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

We will file in the docket all comments we receive, as well as a report summarizing each substantive public contact with FAA personnel concerning these special conditions. You can inspect the docket before and after the comment closing date. If you wish to review the docket in person, go to the address in theADDRESSESsection of this preamble between 7:30 a.m. and 4 p.m., Monday through Friday, except Federal holidays.

We will consider all comments we receive on or before the closing date for comments. We will consider comments filed late if it is possible to do so without incurring expense or delay. We may change these special conditions based on the comments we receive.

If you want us to acknowledge receipt of your comments on this proposal, include with your comments a self-addressed, stamped postcard on which you have written the docket number. We will stamp the date on the postcard and mail it back to you.

On March 29, 2005, Gulfstream Aerospace Corporation (hereafter referred to as “Gulfstream”) applied for an FAA type certificate for its new Gulfstream Model GVI passenger airplane. Gulfstream later applied for, and was granted, an extension of time for the type certificate, which changed the effective application date to September 28, 2006. The Gulfstream Model GVI airplane will be an all-new, two-engine jet transport airplane with an executive cabin interior. The maximum takeoff weight will be 99,600 pounds, with a maximum passenger count of 19 passengers.

Under provisions of Title 14, Code of Federal Regulations (14 CFR) 21.17, Gulfstream must show that the Gulfstream Model GVI airplane (hereafter referred to as “the GVI”) meets the applicable provisions of 14 CFR part 25, as amended by Amendments 25-1 through 25-119, 25-122, and 25-124. If the Administrator finds that the applicable airworthiness regulations (i.e., 14 CFR part 25) do not contain adequate or appropriate safety standards for the GVI because of a novel or unusual design feature, special conditions are prescribed under the provisions of § 21.16.

In addition to complying with the applicable airworthiness regulations and special conditions, the GVI must comply with the fuel vent and exhaust emission requirements of 14 CFR part 34 and the noise certification requirements of 14 CFR part 36. The FAA must also issue a finding of regulatory adequacy pursuant to section 611 of Public Law 92-574, the “Noise Control Act of 1972.”

The FAA issues special conditions, as defined in 14 CFR 11.19, in accordance with § 11.38, and they become part of the type certification basis under § 21.17(a)(2).

Special conditions are initially applicable to the model for which they are issued. Should the type certificate for that model be amended later to include any other model that incorporates the same novel or unusual design features, the special conditions would also apply to the other model under provisions of § 21.101.

The GVI has an electronic flight control system and no direct coupling from the cockpit controller to the control surface, so the pilot may not be aware of the actual surface position utilized to fulfill the requested command. Some unusual flight conditions, such as those arising from atmospheric conditions, aircraft malfunctions, or engine failures, may result in full or near-full control surface deflection. Unless the flightcrew is made aware of excessive deflection or impending control surface limiting, piloted or auto-flight system control of the airplane might be inadvertently continued to a point that could cause a loss of aircraft control or other unsafestability or performance characteristic. Because electronic flight control system technology has outpaced existing regulations, a special condition is proposed to ensure control surface position awareness by the flightcrew.

This proposed special condition would require that suitable flight control position annunciation be provided to the flightcrew when a flight condition exists in which near-full surface authority (not crew-commanded) is being utilized. The suitability of such an annunciation must take into account that some pilot-demanded maneuvers, such as a rapid roll, are necessarily associated with intended full performance, and which may saturate the control surface. Simple alerting systems which would annunciate either intended or unexpected control-limiting situations must be properly balanced between providing necessary crew awareness and avoiding undesirable nuisance warnings.

This proposed special condition would establish a level of safety equivalent to that provided by a conventional flight control system and that contemplated in existing regulations.

As discussed above, this proposed special condition is applicable to the GVI. Should Gulfstream apply at a later date for a change to the type certificate to include another model incorporating the same novel or unusual design features, this proposed special condition would apply to that model as well.

This action affects only certain novel or unusual design features of the GVI. It is not a rule of general applicability.

The authority citation for these special conditions is as follows:

Accordingly, the Federal Aviation Administration (FAA) proposes the following special condition as part of the type certification basis for the GVI airplanes.

In addition to compliance with §§ 25.143, 25.671, 25.672, and 25.1322, the following special condition applies:

When a flight condition exists where, without being commanded by the flightcrew, control surfaces are coming so close to their limits that return to the normal flight envelope and/or continuation of safe flight requires a specific flightcrew member action, a suitable flight control position annunciation must be provided to the flightcrew, unless other existing indications are found adequate or sufficient to prompt that action.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal.

Communications should identify both docket numbers (FAA Docket No. FAA 2011-0023 and Airspace Docket No. 11-ANM-2) and be submitted in triplicate to the Docket Management System (see ADDRESSESsection for address and phone number). You may also submit comments through the Internet athttp://www.regulations.gov.

Commenters wishing the FAA to acknowledge receipt of their comments on this action must submit with those comments a self-addressed stamped postcard on which the following statement is made: “Comments to FAA Docket No. FAA-2011-0023 and AirspaceDocket No. 11-ANM-2”. The postcard will be date/time stamped and returned to the commenter.

All communications received on or before the specified closing date for comments will be considered before taking action on the proposed rule. The proposal contained in this action may be changed in light of comments received. All comments submitted will be available for examination in the public docket both before and after the closing date for comments. A report summarizing each substantive public contact with FAA personnel concerned with this rulemaking will be filed in the docket.

An electronic copy of this document may be downloaded through the Internet athttp://www.regulations.gov. Recently published rulemaking documents can also be accessed through the FAA's web page athttp://www.faa.gov/airports_airtraffic/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office (seetheADDRESSESsection for the address and phone number) between 9 a.m. and 5 p.m., Monday through Friday, except federal holidays. An informal docket may also be examined during normal business hours at the Northwest Mountain Regional Office of the Federal Aviation Administration, Air Traffic Organization, Western Service Center, Operations Support Group, 1601 Lind Avenue, SW., Renton, WA 98057.

Persons interested in being placed on a mailing list for future NPRMs should contact the FAA's Office of Rulemaking, (202) 267-9677, for a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure.

The FAA is proposing an amendment to Title 14 Code of Federal Regulations (14 CFR) part 71 by amending the Class D and Class E airspace areas to change the airport name from Fanning Field to Idaho Falls Regional Airport, and also would adjust the geographic coordinates of the airport to be in concert with the FAA's Aeronautical Products office. Also, existing Class E airspace area extending upward from 700 feet above the surface at Idaho Falls Regional Airport would be adjusted to accommodate aircraft using the new RNAV (RNP) standard instrument approach procedures, and would enhance the safety and management of aircraft operations at the airport.

Class D and Class E airspace designations are published in paragraph 5000, 6002, 6004 and 6005, respectively, of FAA Order 7400.9U, dated August 18, 2010, and effective September 15, 2010, which is incorporated by reference in 14 CFR 71.1. The Class D and Class E airspace designations listed in this document will be published subsequently in this Order.

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

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the U.S. Code. Subtitle 1, section 106, describes the authority for the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in subtitle VII, part A, subpart I, section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of the airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it amends controlled airspace at Idaho Falls Regional Airport, Idaho Falls, ID.

Accordingly, pursuant to the authority delegated to me, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

I. Background A. Statutory Provisions

On October 26, 2001, the President signed into law the Uniting and Strengthening America by Providing Appropriate Tools Required To Intercept and Obstruct Terrorism Act of 2001 (the “USA PATRIOT Act”), Public Law 107-56. Title III of the USA PATRIOT Act amended the anti-money laundering provisions of the Bank Secrecy Act (“BSA”), codified at 12 U.S.C. 1829b, 12 U.S.C. 1951-1959, and 31 U.S.C. 5311-5314 and 5316-5332, to promote the prevention, detection, and prosecution of international money laundering and the financing of terrorism. Regulations implementing the BSA appear at 31 CFR part 103. The authority of the Secretary of the Treasury (“the Secretary”) to administer the BSA and its implementing regulations has been delegated to the Director of FinCEN.1

Section 311 of the USA PATRIOT Act (“section 311”) added section 5318A to the BSA, granting the Secretary the authority, upon finding that reasonable grounds exist for concluding that a foreign jurisdiction, institution, class of transaction, or type of account is of “primary money laundering concern,” to require domestic financial institutions and financial agencies to take certain “special measures” against the primary money laundering concern. Section 311 identifies factors for the Secretary to consider and Federal agencies to consult before the Secretary may conclude that a jurisdiction, institution, class of transaction, or type of account is of primary money laundering concern. The statute also provides similar procedures,i.e.,factors and consultation requirements, for selecting the specific special measures to be imposed against the primary money laundering concern.

Taken as a whole, section 311 provides the Secretary with a range of options that can be adapted to target specific money laundering and terrorist financing concerns most effectively. These options give the Secretary the authority to bring additional pressure on those jurisdictions and institutions that pose money laundering threats. Through the imposition of various special measures, the Secretary can gain more information about the jurisdictions, institutions, transactions, or accounts of concern; can more effectively monitor the respective jurisdictions, institutions, transactions, or accounts; or can protect U.S. financial institutions from involvement with jurisdictions, institutions, transactions, or accounts that are of money laundering concern.

Before making a finding that reasonable grounds exist for concluding that a foreign financial institution is of primary money laundering concern, the Secretary is required to consult with both the Secretary of State and the Attorney General. The Secretary is also required by section 311 to consider “such information as the Secretary determines to be relevant, including the following potentially relevant factors:

• The extent to which such financial institution is used to facilitate or promote money laundering in or through the jurisdiction;

• The extent to which such financial institution is used for legitimate business purposes in the jurisdiction; and

• The extent to which the finding that the institution is of primary money laundering concern is sufficient to ensure, with respect to transactions involving the institution operating in the jurisdiction, that the purposes of the BSA continue to be fulfilled, and to guard against international money laundering and other financial crimes.

If the Secretary determines that reasonable grounds exist for concluding that a financial institution is of primary money laundering concern, the Secretary must determine the appropriate special measure(s) to address the specific money laundering risks. Section 311 provides a range ofspecial measures that can be imposed individually, jointly, in any combination, and in any sequence.2 The Secretary's imposition of special measures requires additional consultations to be made and factors to be considered. The statute requires the Secretary to consult with appropriate Federal agencies and other interested parties3 and to consider the following specific factors:

• Whether similar action has been or is being taken by other nations or multilateral groups;

• Whether the imposition of any particular special measures would create a significant competitive disadvantage, including any undue cost or burden associated with compliance, for financial institutions organized or licensed in the United States;

• The extent to which the action or the timing of the action would have a significant adverse systemic impact on the international payment, clearance, and settlement system, or on legitimate business activities involving the particular institution; and

• The effect of the action on the United States national security and foreign policy.4

In this rulemaking, FinCEN proposes to impose the fifth special measure (31 U.S.C. 5318A(b)(5)) against LCB. The fifth special measure prohibits or conditions the opening or maintaining of correspondent or payable-through accounts for the designated institution by U.S. financial institutions. This special measure may be imposed only through the issuance of a regulation.

LCB is based in Beirut, Lebanon, and maintains a network of 35 branches in Lebanon and a representative office in Montreal, Canada.5 The bank is considered among the top 10 banks in Lebanon in assets and has over 600 employees.6 Originally established in 1960 as Banque des Activities Economiques SAL, it operated as a subsidiary of the Royal Bank of Canada Middle East (1968-1988) and is now a privately owned bank.7 LCB offers a broad range of corporate, retail, and investment products, and it maintains extensive correspondent accounts with banks worldwide, including several U.S. financial institutions.8 As of 2009, LCB's total assets were worth over $5 billion.9

LCB has a controlling financial interest in a number of subsidiaries, including LCB Investments SAL, LCB Finance SAL, LCB Estates SAL, LCB Insurance Brokerage House SAL, Dubai-based Tabadul for Shares and Bonds LLC, Prime Bank Limited (“Prime Bank”) of Gambia.10 Prime Bank is a private commercial bank located in Serrekunda, Gambia.11 LCB owns 51% of Prime Bank, while the remaining shares are held by local and Lebanese partners.12 LCB apparently serves as the sole correspondent bank for Prime Bank.13 For purposes of this document and, unless expressly stated otherwise, references to LCB include the aforementioned subsidiaries.

As a result of the finding on February 17, 2011 by the Secretary, through his delegate, the Director of FinCEN, that reasonable grounds exist for concluding that LCB is a financial institution of primary money laundering concern (seethe notice of this finding published elsewhere today in theFederal Register), and based upon the additional consultations and the consideration of all relevant factors discussed in the finding and in this notice of proposed rulemaking, the Secretary, through FinCEN, has determined that reasonable grounds exist for the imposition of the special measure authorized by section 5318A(b)(5).14 That special measure authorizes the prohibition against the opening or maintaining of correspondent accounts15 by any domestic financial institution or agency for or on behalf of a targeted financial institution. A discussion of the section 311 factors relevant to imposing this particular special measure follows.

Other countries or multilateral groups have not taken action similar to the one proposed in this rulemaking that would prohibit domestic financial institutions and agencies from opening or maintaining a correspondent account for or on behalf of LCB, and require those domestic financial institutions and agencies to screen their correspondents in a manner that is reasonably designed to guard against their indirect use by nested correspondent accounts held by LCB. FinCEN encourages other countries to take similar action based on the findings contained in this rulemaking.

The fifth special measure sought to be imposed by this rulemaking would prohibit covered financial institutions from opening and maintaining correspondent accounts for, or on behalf of, LCB. As a corollary to this measure, covered financial institutions also would be required to take reasonable steps to apply special due diligence, as set forth below, to all of their correspondent accounts to help ensure that no such account is being used indirectly to provide services to LCB. FinCEN does not expect the burden associated with these requirements to be significant, given its understanding that few U.S. financial institutions currently maintain a correspondent account forLCB.16 There is a minimal burden involved in transmitting a one-time notice to correspondent account holders concerning the prohibition on indirectly providing services to LCB. In addition, U.S. financial institutions generally apply some degree of due diligence in screening their transactions and accounts, often through the use of commercially available software such as that used for compliance with the economic sanctions programs administered by the Office of Foreign Assets Control (OFAC) of the Department of the Treasury. As explained in more detail in the section-by-section analysis below, financial institutions should, if necessary, be able to easily adapt their current screening procedures to comply with this special measure. Thus, the special due diligence that would be required by this rulemaking is not expected to impose a significant additional burden upon U.S. financial institutions.

This proposed rulemaking targets LCB specifically; it does not target a class of financial transactions (such as wire transfers) or a particular jurisdiction. LCB is not a major participant in the international payment system and is not relied upon by the international banking community for clearance or settlement services. Thus, the imposition of the fifth special measure against LCB would not have a significant adverse systemic impact on the international payment, clearance, and settlement system. In light of the reasons for imposing this special measure, FinCEN does not believe that it would impose an undue burden on legitimate business activities, and notes that the presence of several larger banks in Lebanon would alleviate the burden on legitimate business activities within that jurisdiction.

The exclusion from the U.S. financial system of banks that serve as conduits for significant money laundering activity and other financial crimes enhances national security, making it more difficult for money launderers to access the substantial resources of the U.S. financial system. More generally, the imposition of the fifth special measure would complement the U.S. Government's worldwide efforts to expose and disrupt international money laundering.

Therefore, pursuant to the finding of the Secretary of the Treasury that LCB is an institution of primary money laundering concern, and after conducting the required consultations and weighing the relevant factors, FinCEN has determined that reasonable grounds exist for imposing the special measure.

The proposed rule would prohibit covered financial institutions from establishing, maintaining, or managing in the United States any correspondent account for or on behalf of LCB. As a corollary to this prohibition, covered financial institutions would be required to apply special due diligence to their correspondent accounts to guard against their indirect use by LCB. At a minimum, that special due diligence must include two elements. First, a covered financial institution must notify those correspondent account holders that the covered financial institution knows or has reason to know provide services to LCB that such correspondents may not provide LCB with access to the correspondent account maintained at the covered financial institution. Second, a covered financial institution must take reasonable steps to identify any indirect use of its correspondent accounts by LCB, to the extent that such indirect use can be determined from transactional records maintained by the covered financial institution in the normal course of business. A covered financial institution should take a risk-based approach when deciding what, if any, additional due diligence measures it should adopt to guard against the indirect use of its correspondent accounts by LCB, based on risk factors such as the type of services it offers and geographic locations of its correspondents.

Section 103.194(a)(1) of the proposed rule defines LCB to include all branches, offices, and subsidiaries of LCB operating in Lebanon or in any jurisdiction. These branches, offices, and subsidiaries include, but are not necessarily limited to, LCB Investments (Holding) SAL, LCB Finance SAL, LCB Estates SAL, LCB Insurance Brokerage House SAL, Dubai-based Tabadul for Shares and Bonds LLC, and Prime Bank Limited in Serrekunda, Gambia. FinCEN will provide updated information, as it is available; however, covered financial institutions should take commercially reasonable measures to determine whether a customer is a branch, office, or subsidiary of LCB.

Section 103.194(a)(2) defines the term “correspondent account” by reference to the definition contained in 31 CFR 103.175(d)(1)(ii). Section 103.175(d)(1)(ii) defines a correspondent account to mean an account established to receive deposits from, or make payments or other disbursements on behalf of, a foreign bank, or handle other financial transactions related to the foreign bank.

In the case of a U.S. depository institution, this broad definition includes most types of banking relationships between a U.S. depository institution and a foreign bank that are established to provide regular services, dealings, and other financial transactions including a demand deposit, savings deposit, or other transaction or asset account, and a credit account or other extension of credit.

In the case of securities broker-dealers, futures commission merchants, introducing brokers in commodities, and investment companies that are open-end companies (mutual funds), we are using the same definition of “account” for purposes of this rule as was established in the final rule implementing section 312 of the USA PATRIOT Act.17

Section 103.194(a)(3) of the proposed rule defines “covered financial institution” with the same definition used in the final rule implementing section 312 of the USA PATRIOT Act,18 which in general includes the following:

• An insured bank (as defined in section 3(h) of the Federal Deposit Insurance Act (12 U.S.C. 1813(h));

• A commercial bank;

• An agency or branch of a foreign bank in the United States;

• A Federally insured credit union;

• A savings association;

• A corporation acting under section 25A of the Federal Reserve Act (12 U.S.C. 611);

• A trust bank or trust company;

• A broker or dealer in securities;

• A futures commission merchant or an introducing broker; or

• A mutual fund.

For purposes of complying with the proposed rule's prohibition on the opening or maintaining of correspondent accounts for, or on behalf of, LCB, FinCEN expects that a covered financial institution would take such steps that a reasonable and prudent financial institution would take to protect itself from loan fraud or other fraud or loss based on misidentification of a person's status.

Section 103.194(b)(1) of the proposed rule would prohibit all covered financial institutions from establishing, maintaining, administering, or managing a correspondent or payable-through account in the United States for, or on behalf of, LCB. The prohibition would require all covered financial institutions to review their account records to ensure that they maintain no accounts directly for, or on behalf of, LCB.

As a corollary to the prohibition on maintaining correspondent accounts directly for LCB, section 103.194(b)(2) would require a covered financial institution to apply special due diligence to its correspondent accounts19 that is reasonably designed to guard against their indirect use by LCB. At a minimum, that special due diligence must include notifying those correspondent account holders that the covered financial institution knows or has reason to know provide services to LCB, that such correspondents may not provide LCB with access to the correspondent account maintained at the covered financial institution. A covered financial institution would, for example, have knowledge that the correspondents provide access to LCB through transaction screening software. A covered financial institution may satisfy this requirement by transmitting the following notice to its correspondent account holders that it knows or has reason to know provide services to LCB:

The purpose of the notice requirement is to help ensure cooperation from correspondent account holders in denying LCB access to the U.S. financial system. However, FinCEN does not require or expect a covered financial institution to obtain a certification from any of its correspondent account holders that indirect access will not be provided in order to comply with this notice requirement. Instead, methods of compliance with the notice requirement could include, for example, transmitting a one-time notice by mail, fax, or e-mail to certain of the covered financial institution's correspondent account customers, informing them that they may not provide LCB with access to the covered financial institution's correspondent account, or including such information in the next regularly occurring transmittal from the covered financial institution to those correspondent account holders. FinCEN specifically solicits comments on the form and scope of the notice that would be required under the rule.

A covered financial institution also would be required under this rulemaking to take reasonable steps to identify any indirect use of its correspondent accounts by LCB, to the extent that such indirect use can be determined from transactional records maintained by the covered financial institution in the normal course of business. For example, a covered financial institution would be expected to apply an appropriate screening mechanism to be able to identify a funds transfer order that on its face listed LCB as the originator's or beneficiary's financial institution, or otherwise referenced LCB in a manner detectable under the financial institution's normal screening processes. An appropriate screening mechanism could be the mechanism used by a covered financial institution to comply with various legal requirements, such as the commercially available software programs used to comply with the economic sanctions programs administered by OFAC. FinCEN specifically solicits comments on the requirement under the proposed rule that covered financial institutions take reasonable steps to screen their correspondent accounts in order to identify any indirect use of such accounts by LCB.

