding company or the Board in conducting its review of a firm's capital plan, similar to the provision in the current capital plan rule. Those results would inform the Board's view of the financial condition of the firm, which has implications for the reasonableness and appropriateness of the firm's capital plan.
Under the current capital plan rule, the Board completes its assessment of a firm's capital plan, including the supervisory stress test, by June 30. Similarly, under the proposal, the Board would complete the assessment of a firm's capital plan and provide each firm with initial notice of the firm's stress buffer requirements by June 30. The proposal would modify certain other procedural requirements associated with the capital plan rule.
Consistent with the current practice, the as-of date for the capital plan cycle would be December 31 of the previous calendar year, and the planning horizon for capital planning would be a period of nine consecutive quarters from that date. Firms would submit their capital plans and related regulatory reports by April 5. The Board generally would determine each firm's stress buffer requirements and conduct a qualitative evaluation of the capital plans of large and complex firms and LISCC firms in the second quarter of the year (April through June). By June 30, the Board generally would disclose to the public
Currently, upon completion of the supervisory stress test but before the disclosure of the final CCAR results, the Board provides each firm with the results of its post-stress capital analysis, and each firm has an opportunity to make a one-time adjustment to its planned capital actions. Similarly, under the proposal, within two business days of receipt of initial notice of its stress buffer requirements, a firm would be required to assess whether its planned capital distributions are consistent with the effective capital distribution limitations that would apply on a pro forma basis under the BHC baseline scenario throughout the fourth through seventh quarters of the planning horizon. In the event of an inconsistency, a firm would be required to reduce the capital distributions in its capital plan to be consistent with such limitations for those quarters of the planning horizon.
Each firm's updated annual stress buffer requirements would become effective for purposes of the capital rule on October 1. From October 1 through September 30 of the following calendar year, a firm would not be permitted to exceed the amount of capital distributions in the firm's capital plan without prior notification to or approval from the Board.
Table 1 below summarizes the key dates and actions in the annual capital plan cycle under the proposal.
Currently, the Board's review and approval of planned capital actions covers the four-quarter period between July 1 and June 30 of the following calendar year. Were a firm's stress buffer requirements to become effective on October 1, 2019, as proposed, for the period July 1 to September 30, 2019, a bank holding company would be authorized to make capital distributions that do not exceed the four-quarter average of capital distributions to which the Board indicated its non-objection for the previous capital plan cycle, unless otherwise determined by the Board. To the extent that a firm wishes to make additional capital distributions beyond its four-quarter average of capital distributions to which the Board indicated its non-objection for the previous capital plan cycle, it would be able to use the established notification or request for approval processes in the current capital plan rule.
The proposed rule would revise the procedures for a firm to request reconsideration of a qualitative objection to its capital plan and would provide similar procedures to allow a firm to request reconsideration of its stress buffer requirements.
Under the proposal, a firm that determines to request reconsideration of any of its stress buffer requirements or of a qualitative objection to its capital plan would be required to submit a request to the Board, and the Board would respond in writing within 30 days. By requiring a firm to submit a request for reconsideration through this procedure, the proposal would provide the Board with an opportunity to consider justifications and additional information that the firm believes would support its request in light of the results of the Board's supervisory stress test, additional information received during the CCAR process, and any other relevant information. The proposed procedures also would provide a firm with an opportunity to respond to any of its stress buffer requirements and help ensure that the stress capital buffer requirements are appropriately sized. Likewise, the proposed procedures would provide a firm with an opportunity to respond to a qualitative objection to its capital plan, and to help ensure that the Board has considered all relevant aspects of the firm's capital planning process and capital adequacy process. While a firm's request for reconsideration is pending, the requirements under reconsideration
The proposal would establish requirements for the timing and contents of a request for reconsideration. Under the proposal, a firm wishing to request reconsideration of a qualitative objection to its capital plan or any of its stress buffer requirements would be required to submit to the Board in writing such request within fifteen calendar days of receipt of notice of its objection or stress buffer requirements. The request would be required to include an explanation of why the firm believes that the objection to its capital plan or either of its stress buffer requirements should be reconsidered. To facilitate the Board's review of a firm's request for reconsideration, the request should identify all supporting reasons for the request. For information not previously provided as part of the capital plan, the request should include an explanation of why the information should be considered.
Within 30 calendar days of receipt of the firm's request for reconsideration, the Board would notify the firm of its decision to affirm or modify any of the firm's stress buffer requirements or affirm or withdraw its objection to the firm's capital plan.
The proposed timeline is intended to provide an adequate opportunity for response, while ensuring that the results of the supervisory stress test and a firm's most recent capital plan are integrated into the firm's ongoing capital requirements and planned distributions as quickly as possible. The proposed process should provide the firm with an opportunity to present any issues or arguments in an efficient manner and allow the Board to respond to the items raised in the request for reconsideration taking into account the results of the stress test and its supervisory experience in light of information and arguments presented by the firm.
While a firm's request for reconsideration is pending, its stress buffer requirement(s) or qualitative objection to the firm's capital plan, if under reconsideration, would not be final, and therefore would not be effective.
In the case that the Board adjusted a firm's stress buffer requirements in response to a request for reconsideration of a firm's stress buffer requirement(s), the firm would follow the procedures provided for the initial notification of the stress buffer requirements. To enable the firm to make the capital distributions included in its original capital plan, if the Board reduced the firm's stress buffer requirements, the firm would have an opportunity to increase its planned capital distributions up to the amount included in the firm's original capital plan. A firm would be required to notify the Board of any adjustments in planned capital distributions.
Currently, the capital plan rule provides that a firm that requests reconsideration of an objection to its capital plan may request an informal hearing as an alternative to requesting reconsideration of an objection to its capital plan. Consistent with the current capital plan rule, the proposal would provide a firm with an opportunity to request an informal hearing as part of its request for request for reconsideration.