Notifying certain correspondent account holders and taking reasonable steps to identify any indirect use of its correspondent accounts by LCB in the manner discussed above would be the minimum due diligence requirements under the proposed rule. Beyond these minimum steps, a covered financial institution should adopt a risk-based approach for determining what, if any, additional due diligence measures it should implement to guard against the indirect use of its correspondent accounts by LCB, based on risk factors such as the type of services it offers and the geographic locations of its correspondent account holders.

A covered financial institution that obtains knowledge that a correspondent account is being used by a foreign bank to provide indirect access to LCB must take all appropriate steps to prevent such indirect access, including the notification of its correspondent account holder per section 103.194(b)(2)(i)(A) and, where necessary, terminating the correspondent account. A covered financial institution may afford the foreign bank a reasonable opportunity to take corrective action prior to terminating the correspondent account. Should the foreign bank refuse to comply, or if the covered financial institution cannot obtain adequate assurances that the account will no longer be available to LCB, the covered financial institution must terminate the account within a commercially reasonable time. This means that the covered financial institution should not permit the foreign bank to establish any new positions or execute any transactions through the account, other than those necessary to close the account. A covered financial institution may reestablish an account closed under the proposed rule if it determines that the account will not be used to provide banking services indirectly to LCB. FinCEN specifically solicits comments on the requirement under the proposed rule that covered financial institutions prevent indirect access to LCB, once such indirect access is identified.

Section 103.194(b)(3) of the proposed rule clarifies that the rule would notimpose any reporting requirement upon any covered financial institution that is not otherwise required by applicable law or regulation. A covered financial institution must, however, document its compliance with the requirement that it notify those correspondent account holders that the covered financial institution knows or has reason to know provide services to LCB, that such correspondents may not provide LCB with access to the correspondent account maintained at the covered financial institution.

FinCEN invites comments on all aspects of the proposal to prohibit the opening or maintaining of correspondent accounts for or on behalf of LCB, and specifically invites comments on the following matters:

1. The form and scope of the notice to certain correspondent account holders that would be required under the rule;

2. The appropriate scope of the proposed requirement for a covered financial institution to take reasonable steps to identify any indirect use of its correspondent accounts by LCB;

3. The appropriate steps a covered financial institution should take once it identifies an indirect use of one of its correspondent accounts by LCB; and

4. The impact of the proposed special measure upon legitimate transactions with LCB involving, in particular, U.S. persons and entities; foreign persons, entities, and governments; and multilateral organizations doing legitimate business with persons or entities operating in Lebanon.

It is hereby certified that this proposed rule will not have a significant economic impact on a substantial number of small entities. FinCEN understands that LCB currently maintains few correspondent accounts in the United States.20 Thus, the prohibition on maintaining such accounts would not have a significant impact on a substantial number of small entities. In addition, all U.S. persons, including U.S. financial institutions, currently must exercise some degree of due diligence in order to comply with various legal requirements. The tools used for such purposes, including commercially available software used to comply with the economic sanctions programs administered by OFAC, can easily be modified to monitor for the use of correspondent accounts by LCB. Thus, the special due diligence that would be required by this rulemaking—i.e.,the one-time transmittal of notice to certain correspondent account holders and the screening of transactions to identify any indirect use of correspondent accounts, would not be expected to impose a significant additional economic burden upon small U.S. financial institutions. FinCEN invites comments about the impact on small entities.

The collection of information contained in this proposed rule is being submitted to the Office of Management and Budget for review in accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)). Comments on the collection of information should be sent to the Desk Officer for the Department of Treasury, Office of Information and Regulatory Affairs, Office of Management and Budget, Paperwork Reduction Project (1506), Washington, DC 20503 (or by e-mail tooira_submission@omb.eop.gov) with a copy to FinCEN by mail or e-mail at the addresses previously specified. Comments should be submitted by one method only. Comments on the collection of information should be received by April 18, 2011. In accordance with the requirements of the Paperwork Reduction Act of 1995, 44 U.S.C. 3506(c)(2)(A), and its implementing regulations, 5 CFR part 1320, the following information concerning the collection of information as required by 31 CFR 103.194 is presented to assist those persons wishing to comment on the information collection.

The collection of information in this proposed rule is in 103.194(b)(2)(i) and 103.194(b)(3)(i). The notification requirement in 103.194(b)(2)(i) would be intended to ensure cooperation from correspondent account holders in denying LCB access to the U.S. financial system. The information required to be maintained by 103.194(b)(3)(i) would be used by Federal agencies and certain self-regulatory organizations to verify compliance by covered financial institutions with the provisions of 31 CFR 103.194. The class of financial institutions affected by the notification requirement would be identical to the class of financial institutions affected by the recordkeeping requirement. The collection of information is mandatory.

Description of Affected Financial Institutions:Banks, broker-dealers in securities, futures commission merchants and introducing brokers, and mutual funds maintaining correspondent accounts.

Estimated Number of Affected Financial Institutions:5,000.

Estimated Average Annual Burden Hours per Affected Financial Institutions:The estimated average burden associated with the collection of information in this proposed rule is one hour per affected financial institution.

Estimated Total Annual Burden:5,000 hours.

FinCEN specifically invites comments on: (a) Whether the proposed collection of information is necessary for the proper performance of the mission of FinCEN, including whether the information shall have practical utility; (b) the accuracy of FinCEN's estimate of the burden of the proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information required to be maintained; (d) ways to minimize the burden of the required collection of information, 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 maintain the information.

As discussed in theFederal Registerrule published 75 FR 65806, October 26, 2010, FinCEN will be removing Part 103 of Chapter I of Title 31, Code of Federal Regulations, and adding Parts 1000 to 1099 (“Chapter X”) effective March 1, 2011. As of this effective date, the changes in the present proposed rule, if finalized, would be reorganized according to Chapter X. The planned reorganization will have no substantive effect on the regulatory changes herein. The regulatory changes of this specific rulemaking would be renumbered according to Chapter X as follows:

Section 103.194 would be moved to § 1010.656.

The proposed rule is not a significant regulatory action for purposes of Executive Order 12866, “Regulatory Planning and Review.”

For the reasons set forth in the preamble, part 103 of title 31 of theCode of Federal Regulations is proposed to be amended as follows:

Public Participation and Request for Comments

We encourage you to participate in this rulemaking by submitting comments and related materials. All comments received will be posted without change tohttp://www.regulations.govand will include any personal information you have provided.

If you submit a comment, please include the docket number for this rulemaking (USCG-2011-0046), indicate the specific section of this document to which each commentapplies, and provide a reason for each suggestion or recommendation. You may submit your comments and material online (viahttp://www.regulations.gov) or by fax, mail, or hand delivery, but please use only one of these means. If you submit a comment online viahttp://www.regulations.gov,it will be considered received by the Coast Guard when you successfully transmit the comment. If you fax, hand deliver, or mail your comment, it will be considered as having been received by the Coast Guard when it is received at the Docket Management Facility. We recommend that you include your name and a mailing address, an e-mail address, or a telephone number in the body of your document so that we can contact you if we have questions regarding your submission.

To submit your comment online, go tohttp://www.regulations.gov,click on the “submit a comment” box, which will then become highlighted in blue. In the “Document Type” drop down menu select “Proposed Rule” and insert “USCG-2011-0046” in the “Keyword” box. Click “Search” then click on the balloon shape in the “Actions” column. If you submit your comments by mail or hand delivery, submit them in an unbound format, no larger than 81/2by 11 inches, suitable for copying and electronic filing. If you submit comments by mail and would like to know that they reached the Facility, please enclose a stamped, self-addressed postcard or envelope. We will consider all comments and material received during the comment period and may change the rule based on your comments.

To view comments, as well as documents mentioned in this preamble as being available in the docket, go tohttp://www.regulations.gov,click on the “read comments” box, which will then become highlighted in blue. In the “Keyword” box insert “USCG-2011-0046” and click “Search.” Click the “Open Docket Folder” in the “Actions” column. You may also visit the Docket Management Facility in Room W12-140 on the ground floor of the Department of Transportation West Building, 1200 New Jersey Avenue, SE., Washington, DC 20590, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. We have an agreement with the Department of Transportation to use the Docket Management Facility.

Anyone can search the electronic form of comments received into any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union,etc.). You may review a Privacy Act notice regarding our public dockets in the January 17, 2008, issue of theFederal Register(73 FR 3316).

We do not now plan to hold a public meeting. But you may submit a request for one on or before the end of the comment period, using one of the four methods specified underADDRESSES. Please explain why you believe a public meeting would be beneficial. If we determine that one would aid this rulemaking, we will hold one at a time and place announced by a later notice in theFederal Register.

On Saturday, May 14, 2011, Competitor Group Inc. of San Diego, California, will sponsor the “TriRock Annapolis” triathlon in Annapolis, Maryland. The swim segment of the event will occur from 7 a.m. to 8:30 a.m. and will be located in Spa Creek and Annapolis Harbor. Up to 2,000 swimmers will operate on a 500-meter course located between the Annapolis City Dock and the confluence of the Spa Creek with the Severn River. The swimmers will be supported by sponsor-provided watercraft. The start and finish will be located at the Annapolis City Dock. A portion of the swim course will impede the Federal navigation channel. Due to the need for vessel control during the event, the Coast Guard would temporarily restrict vessel traffic in the event area to provide for the safety of participants, spectators and other transiting vessels.

The Coast Guard proposes to establish temporary special local regulations on specified waters of Spa Creek and Annapolis Harbor. The regulations would be in effect from 6 a.m. to 9 a.m. on May 14, 2011. The regulated area, approximately 900 yards in length, would extend across the entire width of Spa Creek and Annapolis Harbor, within lines connecting the following positions: From position latitude 38°58′34″ N, longitude 076°29′05″ W, thence to position latitude 38°58′27″ N, longitude 076°28′55″ W, and from position latitude 38°58′53″ N, longitude 076°28′34″ W to position latitude 38°58′21″ N, longitude 076°28′26″ W. The effect of this proposed rule would be to restrict general navigation in the regulated area during the event. These regulations are needed to control vessel traffic during the event to enhance the safety of participants, spectators and transiting vessels.

We developed this proposed rule after considering numerous statutes and executive orders related to rulemaking. Below we summarize our analyses based on 13 of these statutes or executive orders.

This proposed rule is not a significant regulatory action under section 3(f) of Executive Order 12866, Regulatory Planning and Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. We expect the economic impact of this proposed rule to be so minimal that a full Regulatory Evaluation under the regulatory policies and procedures of DHS is unnecessary. Although this regulation will prevent traffic from transiting a portion of Spa Creek and Annapolis Harbor during the event, the effect of this regulation will not be significant due to the limited duration that the regulated area will be in effect and the extensive advance notifications that will be made to the maritime community via the Local Notice to Mariners and marine information broadcasts, so mariners can adjust their plans accordingly.

Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered whether this proposed rule would have a significant economic impact on a substantial number of small entities. 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. This proposed rule would affect the following entities, some of which might be small entities: The owners or operators of vessels intending to transit or anchor in the effected portions of Spa Creek and Annapolis Harbor during the event.

Although this regulation prevents traffic from transiting a portion of the Spa Creek and Annapolis Harbor during the event, this proposed rule will not have a significant economic impact on a substantial number of small entitiesfor the following reasons: Though the regulated area extends across the entire width of the waterway, this proposed rule would be in effect for only a limited period; and before the enforcement period, we will issue maritime advisories so mariners can adjust their plans accordingly. All Coast Guard vessels enforcing this regulated area can be contacted on marine band radio VHF-FM channel 16 (156.8 MHz).

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

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this proposed rule so that they can better evaluate its effects on them and participate in the rulemaking. 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 Coast Guard Sector Baltimore, MD. The Coast Guard will not retaliate against small entities that question or complain about this proposed rule or any policy or action of the Coast Guard.

This proposed rule would call for no 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 State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. We have analyzed this proposed rule under that Order and have determined that it does not have implications for federalism.

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.

This proposed rule would not cause a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This proposed rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

We have analyzed this proposed rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and would not create an environmental risk to health or risk to safety that might disproportionately affect children.

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.

We have analyzed this proposed rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. The Administrator of the Office of Information and Regulatory Affairs has not designated it as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211.

The National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note) directs agencies to use voluntary consensus standards in their regulatory activities unless the agency provides Congress, through the Office of Management and Budget, with an explanation of why using these standards would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g.,specifications of materials, performance, design, or operation; test methods; sampling procedures; and related management systems practices) that are developed or adopted by voluntary consensus standards bodies.

This proposed rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards.

We have analyzed this proposed rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4370f), and have made a preliminary determination that this action is one of a category of actions which do not individually or cumulatively have a significant effect on the human environment. This rule is categorically excluded, under figure 2-1, paragraph (34)(h), of the Instruction. This proposed rule involves implementation of regulations within 33 CFR Part 100 applicable to organized marine events on the navigable waters of the United States that could negatively impact the safety of waterway users and shore side activities in the event area. The category of water activities includes but is not limited to sail boat regattas, boat parades, power boat racing, swimming events, crew racing, canoe and sail board racing. We seek any comments or information that may lead to the discovery of a significant environmental impact from this proposed rule.

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

We encourage you to participate in this rulemaking by submitting comments and related materials. All comments received will be posted without change tohttp://www.regulations.govand will include any personal information you have provided.

If you submit a comment, please include the docket number for this rulemaking (USCG-1998-4354 and/or USCG-1999-5705), indicate the specific section of this document to which each comment applies, and provide a reason for each suggestion or recommendation. You may submit your comments and material online or by fax, mail, or hand delivery, but please use only one of these means. We recommend that you include your name and a mailing address, an e-mail address, or a phone number in the body of your document so that we can contact you if we have questions regarding your submission.

To submit your comment online, go tohttp://www.regulations.gov,click on the “submit a comment” box, which willthen become highlighted in blue. In the “Document Type” drop down menu select “Proposed Rule” and insert “USCG-1998-4354” or “USCG-1999-5705” in the “Keyword” box. Click “Search” then click on the balloon shape in the “Actions” column. If you submit your comments by mail or hand delivery, submit them in an unbound format, no larger than 81/2by 11 inches, suitable for copying and electronic filing. If you submit comments by mail and would like to know that they reached the Facility, please enclose a stamped, self-addressed postcard or envelope.

We will consider all comments and material received during the comment period and may change this proposed rule based on your comments.

To view comments, as well as documents mentioned in this preamble as being available in the docket, go tohttp://www.regulations.gov,click on the “read comments” box, which will then become highlighted in blue. In the “Keyword” box insert “USCG-1998-4354” or “USCG-1999-5705” and click “Search.” Click the “Open Docket Folder” in the “Actions” column. If you do not have access to the internet, you may view the docket online by visiting the Docket Management Facility in Room W12-140 on the ground floor of the Department of Transportation West Building, 1200 New Jersey Avenue, SE., Washington, DC 20590, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. We have an agreement with the Department of Transportation to use the Docket Management Facility.

Anyone can search the electronic form of comments received into any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review a Privacy Act notice regarding our public dockets in the January 17, 2008, issue of theFederal Register(73 FR 3316).

We do not now plan to hold a public meeting. But you may submit a request for one to either docket using one of the methods specified underADDRESSES. In your request, explain why you believe a public meeting would be beneficial. If we determine that one would aid this rulemaking, we will hold one at a time and place announced by a later notice in theFederal Register.

The Clean Water Act (CWA), as amended by section 4202(a)(6) of the Oil Pollution Act of 1990 (OPA 90), requires owners or operators of tank vessels, offshore facilities, and onshore facilities to prepare response plans to mitigate spills of both oils and hazardous substances. Specifically, it requires the owners and operators of those vessels and facilities that could reasonably be expected to cause substantial or significant and substantial harm to the environment to prepare and submit response plans. These plans must address measures to respond, to the maximum extent practicable, to a worst-case discharge or a substantial threat of such a discharge, of oil or a hazardous substance into or on navigable waters, adjoining shorelines, or the exclusive economic zone of the United States. The primary purpose of requiring response plans is to minimize impact of a discharge of oil or hazardous substances into the navigable waters of the United States.

In response to the Congressional statute, the Coast Guard promulgated several rules regarding response plans for oil spills. The Final Rule for oil spill response plans for vessels was published on January 12, 1996 (61 FR 1052), and the rule for facilities followed on February 29, 1996 (61 FR 7890).

In addition to publication of oil spill response plan regulations, we published proposals regarding response plans for hazardous substances. On May 3, 1996, we published an ANRPM addressing vessel and facility response plans (61 FR 20084). The ANPRM discussed the background, statutory requirements, and possible regulatory approaches to developing plans for hazardous substance releases. It also posed 96 questions, and the Coast Guard Received 42 comment letters replying to the ANPRM.

The Coast Guard gathered additional information to formulate hazardous substance response plans from the public during public meetings and a response plan workshop. We conducted two public meetings on July 30, 1996, in Washington, DC, and August 5, 1996, in Houston, TX. The Coast Guard held a workshop and meeting in Houston, TX to engage various stakeholders in issues that had been identified as significant in response to the ANPRM. The workshop focused on four specific issues identified in advance: (1) The role and contents of first responders' guides; (2) the role and capabilities of decision support systems; (3) chemical removal technology; and (4) public responder versus private responder issues.

Finally, the Coast Guard received recommendations from advisory committees. Under the auspices of the Chemical Transportation Advisory Committee (CTAC), the Hazardous Substances Response Plan Subcommittee was formed to develop and recommend hazardous substance response plan criteria for the agency's consideration in developing requirements for response plans. The subcommittee formed working groups to address the various aspects of response planning: Fate and effects, response resources and methodology, and planning process. Based on the work done by these groups, the subcommittee delivered a report containing findings and recommendations, which was considered by the Coast Guard in developing its proposed regulations.

Based on the comments provided to the Coast Guard from the sources listed above, we published two separate NPRMs proposing to require hazardous substance response plans for tank vessels and marine transportation-related facilities on March 22, 1999 and March 31, 2000, respectively (64 FR 13734 and 65 FR 17416). The intent of the proposed regulations was to ensure access to the necessary information and equipment during a response to a spill of hazardous substances, as well as to ensure the availability of appropriate technical expertise as necessary. The proposed requirements allowed for flexibility in determining how to respond to a particular spill, given that the disparate nature of spills of hazardous substances do not lend themselves to standardized procedures, unlike the comparatively standardized procedures for oil spill responses.

The premise of the proposed regulations is that, through an analysis of the required information by area specialists, the most appropriate response strategies for dealing with a particular spill could be identified and performed. Furthermore, the proposed regulations were intended to accommodate the use of the National Response Team's Integrated Contingency Plan (ICP) Guidance, published in theFederal Registeron June 5, 1996 (61 FR 28642). This guidance provided a mechanism for consolidating multiple plans into one functional emergency response plan, minimizing or eliminating duplication of information. In addition, the proposed regulations allowed plans to be structured in such a way that oil response plans for tank vessels and facilities could be amended oraugmented to meet the requirements for hazardous substances.

At this time, we believe that the proposed regulations provide a basis to develop strong, flexible plans to address spills of hazardous substances. The proposals also encourage plans that make use of industry best practices and comply with international standards. We encourage readers to refer to the published NPRMs and their supporting documents for a more complete discussion of the proposed regulations.

In the Coast Guard Authorization Act of 2010 (Pub. L. 111-281), Congress mandated that the agency promulgate final rules pursuant to section 311 of the CWA within 18 months. Despite publishing proposals for hazardous substance response plans in 1999 and 2000, the Coast Guard has not yet issued final rules on this issue. However, in accordance with the legislative mandate, we are planning to publish final rules based on these proposals within the required timeframe. The final rules will consider all of the comments received in the course of this rulemaking action, both written and presented in public meetings.

In this notice, the Coast Guard is reopening the comment period for the NPRMs on hazardous substance response plans for tank vessels and marine transportation-related facilities. At this time, we are not yet responding to comments received in response to the NPRMs, nor are we changing the proposals in any way. Due to the length of time that has elapsed since the publication of the proposed rules, we are reopening the comment period to solicit additional or updated comments regarding the proposed hazardous substance response plan regulations. Such information may relate to changed market conditions, industry practices, improvements in technology, or any other matter addressed by the proposed regulations.

One issue on which we are specifically not requesting comments at this time is the expansion of the requirement for response plans to noxious liquid substances not covered by 40 CFR part 116. In Section 701 of the Coast Guard and Maritime Transportation Act of 2004 (Pub. L. 108-219), Congress amended the CWA by adding paragraph (B) to 33 U.S.C. 1321(j)(5), which authorized the Coast Guard to require response plans for noxious liquid substances not covered under other regulations. However, because the agency is required to publish a final rule by April of 2012, we will not be able to incorporate those chemicals into the current response plan proposals. The agency is closely studying the matter and intends to propose regulations in the future regarding those additional chemicals.

Material proposed for incorporation by reference appears in § 155.3035 of the proposed text. You may inspect this material at U.S. Coast Guard Headquarters where indicated underADDRESSES. Copies of the material are available from the sources listed in § 155.140.

We encourage you to participate in this rulemaking by submitting comments and related materials. All comments received will be posted without change tohttp://www.regulations.govand will include any personal information you have provided.

If you submit a comment, please include the docket number for this rulemaking (USCG-2011-0034), indicate the specific section of this document to which each comment applies, and provide a reason for each suggestion or recommendation. You may submit your comments and material online (viahttp://www.regulations.gov) or by fax, mail, or hand delivery, but please use only one of these means. If you submit a comment online viahttp://www.regulations.gov,it will be considered received by the Coast Guard when you successfully transmit the comment. If you fax, hand deliver, or mail your comment, it will be considered as having been received by the Coast Guard when it is received at the Docket Management Facility. We recommend that you include your name and a mailing address, an e-mail address, or a telephone number in the body of your document so that we can contact you if we have questions regarding your submission.

To submit your comment online, go tohttp://www.regulations.gov,click on the “submit a comment” box, which will then become highlighted in blue. In the “Document Type” drop down menu select “Proposed Rule” and insert “USCG-2011-0034” in the “Keyword” box. Click “Search” then click on the balloon shape in the “Actions” column. If you submit your comments by mail or hand delivery, submit them in an unbound format, no larger than 81/2by 11 inches, suitable for copying and electronic filing. If you submit comments by mail and would like to know that they reached the Facility, please enclose a stamped, self-addressed postcard or envelope. We will consider all comments and material received during the comment period and may change the rule based on your comments.

To view comments, as well as documents mentioned in this preamble as being available in the docket, go tohttp://www.regulations.gov,click on the “read comments” box, which will then become highlighted in blue. In the “Keyword” box insert “USCG-2011-0034” and click “Search.” Click the “Open Docket Folder” in the “Actions” column. You may also visit the Docket Management Facility in Room W12-140 on the ground floor of the Department of Transportation West Building, 1200 New Jersey Avenue, SE., Washington, DC 20590, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. We have an agreement with the Department of Transportation to use the Docket Management Facility.

Anyone can search the electronic form of comments received into any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review a Privacy Act notice regarding our public dockets in the January 17, 2008, issue of theFederal Register(73 FR 3316).

We do not now plan to hold a public meeting. But you may submit a request for a public meeting on or before February 15, 2011 using one of the four methods specified underADDRESSES. Please explain why you believe a public meeting would be beneficial. If we determine that one would aid this rulemaking, we will hold one at a time and place announced by a later notice in theFederal Register.

The Fourth Annual Offshore Challenge, hosted by Offshore Events, LLC, will consist of a series of high-speed boat races. Since 2008, the Annual Offshore Challenge has been held in the Atlantic Ocean offshore of Sunny Isles Beach, Florida. Approximately 50 offshore power boats will be participating in the boat races. These vessels will be traveling at high speeds. Approximately 200 spectator vessels are expected to observe the races. The high speed of the participant vessels poses a safety hazard to race participants, spectators, and the general public. The safety zone is necessary to protect race participants, spectators, and the general public from the hazards associated with the high-speed boat races.

The proposed rule would designate a temporary safety zone around a race area in the Atlantic Ocean offshore of Sunny Isles Beach, Florida. Persons and vessels will be prohibited from entering, transiting through, anchoring in, or remaining within the safety zone unless specifically authorized by the Captain of the Port Miami or a designated representative. Persons and vessels may request permission to enter, transit through, anchor in, or remain within the safety zone by contacting the Captain of the Port Miami via telephone at 305-535-4472 or a designated representative via VHF radio on channel 16. The temporary safety zone will be in effect from 8 a.m. on June 17, 2011 through 5 p.m. on June 19, 2011. The temporary safety zone will be enforced daily from 8 a.m. until 5 p.m. on June 17, 2011 through June 19, 2011.

We developed this proposed rule after considering numerous statutes and executive orders related to rulemaking. Below we summarize our analyses based on 13 of these statutes or executive orders.

This proposed rule is not a significant regulatory action under section 3(f) of Executive Order 12866, Regulatory Planning and Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order.

We expect the economic impact of this proposed rule to be so minimal that a full regulatory evaluation is unnecessary. This proposed rule may have some impact on the public, but these potential impacts will be minimal for the following reasons: (1) The rule will be in effect for three days but will only be enforced for a total of nine hours each day; (2) although persons and vessels will not be able to enter, transit through, anchor in, or remain within the safety zone without authorization from the Captain of the Port Miami or a designated representative, they may operate in the surrounding area during the enforcement period; (3) persons and vessels may still enter, transit through, anchor in, or remain within the safety zone if authorized by the Captain of the Port Miami or a designated representative; and (4) advance notification of the safety zone will be made to the local maritime community via local notice to mariners, marine safety information bulletins, and broadcast notice to mariners.

Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered whether this proposed rule would have a significant economic impact on a substantial number of small entities. 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. This rule may affect the following entities, some of which may be small entities: Owners and operators of vessels intending to enter, transit through, anchor in, or remain within waters of the Atlantic Ocean offshore of Sunny Isles Beach, Florida that are encompassed within the safety zone from 8 a.m. until 5 p.m. on June 17, 2011 through June 19, 2011.

For the reasons discussed in the Regulatory Planning and Review section above, this proposed rule will not have significant economic impact on a substantial number of small entities.

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

Under section 213(a) of the Small Business Regulatory EnforcementFairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this proposed rule so that they can better evaluate its effects on them and participate in the rulemaking. 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 Lieutenant Paul A. Steiner, Sector Miami Prevention Department, Coast Guard; telephone 305-535-8724, e-mailPaul.A.Steiner@uscg.mil.The Coast Guard will not retaliate against small entities that question or complain about this proposed rule or any policy or action of the Coast Guard.

This proposed rule would call for no 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 State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. We have analyzed this proposed rule under that Order and have determined that it does not have implications for federalism.

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 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.

This proposed rule would not cause a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This proposed rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

We have analyzed this proposed rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and would not create an environmental risk to health or risk to safety that might disproportionately affect children.

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.

We have analyzed this proposed rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. The Administrator of the Office of Information and Regulatory Affairs has not designated it as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211.

The National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note) directs agencies to use voluntary consensus standards in their regulatory activities unless the agency provides Congress, through the Office of Management and Budget, with an explanation of why using these standards would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g.,specifications of materials, performance, design, or operation; test methods; sampling procedures; and related management systems practices) that are developed or adopted by voluntary consensus standards bodies.

This proposed rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards.

We have analyzed this proposed rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA) (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. A preliminary environmental analysis checklist supporting this determination is available in the docket where indicated underADDRESSES.This proposed rule involves establishing a temporary safety zone, as described in paragraph 34(g) of the Instruction, east of Sunny Isles, Florida in the Atlantic Ocean. We seek any comments or information that may lead to the discovery of a significant environmental impact from this proposed rule.

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

On April 14, 2010, the Massachusetts Department of Environmental Protection (DEP) submitted a revision to its State Implementation Plan (SIP) for Massachusetts. The SIP revision consists of a minor modification to the carbon monoxide (CO) maintenance plan for Lowell, Massachusetts. (A redesignation request and a maintenance plan for the Lowell CO nonattainment area were approved by EPA on February 19, 2002 (67 FR 7272).) The modification changes the triggering mechanism which will be used by the State to determine if contingency measures need to be implemented in Lowell.

EPA is proposing to approve revisions to the Lowell carbon monoxide maintenance plan submitted by the State of Massachusetts on April 14, 2010. Specifically, EPA is proposing approval of the State's modification of the portion of the maintenance plan used to determine when contingency measures need to be triggered to reduce CO concentrations in Lowell. This proposed action, if finalized, would allow the discontinuation of CO monitoring in the Lowell maintenance area.

Massachusetts's SIP revision and EPA's evaluation of this SIP revision are discussed below. Additional details are also provided in a memorandum dated January 24, 2011, entitled “Technical Support Document for Revision to the Carbon Monoxide Maintenance Plan for Lowell, Massachusetts” (TSD). The TSD and Massachusetts's submittal are available in the docket supporting this action.

On April 14, 2010, the Massachusetts Department of Environmental Protection submitted a SIP revision to EPA that contains a modification to its CO maintenance plan for the Lowell CO maintenance area. The modifications to the maintenance plan change the triggering mechanism by which contingency measures would be implemented and will allow the State to discontinue CO monitoring in the Lowell maintenance area. CO concentrations measured in Lowell have been below the National Ambient Air Quality Standard (NAAQS) for nearly 25 years, and in recent years, maximum measured concentrations have been less than 30% of the 9 parts per million (ppm) 8-hour CO standard.1 In this SIP revision, the State of Massachusetts is establishing an alternative triggering mechanism, which will rely on CO data from a nearby CO monitor in Worcester, Massachusetts.

Under the current maintenance plan, contingency measures in Lowell are triggered when a violation of the CO NAAQS is measured in Lowell. Under the revised maintenance plan, Massachusetts will rely on data from the Worcester CO monitor to determine when and if monitoring will be reestablished in the Lowell maintenance area, and, in some circumstances, when contingency measures will be triggered in the Lowell maintenance area.

If this proposal is finalized, Massachusetts will discontinue CO monitoring in Lowell. Massachusetts DEP will continue to collect and review CO monitoring data from nearby Worcester, MA on an on-going basis. In the event the second highest CO concentration in any calendar year monitored in Worcester reaches 75 percent of the Federal 1-hour or 8-hour NAAQS for CO (35 and 9 ppm, respectively), Massachusetts will, within 9 months of recording such concentrations, re-establish a CO monitoring site in Lowell consistent with EPA siting criteria, and resume analyzing and reporting those data. Massachusetts will continue to commit to implement its contingency program in Lowell in the event that a CO violation (the “contingency trigger”) is monitored at the re-established Lowell monitoring site at any time during the maintenance period and to consider one or more of the other EPA-approved measures listed in the 2001 Maintenance Plan if necessary to reduce CO levels.

If the Worcester CO monitor measures a violation of either the Federal 1-hour or 8-hour NAAQS for CO, the contingency measures in 2001 Maintenance Plan for Lowell will be implemented in Lowell, as well as triggering contingency measures in Worcester under the terms of the existing Maintenance Plan for Worcester, until a re-established Lowell CO monitor shows that the area is attainment of the CO standard.

When implementing contingency measures, Massachusetts will review and implement the measures necessary to remedy the violation, including transportation control measures (TCM) or other additional vehicle or fuel controls.

EPA agrees that the mechanism described above represents an acceptable contingency triggering mechanism for the Lowell CO maintenance plan. If the proposed approval of this revised triggering mechanism is finalized, Massachusetts DEP will be allowed to discontinue monitoring in the Lowell area, which we believe is appropriate for this area which is currently measuring concentrations well below the 1-hour and 8-hour CO NAAQS. Under this plan, we believe air quality goals can be maintained, and State monitoring resources conserved.

On October 17, 2006, EPA published a final monitoring rule revising minimum monitoring requirements, which was codified in 40 CFR part 58. (See71 FR 61236.) That rule explicitly recognized that, in some cases where measured levels of pollutants are low, shutting down certain CO monitors may be allowed without revising the SIP. (See40 CFR 58.14(c)(1)-(6).) The rule, however, also explicitly provides that if a monitor is the only monitor in the area, and it serves as a trigger to implement a contingency measure in an EPA-approved maintenance plan, then the monitor may not be discontinued. (See40 CFR 58.14(c)(1).) Rather, in this case the maintenance plan would need to be revised, and the trigger replaced. (See71 FR 61250 and 71 FR 61301.)

As described above, this action is proposing to approve a change to the mechanism that Massachusetts will use to determine when contingency measures need to be triggered to reduce CO concentrations in Lowell. Previously, the State would implement a contingency measure based on concentrations of CO monitored in Lowell. In light of the fact that Lowell CO concentrations have been well below the standard for some time, the State is looking to conserve resources. Massachusetts DEP wants to use its CO monitor in Worcester, a nearby city, to aid in determining if Lowell has a CO problem. Lowell and Worcester are located 42 miles apart. Worcester (population 175,011)2 is somewhat larger than Lowell (population103,615)3 , so its CO concentrations can be expected to be slightly higher due to greater motor vehicle emissions. CO concentrations in Lowell and Worcester have tracked very closely for many years. (The TSD provides a comparison of the data collected at the Lowell and Worcester CO monitors over the last twenty-five years.) Both cities were designated nonattainment in 1990 for CO “by operation of law,” though both had design values below the standard at that time. In both cases, only the city itself was designated nonattainment since data did not support an expansion of the nonattainment area. Both cities were redesignated to attainment in 2000, and both have measured CO concentrations well below the standard since that time.

In order to conserve resources, the State is seeking to discontinue monitoring in Lowell since current air quality levels do not warrant the additional expense of running a CO monitor in this area. The State has committed to continue CO monitoring in Worcester, and will reestablish CO monitoring in Lowell if air quality in Worcester degrades significantly. In Massachusetts (as in many other places), CO is primarily emitted by on and off-road mobile sources. Starting in the early 1970s, EPA has set national standards that have considerably reduced emissions of CO and other pollutants from motor vehicles, including tailpipe emissions, new vehicle technologies, and clean fuels programs. Moreover, the Massachusetts SIP requires that new or modified large stationary sources demonstrate that their emissions will not cause an exceedance of any NAAQS. Finally, growth is not likely to result in increased CO levels because the CO reductions described above have occurred even as vehicle miles traveled (VMT) have increased. (SeeVMT data in TSD.) For this reason, EPA believes that it is unlikely that the Lowell or Worcester maintenance area will exceed the CO NAAQS again. Thus, we believe that the revisions that Massachusetts has made to the Lowell maintenance plan will continue to protect the citizens of Massachusetts from high CO concentrations, and also conserve resources.

EPA is proposing to approve the Massachusetts SIP revision for the Carbon Monoxide Maintenance Plan for Lowell, which was submitted on April 14, 2010. EPA is soliciting public comments on the issues discussed in this notice or on other relevant matters. These comments will be considered before taking final action. Interested parties may participate in the Federal rulemaking procedure by submitting written comments to the EPA New England Regional Office listed in theADDRESSESsection of thisFederal Register.

EPA is proposing to approve the revisions to the Lowell CO maintenance plan submitted by the State of Massachusetts on April 14, 2010. Specifically, EPA is proposing approval of the State's request to modify the portion of the maintenance plan used to determine when contingency measures need to be implemented in Lowell. As described in more detail above, if this proposal is finalized, the State will shut down the Lowell CO monitor and rely on data from the CO monitor in Worcester to determine when and if monitoring will be reestablished in the Lowell maintenance area, and, in some circumstances, when contingency measures will be triggered in the Lowell maintenance area.

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

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

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

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

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

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

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

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

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

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

In addition, this rule does not have Tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not approved to apply in Indian country located in the State, and EPA notes that it will not impose substantial direct costs on Tribal governments or preempt Tribal law.

Inspection of Public Comments:All comments received before the close of the comment period are available for viewing by the public, including any personally identifiable or confidential business information that is included in a comment. We post all comments received before the close of the comment period on the following Web site as soon as possible after they have been received:http://www.regulations.gov.Follow the search instructions on that Web site to view public comments.

Comments received timely will also be available for public inspection as they are received, generally beginning approximately 3 weeks after publication of a document, at the headquarters of the Centers for Medicare & Medicaid Services, 7500 Security Boulevard, Baltimore, Maryland 21244, Monday through Friday of each week from 8:30 a.m. to 4 p.m. To schedule an appointment to view public comments, phone 1-800-743-3951.

To assist the reader, the following is list of the acronyms used in this proposed rule:

Title XIX of the Social Security Act (the Act) authorizes Federal grants to the States for Medicaid programs to provide medical assistance to persons with limited income and resources. While Medicaid programs are administered by the States, they are jointly financed by the Federal and State governments. Each State establishes its own eligibility standards, benefits packages, payment rates, and program administration for Medicaid in accordance with Federal statutory and regulatory requirements. Operating within broad Federal parameters, States select eligibility groups, types, and range of services, payment levels for services, and administrative and operating procedures. Each State Medicaid program must be described and administered in accordance with a Federally-approved “State plan.” This comprehensive document describes the nature and scope of the State's Medicaid program, and provides assurances that it will be administered in conformity with all Federal requirements.

The Federal government pays its share of medical assistance expenditures to the State on a quarterly basis according to a formula described in sections 1903 and 1905(b) of the Act. Specifically, section 1903 of the Act requires that the Secretary (except as otherwise provided) pay to each State which has a plan approved under this title, for each quarter, an amount equal to the Federal medical assistance percentage of the total amount expended during such quarter as medical assistance under the State plan.

Among the statutory requirements for Medicaid State plans, section 1902(a)(4) of the Act requires that State plans provide for methods of administration as are found to be necessary by the Secretary for the proper and efficient operation of the plan. Section 1902(a)(6) of the Act requires that a State plan formedical assistance provide that the State agency will make such reports, in such form and containing such information, as the Secretary may from time-to-time require, and comply with such provisions as the Secretary may from time-to-time find necessary to assure the correctness and verification of such reports. In addition, section 1902(a)(19) of the Act requires that a State plan for medical assistance provide such safeguards as may be necessary to assure that eligibility for care and services under the plan will be determined, and such care and services will be provided, in a manner consistent with simplicity of administration and the best interests of the recipients.

Title XVIII of the Act provides authority for the Secretary to operate the Medicare program, which provides payment for certain medical expenses for persons 65 years of age or older, certain disabled individuals, and persons with end-stage renal disease (ESRD). Medicare benefits include inpatient care, a wide range of medical services, and outpatient prescription drugs.

The Medicare statute authorizes the Secretary, in the course of operating the Medicare program, to develop, implement, and monitor quality measures, as well as take other actions, to ensure the quality of the care and services received by Medicare beneficiaries.

Payment under the Medicare program for inpatient hospital benefits is generally based on the “inpatient prospective payment system” (IPPS) described in section 1886(d) of the Act. Hospitals receive a payment for each inpatient discharge based on diagnosis codes that identify a “diagnosis-related group” (MS-DRG). Assignment of an MS-DRG can take into account the presence of secondary diagnoses, and payment levels are also adjusted to account for a number of hospital-specific factors.

Section 5001(a) of the Deficit Reduction Act of 2005 (Pub. L. 109-171, enacted on February 8, 2006) (DRA) amended section 1886(b)(3)(B) of the Act to expand the set of hospital quality measures collected by Medicare. In particular, this provision directed the Secretary to start collecting baseline measures set forth by the Institute of Medicine in its November 2005 report in fiscal year (FY) 2007. These measures include 22 Hospital Quality Alliance measures and 3 process measures. In FY 2008 and subsequent years, the Secretary was required to add other measures that reflect consensus among affected parties. The provision also allowed the Secretary to replace and update existing quality measures. The statute mandates that the Secretary establish a process for hospitals to review data that will be made public and, after that process is complete, requires the Secretary to post measures on the Hospital Compare Internet Web site. The quality measures required under section 5001(a) of the DRA were integral to the direction under section 5001(b) of the DRA for the Secretary to develop a plan to implement value-based purchasing commencing FY 2009 for most Medicare hospital services. We are currently developing a hospital value-based purchasing system as required by the Patient Protection and Affordable Care Act (Pub. L. 111-148, enacted on March 23, 2010) (Affordable Care Act).

Section 5001(c) of the DRA amended section 1886(d)(4) of the Act to prohibit payment to hospitals for certain preventable hospital-acquired conditions (HACs) identified by the Secretary. Specifically, under section 1886(d)(4)(D)(iv) of the Act, the Secretary is required to identify HACs for which no payment for hospital services would be made. These conditions are required to have the following characteristics: (a) High cost or high volume or both; (b) result in the assignment of a case to a MS-DRG that has a higher payment when present as a secondary diagnosis; and (c) could reasonably have been prevented through the application of evidence-based guidelines. Section 5001(c) of the DRA provides for revision of the list of conditions from time to time, as long as it contains at least two conditions.

As amended by section 5001(c) of the DRA, section 1886(d)(4) of the Act provides that the Secretary must ensure that additional payment under the IPPS is not made to hospitals for identified HACs including infections. By October 1, 2007, the Secretary was required under section 1886(d)(4)(D) of the Act to select, in consultation with the Centers for Disease Control and Prevention (CDC), diagnosis codes associated with at least two HACs that: (a) Are high cost, high volume, or both; (b) are assigned to a higher paying MS-DRG when present as a secondary diagnosis (that is, conditions under the MS-DRG system that are complications or co-morbidities or major complications or co-morbidities); and (c) could reasonably have been prevented through the application of evidence based guidelines. The list of conditions can be revised from time-to-time as long as the list contains at least two conditions.

Under the provisions of section 1886(d)(4)(D)(ii) of the Act, when an HAC is not present on admission (POA), but is reported as a secondary diagnosis associated with the hospitalization, the Medicare payment under IPPS to the hospital may be reduced to reflect that the condition was hospital-acquired. More specifically, the hospital discharge cannot be assigned to a higher paying MS-DRG if the secondary diagnosis associated with the HAC would otherwise have caused this assignment. If an HAC were POA, then the Medicare payment under IPPS to the hospital would not be reduced. Since October 1, 2007, hospitals subject to the IPPS have been required to submit information on Medicare claims specifying whether diagnoses were POA. The POA indicator reporting requirement and the HAC payment provision apply to IPPS hospitals only. This requirement does not apply to hospitals exempt from the IPPS.