The capital plan rule currently provides that the Board may require a firm to resubmit its capital plan if the Board determines that there has been a material change in the firm's risk profile, financial condition, or corporate structure or if the bank holding company stress scenario(s) used in the firm's most recent capital plan are no longer appropriate for the firm's business model and portfolios, or changes in financial markets or the macro-economic outlook that could have a material impact on a firm's risk profile and financial condition require the use of updated scenarios (material change). Additionally, a firm must resubmit its capital plan if it determines there has been or will be a material change in the firm's risk profile, financial condition, or corporate structure since the firm last submitted the capital plan to the Board. Until the Board has acted on that resubmitted capital plan, a firm is not permitted to make any capital distributions other than those approved by the Board in
Similar to the current procedure, under the proposal, the Board may recalculate a firm's stress buffer requirements whenever the firm chooses or is required to resubmit its capital plan. The Board would review a resubmitted capital plan within 75 calendar days after receipt and, at the Board's discretion, provide the firm with one or more updated stress buffer requirements, and, for a large and complex or LISCC firm, would object or not object to the resubmitted capital plan on qualitative grounds. Under the proposal, upon a determination by the Board or the firm of a material change, the Board may conduct an updated supervisory stress test and recalculate a firm's stress buffer requirements based on the resubmitted capital plan.
Conceptually, a firm's capital buffer is the amount by which its regulatory capital ratios exceed minimum requirements. For example, for risk-based capital purposes under the current capital rule, a firm's capital conservation buffer is equal to the lowest of the following ratios: The firm's CET1 capital ratio minus its minimum CET1 capital ratio requirement, its tier 1 capital ratio minus its minimum tier 1 capital ratio requirement, and its total capital ratio minus its minimum total capital ratio requirement. The proposal would retain this concept for determining a firm's buffer above its minimum risk-based capital requirements, and would extend the concept for purposes of determining a firm's buffer above its minimum 4 percent tier 1 leverage ratio requirement (leverage buffer). Under the proposal, a firm would compare a given buffer to the relevant buffer requirement to determine whether it is subject to limitations on its capital distributions and discretionary bonus payments.
To incorporate the stress buffer requirements into the capital rule, the proposal would revise the capital rule to introduce the terms “stress capital buffer requirement” and “stress leverage buffer requirement,” and to define standardized approach capital conservation buffer requirement and advanced approaches capital conservation buffer requirement for firms subject to the capital plan rule. A firm would determine its standardized approach capital conservation buffer using risk-based capital ratios calculated under the capital rule's standardized approach, and, if applicable, would determine its advanced approaches capital conservation buffer using risk-based capital ratios calculated under the rule's advanced approaches.
A firm would be subject to the most stringent distribution limitation, if any, as determined by the firm's standardized approach capital conservation buffer requirement, the firm's stress leverage buffer requirement and, if applicable, the firm's advanced approaches capital conservation buffer requirement, and the enhanced supplementary leverage ratio standard. The firm would determine the maximum amount it could pay in capital distributions and discretionary bonus payments that quarter (maximum payout amount) by multiplying the firm's eligible retained income by the most stringent payout ratio, if any, that it is subject to as determined under Table 2 to 12 CFR 217.11 of the proposed rule.
For example, in order to determine the maximum payout amount that a firm may pay in capital distributions and discretionary bonus payments for the first quarter of 2020, a firm would multiply its maximum payout ratio by its eligible retained income. For the period from January 1, 2020 to March 31, 2020, the eligible retained income of the firm would be based on the firm's net income for the year 2019 and the maximum payout ratio would be determined based on the capital ratios of the firm as of December 31, 2019. Firms that are subject to stress buffer requirements are expected to know their
The proposal would not amend the current definitions of “distribution” and “capital distribution” found in the capital rule and capital plan rule, respectively. Under the capital rule, the definition of distribution includes reductions in tier 1 capital through a repurchase or any other means, except when the institution, in the same quarter as the repurchase, fully replaces the tier 1 instrument by issuing another similar instrument. Under the capital plan rule, a capital distribution means a redemption or repurchase of any debt or equity capital instrument, a payment of common or preferred stock dividends, a payment that may be temporarily or permanently suspended by the issuer on any instrument that is eligible for inclusion in the numerator of any minimum regulatory capital ratio, and any similar transaction that the Board determines to be in substance a distribution of capital. Unlike the definition of distribution in the capital rule, the definition of capital distribution in the capital plan rule does not provide an exception for distributions accompanied by an offsetting issuance. The discrepancy between the two definitions reflects the different purposes of the two rules. The broader definition included in the capital plan rule ensures that all distributions, including those offset by issuances, are included in a firm's capital plan. However, because distributions offset by equivalent issuances within a quarter do not affect a firm's capital position, this type of distribution is not included in the definition in the capital rule.
To increase the transparency regarding the application of an additional trading and counterparty scenario component, the proposal would expressly include the definition of “significant trading activity” into the Board's company-run stress test requirements,
The proposal would modify the Consolidated Financial Statements for Holding Companies Report (FR Y-9C; OMB: 7100-0128) to collect information regarding the stress buffer requirements applicable to a firm and the Capital Assessments and Stress Testing Report (FR Y-14A; OMB No. 7100-0341). Specifically, the proposal would add new line items to the quarterly FR Y-9C in order to collect information regarding a firm's stress capital buffer requirement, stress leverage buffer requirement, and GSIB surcharge and countercyclical capital buffer amount, as applicable, and information necessary to calculate a firm's distribution limitations, including its capital conservation buffer, advanced approaches capital conservation buffer, leverage buffer, eligible retained income, and distributions. This information would enable the Board and the public to identify any distribution limitations and monitor a bank holding company's performance on a quarterly basis.
The proposal would add similar items to the semi-annual FR Y-14A schedule to collect the information necessary to compare a firm's projected capital ratios to expected buffer requirements and implement the proposed evaluation of planned capital actions under the BHC baseline scenario.
To implement this requirement, a firm would be required to report its capital distributions on the FR Y-14A filed in connection with its initial capital plan on April 5, and in the event of any downward adjustments to its planned capital distributions, resubmit the FR Y-14A summary schedule within two business days of receiving its stress buffer requirements, that reflect the stress buffer requirements and its reduced planned capital distributions.
In accordance with section 3512 of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521) (PRA), the Board may not conduct or sponsor, and a respondent is not required to respond to, an information collection unless it displays a currently valid Office of Management and Budget (OMB) control number. The Board reviewed the proposed rule under the authority delegated to the Board by OMB.
The proposed rule would revise collection of information requirements subject to the PRA. As described further below, the proposal would revise the reporting requirements found in section 12 CFR 225.8. Additionally, the Board proposes to revise certain other collections of information to reflect the changes proposed in the proposed rule.