The following is a list of the current Medicare HACs (75 FR 50084 through 50085):

• Foreign Object Retained After Surgery.

• Air Embolism.

• Blood Incompatibility.

• Stage III and IV Pressure Ulcers.

• Falls and Trauma.

+ Fractures.

+ Dislocations.

+ Intracranial Injuries.

+ Crushing Injuries.

+ Burns.

+ Electric Shock.

• Manifestations of Poor Glycemic Control.

+ Diabetic Ketoacidosis.

+ Nonketotic Hyperosmolar Coma.

+ Hypoglycemic Coma.

+ Secondary Diabetes with Ketoacidosis.

+ Secondary Diabetes with Hyperosmolarity.

• Catheter-Associated Urinary Tract Infection (UTI).

• Vascular Catheter-Associated Infection.

• Surgical Site Infection Following:

+ Coronary Artery Bypass Graft (CABG)—Mediastinitis.

+ Bariatric Surgery.

- Laparoscopic Gastric Bypass.

- Gastroenterostomy.

- Laparoscopic Gastric Restrictive Surgery.

+ Orthopedic Procedures.

- Spine.

- Neck.

- Shoulder.

- Elbow.

• Deep Vein Thrombosis (DVT)/Pulmonary Embolism (PE).

+ Total Knee Replacement.

+ Hip Replacement.

The Secretary may revise this list upon review.

In 2002, the National Quality Forum (NQF) published “Serious Reportable Events in Healthcare: A Consensus Report”, which listed 27 adverse events that were “serious, largely preventable and of concern to both the public and health care providers.” These events and subsequent revisions to the list became known as “never events.” This concept and need for the proposed reporting led to NQF's “Consensus Standards Maintenance Committee on Serious Reportable Events,” which maintains and updates the list which currently contains 28 items.

The Medicare program has addressed certain “never events” through national coverage determinations (NCDs). Similar to any other patient population, Medicare beneficiaries may experience serious injury and/or death if they undergo erroneous surgical or other invasive procedures and may require additional healthcare in order to correct adverse outcomes that may result from such errors. In order to address and reduce the occurrence of these surgeries, Medicare issued three NCDs. Under these NCDs, Medicare does not cover a particular surgical or other invasive procedure to treat a particular medical condition when the practitioner erroneously performs: (1) A different procedure altogether; (2) the correct procedure but on the wrong body part; or (3) the correct procedure but on the wrong patient. Medicare will also not cover hospitalizations and other services related to these non-covered procedures.

Section 5001(c) of the DRA addressed only the Medicare program and did not require that Medicaid implement nonpayment policies for HACs. However, in light of the Medicare requirements, we encouraged States to adopt payment prohibitions on provider claims for HACs to coordinate with the Medicare prohibitions under section 1886(d)(4)(D) of the Act. To accomplish this task, we issued State Medicaid Director Letter (SMDL) #08-004 on July 31, 2008. In the July 31, 2008 SMDL, we noted that there was variation in how State Medicaid programs had addressed such claims in the past. The letter noted that nearly 20 States already had, or were considering, eliminating payment for some or all of the 28 conditions on the NQF's list of Serious Reported Events. Other States had more limited efforts to deny payment for services related to such conditions because the services were “medically unnecessary” in light of the primary diagnosis.

Recognizing this variation and addressing the immediate concern of the States over Federal cost-shifting that could result from the Medicare HAC policy as applied to those who are dually-eligible for Medicare and Medicaid, we took a flexible position in the July 31, 2008 SMDL guidance on State Medicaid handling of the issue. The SMDL indicated that States seeking to implement HAC nonpayment policies could do so by amending their Medicaid State plans to specify the extent to which they would deny payment for an HAC. Those interested only in avoiding secondary liability for Federal Medicare denials of HACs and NCDs in the case of dual-eligibles could do so by amending their State Plan to indicate that payment would not be available for HACs and the procedures described in the 3 NCDs that are not paid by Medicare. States that wanted broader payment prohibitions could indicate that payment would not be available for conditions specified in the State plan amendment (SPA), or that meet criteria identified in the SPA.

Section 2702 of the Affordable Care Act requires that the Secretary implement Medicaid payment adjustments for health care-acquired conditions (HCACs). Section 2702 of the Affordable Care Act did not grant the Secretary new authorities, indicating that existing statutory authorities are sufficient to fulfill the obligation. Section 2702(a) of the Affordable Care Act sets out a general framework for application of Medicare prohibitions on payment for HCACs to the Medicaid program. Section 2702(a) of the Affordable Care Act first directs the Secretary to identify current State practices that prohibit payment for HCACs and to incorporate the practices identified, or elements of such practices, which the Secretary determines appropriate for application to the Medicaid program in regulations. Section 2702(a) of the Affordable Care Act then requires that, effective as of July 1, 2011, the Secretary prohibit payments to States under section 1903 of the Act for any amounts expended for providing medical assistance for HCACs specified in regulations. Such regulations must ensure that the prohibition on payment for HCACs shall not result in a loss of access to care or services for Medicaid beneficiaries.

Section 2702(b) of the Affordable Care Act defines the term ”health care-acquired condition” as “a medical condition for which an individual was diagnosed that could be identified by a secondary diagnostic code described in section 1886(d)(4)(D)(iv) of the Act.”

Section 2702(c) of the Affordable Care Act specifically requires that the Secretary, in carrying out section 2702 of the Affordable Care Act, apply the regulations issued under section 1886(d)(4)(D) of the Act relating to the prohibition of payments based on the presence of a secondary diagnosis code specified by the Secretary in such regulations, as appropriate for the Medicaid program. The Secretary may exclude certain conditions identified under title XVIII of the Act for nonpayment under title XIX of the Act when the Secretary finds the inclusion of such conditions to be inapplicable to beneficiaries under title XIX.

Section 2702 of the Affordable Care Act requires that the Secretary identify current State practices that prohibit payment for HCACs and incorporate those practices, as appropriate, into Medicaid regulations.

To fulfill the statutory direction, we reviewed existing SPAs originally submitted in response to the July 31, 2008 SMDL (#08-004). We also researched State HCAC-related nonpayment policies that had been implemented outside of Medicaid State plans. We reviewed State quality assurance programs, pay-for-performance programs, reporting requirements and procedures, and payment systems.

We reviewed various articles, reports, summaries, and data bases pertaining to States' existing practices concerning hospital and HCACs and infections including, but not limited to:

•Nonpayment for Preventable Events and Conditions: Aligning State and Federal Policies to Drive Health System Improvement,Jill Rosenthal and Carrie Hanlon, December 2009.

• “Estimating the Costs of Potentially Preventable Hospital Acquired Complications,” Richard L. Fuller M.S.,et al, Health Care Financing Review,Summer 2009, Volume 30, Number 4.

• “Identifying Potential Preventable Complications Using a Present onAdmission Indicator,” John S. Hughes, M.D.,et al, Health Care Financing Review,Spring 2006, Volume 27, Number 3.

•State Government Tracking of Hospital-Acquired Conditions,Nathan West, MPAet al,April 2010.

• “The Triple Aim: Care, Health, and Cost,” Donald Berwick,et al., Health Affairs,Volume 27, Number 3 (2008).

• “Lessons from the Pioneers: Reporting Healthcare-Associated Infections,” Anna Spencer,et al.National Conference of State Legislatures, July 2010.

• “OIG Report: Adverse Events in Hospitals: National Incidence Among Medicare Beneficiaries,” OEI-06-09-00090, November 2010.

• “OIG Report: Adverse Events in Hospitals: Public Disclosure of Information About Events,” OEI-06-09-00360, January 2010.

• “OIG Report: Adverse Events in Hospitals: State Reporting Systems,” OEI-06-07-00471, December 2008.

•To Err is Human: Building a Safer Health System, A report of the Committee on Quality of Health Care in America,Institute of Medicine, National Academy Press, 2000, L.T. Kohn, J.M. Corrigan, and M.S. Donaldson, eds.

We discussed internally within CMS, as well as with interagency partners at the Agency for Healthcare Research and Quality (AHRQ) and the CDC to ensure that the proposed regulations are consistent with other regulations, policies, and procedures currently in existence surrounding this issue. We also met with them to gain information on areas where we could mirror existing processes to eliminate undue burdens on States or providers.

We issued a State survey to capture data from all related payment policies regardless of whether they were implemented as a result of the July 31, 2008 SMDL or whether such practices are currently detailed in the State plan. The survey is still undergoing the Paperwork Reduction Act (PRA) process and has not been made mandatory. However, we have received information from a few States through the survey and have reviewed other information that has been helpful in explaining current State processes for making payment adjustments for HCACs. Subsequent to the publication of the survey, we held all-State calls where we answered questions in response to the survey, had States with existing policies talk about their experiences, and listened to discussion regarding the implementation of the HCAC policy.

We met with nongovernmental partners including the NQF, the National Academy for State Health Policy, the National Association of Children's Hospitals, the Joint Commission, and State Medicaid Medical Directors. Most of these organizations are primarily focused on State program development and/or quality issues. We reached out to them to ensure that the proposed policies would be consistent with current industry understanding of both State payment and quality improvement goals. In our discussions with these organizations, we were able to discuss State experiences on a broad, national level that had been gained from working with States. During these meetings, we discussed a number of issues related to the proposed rule and State concerns in implementing this provision. For instance, it was clear from many of our discussions that States hoped to be able to look to this provision to provide additional definition regarding the types of conditions to identify for nonpayment, as well as to provide some support in working with provider communities to which these policies would be applied.

We found that 29 States do not have existing HCAC-related nonpayment policies. Most of the 21 States that currently have HCAC-related nonpayment policies identify at least Medicare's HACs for nonpayment in hospitals. However, it is important to note that at least half of the existing policies we reviewed exceeded Medicare's current HAC requirements and policies, either in the conditions identified, the systems used to indicate the conditions, or the settings to which the nonpayment policies applied. These policies vary tremendously from State to State in the authority used to enact the policies, the terminology used, the conditions identified, State's utilization of the current Medicare HAC list, the service settings to which nonpayment policies are applied, reporting requirements, and the claims processing of the nonpayment policies.

All of the States with HCAC-related nonpayment policies have implemented provisions that would protect the State from dual-eligible liability either by directly prohibiting payment for Medicare crossover claims or by relying on existing State plan authority to deny payment for claims previously denied by Medicare.

We found that 17 of the States implemented Medicaid specific policies that reduce payment for services provided to Medicaid beneficiaries. Most of the States implementing Medicaid specific policies identify at least Medicare's current list of HAC, and nearly half of those States defined a list that was different from Medicare's current list of HACs for nonpayment.

Similar variation exists in States' plan language identifying Medicare's NCD for nonpayment ranging from mirroring Medicare to completely breaking from Medicare. We do note, however, that the nature of the NQF serious reportable events, like surgery on the wrong body part, proper surgery wrong patient, and wrong surgery, is so severe that States were likely to have relied on State coverage provisions and appropriate care requirements to deny payment for these events.

We also found that States use different general terminology for HCAC-related nonpayment policies even though many of the conditions identified overlap, are from the same sources, and do not generally vary in medical definition from one list to the other. For example, 3 States identify “air embolism” as a condition for nonpayment under its plans with the condition understood to be consistently defined for medical purposes. However, one State includes air embolisms on its list of “HACs”; another includes the same condition as a “Serious Adverse Event”; and the third includes it on a list of “Medical Errors.”

We also found that at least 7 of the States with HCAC-related nonpayment policies apply those policies to settings other than the inpatient hospital setting required by Medicare, including both physicians and ambulatory surgical centers.

Variation across States is not surprising given the States have been permitted broad flexibility in defining their HCAC policies and programs. However, we attribute some of the variety on this issue to the wealth of information and evidence-based guidelines available to States, either through their own experiences and resources or through industry researched and developed resources related to health system quality. Data gathered on the conditions identified, reporting strategies, and implementation guidelines indicate that States have relied heavily on existing health system quality improvement research to define requirements while tailoring policies appropriate to their own systems. In addition, our research indicates that States' HCAC-related nonpayment policies are mainly intended to drive broader health system agendas to promote quality outcomes. We believe the use of evidence-based measures and the push for health system quality are an appropriate foundation for theproposed regulation. We propose to implement Medicaid HCAC regulations that would provide some consistency across health care payers (Medicare and Medicaid). At the same time, we also propose to accommodate State flexibility to design individual HCAC policies for nonpayment, quality-related programs suitable for their own Medicaid program and health marketplace to the extent such policies go beyond Federally-established minimum standards. We request comment on this issue.

The July 31, 2008 SMDL (#08-004) instructed States to submit SPAs to enact nonpayment provisions. Thirteen States complied with this requirement. Other States that implemented these policies through some other authority like State law or administrative procedures will be required to submit new SPAs for review and work with CMS to ensure their policies, effective July 1, 2011, are in line with the final provisions of this rule.

We are proposing to exercise our authority under sections 1902(a)(4), 1902(a)(19), and 1902(a)(30)(A) of the Act to provide for identification of Provider Preventable Conditions (PPCs) as an umbrella term for hospital and nonhospital conditions identified by the State for nonpayment to ensure the high quality of Medicaid services. These statutory provisions authorize requirements that States use methods and procedures determined by the Secretary to be necessary for the proper and efficient administration of the State plan, to provide care and services in the best interests of beneficiaries, and to provide for payment that is consistent with efficiency, economy, and quality of care.

With the introduction of this term, we propose to include two categories of PPCs—HCACs and OPPCs. HCACs would apply as required under the statute. OPPCs would be applicable to other conditions that States identify and have approved through their Medicaid State plans.

The inclusion of the new terms, PPCs and OPPCs, is consistent with the implementation of a broader application of this policy which allows us to appropriately incorporate existing State practices. The adoption of a new term is necessary because the term, “health care-acquired condition” is very narrowly defined in the Statute and does not provide for the inclusion of conditions other than those identified as HACs for Medicare, even excluding the 3 Medicare NCDs. Additionally, the statutory definition of HCACs only applies to the inpatient hospital service setting.

We considered a broader definition of the term, “health care-acquired conditions,” attempting to isolate the idea of the actual condition from the setting in which it occurred, however after conferring with Medicare to clearly understand the statute at section 1886(d)(4)(D)(iv) of the Act, we came to understand that it applies specifically to conditions applicable to inpatient hospitals as defined in that section and reimbursed by diagnosis related groups. For example, section 1886 of the Act is titled, “Payment to Hospitals for Inpatient Hospital Services.” Section 1886(d) of the Act applies specifically to “the amount of the payment with respect to the operating costs of inpatient hospital services.” Section 1886(d)(4) of the Act requires that, “The Secretary shall establish a classification of inpatient hospital discharges* * *” Section 1886(d)(4)(D) of the Act is specific to the assignment of diagnosis-related groups which apply solely to Medicare payment for inpatient hospital services.

We did look to the Affordable Care Act in creating these terms. Section 3008(b) of the Affordable Care Act, “Study And Report On Expansion Of Healthcare Acquired Conditions Policy To Other Providers,” requires that Medicare study the effects of expanding its existing policy to other providers. We adopted the “Other Providers” term to remain consistent with Medicare in the expansion of its policy.

In looking to expand the overall policy, we considered a number of other terms but determined that many of them like “adverse events” or “serious reportable events” would generate confusion because they had existing industry definitions that did not necessarily overlap with our policy aims. We adopted the term “Provider Preventable Condition” after discussion with Medicare because it appropriately identified the scope of the conditions and could act as a “catch-all.” Also, the term had not been narrowly defined by use in Medicare, Medicaid, or in the industry at-large.

After researching State, industry, and Federal information related to the importance of reporting of quality data in driving improved health outcomes, we propose that a simplified level of reporting is essential to creating a successful nonpayment policy both from the payment and quality perspectives. We believe that any requirements for provider reporting should provide a consistent format for States to report State-specific measures; require that providers report conditions identified for nonpayment when they occur regardless of a provider's intention to bill; and not cause undue burden on States or providers.

Quality reporting across States is inconsistent. There are 27 States that require reporting of either hospital-acquired infections, conditions, or some combination of both. Some of those States require quality reporting but have not implemented associated HCAC-related nonpayment policies. Others have HCAC-related nonpayment policies, but have not implemented quality reporting requirements.

Existing national quality reporting formats do not support the collection of data on HCACs and OPPCs for Medicaid beneficiaries. Providers, mainly hospitals, are subject to reporting requirements in addition to those imposed by States. For instance, most hospitals report some quality measures to CMS, the Joint Commission, or the CDC. We considered requiring reporting to Hospital Compare and the National Health Safety Network, but decided against these formats because: We do not believe they currently have the capacity to allow State specific reporting of varied measures; their existing collections may not be consistent with what most States are currently requiring providers report; and the reporting formats may impose undue significant burden for providers—particularly those that do not have full-time quality staffs or resources.

Without direct reporting requirements, providers have no incentive to report conditions or adverse events for nonpayment or otherwise. HACs, HCACs, and related policies represent liabilities for providers beyond nonpayment provisions. In fact, Medicare and the industry-at-large, have experienced nonclaiming or nonbilling on the part of providers seeking to escape the liability that could come with any type of notification of a particular event or avoid negative health outcome indicators.

In consideration of our research, we propose a requirement that existing claims systems be used as a platform for provider self-reporting. We also propose to include reporting provisions that would require provider reporting in instances when there is no associated bill. For instance, States could employ the widely used POA system in combination with including edits in their Medicaid claims systems that would indicate an associated claim and flag it for medical review.

We also found that States' payment systems will dictate the manner in which States are able to operationalize PPCs related nonpayment policies. For instance, some States reimburse using MS-DRG or some other type of grouper software to price claims. As with Medicare, these States may use the POA indicator system to identify claims and reduce payments by programming the grouper to reduce payment through the grouper. We note that a considerable number of States do not use grouper systems to reimburse providers. These States may identify and reduce payment for HCACs using methods appropriate to the specific reimbursement system used within that State. For instance, at least one State has elected to carve out a portion of the total system reimbursements for redistribution based on its own historical quality measures. We believe that the proposed provision allows States this type of flexibility in designing methodologies that would isolate amounts for nonpayment and allow provider payment to be reduced based on a CMS-approved State plan methodology that is prospective in nature. We would welcome comment on this issue.

We propose to codify provisions that would allow States flexibility in identifying PPCs that include, at a minimum, the HAC identified by Medicare, but may also include other State-identified conditions. This flexibility would extend to applying nonpayment provisions to service settings beyond the inpatient hospital setting. We believe that establishing Medicare as the minimum for the application of this policy is appropriate at this point. Many States that have implemented HCAC-related policies have adhered to Medicare because the conditions have been researched and are generally accepted by the provider community. In addition, provider familiarity with Medicare's HACs and identification processes limits the States' implementation burden.

We also recognize that Medicare's own policy is evolving. The Affordable Care Act requires that Medicare attach new payment incentives to its HAC provisions, as well as to study the implications of applying HCACs policy to providers other than inpatient hospital providers. We encourage States to consider the benefits and quality implications of expanding HCAC quality and nonpayment policies as more information becomes available from Medicare and State Medicaid programs. We invite comment on the topic of expanding HCAC-related policies in State Medicaid programs.

We propose that PPCs are defined under two categories: HCACs; and OPPCs. We are proposing to define the category of PPCs that would be referred to using the term “health care-acquired conditions” (HCACs) based on the definition of that term in section 2702(b) of the Affordable Care Act. That definition provides that an HCAC must be a condition that “could” be identified in the Medicare program by a secondary ICD-9-CM OR ICD-10-CM code as an HAC under section 1886(d)(4)(D)(iv) of the Act for Medicare purposes. Section 2702(c) of the Affordable Care Act specifically requires that the Secretary shall apply to State plans (or waivers) under title XIX of the Act the regulations issued under section 1886(d)(4)(D) of the Act relating to the prohibition of payments based on the presence of a secondary diagnosis code specified by the Secretary in such regulations, as appropriate for the Medicaid program. This means States must, at a minimum, identify conditions as HACs in accordance with section 1886(d)(4)(D) of the Act. Consistent with this identification, we propose that every State must, at a minimum, identify as an HCAC, those secondary diagnosis codes that have been identified as Medicare HACs when not present on hospital admission. We note that the Secretary has authority to update the Medicare HAC list as appropriate. As such, States are required to comply with subsequent updates or revisions in accordance with section 1886(d)(4)(D) of the Act.

States will be responsible for ensuring that the conditions identified under their Medicaid State plans are, at a minimum, consistent with those identified in Medicare's final annual hospital IPPS rule. Medicare is required to display its final IPPS rule 60 days prior to the beginning of the Federal fiscal year to which the update applies. If Medicare revises its HAC list, we believe States will have sufficient time to update their corresponding policies. Therefore, we propose that States' policies will be effective consistent with Medicare's revisions to its list of HACs. We are soliciting comments on this issue.