The OMB control numbers are 7100-0128, 7100-0341, and 7100-0342 for this information collection.
Comments are invited on:
a. Whether the collections of information are necessary for the proper performance of the Federal Reserve's functions, including whether the information has practical utility;
b. The accuracy or the estimate of the burden of the information collections, including the validity of the methodology and assumptions used;
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 comment will become a matter of public record. Comments on aspects of this notice that may affect reporting, recordkeeping, or disclosure requirements and burden estimates should be sent to: Secretary, Board of Governors of the Federal Reserve System, 20th and C Streets NW, Washington, DC 20551. A copy of the comments may also be submitted to the OMB desk officer by mail to U.S. Office of Management and Budget, 725 17th Street NW, #10235, Washington, DC 20503 or by facsimile to 202-3955806, Attention, Agency Desk Officer.
(1)
(2)
The Capital Assessments and Stress Testing information collection consists of the FR Y-14A, FR Y-14Q, and FR Y-14M reports. The semi-annual 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.
(3)
The Board is providing an initial regulatory flexibility analysis with respect to this proposed rule. The Regulatory Flexibility Act, 5 U.S.C. 601
The Board has considered the potential impact of the proposed rule on small entities in accordance with the RFA. Based on its analysis and for the reasons stated below, the Board believes that this proposed rule will not have a significant economic impact on a substantial number of small entities. Nevertheless, the Board is publishing and inviting comment on this initial regulatory flexibility analysis. A final regulatory flexibility analysis will be conducted after comments received during the public comment period have been considered. The proposal would also make corresponding changes to the Board's reporting forms.
As discussed in detail above, the proposed rule would amend the capital rule, capital plan rule, stress testing rules, and the proposed Stress Testing Policy Statement, that was previously proposed on December 15, 2017. Under the proposed rule, the Board would use the results of the supervisory stress test to establish the size of a firm's stress capital buffer requirement and stress leverage buffer requirement. The stress capital buffer requirement would replace the static 2.5 percent of standardized risk-weighted assets
The Board has broad authority under the International Lending Supervision Act (ILSA)
The proposed rule would apply only to bank holding companies with total consolidated assets of $50 billion or more, any nonbank financial company supervised by the Board that becomes subject to the capital planning requirements pursuant to a rule or order of the Board, and to U.S. intermediate holding companies established pursuant to the Board's Regulation YY. Currently, all nonbank financial companies supervised by the Board are not subject to the capital planning requirements and all U.S. intermediate holding companies established pursuant to Regulation YY have greater than $1 billion in total assets. The proposed rule would not apply to any small entities. Further, the proposal would make changes to the projected reporting, recordkeeping, and other compliance requirements of the rule by proposing to collect information from firms subject to the capital plan rule relating to adjustments to planned capital distributions included in a firm's capital plan and information regarding a firm's capital conservation buffer requirements (including the stress buffer requirements) and any applicable distribution limitations under the capital rule. These changes would not impact small entities. In addition, the Board is aware of no other Federal rules that duplicate, overlap, or conflict with the proposed changes to the capital rule, capital plan rule, and stress testing rules. Therefore, the Board believes that the proposed rule will not have a significant economic impact on small banking organizations supervised by the Board and therefore believes that there are no significant alternatives to the proposed rule that would reduce the economic impact on small banking organizations supervised by the Board.
The Board welcomes comment on all aspects of its analysis. In particular, the Board requests that commenters describe the nature of any impact on small entities and provide empirical data to illustrate and support the extent of the impact.
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 proposed rule in a simple and straightforward manner, and invites comment on the use of plain language.
For example:
• Have we organized the material to suit your needs? If not, how could the rule be more clearly stated?
• Are the requirements in the rule clearly stated? If not, how could the rule 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 make the regulation easier to understand?
• Would more, but shorter, sections be better? If so, which sections should be changed?
• What else could we do to make the regulation easier to understand?
Administrative practice and procedure, Banks, Banking, Holding companies, Reporting and recordkeeping requirements, Securities.
Administrative practice and procedure, Banks, Banking, Capital planning, Holding companies, Reporting and recordkeeping requirements, Securities, Stress testing.
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
12 U.S.C. 248(a), 321-338a, 481-486, 1462a, 1467a, 1818, 1828, 1831n, 1831o, 1831p-1, 1831w, 1835, 1844(b), 1851, 3904, 3906-3909, 4808, 5365, 5368, 5371.
(a)
(2)
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
(3)
(A) The Board-regulated institution's common equity tier 1 capital ratio minus the Board-regulated institution's minimum common equity tier 1 capital ratio requirement under § 217.10;
(B) The Board-regulated institution's tier 1 capital ratio minus the Board-regulated institution's minimum tier 1 capital ratio requirement under § 217.10; and
(C) The Board-regulated institution's total capital ratio minus the Board-regulated institution's minimum total capital ratio requirement under § 217.10; or
(ii) Notwithstanding paragraphs (a)(3)(i)(A) through (C) of this section, if the Board-regulated institution's common equity tier 1, tier 1 or total capital ratio is less than or equal to the Board-regulated institution's minimum common equity tier 1, tier 1 or total capital ratio requirement under § 217.10, respectively, the Board-regulated institution's capital conservation buffer is zero.
(4)
(ii)
(iii)
(A) Eligible retained income is negative; and
(B) Capital conservation buffer was less than 2.5 percent as of the end of the previous calendar quarter.
(iv)
(v)
(b)
(i)
(ii)
(iii)
(iv)
(B) If, in accordance with subpart D or E of this part, the Board-regulated institution has assigned to a private sector credit exposure a risk weight associated with a protection provider on a guarantee or credit derivative, the location of the exposure is the national jurisdiction where the protection provider is located.
(C) The location of a securitization exposure is the location of the underlying exposures, or, if the underlying exposures are located in more than one national jurisdiction, the national jurisdiction where the underlying exposures with the largest aggregate unpaid principal balance are located. For purposes of this paragraph (b), the location of an underlying exposure shall be the location of the borrower, determined consistent with paragraph (b)(1)(iv)(A) of this section.