Because the definition does not require that HCACs must be limited to Medicare HAC, we propose a definition for an HCAC that would not be limited to those specifically identified for the Medicare program, but can include conditions identified by States for nonpayment under their State plans, as approved by CMS through the State plan review process, that the State has determined meet the statutory criteria outlined at section 1886(d)(4)(D)(iv) of the Act. We believe this is appropriate at this point in time, considering where many States are in development of their programs but we are seeking comment on this proposed policy. This proposed definition would establish Medicare as the floor, but allow further State innovation as determined by each State. However, even if a State chooses to go beyond Medicare, it will still have to be implemented through SPAs, and we will publish such policies on the CMS Web site on an annual basis to encourage States to learn from each other. With respect to those statutory criteria for identification of an HCAC, section 1886(d)(4)(D)(iv) of the Act sets forth the following criteria:

• Cases described by such code have a high cost or high volume, or both, under this title.

• The code results in the assignment of a case to a MS-DRG that has a higher payment when the code is present as a secondary diagnosis.

• The code describes such conditions that could reasonably have been prevented through the application of evidence-based guidelines.

In applying these criteria to identify HCACs, we propose that the term “code” would refer to ICD-9-CM OR ICD-10-CM codes assigned in the International Classification of Diseases coding system, 9th (or 10th) Revision, Clinical Modification or a State-specified alternative method of identifying conditions for purposes of payment.

In addition, we propose that when analyzing the payment impact of an inpatient hospital HCAC, the State may consider the nature of its particular payment methodology. For instance, when a State reimburses hospitals on a per diem basis and determines that there was an HCAC that was not POA, the State may need to isolate the increased cost of the services (possibly through a utilization review) and reduce the per diem reimbursement accordingly.

While we believe that the broad use of ICD-9-CM OR ICD-10-CM codes in inpatient hospital payment, as well as the POA indicator system currently used by Medicare to indicate conditions for nonpayment is the most consistent methodology for States in identifying HCACs, we are interested in hearing about other methods of identifying HCACs. We recognize that there is considerable variation among State hospital payment methodologies. Inaddition, we recognize that there is considerable variation among States in the availability of data necessary to identify HCACs and related quality issues. We are proposing to require that States implement requirements for provider self-reporting of HCACs in the Medicaid claims payment process.

The rule proposes that States would identify an HCAC similar to the way Medicare identifies an HAC. However, as the OIG points out in its report evaluating the usefulness of selected methods for identifying events that harm hospitalized Medicare beneficiaries,Adverse Events in Hospitals: Methods for Identifying Events (OEI-06-08-00221),tools like the Institute for Healthcare Improvement's Global Trigger Tool that require standardized medical record reviews are considered much more effective in detection than the POA system. This is significant because one cannot prevent what one cannot detect. Accurate measurement is the necessary antecedent of quality improvement. We are soliciting comments on the efficiency of POA indicators for purposes of this provision.

We are also proposing to provide that States may identify similar OPPCs related to services furnished in settings other than inpatient hospitals, which would also be subject to a payment prohibition.

Preventable conditions that are caused or related to the provision of health care are not limited to inpatient hospital settings. These conditions can occur in outpatient hospital, nursing facility, and ambulatory care settings, and other healthcare settings.

We are proposing that the treatment of these OPPCs will be similar to the treatment of HCACs. State plans must provide for nonpayment for care and services related to these OPPCs, and Federal financial participation (FFP) will not be available in State expenditures for such care and services related to OPPCs.

To establish a base of an OPPC, we propose to define OPPC to include, at a minimum, wrong surgical or other invasive procedure performed on a patient; a surgical or other invasive procedure performed on the wrong body part; and a surgical or other invasive procedure performed on the wrong patient.

These three conditions were addressed by Medicare in three national coverage analyses (NCAs) to establish NCDs.

Effective January 15, 2009, Medicare does not cover a particular surgical or other invasive procedure to treat a particular medical condition when the practitioner erroneously performs: (1) A different procedure altogether; (2) the correct procedure but on the wrong body part; or (3) the correct procedure but on the wrong patient. Medicare will also not cover hospitalizations and other services related to these non-covered procedures as defined in the Medicare Pub. 100-02, Benefit Policy Manual (BPM), chapter 1, sections 10 and 120 and chapter 16, section 180. We propose to adopt these 3 for purposes of this regulation.

In addition to these Federally-identified OPPCs, we propose to authorize States to identify other OPPCs and apply payment prohibitions the same as those applied to HCACs. The criteria that we are proposing for such other OPPCs would be similar to the criteria for HCACs. We propose the following criteria for States to use in identifying additional OPPCs:

• A condition or event identified by a State for inclusion under this provision must be a discrete, auditable, quantifiable, and clearly defined occurrence.

• A condition or event must be clearly adverse, resulting in a negative consequence of care that results in unintended injury or illness.

• A condition or event identified must be reasonably preventable, meaning an event that could have been anticipated and prepared for, but that occurs because of an error or other system failure.

In designating additional OPPCs, we recommend that States consider the 2002 NQF report entitled “Serious Reportable Events in Healthcare: A Consensus Report.” In that report, NQF listed 27 events that were “serious, largely preventable and of concern to both the public and health care providers.” NQF's “Consensus Standards Maintenance Committee on Serious Reportable Events” maintains and updates the list which currently contains 28 items.

In order to implement the requirements of this new payment prohibition, we recognize that States may need additional information to properly process claims and determine the availability of FFP. We propose requiring States to establish provider self-reporting procedures for PPCs related to claims for Medicaid payment or courses of treatment that otherwise would be payable under Medicaid. We solicit comments on this issue.

We will continue to gather information from States to further inform our policies and facilitate information sharing across States. We note that the Secretary may update this regulation over time to require additional nonpayment by States as we learn more from State practices.

Section 2702(a) of the Affordable Care Act requires that the Secretary ensure that adjustments to payment rates under this section do not result in a loss of access to care for beneficiaries. To this end, we propose that any reduction in payment would be limited to the amounts directly identifiable as related to the PPC and the resulting treatment. We are proposing this method of protecting access because it limits States' ability to unduly reduce provider rates. For instance, if a patient develops mediastinitis after a CABG, the State would be allowed to deny payment for the treatment of the mediastinitis, but not the CABG.

Additionally, we do not believe that beneficiaries would be best served by this policy if the focus was shifted from quality to system cost containment. We note further that nothing in this rule prevents a State from reinvesting any savings it may achieve from nonpayment of PPCs into rate improvements aimed at achieving improved access to care, as appropriate. We solicit comments on this issue.

Consistent with the provisions of section 2702(a) of the Affordable Care Act, we would make these requirements effective July 1, 2011. We will be requesting that States submit conforming SPAs to implement these provisions prior to that date. To be in compliance with the July 1, 2011 proposed effective date, under 42 CFR 430.20, the last date an SPA may be submitted would be September 30, 2011, which is the last day of the quarter in which the amendment would be effective.

The provisions of this rule would deny FFP for Medicaid expenditures made for PPCs, including HCACs and OPPCs identified in the State plan; and ensure that related payment adjustments do not limit beneficiary access to care. These provisions would apply to payments as specified under States' approved Medicaid State plans, effective no later than July 1, 2011. We are proposing to modify the regulations at 42 CFR parts 434, 438, and 447 following general provider payment rules and preceding other provisions concerning reductions in provider payments. In addition, to ensure that these provisions apply to contracts thatStates use to provide Medicaid benefits using a managed care delivery system, we are also proposing to modify the regulations at 42 CFR part 438. Because the basic rule is set forth in part 447, we discuss that proposed modification first.

Currently the general rules regarding Medicaid State plan payments for Medicaid are provided at part 447 subpart A. We propose to add a new § 447.26 to indicate that FFP will not be available for expenditures made for PPCs. We have included in § 447.26(a) a statement of the basis and purpose for the regulation, and in § 447.26(b), the definitions for the umbrella term PPCs, and the included terms HCACs, and other PPCs. These proposed provisions will establish Medicare as the floor that all States must adopt, but allow flexibility for States to move beyond the Medicare definitions and settings. As States' programs evolve and they make additional requirements, we would require that necessary SPAs be submitted for implementation purposes.

In § 447.26(c), we are proposing to set forth the general rule that State plans must preclude payment to providers for PPCs, and that FFP is not available for State expenditures for PPCs. To ensure beneficiary access to care, we specify that any reductions may be limited to the added cost resulting from the PPC.

In § 447.26(d), we have included a provision that would require States to require provider reporting of PPCs associated with Medicaid claims, or with courses of treatment for Medicaid beneficiaries that would otherwise be payable under Medicaid.

In addition to these changes in part 447, we are proposing to include a requirement in § 434.6(a)(12) for contracts for medical or administrative services that contractors do not make payment for PPCs, and require that providers comply with the reporting requirements in § 447.26(d) as a condition of receiving payment. Likewise, to ensure that these provisions are included as required elements in Medicaid managed care contracts, we are proposing to include a requirement in § 438.6(f)(2) that contracts must comply with both § 434.6(a)(12) and § 447.26.

We have proposed these particular provisions because the information gathered in preparation for issuing these proposed rules indicate the need for a consistent authority under which States can implement PPC nonpayment policies; a consistent approach to identifying conditions for nonpayment; a streamlined terminology to indicate Medicaid HCAC payment policies; State flexibility to implement provisions suitable to their own systems; and a consistent provider reporting platform.

Under the Paperwork Reduction Act of 1995, we are required to provide 60-day notice in theFederal Registerand solicit public comment before a collection of information requirement is submitted to the Office of Management and Budget (OMB) for review and approval. In order to fairly evaluate whether an information collection should be approved by OMB, section 3506(c)(2)(A) of the Paperwork Reduction Act of 1995 requires that we solicit comment on the following issues:

• The need for the information collection and its usefulness in carrying out the proper functions of our agency.

• The accuracy of our estimate of the information collection burden.

• The quality, utility, and clarity of the information to be collected.

• Recommendations to minimize the information collection burden on the affected public, including automated collection techniques.

We are soliciting public comment on each of these issues for the following sections of this document that contain information collection requirements (ICRs):

Effective July 1, 2011, proposed § 447.26 would require States to submit SPAs for CMS approval that would reduce payments to providers by amounts related to PPCs. The burden associated with this proposed requirement would be the time and effort necessary for a State to submit its SPA and the associated pre-print. We estimate that 50 States would be required to comply with this requirement. We further estimate that it will take each State 7 hours to submit the aforementioned documentation to CMS. The total estimated burden associated with this requirement would be 350 hours at a cost of $20.67 per hour per State.

We estimate that it will take each State 7 hours because we intend to issue a template to States to simplify the process of making the related amendment to the Medicaid State plan.

Proposed § 447.26 would also require States to implement provider reporting requirements to ensure that PPCs are identified in claims for Medicaid payment. The burden associated with this requirement is the time and effort necessary to develop and implement provider reporting requirements that are effective with the provisions of this regulation. We estimate that 50 States would be required to comply with this requirement. Similarly, we estimate that it will take 24 hours for each State to develop and implement the provider reporting requirements as specified above. The total estimated burden associated with this requirement would be 1,200 hours at a cost of $20.67 per hour per State. We believe that this estimate is reasonable because we are requiring that States have providers use their existing claims processes to report identified events.

Proposed § 438.6(f)(2) would also require States which provide medical assistance using a managed care delivery system to modify their managed care contracts to reflect the PPCs payment adjustment policies as applied through these regulations. The burden associated with this requirement is the time and effort necessary for a State to amend its managed care contracts to reflect these policies. We estimate that 48 States would be required to comply with this requirement. We also estimate that it would take 8 hours for each State to revise its contracts to comply with this requirement and submit the amended contract to CMS for review and approval. The total estimated annual burden associated with this requirement is 384 hours at a cost of $20.67 per hour per State.

The total estimated burden associated with this requirement is 1,934 hours at a cost of $806.13 per State.

If you comment on these information collection and recordkeeping requirements, please do either of the following:

1. Submit your comments electronically as specified in theADDRESSESsection of this proposed rule; or

2. Submit your comments to the Office of Information and Regulatory Affairs, Office of Management and Budget,Attention:CMS Desk Officer, [CMS-2400-P];Fax:(202) 395-6974; orE-mail: OIRA_submission@omb.eop.gov.

Because of the large number of public comments we normally receive onFederal Registerdocuments, we are not able to acknowledge or respond to them individually. We will consider all comments we receive by the date and time specified in theDATESsection of this preamble, and, when we proceed with a subsequent document, we will respond to the comments in the preamble to that document.

This proposed rule implements section 2702 of the Affordable Care Actof 2010 which directs the Secretary to issue Medicaid regulations effective as of July 2011, prohibiting Federal payments to States (under section 1903 of the Act) for any amounts expended for providing medical assistance for HCACs. It would also authorize States to identify other PPCs for which Medicaid payment would be prohibited. We view this regulation as one step of a larger approach to address the problem of HCACs.

We have examined the impacts of this rule as required by Executive Order 12866 on Regulatory Planning and Review (September 30, 1993), Executive Order 13563 on Improving Regulation and Regulatory Review (February 2, 2011), the Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354), section 1102(b) of the Social Security Act, section 202 of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4), Executive Order 13132 on Federalism (August 4, 1999), and the Congressional Review Act (5 U.S.C. 804(2)).

Executive Order 12866 directs 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). A regulatory impact analysis (RIA) must be prepared for major rules with economically significant effects ($100 million or more in any 1 year). This rule does not reach the economic threshold and thus is not considered a major rule under the Congressional Review Act. We request comments on our economic analysis.

It is difficult to estimate the amount which will be withheld from providers under this regulation, as not all of these events will be billed. However, it is instructive to note that the total dollar amount of Medicare claims denied under its HAC policy is approximately $20 million per year (see75 FR 23895, May 4, 2010). The original regulation creating the Medicare HACs was published in the August 19, 2008Federal Register(73 FR 48433). In addition, estimates were conducted by the Congressional Budget Office (CBO) and the CMS Office of the Actuary (OACT) on the impact of section 2702 of the Affordable Care Act. The CBO estimate concluded there would be no impact associated with section 2702 of the Act (CBO and JCT, 2010 Estimate). The CMS OACT estimate (Estimated Financial Effects of the “Patient Protection and Affordable Care Act,” as Amended, 2010) projected an impact from section 2702 on the Medicaid program of cost savings of $2 million for FY 2011 ($1 million for the Federal share and $1 million for the State share), with an aggregate cost savings of $35 million ($20 million for the Federal share and $15 million for the State share) for FYs 2011 through 2015. The Federal and State share cost savings, as result of denied payments, are represented by the reduction in transfers from Medicaid to hospitals.

There are administrative cost impacts on States to modify their systems to meet reporting requirements, but we believe these are not significant. As noted above, the reporting system in this proposed regulation relies on an existing billing system currently in place. Both States and providers already have billing, claiming, and payment systems in place to act upon the information obtained. The costs reported in section III. of this proposed rule, Collection of Information Requirements, amount to an additional $39,976 dollars aggregate across all States.

Hospitals may incur additional costs to reduce HCACs. Such costs include hiring additional nurses to ensure enforcement of the infection prevention policies. In turn, preventing or reducing HCACs will lead to a reduction in direct health spending, which is a benefit realized by Medicaid, hospitals and other payers.

The Joint Commission requires hospitals to have established programs for Quality Improvement, Risk Management, Safety, and Infection Control. As a result, a majority of hospitals already have in place programs to avert Medicare HACs and thus would not incur new costs to implement parallel programs to avert Medicaid HACs. Furthermore, we anticipate a public benefit to all providers and payers since programs that hospitals develop to avoid Medicaid HCACs will likely benefit all patients and reduce health care costs. Patient benefits resulting from a reduction in HCAC may include an increase in healthy years of life. However, this public benefit will derive from possible responses by hospitals and not from this regulation itself.

We realize that the overall problem of HCACs cannot be completely addressed in this regulation, as this proposed regulation is one step of an overall approach. Consequently, the estimated economic impacts from all HHS initiatives to address HCACs may result in much higher savings impact than presented in this analysis. However, such economic savings, for example, will not derive from this regulation alone, but will in part come from the knowledge that State and Federal governments gain from the reporting requirements created by this regulation. That knowledge will in turn inform future HHS initiatives to reduce excess morbidity and mortality attributable to HCACs.

The RFA requires agencies to analyze options for regulatory relief for small entities, if a rule has a significant impact on a substantial number of small entities. Most hospitals, other providers, and suppliers are small entities, either by nonprofit status or by having revenues of $7.0 million to $34.5 million in any 1 year. Individuals and States are not included in the definition of a small entity. Guidance issued by the Department of Health and Human Services interpreting the RFA considers effects to be economically significant if they reach a threshold of 3 to 5 percent or more of total revenue or total costs. As illustrated in Table 1, any decrease in payments, as a result of this regulation, to small entities should be significantly less than this threshold.Therefore, we are not preparing an analysis for the RFA because the Secretary has determined that this proposed rule will not have a significant economic impact on a substantial number of small entities.

In addition, section 1102(b) of the Act requires us to prepare a RIA if a rule may have a significant impact on the operations of a substantial number of small rural hospitals. This analysis must conform to the provisions of section 603 of the RFA. For purposes of section 1102(b) of the Act, we define a small rural hospital as a hospital that is located outside of a Metropolitan Statistical Area for Medicare payment regulations and has fewer than 100 beds. We are not preparing an analysis for section 1102(b) of the Act because the Secretary has determined that this proposed rule will not have a significant impact on the operations of a substantial number of small rural hospitals.

Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) also requires that agencies assess anticipated costs and benefits before issuing any rule whose mandates require spending in any 1 year of $100 million in 1995 dollars, updated annually for inflation. In 2011, that threshold is approximately $136 million. This rule will have no consequential effect on State, local, or tribal governments in the aggregate or on the private sector.

Executive Order 13132 establishes certain requirements that an agency must meet when it promulgates a proposed rule (and subsequent final rule) that imposes substantial direct requirement costs on State and local governments, preempts State law, or otherwise has Federalism implications. While this regulation does not impose substantial costs on State or local governments, it does preempt some State laws. The requirements of Executive Order 13132 are applicable.

Executive Order 13132 sets forth a process to be followed by the Federal government whenever Federal regulatory processes may affect or preempt State regulations or laws. We are aware that many States do have regulations for Medicaid nonpayment in the event that specified adverse events occur during provider care. This proposed rule is intended to create a Federal legal minimum for such State regulations. States could continue to enact more stringent laws or regulations upon approval of a Medicaid SPA by CMS to assure that there is no adverse impact on Medicaid beneficiary access to care.

This proposed rule derives from section 2702 of the Affordable Care Act and other CMS regulatory authority. Like the Affordable Care Act, it is derived from Federal authority under the Commerce Clause of the U.S. Constitution. Under the requirements of Executive Order 13132 and the requirements of section 2702 of the Affordable Care Act, we have consulted with the States before issuing this proposed rule. Major portions of the regulation are, in fact, derived from comparable State regulations. Significant regulatory authority in this area would remain with the States should the proposed regulation become final. As stated, the proposed rule does not completely preempt State law, but merely sets a Federal minimum standard.

Moreover, we solicit comments from States as part of this proposed rule and will consider such State comments in drafting the final rule. While there will be some additional administrative costs to States to administer this regulation, it is expected that State Medicaid savings will largely offset such costs.

The requirements of Executive Order 13132 will be met in the final rule to be issued 30 days prior to the effective date of July 1, 2011, set forth in the Affordable Care Act.

The effects on State Medicaid programs as a result of this provision will depend on various factors. For instance, as we state in the preamble, there are 21 States that have already implemented similar policies. While we have reviewed existing State policies and incorporated those policies that we believe would best apply on a national level, these States will have to make changes to comply with the minimums set in this proposed rule. In addition, States will have to work through the SPA review process to ensure that their existing policies do not serve to limit beneficiaries' access to health care.

The States that have used State plan authority to implement their nonpayment policies will need to review their policies and ensure that they comply with any finally implemented provisions of these rules. These States will likely have to submit revisions to their State plans. In addition, the States that implemented these policies through some other authority like State law or administrative procedures will have to submit new SPAs for review and work with CMS to ensure that their policies effective July 1, 2011, are in line with the final provisions of these rules. States that have elected not to implement Medicaid specific policies or that do not have related policies at all will need to submit new SPAs. Further, States which use a managed care delivery system to provide Medicaid benefits to beneficiaries will have to amend and submit for CMS review and approval managed care contracts that reflect these new requirements. While this regulation is effective on July 1, 2011, most States will already have their managed care contracts for the fiscal year in place by that time and there may be some delay in incorporating new language in their managed care contracts. We will issue subregulatory guidance to States requiring that appropriate changes be made to managed care contracts to comply with the regulation.

All States will need to incorporate the reporting requirements into their claims systems. In addition, States will need to evaluate the best ways in which to identify and reduce payment for PPCs under their respective Medicaid plans.

We anticipate that this provision will prompt programmatic changes for States regarding quality improvement considerations within health care systems. This provision, while it is a payment provision, is primarily targeted at preventing medical errors.

We anticipate that these provisions will prompt health care providers to adopt quality programs that would limit the risk of providing services or using resources, in error, that will not be reimbursed.

We anticipate that the reporting requirements will ultimately be a catalyst for providers in developing quality practices to reduce the risks associated with receiving care at their facilities and promote overall quality improvements.

Medicare's and States' experience has demonstrated that related policies often do not produce substantial short-term financial savings within health care systems. Medicare estimated that the policy will reduce its spending by an aggregate amount of about $80,000,000 from FY 2009 through FY 2013, or by less than 0.01 percent of total annual spending on inpatient hospital services (75 FR 50661). States report similar short-term savings. However, there are more significant gains to be realized when considering the broader impact of increased quality on the health system overall, or more exactly the savings created when preventable conditions and related treatment are measured.

The anticipated public benefit to all providers and payers from programsthat hospitals develop to avoid Medicaid HCACs will likely benefit all patients and reduce health care costs. This includes, for example, Medicaid beneficiaries realizing an increase in healthy years of life as a result of the reduction in HCACs. However, this public benefit will derive from possible responses by hospitals and not from this regulation itself.

The Statute requires that Medicaid, at a minimum, recognize Medicare's current list of HACs. We considered proposing regulatory action that included only the conditions listed as Medicare HACs. However, when considering current State practices our research concluded that many States' policies included conditions not identified by Medicare as HACs. We concluded that such limited action would not serve the program purposes of ensuring high quality care and would potentially limit State flexibility to protect beneficiaries and program integrity. Similarly, we considered proposing regulatory action that included only the inpatient hospital setting. Again, after assessing current State practices, as well as industry-based research, there is clear indication that data is available to States that will allow them to employ evidence based policy practices beyond the inpatient hospital setting. In order to provide States full flexibility to protect beneficiaries and the program, we elected the more comprehensive approach proposed. We are seeking comment on both issues.

We considered defining OPPC as, “a condition occurring in any health care setting that could have reasonably been prevented through the ordinary provision of high quality care during the course of treatment * * *” We believed that this terminology would limit additional requirements on States to produce evidence of preventability. However, after discussing the terminology and scientific parameters that exist in relation to this issue, we propose that the term be defined as, “a condition that could have reasonably been prevented through the application of evidence based guidelines.” We are seeking comment on the use of both definitions.

For the reasons outlined in the RIA, we are not preparing an analysis for either the RFA or section 1102(b) of the Act because we have determined that this proposed rule would not have a direct significant economic impact on a substantial number of small entities or a direct significant impact on the operations of a substantial number of small rural hospitals.

In accordance with the provisions of Executive Order 12866, this regulation was reviewed by the Office of Management and Budget.

For the reasons set forth in the preamble, the Centers for Medicare & Medicaid Services proposes to amend 42 CFR parts 434, 438, and 447, as set forth below:

On January 28, 2010, the Health Resources and Services Administration published a final rule in theFederal Register(75 FR 4656) designed to implement section 1921 of the Social Security Act (herein referred to as section 1921). Section 1921 expands the scope of the NPDB. Section 1921 requires each state toadopt a system of reporting to the Secretary certain adverse licensure actions taken against health care practitioners and health care entities by any authority of the state responsible for the licensing of such practitioners or entities. It also requires each state to report any negative action or finding that a state licensing authority, a peer review organization, or a private accreditation entity has finalized against a health care practitioner or entity. Practically speaking, Section 1921 resulted in, among other consequences, the transfer of the vast majority of information contained in the HIPDB to the NPDB.

The HIPDB was created by the Health Insurance Portability and Accountability Act (HIPAA) of 1996, Public Law (Pub. L. 104-191), which required the Secretary, acting through the Office of Inspector General (OIG) and the United States Attorney General, to establish a new health care fraud and abuse control program to combat health care fraud and abuse.

Groups that have access to this information include all organizations eligible to query the NPDB under the Health Care Quality Improvement Act of 1986 (hospitals, other health care entities that conduct peer review and provide health care services, state medical or dental boards and other health care practitioner state boards), other state licensing authorities, agencies administering federal health care programs, including private entities administering such programs under contract, state agencies administering or supervising the administration of state health care programs, State Medicaid Fraud Control Units, and certain law enforcement agencies, and utilization and quality control peer review organizations (referred to as QIOs) as defined in Part B of title XI of the Social Security Act and appropriate entities with contracts under section 1154(a)(4)(C) of the Social Security Act. Individual health care practitioners and entities can self-query.

One of the primary purposes of these data will be use of this information by a federal or state government agency charged with the responsibility of investigating or prosecuting a case where there is an indication of a violation or potential violation of law, whether civil, criminal, or regulatory in nature. The information in this system may also be used in the preparation for a trial or hearing for such violation. Specifically, this proposed rule would exempt this data bank from certain provisions of the Privacy Act.1 This exemption is intended to protect, from release to the record subject, information on law enforcement queries to the data bank. It would also exempt the data bank from Privacy Act access and amendment procedures in order to establish access and amendment procedures in the NPDB regulations.

While subjects will have access to information on all other queries to the data bank, disclosure of law enforcement queries could compromise ongoing investigation activities. The premature disclosure of the existence of a law enforcement activity to an outside party (who may also be the subject of the investigation) could lead to, among other things, the destruction or alteration of evidence and the tampering with witnesses.

Record subjects are guaranteed access to, and correction rights for, substantive information reported to the NPDB. The procedures, appearing in 45 CFR part 60, use the Privacy Act access and correction procedures as a basic framework while, at the same time, providing significant additional rights (such as automatic notification to the record subject of any report filed with the data bank). Data bank subjects also have broader rights on NPDB correction procedures, including the right to file a statement of disagreement as soon as a report is filed with the data bank.

The Office of Management and Budget has reviewed this proposed rule in accordance with the provisions of Executive Order 12866 and the Regulatory Flexibility Act (5 U.S.C. 601-612), as amended by Executive Orders 13258 and 13422, and has determined that it will have no major effect on the economy or federal expenditures. Executive Order 12866 directs agencies to assess all costs and benefits of available regulatory alternatives and, when rulemaking is necessary, to select regulatory approaches that maximize net benefits, including potential economic, environmental, public health, safety distributive and equity effects.

The Secretary has determined that this proposed rule is not a “major rule” within the meaning of the statute providing for Congressional Review of Agency Rulemaking, 5 U.S.C. 801, and has determined that it does not meet the criteria for a significant regulatory action. In addition, under the Small Business Enforcement Act (SBEA) of 1996, if a rule has a significant economic effect on a substantial number of small businesses, the Secretary must specifically consider the economic effect of a rule on small business entities and analyze regulatory options that could lessen the impact of the rule. The Secretary has reviewed this proposed exemption in accordance with the provisions of the SBEA and certifies that this proposed exemption will not have a significant impact on a substantial number of small entities. Specifically, as indicated above, while the reports of adverse actions to the NPDB will be known to the subjects of the records in the data bank, the access and use of such information by law enforcement agencies would not be known to the subjects of the records. As a result, we believe that disclosure of this information could compromise ongoing law enforcement activities.

Similarly, it will not have effects on state, local, and tribal governments and on the private sector such as to require consultation under the Unfunded Mandates Reform Act of 1995.

The Secretary has reviewed this proposed rule in accordance with Executive Order 13132 regarding federalism, and has determined that it does not have “federalism implications.” This rule would not “have substantial direct effects on the states, or 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 proposals made in this notice of proposed rulemaking, if implemented, would not adversely affect the following family elements: family safety, family stability, marital commitment; parental rights in the education, nurture and supervision of their children; family functioning, disposable income, or poverty; or the behavior and personal responsibility of youth, as determined under section 654(c) of the Treasury and General Government Appropriations Act of 1999.

This proposed rule does not have any information collection requirements.

We will accept written comments and information during this reopened comment period on our proposed designation of the proposed revisions to critical habitat for the Pecos assiminea (Assiminea pecos), and the proposed critical habitat for the Roswell springsnail (Pyrgulopsis roswellensis), Koster's springsnail (Juturnia kosteri), and Noel's amphipod (Gammarus desperatus) (four invertebrates) that was published in theFederal Registeron June 22, 2010, (75 FR 35375), and the additional area proposed in this notice. As a result of information sent to us in response to our June 22, 2010, proposal and request for comments, we became aware that a population of amphipods was confirmed to be Noel's amphipod along the Rio Hondo, on the South Tract of Bitter Lake National Wildlife Refuge. We are particularly interested in information on our proposed inclusion of this new habitat in our final critical habitat designation, including comments on the economic analysis and environmental assessment of the proposed designation related to this new area. We particularly seek comments concerning:

(1) The reasons why we should or should not designate habitat as “critical habitat” under section 4 of the Endangered Species Act of 1973, as amended (Act) (16 U.S.C. 1531et seq.), including whether there are threats to the species from human activity, the degree of which can be expected to increase due to the designation, and whether that increase in threat outweighs the benefit of designation such that the designation of critical habitat is not prudent.

(2) Specific information on:

(a) The amount and distribution of habitat for the Roswell springsnail, Koster's springsnail, Noel's amphipod, and Pecos assiminea;

(b) What areas occupied at the time of listing and that contain features essential to the conservation of the species we should include in the designation and why. We are particularly interested in information on the additional habitat containing the recently discovered Noel's amphipod population on the South Tract of Bitter Lake National Wildlife Refuge;

(c) Special management considerations or protections for areas that contain the features essential to the conservation of the Roswell springsnail, Koster's springsnail, Noel's amphipod, and Pecos assiminea that have been identified in this proposal, including management for the potential effects of climate change; and

(d) What areas not occupied at the time of listing are essential for the conservation of the species and why.

(3) Land use management and current or planned activities in the subject areas and their possible impacts on proposed critical habitat, particularly in the area occupied by the recently discovered Noel's amphipod population on the South Tract of Bitter Lake National Wildlife Refuge.

(4) Any foreseeable economic, national security, or other relevant impacts of designating any area that may be included in the final designation. We are particularlyinterested in any impacts on small entities or families, and the benefits of including or excluding areas that exhibit these impacts.

(5) Whether our approach to designating critical habitat could be improved or modified in any way to provide for greater public participation and understanding, or to assist us in accommodating public concerns and comments.

(6) Information on the extent to which the description of economic impacts in the economic analysis is complete and accurate, and information on potential economic impacts that may occur should we designate the area occupied by the recently discovered Noel's amphipod population on the South Tract of Bitter Lake National Wildlife Refuge.

(7) The likelihood of adverse social reactions to the designation of critical habitat, as discussed in the economic analysis and environmental assessment, and how the consequences of such reactions, if likely to occur, would relate to the conservation and regulatory benefits of the proposed critical habitat designation.

If you submitted comments or information on the proposed rule (75 FR 35375) during the initial comment period from June 22, 2010, to August 23, 2010, please do not resubmit them. We have incorporated them into the public record as part of that comment period, and we will fully consider them in the preparation of our final determination. Our final determination concerning revised critical habitat will take into consideration all written comments and any additional information we receive during both comment periods. On the basis of public comments, we may, during the development of our final determination, find that areas proposed are not essential, are appropriate for exclusion under section 4(b)(2) of the Act, or are not appropriate for exclusion.

You may submit your comments and materials concerning the proposed rule, economic analysis, or environmental assessment by one of the methods listed in theADDRESSESsection. We will not consider comments sent by e-mail or fax or to an address not listed in theADDRESSESsection.

If you submit a comment viahttp://www.regulations.gov,your entire comment—including any personal identifying information—will be posted on the Web site. We will post all hardcopy comments onhttp://www.regulations.govas well. If you submit a hardcopy comment that includes personal identifying information, you may request at the top of your document that we withhold this information from public review. However, we cannot guarantee that we will be able to do so.

Comments and materials we receive, as well as supporting documentation we used in preparing the proposed rule, economic analysis, and environmental assessment will be available for public inspection onhttp://www.regulations.govat Docket No. FWS-R2-ES-2009-0014, or by appointment, during normal business hours, at the U.S. Fish and Wildlife Service, New Mexico Ecological Services Field Office (see FOR FURTHER INFORMATION CONTACT). You may obtain copies of the proposed rule, economic analysis, and environmental assessment on the Internet athttp://www.regulations.govat Docket Number FWS-R2-ES-2009-0014, or by mail from the New Mexico Ecological Services Field Office (see FOR FURTHER INFORMATION CONTACTsection).

It is our intent to discuss in this notice only those topics relevant to the designation of one additional critical habitat unit for Noel's amphipod (Gammarus desperatus) in this proposed rule. For more information on the Roswell springsnail (Pyrgulopsis roswellensis), Koster's springsnail (Juturnia kosteri), Noel's amphipod, and Pecos assiminea (Assiminea pecos), refer to the final listing rule published in theFederal Registeron August 9, 2005 (70 FR 46304), and to the proposed rule revising critical habitat for Pecos assiminea and proposing new critical habitat for Roswell springsnail, Koster's springsnail, and Noel's amphipod that published in theFederal Registeron June 22, 2010 (75 FR 35375).

Noel's amphipod is a small, freshwater shrimp in the family Gammaridae that inhabits shallow, cool, well-oxygenated waters of streams, ponds, ditches, sloughs, and springs in southeast New Mexico (Holsinger 1976, p. 28; Pennak 1989, p. 478). Since publication of the June 22, 2010, proposed rule (75 FR 35375), a new population of amphipods found in spring vents along the Rio Hondo on the South Tract of Bitter Lake National Wildlife Refuge (Refuge) was confirmed genetically and morphologically to be Noel's amphipod (Berg 2010, p. 1; Lang 2010, pp. 2-3).

On August 9, 2005, we listed Roswell springsnail, Koster's springsnail, Noel's amphipod, and Pecos assiminea as endangered under the Act (70 FR 46304). In that rule, we also designated critical habitat for Pecos assiminea at Diamond Y Springs Complex in Pecos County, Texas, and at East Sandia Springs in Reeves County, Texas. We excluded the Refuge from the critical habitat designation because special management for the four invertebrates was already occurring there.

On March 12, 2009, in response to a complaint filed by Forest Guardians (now WildEarth Guardians) challenging the exclusion of the Refuge from the final critical habitat designation for the four species, we reopened the comment period on the proposed designation of lands of the Bitter Lake National Wildlife Refuge as critical habitat for the four invertebrates (74 FR 10701).

On June 22, 2010, we published a proposed rule revising critical habitat for the Pecos assiminea and proposing new critical habitat for Roswell springsnail, Koster's springsnail, and Noel's amphipod (75 FR 35375). The comment period was open for 60 days and closed on August 23, 2010. Information we received during that comment period led to our consideration of a new area for critical habitat for the Noel's amphipod and, therefore, to publishing this additional notice to accept public comment on the proposed designation of the additional area.

Critical habitat is defined in section 3 of the Act as:

(1) The specific areas within the geographical area occupied by the species, at the time it is listed in accordance with the Act, on which are found those physical or biological features

(a) essential to the conservation of the species and

(b) which may require special management considerations or protection; and

(2) Specific areas outside the geographical area occupied by the species at the time it is listed, upon a determination that such areas are essential for the conservation of the species.

Conservation, as defined under section 3 of the Act, means to use and the use of all methods and procedures that are necessary to bring an endangered or threatened species to the point at which the measures provided under the Act are no longer necessary. Such methods and procedures include, but are not limited to, all activities associated with scientific resources management such as research, census, law enforcement, habitat acquisitionand maintenance, propagation, live trapping, transplantation, and, in the extraordinary case where population pressures within a given ecosystem cannot be otherwise relieved, may include regulated taking.

Critical habitat receives protection under section 7 of the Act through the requirement that Federal agencies insure, in consultation with the Service, that any action they authorize, fund, or carry out is not likely to result in the destruction or adverse modification of critical habitat. The designation of critical habitat does not affect land ownership or establish a refuge, wilderness, reserve, preserve, or other conservation area. Such designation does not allow the government or public to access private lands. Such designation does not require implementation of restoration, recovery, or enhancement measures by non-Federal landowners. Where a landowner seeks or requests Federal agency funding or authorization for an action that may affect a listed species or critical habitat, the consultation requirements of section 7(a)(2) would apply, but even in the event of a destruction or adverse modification finding, the obligation of the Federal action agency and the landowner is not to restore or recover the species, but to implement reasonable and prudent alternatives to avoid destruction or adverse modification of critical habitat.

For inclusion in a critical habitat designation, the habitat within the geographical area occupied by the species at the time it was listed must contain the physical and biological features essential to the conservation of the species and be included only if those features may require special management considerations or protection. Critical habitat designations identify, to the extent known using the best scientific and commercial data available, habitat areas that provide essential life-cycle needs of the species (areas on which are found the physical and biological features laid out in the appropriate quantity and spatial arrangement for the conservation of the species).

Under the Act, we can designate critical habitat in areas outside the geographical area occupied by the species at the time it is listed, upon a determination that such areas are essential for the conservation of the species. We designate critical habitat in areas outside the geographical area occupied by a species only when a designation limited to its range would be inadequate to ensure the conservation of the species. When the best available scientific data do not demonstrate that the conservation needs of the species require such additional areas, we will not designate critical habitat in areas outside the geographical area occupied by the species. An area currently occupied by the species but that was not occupied at the time of listing may, however, be essential to the conservation of the species and may be included in the critical habitat designation.

Section 4 of the Act requires that we designate critical habitat on the basis of the best scientific and commercial data available. Further, our Policy on Information Standards Under the Endangered Species Act (published in theFederal Registeron July 1, 1994 (59 FR 34271)), the Information Quality Act (section 515 of the Treasury and General Government Appropriations Act for Fiscal Year 2001 (Pub. L. 106-554; H.R. 5658)), and our associated Information Quality Guidelines, provide criteria, establish procedures, and provide guidance to ensure that our decisions are based on the best scientific data available. They require our biologists, to the extent consistent with the Act and with the use of the best scientific data available, to use primary and original sources of information as the basis for recommendations to designate critical habitat.

When we are determining which areas should be designated as critical habitat, our primary source of information is generally the information developed during the listing process for the species. Additional information sources may include the recovery plan for the species, articles in peer-reviewed journals, conservation plans developed by States and counties, scientific status surveys and studies, biological assessments, or other unpublished materials and expert opinion or personal knowledge.

We recognize that critical habitat designated at a particular point in time may not include all of the habitat areas that we may later determine are necessary for the recovery of the species. For these reasons, a critical habitat designation does not signal that habitat outside the designated area is unimportant or may not be required for recovery of the species. Areas that are important to the conservation of the species, but are outside the critical habitat designation, will continue to be subject to conservation actions we implement under section 7(a)(1) of the Act. Areas that support populations are also subject to the regulatory protections afforded by the section 7(a)(2) jeopardy standard, as determined on the basis of the best available scientific information at the time of the agency action. Federally funded or permitted projects affecting listed species outside their designated critical habitat areas may still result in jeopardy findings in some cases. Similarly, critical habitat designations made on the basis of the best available information at the time of designation will not control the direction and substance of future recovery plans, habitat conservation plans (HCPs), or other species conservation planning efforts if new information available at the time of these planning efforts calls for a different outcome.

In accordance with section 3(5)(A)(i) and 4(b)(1)(A) of the Act and regulations at 50 CFR 424.12, in determining which areas within the geographical area occupied at the time of listing to designate as critical habitat, we consider the physical and biological features essential to the conservation of the species that may require special management considerations or protection. These include, but are not limited to:

(1) Space for individual and population growth and for normal behavior;

(2) Food, water, air, light, minerals, or other nutritional or physiological requirements;

(3) Cover or shelter;

(4) Sites for breeding, reproduction, or rearing (or development) of offspring; and

(5) Habitats that are protected from disturbance or are representative of the historic, geographical, and ecological distributions of a species.

We consider the physical or biological features essential to the conservation of the species to be the primary constituent elements (PCEs) laid out in the appropriate quantity and spatial arrangement for the conservation of the species. We derived the specific PCEs from studies of the habitat, ecology, and life history of the Roswell springsnail, Koster's springsnail, Noel's amphipod, and Pecos assiminea. The description of the PCEs for all four invertebrates and a full description of the essential environment as it relates to the specific PCEs are described in the June 22, 2010, published proposed designation of critical habitat for the four invertebrates (75 FR 35375). We are restating the PCEs for Noel's amphipod here, as the additional proposed critical habitat area contains only that species.

Based on the species' needs and our current knowledge of the life history, biology, and ecology of Noel'samphipod and the habitat requirements for sustaining its essential life-history functions, we have determined that the primary constituent element essential to the conservation of Noel's amphipod is springs and spring-fed wetland systems that:

(1) Have permanent, flowing, unpolluted water;

(2) Have slow to moderate water velocities;

(3) Have substrates including limestone cobble and aquatic vegetation;

(4) Have stable water levels with natural diurnal (daily) and seasonal variations;

(5) Consist of fresh to moderately saline water;

(6) Have minimal sedimentation;

(7) Vary in temperature between 10-20 °C (50-68 °F) with natural seasonal and diurnal variations slightly above and below that range; and

(8) Provide abundant food, consisting of:

(a) Submergent vegetation and decaying organic matter;

(b) A surface film of algae, diatoms, bacteria, and fungi; and

(c) Microbial foods, such as algae and bacteria, associated with aquatic plants, algae, bacteria, and decaying organic material.