(2)
(ii)
(iii)
(iv)
(v)
(B)
(vi)
(3)
(c)
(ii)
(iii)
(A) A standardized approach capital conservation buffer requirement equal to its stress capital buffer requirement plus its applicable countercyclical capital buffer amount in accordance with paragraph (b) of this section plus its applicable GSIB surcharge in accordance with paragraph (d) of this section; and
(B) If the Board-regulated institution calculates risk-weighted assets under subpart E of this part, an advanced approaches capital conservation buffer requirement equal to 2.5 percent plus the Board-regulated institution's countercyclical capital buffer amount in accordance with paragraph (b) of this section plus its applicable GSIB surcharge in accordance with paragraph (d) of this section.
(iv)
(A) A standardized approach capital conservation buffer, calculated under paragraph (c)(2) of this section, that is greater than its standardized approach capital conservation buffer requirement
(B) If applicable, an advanced approaches capital conservation buffer, calculated under paragraph (c)(3) of this section, that is greater than the Board-regulated institution's advanced approaches capital conservation buffer requirement calculated under paragraph (c)(1)(iii)(B) of this section; and
(C) A leverage buffer, calculated under paragraph (c)(4) of this section, that is greater than its stress leverage buffer requirement calculated under paragraph (a)(2)(vii) of this section; and
(D) If applicable, a SLR buffer, calculated under paragraph (c)(5) of this section, that is greater than its SLR buffer requirement as calculated under paragraph (a)(2)(v) of this section.
(v)
(A) Eligible retained income is negative; and
(B)(
(
(
(
(vi)
(v)
(2)
(ii) A Board-regulated institution that is subject to 12 CFR 225.8 has a standardized approach capital conservation buffer that is equal to the lowest of the following ratios, calculated as of the last day of the previous calendar quarter:
(A) The ratio calculated by the Board-regulated institution under § 217.10(b)(1) or (c)(1)(i), as applicable, minus the Board-regulated institution's minimum common equity tier 1 capital ratio requirement under § 217.10(a);
(B) The ratio calculated by the Board-regulated institution under § 217.10(b)(2) or (c)(2)(i), as applicable, minus the Board-regulated institution's minimum tier 1 capital ratio requirement under § 217.10(a); and
(C) The ratio calculated by the Board-regulated institution under § 217.10(b)(3) or (c)(3)(i), as applicable, minus the Board-regulated institution's minimum total capital ratio requirement under § 217.10(a).
(iii) Notwithstanding paragraph (c)(2)(ii) of this section, if any of the ratios calculated by the Board-regulated institution under § 217.10(b)(1), (2), or (3), or if applicable § 217.10(c)(1)(i), (c)(2)(i), or (c)(3)(i) is less than or equal to the Board-regulated institution's minimum common equity tier 1 capital ratio, tier 1 capital ratio, or total capital ratio requirement under § 217.10(a), respectively, the Board-regulated institution's capital conservation buffer is zero.
(3)
(ii) A Board-regulated institution that calculates risk-weighted assets under subpart E of this part has an advanced approaches capital conservation buffer that is equal to the lowest of the following ratios, calculated as of the last day of the previous calendar quarter:
(A) The ratio calculated by the Board-regulated institution under § 217.10(c)(1)(ii) minus the Board-regulated institution's minimum common equity tier 1 capital ratio requirement under § 217.10(a);
(B) The ratio calculated by the Board-regulated institution under § 217.10(c)(2)(ii) minus the Board-regulated institution's minimum tier 1 capital ratio requirement under § 217.10(a); and
(C) The ratio calculated by the Board-regulated institution under § 217.10(c)(3)(ii) minus the Board-regulated institution's minimum total capital ratio requirement under § 217.10(a).
(iii) Notwithstanding paragraphs (c)(3)(ii) of this section, if any of the ratios calculated by the Board-regulated institution under § 217.10(c)(1)(ii), (c)(2)(ii), or (c)(3)(ii) is less than or equal to the Board-regulated institution's minimum common equity tier 1 capital ratio, tier 1 capital ratio, or total capital ratio requirement under § 217.10(a), respectively, the Board-regulated institution's advanced approaches capital conservation buffer is zero.
(4)
(ii) A Board-regulated institution has a leverage buffer that is equal to the Board-regulated institution's leverage ratio minus 4 percent, calculated as of the last day of the previous calendar quarter.
(iii) Notwithstanding paragraph (c)(4)(ii) of this section, if the Board-regulated institution's leverage ratio is less than or equal to 4 percent, the Board-regulated institution's leverage buffer is zero.
(5)
(ii) A global systemically important BHC has a SLR buffer that is equal to the global systemically important BHC's supplementary leverage ratio minus 3 percent, calculated as of the last day of the previous calendar quarter.
(iii) Notwithstanding paragraph (c)(5)(ii) of this section, if the global systemically important BHC's supplementary leverage ratio is less than or equal to 3 percent, the global systemically important BHC's SLR buffer is zero.
(d)
(g)
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.
(a)
(b)
(i) Any top-tier bank holding company domiciled in the United States with average total consolidated assets of $50 billion or more ($50 billion asset threshold);
(ii) Any other bank holding company domiciled in the United States that is made subject to this section, in whole or in part, by order of the Board;
(iii) Any U.S. intermediate holding company subject to this section pursuant to 12 CFR 252.153; and
(iv) 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)
(3)
(4)
(5)
(6)
(c)
(ii) A bank holding company that meets the $50 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 $50 billion asset threshold, unless that time is extended by the Board in writing.
(iii) The Board or the appropriate Reserve Bank with the concurrence of the Board, may require a bank holding company described in paragraph (c)(1)(i) or (ii) of this section to comply with any or all of the requirements in
(2)
(B) A U.S. intermediate holding company required to be established or designated pursuant to 12 CFR 252.153 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 U.S. intermediate holding company is required to be established, unless that time is extended by the Board in writing.
(C) The Board or the appropriate Reserve Bank with the concurrence of the Board, may require a U.S. intermediate holding company described in paragraph (c)(2)(i)(A) or (B) of this section to comply with any or all of the requirements in paragraph (e)(1), (e)(3), (g), or (k) of this section if the Board or appropriate Reserve Bank with concurrence of the Board, determines that the requirement is appropriate on a different date based on the company's risk profile, scope of operation, or financial condition and provides prior notice to the company of the determination.