When designating critical habitat, we assess whether the specific areas within the geographical area occupied by the species at the time of listing contain features that are essential to the conservation of the species and that may require special management considerations or protection. As stated in the final listing rule (70 FR 46304, August 9, 2005), threats to the four invertebrates include reducing or eliminating water in suitable or occupied habitat through drought or pumping; introducing pollutants to levels unsuitable for the species from urban areas, agriculture, release of chemicals, and oil and gas operations; fires that reduce or eliminate available habitat; and introducing nonnative species into the invertebrates' inhabited spring systems such that suitable habitat is reduced or eliminated. Each of these threats is discussed in detail in the June 22, 2010, proposed designation of critical habitat for the four invertebrates (75 FR 35375); only those threats relevant to the newly found population and not discussed in the previous proposed rule are discussed here. Other threats (water quantity, contamination from oil and gas operations, fire, and introduced species) are also threats to this population.

Water contamination is a significant threat for Noel's amphipod in the small spring vents along the Rio Hondo on the South Tract of the Refuge. One possible source of water contamination is runoff of agricultural fertilizers and pesticides that are applied to the croplands on the South Tract of the Refuge. This tract encompasses approximately 1,400 acres (ac) (566 hectares (ha)) that are closed to public access. About 330 ac (133.5 ha) are used as agricultural cropland (Service 1998, p. 7) to provide food, habitat, and feeding areas for wintering migratory bird populations (Service 1998, p. 7). Alfalfa, corn, hegari, barley, winter wheat, sorghum, and other small grains are cultivated on this tract (Service 2010, p. 14). Although crop rotation minimizes the need for chemical fertilizers, both fertilizers and pesticides are used on this tract, and these chemicals have the potential to enter the springs inhabited by Noel's amphipod. Chemicals used on the South Tract in the past 10 years include Accent (Nicosulfuron), Banvel (Dicamba), Pounce (Permethrin), Roundup and Equivalents (Glyphosate), Pursuit DG (Imazathapyr), Rhonox (2-ethylhexyl ester of 2-methyl-4-chlorophenoxyacetic acid), Steadfast (Nicosulfuron/Rimsulfuron), Malathion 57 (Malathion), and Impact (Topramezone) (Service 2010, p. 43-44). To protect aquatic life in the Rio Hondo, the Refuge implements chemical-specific buffers within which the chemicals cannot be used. Additionally, restrictions are in place prohibiting use of chemicals on Refuges that dissolve and travel in groundwater. These restrictions and buffers serve to minimize exposure of Noel's amphipod to these chemicals. Nevertheless, there remains a potential for contamination and negative effects to Noel's amphipod and its habitat.

The Refuge is in the process of reviewing the farming program on the South Tract. A draft environmental analysis (Service 2010, pp. 1-55) evaluates the effects of several levels of farming on this tract. The current preferred alternative is to eliminate farming on the South Tract; if the draft environmental analysis is adopted, no future chemical application of fertilizers or pesticides would occur in the vicinity of Noel's amphipod populations, and this source of potential water contamination would be eliminated.

Another potential source of water contamination in Noel's amphipod habitats on the South Tract is from periodic inundation by water from the Rio Hondo. The Rio Hondo is a perennial stream from Roswell to its confluence with the Pecos River, and its watershed extends eastward to the Sacramento Mountains. The majority of the lower Rio Hondo valley is used for extensive agricultural purposes, including ranching, commercial livestock feeding, and crop production, as well as residential land use (USACE 1974, p. 8). Stormwater runoff from areas with these land uses is one way contaminants can be transported into the Rio Hondo and into Noel's amphipod habitats. In addition, stormwater runoff from urban areas (such as from the City of Roswell) has been identified as potentially containing many materials such as solids, plastics, sediment, nutrients, metals, pathogens, salts, oils, fuels, and various chemicals, including antifreeze, detergents, pesticides, and other pollutants that can be toxic to aquatic life (Burton and Pitt 2002, pp. 6-7; Selbig 2009, p. 1).

Another way the Rio Hondo receives contaminants is by wastewater effluent discharge (USACE 1974, p. 9; Smith 2000, p. 65). At the present time, the average return flow from City of Roswell Wastewater Treatment Facility is approximately 6.2 cubic feet per second (cfs) (0.18 cubic meters per second (cms)). Effluent from the Roswell Wastewater Treatment Facility is largely used for crop irrigation from February through November or is discharged to the North Spring River, which flows 5 miles (mi) (8 kilometers (km)) before entering the Rio Hondo (Smith 2000, p. 65; USEPA 2006, p. 2), upstream of the Noel's amphipod population. In 2010, the Roswell Wastewater Treatment Facility was modified to provide a higher level of water purification that should improve the quality of the effluent discharge (J. Anderson, City of Roswell, pers. comm. December 9, 2010; USEPA 2007, p. 5). However, some nutrients, bacteria, metals, pesticides, oxygen-demanding substances, organic chemicals, surfactants, flame retardants, personal care products, steroids, hormones, and pharmaceuticals are expected to remain in the Rio Hondo (USEPA 2009, pp. 26-39).

Past analysis of water quality in the Rio Hondo has indicated some concerns. For example, sampling in the past yielded that total dissolved solids in Rio Hondo water averaged 935 mg/L, sulfates averaged 722 mg/L, and chlorides averaged 40 mg/L (USACE 1974, p. V-4) (both sulfates and chlorides are components of salt). However, more recent sampling by the New Mexico Environment Department (NMED) (2006a, p. 13) found higher total dissolved solids (average 7,321 mg/L), including more chloride (average2,640 mg/L) and slightly more sulfate (average 776 mg/L) than reported by the USACE (1974, p. V-4). In addition, the NMED (2006b, p. 32) identified water quality parameters of nutrients, bacteria, salinity, and temperature as a concern in the upper Rio Hondo watershed. Potential sources of nutrients or bacteria are municipal wastewater treatment facility effluents, onsite waste treatment systems (septic tanks), residential areas, landscape maintenance, livestock feeding operations, rangeland grazing, atmospheric deposition, stream modification or destabilization, and urban areas and construction sites (NMED 2006b, p. 32).

Riverine conditions in the Rio Hondo are not suitable for Noel's amphipod; the amphipod is found only in the nearby springs. However, Noel's amphipod could be affected by river water entering the spring runs during periods of high flow by either flushing the amphipods downstream or by river water mixing with spring water and introducing contaminants or altered water chemistry to the spring habitats. The Rio Hondo has a base flow between 2 and 6 cfs (0.06 to 0.17 cms) but exceeds 10 cfs (.03 cms; a flow high enough to inundate the springs) approximately 5 to 10 times per year for short durations (USGS 2010, p. 1). Under base flow conditions, the spring runs that harbor Noel's amphipod are found along the riverbank at elevations higher than the stream, and, therefore, the water from the river does not mix with the spring outflow water. However, when Rio Hondo flows are elevated, these springs become inundated with water from the river and the amphipods may be exposed to contaminants from the Rio Hondo.

Groundwater that supplies the outflow to the springs where the amphipod occurs is an additional potential source of spring water contamination. This water is clearly distinct from the water of the nearby Rio Hondo based on very different temperatures and low dissolved oxygen measurements (Lusk 2010, p. 1). Low dissolved oxygen is typical of spring water conditions, as oxygen enters the water mainly through the atmosphere (Whiteet al.1990, p. 584), and spring water temperatures remain much more constant throughout the year due to the insulating effect of soil and rock on groundwater (Constantz 1998, p. 1610). The South Tract of the Refuge lies within the same groundwater source area as the Middle Tract, where the other Noel's amphipod populations are found and is, therefore, subject to the same threat of contamination from oil and gas activities as was discussed in the proposed designation of critical habitat for the four invertebrates (75 FR 35375, June 22, 2010).

There has been no research on the specific effects on Noel's amphipod of contaminants such as metals, pesticides, fertilizers, nutrients, or bacteria. However, there is some evidence that freshwater amphipods in the family Gammaridae (in particular,Gammarus) may require higher oxygen levels and less polluted water than some other amphipods such asCrangonyx(e.g.,MacNeilet al.1997, pp. 350, 356; MacNeilet al.2000, p. 2). Gammarid amphipods (such as Noel's amphipod) may be considered an indicator of relatively unpolluted waters (MacNeilet al.1997, p. 356; MacNeilet al.2000, p. 6). Additionally, bacteria in high levels can affect amphipods directly through infections, or indirectly by depleting the dissolved oxygen in the water column through respiration or decomposition (Boylen and Brock 1973, p. 631).

As required by section 4(b)(1)(A) of the Act, we use the best scientific and commercial data available to determine critical habitat. In accordance with the Act and its implementing regulation at 50 CFR 424.12(e), we consider whether designating additional areas—outside those currently occupied as well as those occupied at the time of listing—are necessary to ensure the conservation of the species. For our June 22, 2010 proposed designation of critical habitat (75 FR 35375), we evaluated areas within the geographical area occupied at the time of listing that contain the features essential to the conservation of Roswell springsnail, Koster's springsnail, Noel's amphipod, and Pecos assiminea. We considered an area to be currently occupied if Roswell springsnail, Koster's springsnail, Pecos assiminea, or Noel's amphipod were found to be present by species experts within the last 5 years and no major habitat modification has occurred that would preclude its presence. We also considered areas outside of the geographical area occupied at the time of the listing rule to designate critical habitat for the four invertebrates (75 FR 35375), and recommendations contained in State wildlife resource reports (Cole 1985, pp. 93-104; Jones and Balleau 1996, pp. 1-16; Boghici 1997, pp. 1-120; Balleauet al.1999, pp. 1-42; NMDGF 1999, pp. A1-B46; NMDGF 2006, pp. 1-16; NMDGF 2007, pp. 1-20; and NMDGF 2008, pp. 1-28) and the State recovery plan (NMDGF 2005, pp. 1-80) in making this determination. We also reviewed the available literature pertaining to habitat requirements, historic localities, and current localities for these species. This includes data submitted during section 7 consultations and regional geographic information system (GIS) coverages.

Since the June 22, 2010, proposal we identified an additional site along the Rio Hondo on the South Tract of the Refuge that is currently occupied by Noel's amphipod, but not by the other three species. We believe this site was occupied by Noel's amphipod at the time of listing because amphipods were first found at this site in 2006, one year after listing (Warrick 2006, p. 1). However, they were not taxonomically confirmed to be Noel's amphipod until 2010 (Berg 2010, p. 1; Lang 2010, p. 1). Since this spring area is isolated from other occupied areas and no reintroduction efforts have taken place, it has likely been occupied for a very long time, but appropriate surveys had not been previously conducted to verify it. We reasonably assume, therefore, that the site was occupied at the time of listing in 2005 and not discovered until 2006.

In our June 22, 2010 proposed designation of additional critical habitat for the four invertebrates, we selected areas based on the best scientific data available that possess those PCEs essential to the conservation of the species that may require special management considerations or protection. We are now modifying that proposed critical habitat to add the additional site along the Rio Hondo on the South Tract of the Refuge that is currently occupied only by Noel's amphipod. By inclusion of the additional site along the Rio Hondo, we are again proposing to designate as critical habitat all sites currently occupied by at least one of the four invertebrates.

Our reason for proposing to designate all known occupied habitat for these species is that the four invertebrates are not migratory, nor is there frequent gene exchange between populations or critical habitat units. Further, the proposed critical habitat units in New Mexico and west Texas are sufficiently distant (40 to 100 mi (64 to 161 km)) from one another to rule out Pecos assiminea gene exchange. Therefore, due to the lack of frequent gene exchange, we have determined that all of the currently occupied sites of these populations are essential to the conservation of the species because they provide for the maintenance of the genetic diversity of the four invertebrates, and contain all of theknown remaining genetic diversity within each species. All of the proposed critical habitat units also have the defined PCEs and the kind, amount, and quality of habitat associated with those occurrences. The units contain the appropriate quantity and distribution of PCEs to support the life cycle stages we have determined are essential to the conservation of the species.

When determining critical habitat boundaries within this proposed rule, including the newly proposed Unit 5, we made every effort to avoid including structures such as culverts and roads, because areas with such structures lack PCEs for the four invertebrates. The scale of the maps we prepared under the parameters for publication within the Code of Federal Regulations may not reflect the exclusion of such areas. Any such structures inadvertently left inside critical habitat boundaries shown on the map of this proposed rule have been excluded by text in the proposed rule and are not proposed for designation as critical habitat. Therefore, if the critical habitat were finalized as proposed, a Federal action involving these areas would not trigger section 7 consultation with respect to critical habitat and the requirement of no adverse modification unless the specific action would affect the PCEs in the adjacent critical habitat.

In summary, this proposed critical habitat designation includes populations of the four invertebrates and habitats that possess the physical and biological features essential to the conservation of the species. We believe the populations included in this designation, if secured, would provide for the conservation of Roswell springsnail, Koster's springsnail, Pecos assiminea, and Noel's amphipod by:

(1) Maintaining the physical and biological features essential to the conservation of the species in areas where populations of the four invertebrates are known to occur, and

(2) Maintaining the current distribution of these populations, and thus preserving genetic variation throughout the ranges of the four invertebrates and minimizing the potential effects of local extinction.

The area identified in this proposed rule constitutes an addition to the proposed revision of the areas we proposed for designation as critical habitat for the four invertebrates on June 22, 2010 (75 FR 35375). All areas proposed on June 22, 2010, remain proposed for designation as critical habitat. In this proposed rule, we are proposing an additional area on the South Tract of the Refuge along the Rio Hondo in which amphipod populations were recently confirmed to be Noel's amphipod (Berg 2010, p. 1). Therefore, we are proposing as critical habitat all occupied sites for Noel's amphipod, as all of these sites are essential to the conservation of the species.

We are proposing an additional unit as critical habitat for Noel's amphipod in New Mexico. For a full description of Units 1 through 4, please see the June 22, 2010, proposed rule (75 FR 35375). The new Unit 5 we propose as additional critical habitat for Noel's amphipod, and its approximate area, is displayed in Table 3. This location is currently occupied by Noel's amphipod. In total, we are proposing to designate as critical habitat 520.8 acres (210.8 hectares) for the four species.

Request for Information

When we make a finding that a petition presents substantial information indicating that listing a species may be warranted, we are required to promptly review the status of the species (status review). For the status review to be complete and based on the best available scientific and commercial information, we request information on the sand verbena moth from governmental agencies, Native American Tribes, the scientific community, industry, and any other interested parties. We seek information on:

(1) The species' biology, range, and population trends, including:

(a) Habitat requirements for feeding, breeding, and sheltering;

(b) Genetics and taxonomy;

(c) Historical and current range, including distribution patterns;

(d) Historical and current population levels, and current and projected trends; and

(e) Past and ongoing conservation measures for the species, its habitat, or both.

(2) The factors that are the basis for making a listing determination for a species under section 4(a) of the Endangered Species Act of 1973, as amended (Act) (16 U.S.C. 1531et seq.), which are:

(a) The present or threatened destruction, modification, or curtailment of its habitat or range;

(b) Overutilization for commercial, recreational, scientific, or educational purposes;

(c) Disease or predation;

(d) The inadequacy of existing regulatory mechanisms; or

(e) Other natural or manmade factors affecting its continued existence.

(3) Information on yellow sand verbena (Abronia latifolia), the host plant for the sand verbena moth, such as patch size and distribution, including distribution of known or potential sand verbena moth habitats; information on ongoing or future activities in potential sand verbena moth habitat; information on yellow sand verbena population trends; and information on other native or nonnative plant distributions, particularly nonnative beachgrass (Ammophilaspp.), in the range of the yellow sand verbena, especially where the sand verbena moth occurs.

If, after the status review, we determine that listing the sand verbena moth is warranted, we will propose critical habitat (seedefinition in section 3(5)(A) of the Act), under section 4 of the Act, to the maximum extent prudent and determinable at the time we propose to list the species. Therefore, within the geographical range currently occupied by the sand verbena moth, we request data and information on:

(1) What may constitute “physical or biological features essential to the conservation of the species”;

(2) Where such physical or biological features are currently found; and

(3) Whether any of these features may require special management considerations or protection.

In addition, we request data and information on whether there are any specific areas outside the geographical area occupied by the species that may be considered essential to the conservation of the species. Please provide specific comments and information as to what, if any, critical habitat you think we should propose for designation if the species is proposed for listing, and explain why such habitat meets the requirements of section 4 of the Act.

Please include sufficient information with your submission (such as scientific journal articles or other publications) to allow us to verify any scientific or commercial information you include.

Submissions merely stating support for or opposition to the action underconsideration without providing supporting information, although noted, will not be considered in making a determination. Section 4(b)(1)(A) of the Act directs that determinations as to whether any species is an endangered or threatened species must be made “solely on the basis of the best scientific and commercial data available.”

You may submit your information concerning this status review by one of the methods listed in theADDRESSESsection. We will not accept comments sent by e-mail or fax or to an address not listed in theADDRESSESsection of this document. If you submit information viahttp://www.regulations.gov,your entire submission—including any personal identifying information—will be posted on the Web site. If you submit a hardcopy that includes personal identifying information, you may request at the top of your document that we withhold this personal identifying information from public review. However, we cannot guarantee that we will be able to do so. We will post all hardcopy submissions onhttp://www.regulations.gov.

Information and supporting documentation that we received and used in preparing this finding is available for you to review athttp://www.regulations.gov,or you may make an appointment during normal business hours at the U.S. Fish and Wildlife Service, Washington Fish and Wildlife Office (see FOR FURTHER INFORMATION CONTACT).

Section 4(b)(3)(A) of the Act (16 U.S.C. 1533(b)(3)(A)) requires that we make a finding on whether a petition to list, delist, or reclassify a species presents substantial scientific or commercial information indicating that the petitioned action may be warranted. We are to base this finding on information provided in the petition, supporting information submitted with the petition, and information readily available in our files. To the maximum extent practicable, we are to make this finding within 90 days of our receipt of the petition and publish our notice of the finding promptly in theFederal Register.

Our standard for substantial scientific or commercial information with regard to a 90-day petition finding is “that amount of information that would lead a reasonable person to believe that the measure proposed in the petition may be warranted” (50 CFR 424.14(b)). If we find that substantial scientific or commercial information was presented, we are required to promptly conduct a species status review, which we subsequently summarize in our 12-month finding.

On February 17, 2010, we received a petition, dated February 4, 2010, from WildEarth Guardians and the Xerces Society for Invertebrate Conservation requesting that the sand verbena moth be listed as endangered or threatened throughout its entire range and that critical habitat be designated under the Act (WildEarth Guardians and the Xerces Society for Invertebrate Conservation 2010, hereafter cited as “Petition”). The petition clearly identified itself as such and included the requisite identification information for the petitioner(s), as required by 50 CFR 424.14(a). In a March 22, 2010, letter to the petitioners, we responded that we reviewed the information presented in the petition and determined that issuing an emergency regulation temporarily listing the species under section 4(b)(7) of the Act was not warranted. We also stated that due to court orders and judicially approved settlement agreements for other listing and critical habitat determinations under the Act that required nearly all of our listing and critical habitat funding for fiscal year 2010, we would not be able to further address the petition at that time but would complete the action when workload and funding allowed. On May 26, 2010, we received a notice of violation with intent to file suit, dated May 20, 2010, from WildEarth Guardians and the Xerces Society requesting that we make a 90-day finding on the listing petition within the next 60 days. On July 14, 2010, we notified the petitioners that funding became available and we were currently reviewing the petition. This finding addresses the petition.

The sand verbena moth was first described and collected in 1995 (Troubridge and Crabo 1995, pp. 87-90), and is the only species of the genusCopablepharonknown to occur west of the Cascade Mountains (Troubridge and Crabo 1995, p. 89; Committee on the Status of Endangered Wildlife in Canada (COSEWIC) 2003, p. 4). The adults of the sand verbena moth can be easily identified by their distinctive physical characteristics. The sand verbena moth is dark in color with yellow and black forewing lines and is the only species within the genus with a predominantly gray underside to its forewing and hindwing (Troubridge and Crabo 1995, p. 89). Total wingspan varies from 35 to 40 millimeters (mm) (1.38 to 1.47 inches (in)) in length (COSEWIC 2003, p. 5).

There is very little information on the biology and habitat requirements of the sand verbena moth (British Columbia Invertebrates Recovery Team (BCIRT) 2008, pp. 3, 5) and data on its distribution are known to be incomplete (NatureServe 2010 [online]). Virtually all of the available information is based on the original description of the species (Troubridge and Crabo 1995, pp. 87-90) and observations of the four metapopulations located in British Columbia (see“Distribution and Status” below). The adult sand verbena moth has a lifespan of 5 to 14 days (Species At Risk Act (SARA) Registry 2009, p. 4) and one flight period that occurs from mid-May to late July (Troubridge and Crabo 1995, p. 89; COSEWIC 2003, p. 16). Adults have been observed at dusk and early evening (COSEWIC 2003, p. 16) and lay eggs singly or in groups on leaves or flowers of its only host plant, the yellow sand verbena. Larvae feed exclusively at night on the leaves and flowers of the plant (COSEWIC 2003, pp. 5, 16) and burrow in the sand during the day (Troubridge and Crabo 1995, p. 89). Larvae are green in color in early instars (developmental stages) and turn brown with pale longitudinal stripes in late instars. Mature larvae are found in the sand below the host plant and are dormant during the winter (SARA Registry 2009, p. 4). Pupation occurs between late April and late May. Pupae measure approximately 20 mm (0.8 in) in length, are brown in color, and are protected by a thin layer of sand particles. Pupae have a distinct external compartment in which the proboscis develops (COSEWIC 2003, pp. 5, 16).