(ii)
(B) After the time periods set forth in paragraph (c)(2)(ii)(A) of this section, this section will cease to apply to a bank holding company that is a subsidiary of a U.S. intermediate holding company, unless otherwise determined by the Board in writing.
(d)
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
(11)
(12)
(13)
(14)
(15)
(16)
(i) Has, as of December 31 of the calendar year prior to the capital plan cycle:
(A) Average total consolidated assets of less than $250 billion;
(B) Average total nonbank assets of less than $75 billion; and
(ii) Is not a bank holding company that is identified as a global systemically important BHC pursuant to § 217.402.
(17)
(18)
(19)
(20)
(21)
(22)
(23)
(24)
(25)
(26)
(27)
(e)
(ii) A bank holding company must submit its complete capital plan to the Board and the appropriate Reserve Bank by April 5 of each calendar year, or such later date as directed by the Board or by the appropriate Reserve Bank with concurrence of the Board.
(iii) The bank holding company's board of directors or a designated committee thereof must at least annually and prior to submission of the capital plan under paragraph (e)(1)(ii) of this section:
(A) Review the robustness of the bank holding company's process for assessing capital adequacy;
(B) Ensure that any deficiencies in the bank holding company's process for assessing capital adequacy are appropriately remedied; and
(C) Approve the bank holding company's capital plan.
(2)
(i) An assessment of the expected uses and sources of capital over the planning horizon that reflects the bank holding company's size, complexity, risk profile, and scope of operations, assuming both expected and stressful conditions, including:
(A) Estimates of projected revenues, losses, reserves, and pro forma capital levels, including regulatory capital ratios, and any additional capital measures deemed relevant by the bank holding company, over the planning horizon under a range of scenarios, including any scenarios provided by the Federal Reserve, the BHC baseline scenario, and at least one BHC stress scenario;
(B) A discussion of the results of any stress test required by law or regulation, and an explanation of how the capital plan takes these results into account; and
(C) A description of all planned capital actions over the planning horizon that are consistent with effective capital distribution limitations and as may be adjusted pursuant to paragraph (h) of this section. In determining whether a bank holding company's planned capital distributions are consistent with effective capital distribution limitations, a bank holding company must assume:
(
(
(ii) A detailed description of the bank holding company's process for assessing capital adequacy, including:
(A) A discussion of how the bank holding company will, under expected and stressful conditions, maintain capital commensurate with its risks, maintain capital above the regulatory capital ratios, and serve as a source of strength to its subsidiary depository institutions;
(B) A discussion of how the bank holding company will, under expected and stressful conditions, maintain sufficient capital to continue its operations by maintaining ready access to funding, meeting its obligations to creditors and other counterparties, and continuing to serve as a credit intermediary;
(iii) The bank holding company's capital policy; and
(iv) A discussion of any expected changes to the bank holding company's business plan that are likely to have a material impact on the bank holding company's capital adequacy or liquidity.
(3)
(i) The bank holding company's financial condition, including its capital;
(ii) The bank holding company's structure;
(iii) Amount and risk characteristics of the bank holding company's on- and off-balance sheet exposures, including exposures within the bank holding company's trading account, other trading-related exposures (such as counterparty-credit risk exposures) or other items sensitive to changes in market factors, including, as appropriate, information about the sensitivity of positions to changes in market rates and prices;
(iv) The bank holding company's relevant policies and procedures, including risk management policies and procedures;
(v) The bank holding company's liquidity profile and management;
(vi) The loss, revenue, and expense estimation models used by the bank holding company for stress scenario analysis, including supporting documentation regarding each model's development and validation; and
(vii) Any other relevant qualitative or quantitative information requested by the Board or by the appropriate Reserve Bank to facilitate review of the bank holding company's capital plan under this section.
(4)
(A) The bank holding company determines there has been or will be a material change in the bank holding company's risk profile, financial condition, or corporate structure since the bank holding company last
(B) The Board or the appropriate Reserve Bank with concurrence of the Board, directs the bank holding company in writing to revise and resubmit its capital plan for any of the following reasons:
(
(
(
(
(ii) A bank holding company may resubmit its capital plan to the Federal Reserve if the Board or the appropriate Reserve Bank objects to the capital plan.
(iii) The Board or the appropriate Reserve Bank with concurrence of the Board, may extend the 30-day period in paragraph (e)(4)(i) of this section for up to an additional 60 calendar days, or such longer period as the Board or the appropriate Reserve Bank, with concurrence of the Board, determines appropriate.
(iv) Any updated capital plan must satisfy all the requirements of this section; however, a bank holding company may continue to rely on information submitted as part of a previously submitted capital plan to the extent that the information remains accurate and appropriate.
(5)
(f)
(2)
(i)(A) The ratio of a bank holding company's common equity tier 1 risk-based capital to risk-weighted assets, as calculated under 12 CFR part 217, subpart D, as of the final quarter of the previous capital plan cycle, unless otherwise determined by the Board; minus
(B) The lowest projected ratio of the bank holding company's common equity tier 1 capital to risk-weighted assets in any quarter of the planning horizon under the supervisory stress test described in paragraph (f)(4) of this section; plus
(C) The sum of the ratios of the bank holding company's planned common stock dividends (expressed as a dollar amount) to projected risk-weighted assets for each of the fourth through seventh quarters of the planning horizon; or
(ii) 2.5 percent.
(3)
(i) The ratio of a bank holding company's tier 1 capital to average total consolidated assets, as calculated under 12 CFR part 217, subpart D, as of the final quarter of the previous capital plan cycle, unless otherwise determined by the Board; minus
(ii) The lowest projected leverage ratio for the bank holding company in any quarter during the planning horizon under the supervisory stress test described in paragraph (f)(4) of this section; plus
(iii) The sum of the ratios of the bank holding company's planned common stock dividends (expressed as a dollar amount) to the difference between projected total consolidated assets and amounts projected to be deducted from tier 1 capital under 12 CFR 217.22(a), (c), and (d) for each of the fourth through seventh quarters of the planning horizon.
(4)
(g)
(1) The comprehensiveness of the capital plan, including the extent to which the analysis underlying the capital plan captures and addresses potential risks stemming from activities across the bank holding company and the bank holding company's capital policy;
(2) The reasonableness of the bank holding company's capital plan, the assumptions and analysis underlying the capital plan, and the robustness of its capital adequacy process;
(3) Relevant supervisory information about the bank holding company and its subsidiaries;
(4) The bank holding company's regulatory and financial reports, as well as supporting data that would allow for an analysis of the bank holding company's loss, revenue, and reserve projections;
(5) The results of any stress tests conducted by the bank holding company or the Federal Reserve; and
(6) Other information requested or required by the Board or the appropriate Reserve Bank, as well as any other information relevant, or related, to the bank holding company's capital adequacy.
(h)
(2)
(3)
(i) Determine whether the capital distributions for the fourth through seventh quarters of the planning horizon under the BHC baseline scenario included in the capital plan submitted pursuant to paragraph (e)(1)(ii) of this section would be consistent with effective capital distribution limitations, assuming the stress buffer requirements provided by the Board under paragraph (h)(1) or (j)(5) of this section, as applicable; and
(ii) If the capital distributions for the fourth through seventh quarters of the planning horizon under the BHC baseline scenario included in the capital plan submitted pursuant to paragraph (e)(1)(ii) of this section would not be consistent with effective capital distribution limitations assuming the stress buffer requirements, the bank holding company must determine how it would reduce its planned capital distributions such that those planned capital distributions would be consistent with effective capital distribution limitations assuming the stress buffer requirements, and must notify the Board of these reductions; or
(iii) If the capital distributions for the fourth through seventh quarters of the planning horizon under the BHC baseline scenario included in the capital plan submitted pursuant to paragraph (e)(1)(ii) of this section would be consistent with effective capital distribution limitations assuming the stress buffer requirements, the bank holding company may determine to adjust its planned capital distributions, provided that the adjusted planned capital distributions do not exceed the amount included in the capital plan submitted pursuant to paragraph (e)(1)(ii) of this section, and, if any adjustments are made, must notify the Board of these adjustments.
(4)
(ii) If a bank holding company requests reconsideration under paragraph (j) of this section, the bank holding company must provide the Board with its final planned capital distributions, including any adjustments made pursuant to paragraph (h)(3) of this section, within 2 business days of receipt of notice of the Board's response under paragraph (j)(5) of this section.
(5)
(ii) A bank holding company's final planned capital distributions and stress buffer requirements shall:
(A) Unless otherwise determined by the Board, be effective on October 1 of the calendar year in which a capital plan was submitted pursuant to paragraph (e)(1)(ii) of this section; and
(B) Remain in effect until superseded, unless otherwise determined by the Board.
(6)
(i) The stress buffer requirements provided to a bank holding company under paragraph (h)(1) of this section that includes the adjustments made under paragraph (h)(3) also of this section, if any;
(ii) A summary of the results of the supervisory stress test described in paragraph (f)(4) of this section; and
(iii) A bank holding company's request for reconsideration under paragraph (j) of this section, and the Board's response to any such request for reconsideration or a summary thereof.
(i)
(i) Unless otherwise determined by the Board, by June 30 of the calendar year in which a capital plan was submitted pursuant to paragraph (e)(1)(ii) of this section; and
(ii) For a capital plan resubmitted pursuant to paragraph (e)(4) of this section, within 75 calendar days after the date on which a capital plan is resubmitted, unless the Board provides notice to the bank holding company that it is extending the time period.
(2)
(i) The bank holding company has material unresolved supervisory issues, including but not limited to issues associated with its capital adequacy process;
(ii) The assumptions and analysis underlying the bank holding company's capital plan, or the bank holding company's methodologies and practices that support its capital planning process, are not reasonable or appropriate; or
(iii) The bank holding company's capital planning process or proposed capital distributions otherwise constitute an unsafe or unsound practice, or would violate any law, regulation, Board order, directive, or condition imposed by, or written agreement with, the Board or the appropriate Reserve Bank. In determining whether a capital plan or any proposed capital distribution would constitute an unsafe or unsound practice, the Board or the appropriate Reserve Bank would consider whether the bank holding company is and would remain in sound financial condition after giving effect to the capital plan and all proposed capital distributions.
(3)
(4)
(5)
(j)
(1)
(2)
(ii) A request for reconsideration of a stress buffer requirement, provided under paragraph (h) of this section, must be received within 15 calendar days of receipt of a notice of bank holding company's stress buffer requirement.
(3)
(ii) A request for reconsideration may include a request for an informal hearing on the bank holding company's request for reconsideration.
(4)
(ii) An informal hearing shall be held within 30 calendar days of a request, if granted, provided that the Board may extend this period upon notice to the requesting party.
(5)
(ii) Within 30 calendar days of receipt of the bank holding company's request for reconsideration of its stress buffer requirement submitted under paragraph (j) of this section or within 30 days of the conclusion of an informal hearing conducted under paragraph (j)(4) of this section, the Board will notify the company of its decision to affirm or modify, as applicable, the bank holding company's stress buffer requirement, provided that the Board may extend this period upon notice to the bank holding company.
(6)
(k)
(i) After giving effect to the capital distribution, the bank holding company would not meet a minimum regulatory capital ratio;
(ii) The Board or the appropriate Reserve Bank with concurrence of the Board, notifies the company in writing that the Federal Reserve has determined that the capital distribution would result in a material adverse change to the company's capital or liquidity structure or that the company's earnings were materially underperforming projections;
(iii) Except as provided in paragraph (k)(2) of this section, the dollar amount of the capital distribution will exceed the dollar amount of the bank holding company's final planned capital distributions, as measured on an aggregate basis beginning in the fourth quarter of the planning horizon through the quarter at issue; or
(iv) The capital distribution would occur after the occurrence of an event requiring resubmission under paragraph (e)(4)(i)(A) or (B) of this section and before the Federal Reserve has responded or acted under paragraphs (h) and (i) of this section, as applicable.
(2)
(A) The bank holding company is, and after the capital distribution would remain, well capitalized as defined in § 225.2(r);
(B) The bank holding company's performance and capital levels are, and after the capital distribution would remain, consistent with its projections under the BHC baseline scenario;
(C) The annual aggregate dollar amount of all capital distributions in the period beginning on July 1 of a calendar year and ending on June 30 of the following calendar year would not exceed the total dollar amounts of the bank holding company's final planned capital distributions by more than 0.25 percent multiplied by the bank holding company's tier 1 capital, as reported to the Federal Reserve on the bank holding company's most recent first-quarter FR Y-9C;
(D) Between July 1 of a calendar year and March 15 of the following calendar year, the bank holding company provides the appropriate Reserve Bank with notice 15 calendar days prior to a capital distribution that includes the elements described in paragraph (k)(4) of this section; and
(E) The Board or the appropriate Reserve Bank with concurrence of the Board, does not object to the transaction proposed in the notice. In determining whether to object to the proposed transaction, the Board or the appropriate Reserve Bank shall apply the criteria described in paragraph (k)(5)(ii) of this section.
(ii) The exception in this paragraph (k)(2) shall not apply if the Board or the appropriate Reserve Bank notifies the bank holding company in writing that it is ineligible for this exception.
(3)
(ii)
(B)
(C)
(iii)
(A) To the extent that the Board or appropriate Reserve Bank indicates in writing its approval pursuant to paragraph (k)(5) of this section, following a request for prior approval from the bank holding company that includes all of the information required to be submitted under paragraph (k)(4) of this section;
(B) To capital distributions arising from the issuance of a capital instrument eligible for inclusion in the numerator of a regulatory capital ratio that the bank holding company had not included in its capital plan;
(C) To the extent that the bank holding company raised a smaller dollar amount of capital in the category of regulatory capital instruments described in paragraph (k)(3)(i) of this section due to employee-directed capital issuances related to an employee stock ownership plan;
(D) To the extent that the bank holding company raised a smaller dollar amount of capital in the category of regulatory capital instruments described in paragraph (k)(3)(i) of this section due to a planned merger or acquisition that is no longer expected to be consummated or for which the consideration paid is lower than the projected price in the capital plan; or
(E) To the extent that the dollar amount by which the bank holding company's net distributions exceed the dollar amount of its net final planned capital distributions in the category of regulatory capital instruments described in paragraph (k)(3)(i) of this section, as measured on an aggregate basis beginning in the fourth quarter of the planning horizon through the end of the current quarter, is less than 0.25 percent of the bank holding company's tier 1 capital, as reported to the Federal Reserve on the bank holding company's most recent first-quarter FR Y-9C; between July 1 of a calendar year and March 15 of the following calendar year, the bank holding company provides the appropriate Reserve Bank with notice 15 calendar days prior to any capital distribution in that category of regulatory capital instruments that includes the elements described in paragraph (k)(4) of this section; and the Board or the appropriate Reserve Bank with concurrence of the Board, does not object to the transaction proposed in the notice. In determining whether to object to the proposed transaction, the Board or the appropriate Reserve Bank shall apply the criteria described in paragraph (k)(5)(ii) of this section.
(iv)
(4)
(A) The bank holding company's current capital plan or an attestation that there have been no changes to the capital plan since it was last submitted to the Federal Reserve;
(B) The purpose of the transaction;
(C) A description of the capital distribution, including for redemptions or repurchases of securities, the gross consideration to be paid and the terms and sources of funding for the transaction, and for dividends, the amount of the dividend(s); and
(D) Any additional information requested by the Board or the appropriate Reserve Bank (which may include, among other things, an assessment of the bank holding company's capital adequacy under a revised stress scenario provided by the Federal Reserve, a revised capital plan, and supporting data).
(ii) Any request submitted with respect to a capital distribution described in paragraph (k)(1)(i) of this section shall also include a plan for restoring the bank holding company's capital to an amount above a minimum level within 30 calendar days and a rationale for why the capital distribution would be appropriate.
(5)
(ii) In acting on a request under this paragraph (k)(5), the Board or appropriate Reserve Bank will apply the considerations and principles in paragraphs (g) and (i) of this section, as appropriate. In addition, the Board or the appropriate Reserve Bank may disapprove the transaction if the bank holding company does not provide all of the information required to be submitted under paragraph (k)(4) of this section.
(6)
(A) The Board may, in its sole discretion, order an informal hearing if the Board finds that a hearing is appropriate or necessary to resolve disputes regarding material issues of fact.
(B) An informal hearing shall be held within 30 calendar days of a request, if granted, provided that the Board may extend this period upon notice to the requesting party.
(C) Written notice of the final decision of the Board shall be given to the bank holding company within 60 calendar days of the conclusion of any informal hearing ordered by the Board, provided that the Board may extend this period upon notice to the requesting party.
(D) While the Board's final decision is pending and until such time as the Board or the appropriate Reserve Bank with concurrence of the Board, approves the capital distribution at issue, the bank holding company may not make such capital distribution.
(ii) [Reserved]
(
12 U.S.C. 321-338a, 481-486, 1467a, 1818, 1828, 1831n, 1831o, 1831p-l, 1831w, 1835, 1844(b), 1844(c), 3101
(c)
(1) The covered company will not pay any dividends on any instruments that qualify as common equity tier 1 capital;
(2) The covered company will make payments on instruments that qualify as additional tier 1 capital or tier 2 capital equal to the stated dividend, interest, or principal due on such instrument;
(3) The covered company will not make a redemption or repurchase of any capital instrument that is eligible for inclusion in the numerator of a regulatory capital ratio; and
(4) The covered company will not make any issuances of common stock or preferred stock, except for issuances 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.
(b) * * *
(2) * * *
(i) The Board may require a covered company with significant trading activity (a covered company that has aggregate trading assets and liabilities of $50 billion or more, or aggregate trading assets and liabilities equal to 10 percent or more of total consolidated assets, and is not a large and noncomplex bank holding company, as defined in 12 CFR 225.8) to include a trading and counterparty component in its adverse and severely adverse scenarios in the stress test required by this section:
(b)
(1) The covered company will not pay any dividends on any instruments that qualify as common equity tier 1 capital;
(2) The covered company will make payments on instruments that qualify as additional tier 1 capital or tier 2 capital equal to the stated dividend, interest, or principal due on such instrument;
(3) The covered company will not make a redemption or repurchase of any capital instrument that is eligible for inclusion in the numerator of a regulatory capital ratio; and
(4) The covered company will not make any issuances of common stock or preferred stock, except for issuances 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.
The supervisory stress test incorporates an assumption that restricts the contraction of aggregate credit supply during the stress period. The aim of supervisory stress testing is to assess whether firms are sufficiently capitalized to absorb losses during times of economic stress, while meeting obligations and continuing to lend to households and businesses. While an individual firm may assume that it reacts to rising losses by sharply restricting its lending, (
Accordingly, in projecting a firm's balance sheet, the Federal Reserve will assume that the firm takes actions to maintain a constant level of assets, including loans, trading assets, and securities over the planning horizon. In order to implement this policy, the Federal Reserve must make assumptions about new loan balances. To predict losses on new originations over the planning horizon, newly originated loans are assumed to have the same risk characteristics as the existing portfolio, where applicable, with the exception of loan age and delinquency status. These newly originated loans would be part of a covered company's normal business, even in a stressed economic environment. By precluding the need to make assumptions about how underwriting standards might tighten or loosen during times of economic stress, the Federal Reserve adheres to Principle 1.3 and promotes consistency across covered companies. Similar to the Board's current methodology, balance sheet projections would reflect the impact of a planned merger or acquisition, or completed or contractually agreed-on divestiture.
In projecting the denominator for the calculation of the leverage ratio, the Federal Reserve will account for the effect of changes associated with the calculation of regulatory
In projecting risk-weighted assets, the Federal Reserve will generally assume that a covered company's risk-weighted assets remain unchanged over the planning horizon. This assumption allows the Federal Reserve to independently project firms' risk-weighted assets in line with the goal of simplicity (Principle 1.4). In addition, this approach is forward-looking (Principle 1.2), as this assumption removes reliance on historical data and past outcomes from the projection of risk-weighted assets.
In projecting a firm's risk-weighted assets, the Federal Reserve will account for the effect of changes associated with the calculation of regulatory capital or changes to the Board's regulations in the calculation of risk-weighted assets. As with the Board's current methodology, risk-weighted asset projections would reflect the impact of a planned merger or acquisition, or completed or contractually agreed-on divestiture.
(a) while engaged in an action against an enemy of the United States;
(b) while engaged in military operations involving conflict with an opposing foreign force or, with respect to the Coast Guard, an international terrorist organization; or
(c) while serving with friendly foreign forces engaged in an armed conflict against an opposing armed force in which the United States is not a belligerent party.
(a) while engaged in an action against an enemy of the United States;
(b) while engaged in military operations involving conflict with an opposing foreign force or, with respect to the Coast Guard, an international terrorist organization; or
(c) while serving with friendly foreign forces engaged in an armed conflict against an opposing armed force in which the United States is not a belligerent party.
(a) The Secretary of the military department concerned, or the Secretary of Homeland Security with respect to the Coast Guard when it is not operating as a service in the Navy, may award the Legion of Merit, without degree, in the name of the President to any member of the Armed Forces of the United States, who, after September 8, 1939, has distinguished himself or herself by exceptionally meritorious conduct in performing outstanding services.
(b) The Secretary of Defense, after concurrence by the Secretary of State, may award the Legion of Merit, in the degrees of Commander, Officer, and Legionnaire, to a member of the armed forces of friendly foreign nations.
(c) The Secretary of Defense, after concurrence by the Secretary of State, shall submit to the President for his approval, recommendations for award of the Legion of Merit, in the degree of Chief Commander, to a member of the armed forces of friendly foreign nations.
(a) The Secretary of the military department concerned, or the Secretary of Homeland Security with respect to the Coast Guard when it is not operating as a service in the Navy, may award the Distinguished Flying Cross in the name of the President to any eligible person identified in subsection (b) who, while serving in any capacity with the Army, Navy, Marine Corps, Air Force, or Coast Guard, distinguishes himself or herself by heroism or extraordinary achievement while participating in an aerial flight aboard an aircraft or spacecraft.
(b) (i) Any member of the Armed Forces of the United States, including a member not on active duty, who, while participating in an aerial flight aboard an aircraft or spacecraft, performs official duties incident to such membership is eligible for the award of the Distinguished Flying Cross.
(c) No Distinguished Flying Cross may be awarded or presented to any person, or to that person's representative, if the person's service after the qualifying act or achievement has not been honorable.
(d) With regard to the award of the Distinguished Flying Cross for a qualifying act or achievement performed:
(e) The Distinguished Flying Cross may be awarded posthumously. When so awarded, it may be presented to such representative of the deceased as may be deemed appropriate by the Secretary of the military department concerned, or the Secretary of Homeland Security with respect to the Coast Guard when it is not operating as a service in the Navy.
(f) Not more than one Distinguished Flying Cross may be awarded to any one person. For each succeeding act of heroism or extraordinary achievement justifying such an award, a suitable bar or other device may be awarded to be worn with the medal.
(a) The Secretary of the military department concerned, or the Secretary of Homeland Security with respect to the Coast Guard when it is not operating as a service in the Navy, may award the Soldier's Medal, Navy and Marine Corps Medal, Airman's Medal, and Coast Guard Medal in the name of the President to any person who, while serving in any capacity with the Army, Navy, Marine Corps, Air Force, or Coast Guard, as the case may be, distinguishes himself or herself by heroism not involving actual conflict with an enemy.
(b) The Secretary of the Navy may award the Navy and Marine Corps Medal to any person to whom the Secretary of the Navy, before August 7, 1942, awarded a letter of commendation for heroism, and who applies for that medal, regardless of the date of the act of heroism.
(c) Not more than one Soldier's Medal, Navy and Marine Corps Medal, Airman's Medal, or Coast Guard Medal may be awarded to any one person. For each succeeding act of heroism justifying such an award, a suitable bar or other device may be awarded to be worn with the medal.
(b) This order shall be implemented consistent with applicable law and subject to the availability of appropriations.
(c) This order supersedes Executive Order 4601 of March 1, 1927, as amended, and Executive Order 9260 of October 29, 1942, as amended. However, existing regulations prescribed pursuant to those orders, shall, so far as they are not inconsistent with this order, remain in effect until modified or revoked by regulations prescribed by the Secretary of the military department concerned, or the Secretary of Homeland Security with respect to the Coast Guard when it is not operating as a service in the Navy, under this order.
(d) This order is not intended to, and does not, invalidate any award of military decorations covered by this order made prior to the effective date of this order.
(e) 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 |