The sand verbena moth was first described by Troubridge and Crabo (1995, pp. 87-90) after its discovery in Deception Pass State Park, Washington, and Saanichton, British Columbia. Troubridge and Crabo (1995, p. 89) state, “where it occurs,C. fuscumcan be relatively abundant,” and “it was the most common noctuid at Deception Pass State Park, Washington.” Currently, the sand verbena moth has been collected only in the Georgia Basin-Puget Sound Region in British Columbia and Washington, but this area has not been thoroughly surveyed for the species, and roughly 90 percent of the range of its host plant, yellow sand verbena, has not been surveyed for the sand verbena moth. Because the range of the sand verbena moth's host plant extends along the coast from British Columbia southward into California, additionalsampling in Washington, Oregon, and California is needed to evaluate the full extent of the range of the sand verbena moth.

Exactly how many populations of the sand verbena moth are currently known is unclear. Although the petitioners at times state that 10 populations are known, 4 in British Columbia and 6 in Washington (e.g.,Petition, pp. 1, 6, 8), they also point out that not all of these sites may be separate occurrences, and at one point list a total of 9 populations, 4 in British Columbia and 5 in Washington (Petition, p. 9). We are aware of nine populations of the sand verbena moth, distributed over a total of approximately 4,850 square kilometers (km2) (1,873 square miles (mi2)). In Canada, surveys conducted between 2001 and 2007 confirmed the presence of the sand verbena moth on Goose Spit, Sandy Island, Cordova Spit/Island View Beach, and James Island. All but one of these locations occur on public, military, and indigenous lands. The James Island population, discovered in 2007, occurs entirely on private land. The BCIRT considers each location to be a metapopulation that is defined by a combination of many subpopulations (BCIRT 2008, p. 2). In Washington in the United States, five populations have been confirmed. Although according to the COSEWIC (2003, p. 15) all known U.S. locations occur primarily on public or military lands, we only know the specific locations for sites on Dungeness National Wildlife Refuge in Sequim, Deception Pass State Park on Whidbey Island, and San Juan Island National Historical Park (San Juan Island NHP) on San Juan Island. Two other populations are located in Port Townsend and Whidbey Island; however, we have no information regarding their exact locations (COSEWIC 2003).

There is also conflicting information as to whether the known populations are isolated from one another. Although the petitioners state, “all populations are isolated from each other,” citing COSEWIC 2003 and BCIRT 2008 (Petition, p. 7), the petitioners also cite NatureServe (2009) as indicating that not all of the known sites may be separate occurrences.

The COSEWIC (2003, p. 8) describes the methodology for surveys conducted in British Columbia and Washington between 2001 and 2002. In most cases, a single light trap was set from dusk to dawn next to patches of yellow sand verbena during the sand verbena moth's flight season. Occasionally, two traps were set, and some hand-netting occurred. In British Columbia, 19 locations were surveyed for the sand verbena moth over a period of 19 days between May 20 and August 14, 2001. A total of nine sand verbena moths were collected at two of these locations (COSEWIC 2003, pp. 32-36). In 2002, seven locations were surveyed in British Columbia between May 30 and June 15. During this period, one sand verbena moth was collected at a single location in the Comcox area over a period of 6 days (COSEWIC 2003, pp. 36-39). In the Puget Sound Region in Washington, surveys were conducted between June 6 and June 12, 2002. A total of 36 sand verbena moths were collected at 5 of the 9 locations surveyed over a period of 4 days (COSEWIC 2003, pp. 36-38). According to the COSEWIC (2003, p. 9), one survey was conducted in Oregon in 2002. Light-trapping was not possible, and the sand verbena moth was not detected by hand-searching flowering patches of yellow sand verbena. The COSEWIC (2003, p. 9) did not present any additional information or citation regarding this survey, and concluded that additional sampling is needed to determine if the sand verbena moth is present in Oregon and California in areas where its host plant is found.

According to the COSEWIC (2003, p. 18), the use of data collected from light traps is an inappropriate method for estimating population sizes or characterizing population densities of the sand verbena moth. Thus, there are no reliable population estimates for British Columbia populations (BCIRT 2008, p. 2) or populations in the United States (NatureServe 2009 [online]). Because of the recent discovery of the sand verbena moth, there is no historical information on population sizes, nor is there any evidence of any decline. The petitioners acknowledge, “because this species was only recently described, information on historical population abundance that would inform whether or not this species has declined over time is unavailable” (Petition, p. 7).

The sand verbena moth is listed as endangered under the Species At Risk Act in British Columbia (SARA Registry 2009, p. 1) and is a candidate species in the State of Washington (Washington Department of Fish and Wildlife (WDFW) 2010 [online]). NatureServe (2009 [online]) ranks the species as critically imperiled to imperiled (G1G2). NatureServe notes this global rank, “is explicitly based on the conclusion by COSEWIC and others that the purported range is essentially correct and that the moth is not nearly as widespread as its foodplant” (NatureServe 2009 [online]).

Although the petitioners contend the moth is facing an “accelerating decline,” they offer no support for this statement (Petition, p. 2). Furthermore, the petitioners cite NatureServe (2009) as describing global long-term declines of 75 to 90 percent for the sand verbena moth. Although NatureServe does classify the global long-term trend for the species as “large decline (75-90%),” it is unclear how NatureServe may have arrived at this conclusion, as the moth was only discovered in 1995, and there are no reliable quantitative data regarding sand verbena moth population sizes or trends. The projected decline is apparently an inferred consequence of presumed habitat loss due to dune stabilization and exotic plants, but no documentation is provided to support this inference (NatureServe 2010 [online]). The petitioners further suggest that possible declines in the host plant, yellow sand verbena, may have resulted in declines in the sand verbena moth (Petition, p. 7). They cite COSEWIC (2003) as stating that yellow sand verbena populations in many sites have likely declined substantially over the past 50 years because of vegetation changes. However, we note that NatureServe (2010 [online]) ranks the yellow sand verbena as “globally secure.”

The yellow sand verbena occurs in spits, dunes, and sandy coastal habitat that lack dense plant cover (COSEWIC 2003, p. 11). This species is distributed from the Queen Charlotte Islands, British Columbia, to Santa Barbara County, California (Hickman 1993, p. 769). NatureServe (2010 [online]) ranks the yellow sand verbena as globally secure (G5). This plant is considered to be vulnerable in Oregon and British Columbia, but its conservation status has not been assessed in Washington or California (NatureServe 2010, [online]). Yellow sand verbena is not listed by the Washington Department of Natural Resources, Natural Heritage Program (COSEWIC 2003, pp. v-vi), nor is it considered a sensitive species by the National Park Service or Forest Service (Thomas 2010, pers. comm.).

The patch size, structure, and configuration of yellow sand verbena necessary to sustain populations of sand verbena moth are poorly understood (BCIRT 2008, pp. 3, 5). To date, there is no quantitative or qualitative measure of habitat at known sand verbena moth locations in Washington. At known locations in British Columbia, the sand verbena moth occurs in small satellite patches within 200 m (656 ft), or so, of larger populations of yellow sand verbena. Isolated small, sparse, or non-flowering populations of the plants do not appear to support the sand verbena moth (NatureServe 2009 [online]). In addition, the sand verbena moth has not been collected in yellow sand verbena patches less than 500 square meters (m2) (5,382 square feet (ft2)) (BCIRT 2008, pp. 3, 5); however, the BCIRT cautions, “this statement is only quantitative and neither indicates this area as a minimum patch size nor suggests that patches should be managed to this size.”

Section 4 of the Act (16 U.S.C. 1533) and its implementing regulations at 50 CFR 424 set forth the procedures for adding a species to, or removing a species from, the Federal Lists of Endangered and Threatened Wildlife and Plants. A species may be determined to be an endangered or threatened species due to one or more of the five factors described in section 4(a)(1) of the Act:

(A) The present or threatened destruction, modification, or curtailment of its habitat or range;

(B) Overutilization for commercial, recreational, scientific, or educational purposes;

(C) Disease or predation;

(D) The inadequacy of existing regulatory mechanisms; or

(E) Other natural or manmade factors affecting its continued existence.

In considering what factors might constitute threats, we must look beyond the exposure of the species to a particular factor to evaluate whether the species may respond to that factor in a way that causes actual impacts to the species. If there is exposure to a factor and the species responds negatively, the factor may be a threat and we attempt to determine how significant a threat it is. The threat may be significant if it drives, or contributes to, the risk of extinction of the species such that the species may warrant listing as endangered or threatened as those terms are defined by the Act. The identification of factors that could impact a species negatively may not be sufficient to compel a finding that substantial information has been presented suggesting that listing may be warranted. The information should contain evidence or the reasonable extrapolation that any factor(s) may be an operative threat that acts on the species to the point that the species may meet the definition of endangered or threatened under the Act.

In making this 90-day finding, we evaluated whether information regarding threats to the sand verbena moth, based on information presented in the petition and other information available in our files, is substantial, thereby indicating that the petitioned action may be warranted. Our evaluation of this information is presented below.

According to the petitioners, yellow sand verbena requires chronic disturbance to maintain long-term populations of the sand verbena moth (Petition, p. 10, citing COSEWIC 2003, p. 19). The petitioners state stabilization of dunes by both native and introduced species, such as the nonnative European beachgrass,Ammophila arenaria,degrades habitat for yellow sand verbena and consequently the sand verbena moth as well (Petition, p. 10). The petitioners further state that nonnative beachgrass displaces yellow sand verbena, although no supporting documentation is provided for this claim (Petition, p. 10). The petitioners maintain (Petition, p. 10, citing BCIRT 2008, p. 19) this threat is severe at all locations in British Columbia and most locations in Washington. Troubridge and Crabo (cited as 1995, p. 99, in Petition, p. 10) note European beachgrass has stabilized most of the dune habitat on the Pacific Coast, replacing native vegetation. In addition, the petitioners cite nonnative beachgrass as dominating most Washington dunes (Petition, p. 10, citing Washington State Department of Ecology pp. 1-2, [online]).

We reviewed the information presented in the petition and information in our files and found no information indicating that dune stabilization (referred to as “vegetation stabilization” by the petitioners) is a significant threat at sand verbena moth locations in Washington. Only one reference, L. Crabo (2010, pers. comm.), was presented in the petition regarding the threat of beachgrass at known sand verbena moth locations in the Puget Sound Region of Washington (Petition, p. 10). According to the petitioners, L. Crabo noted that the dunes at Deception Pass State Park have been less affected by European beachgrass and Scotch broom (Cytisus scoparius) than some of the other sites (Petition, p. 10). The petitioners did not document this communication (S. Jepsen, Xerces Society, 2010, pers. comm.); thus we are unable to verify and assess this claim or any other information that was referenced as “L. Crabo 2010, pers. comm.” in the petition. According to the Washington State Department of Ecology (pp. 1-2, [online]), both American beachgrass (Ammophila breviligulata) and European beachgrass have changed sediment transport, plant communities, and habitat along the southwest coast of Washington. Currently, American beachgrass dominates most foredunes, from the mouth of the Columbia River to the mouth of the Copalis River (Washington State Department of Ecology p. 2, [online]). The current distribution of European beachgrass was not discussed, nor was information provided regarding beachgrass in the Puget Sound Region of Washington (Washington State Department of Ecology pp. 1-2, [online]).

We acknowledge that beachgrass may outcompete native dune species, including yellow sand verbena. Wiedemann and Pickart (1996, p. 287) state that beachgrass has outcompeted native plant species and drastically reduced their habitat. However, displacement has so far been demonstrated indirectly by correlation studies between beachgrass and species diversity (cited as Barbouret al.1976, in Wiedmann and Pickart 1996, p. 295), and responses to beachgrass differ among foredune species (cited as Boyd 1992, in Wiedmann and Pickart 1996, p. 295).

At occupied sand verbena moth locations in Washington, the total area of beachgrass and yellow sand verbena available to the sand verbena moth has not been quantified. Limited information is available for other nearby sites that support both yellow sand verbena and beachgrass. At Graveyard Spit in Dungeness National Wildlife Refuge (NWR), yellow sand verbena is distributed throughout the refuge, but does not appear to be outcompeted by either native or nonnative grasses. This spit is located in a designated research natural area and supports a relatively intact native beach strand community (Thomas 2010, pers. comm.). On Protection Island NWR, approximately 42 acres on Violet Spit support beachgrass. Yellow sand verbena has also been noted on Protection Island, and beachgrass is reported to be dense at this location; however, comprehensive surveys of either yellow sand verbena or beachgrass have not been completed, as the area is avoided during flowering due to its overlap in timing with the Salish Sea's largest nesting colonies of glaucous-wingedgulls (Larus glaucescens). The refuge is planning native strand restoration at this site. On San Juan Island NWR, beachgrass has been noted on Smith Island, and no vegetation occurs on Minor Spit. The density of beachgrass and yellow sand verbena available to the sand verbena moth has not been quantified at these locations (Thomas 2010, pers. comm.).

Although not currently a known location for sand verbena moth, we received a yellow sand verbena inventory report from Willapa NWR, located in southwest Washington. In 2006, all sandy beaches from the Columbia River North Jetty to Leadbetter Point were surveyed. A total of 1,003 mature plants and 2,447 immature plants were documented over the course of the survey (Lewis 2006, unnumbered p. 2). Lewis noted the shape of a few large plants was altered by encroaching beachgrass. The beachgrass appeared to shade out yellow sand verbena and reduce its vigor, and thus may outcompete it. Yellow sand verbena plants were not documented in areas or zones established by beachgrass (Lewis 2006, unnumbered p. 3).

In British Columbia, dune stabilization has been identified as the primary threat to yellow sand verbena and, therefore, to the sand verbena moth (COSEWIC 2003, p. 19; NatureServe 2009, [online]). According to COSEWIC (2003, p. 14), the introduction of invasive nonnative plants, such as Scotch broom and exotic grasses, has accelerated dune stabilization at sand verbena moth locations in British Columbia.

In summary, we have little information to suggest that dune stabilization may pose a significant threat to the sand verbena moth within its known range in the State of Washington, and whether the sand verbena moth may occur elsewhere on the Pacific Coast of the United States where its host plant is found is uncertain. However, we acknowledge that the Committee on the Status of Endangered Wildlife in Canada, which we consider to be a reliable source of scientific information, considers dune stabilization to be a significant threat to the species within its range in British Columbia. Therefore, based on this information, we find that the petition presents substantial scientific or commercial information indicating that dune stabilization may pose a threat to the sand verbena moth such that the petitioned action may be warranted.

The petitioners state that at least four sand verbena moth locations, three in British Columbia and one in Washington, have experienced habitat reduction due to park infrastructure, and additionally they claim that military buildings and marine development may result in reduced moth habitat as well (Petition, p. 10). According to the petition (2010, p. 10), L. Crabo (2010, pers. comm.) stated, “a parking lot has already converted sand dune habitat in the Deception Pass State Park location, and a housing development occurs nearby; only about 300 yards of beach dune habitat remain at the type locality for the sand verbena moth, making this species vulnerable to extirpation at this location.” We were unable to verify and assess the petitioners' reference, as no documentation of this personal communication exists (Jepsen 2010, pers. comm.).

Sand verbena moth and yellow sand verbena populations that occur in U.S. National Park lands and National Wildlife Refuges are generally protected from development; thus habitat conversion due to park infrastructure would not affect habitat at two known sand verbena moth locations in Washington. The petitioners did not provide information, nor do we have any in our files, that supports the claim that military buildings and other infrastructure or marine development have reduced sand verbena moth habitat in Washington. As the total habitat occupied by sand verbena moth populations in Washington has never been documented, any putative reduction in sand verbena moth habitat cannot be determined.

In British Columbia, the COSEWIC (2003, p. 19) considers habitat conversion to be a secondary threat to the sand verbena moth and notes it may have substantial local impacts. According to the BCIRT (2008, p. 16), all of the sites located in Canada have been impacted by habitat conversion, including destruction of sand dunes for park use, development of military training facilities, expansion of beach areas, and marine development.

In summary, we have little information to suggest that habitat conversion may pose a significant threat to the sand verbena moth within its known range in the State of Washington, and whether the sand verbena moth may occur elsewhere on the Pacific Coast of the United States where its host plant is found is uncertain. However, we acknowledge that the Committee on the Status of Endangered Wildlife in Canada, which we consider to be a reliable source of scientific information, considers habitat conversion to be an important threat to the species within its range in British Columbia. Therefore, based on this information, we find that the petition presents substantial scientific or commercial information indicating that dune stabilization may pose a threat to the sand verbena moth such that the petitioned action may be warranted.

The petitioners state that recreational foot traffic on beach dunes presents a threat to the sand verbena moth and its habitat, and claim the threat is likely to increase due to population growth (Petition, p. 10). According to the petitioners (Petition, p. 10), L. Crabo (2010, pers. comm.) noted the sand verbena moth population at Deception Pass State Park is threatened by high levels of human recreation.

We were unable to verify or assess the petitioners' reference cited as a personal communication in regard to recreation at Deception Pass State Park, Washington, as no documentation of this communication exists (Jepsen 2010, pers. comm.). At Dungeness NWR, yellow sand verbena is distributed within a research natural area that is closed to the public (Thomas 2010, pers. comm.); thus recreation is not likely to pose a threat to the sand verbena moth or its habitat now or in the foreseeable future at this location. We have no additional information regarding recreational use at other sand verbena moth locations in Washington.

In British Columbia, the COSEWIC (2003, p. 19) considers recreation a secondary threat to the sand verbena moth; however, actions have been taken to reduce this threat at several locations (BCIRT 2008, pp. 8-9). At Goose Spit, preliminary guidelines for activities near sand verbena moth populations have been developed and signs posted near the site at the dune entrance (BCIRT 2008, p. 8). This population was temporarily fenced to prevent disturbance from military training activities (BCIRT 2008, p. 9). At Island View Regional Park, a split rail fence was constructed to reduce access to thesand verbena moth population. In addition, an educational program was implemented to encourage visitors to stay on established walkways (BCIRT 2008, p. 9).

Based on the above evaluation, we find that the information provided in the petition, as well as other information readily available in our files, fails to meet our standard for substantial scientific or commercial information indicating that recreation may pose a threat to the yellow sand verbena moth such that the petitioned action may be warranted.

The petitioners state that all sand verbena moth habitat occurs within 25 to 100 m (82 to 328 ft) of the shoreline, and therefore it is vulnerable to coastal erosion caused by severe winter storms, wildfire, and heavy winds during the moth's flight season (Petition, p. 10). Furthermore, they point out that in British Columbia, storms over the winter of 2005-2006 eroded 2 to 10 m (6.6 to 32.8 ft) of dunes along Goose Spit (Petition, p. 11). According to the petitioners, the population on San Juan Island is threatened by erosion because it is located on an eroded dune and the roots of yellow sand verbena are visible (Petition, p. 10).

Although they have identified coastal erosion as a threat to the sand verbena moth, the petitioners also make the converse argument that yellow sand verbena and, therefore, the sand verbena moth are adversely affected by the construction of artificial barriers, such as bulkheading and hard protection techniques, constructed to reduce coastal erosion (Petition, p. 15).

According to the COSEWIC (2003, p. 19) the primary threat to the sand verbena moth is habitat loss and degradation as a result of dune stabilization. Natural disturbance of yellow sand verbena populations in open sand areas or new sand deposition, in which colonization may occur, is required to maintain populations of the sand verbena moth (COSEWIC 2003, p. 19). Erosion, winter storms, wildfire, and heavy winds are all natural processes that occur in coastal habitat that likely have maintained suitable dune habitat for yellow sand verbena over time. The BCIRT (2008, p. 5) states, “yellow sand-verbena locations typically lack dense herbaceous or bryophyte plant cover, likely a result of periodic disturbance by natural environmental processes (e.g.,storms, wave-washed logs, and wind). Such weather processes prevent dune stabilization which would otherwise occur through natural succession and plant encroachment.” COSEWIC (2003, p. 20) states, “accelerated coastal disturbance and sediment transport associated with increased storm frequency may result in increased development of open sand habitats, which would have a positive effect” on the sand verbena moth.

In 2005-2006, 2 to 10 m (6.6 to 32.8 ft) of coastal erosion of dune front occurred at Goose Spit, British Columbia, for a length of 200 m (656 ft) along the beach (cited as Allan, pers. comm., 2007 in BCIRT 2008, p. 7). This resulted in a loss of yellow sand verbena plants that are used by the sand verbena moth. In 2007, the dunes were stabilized with abutments to minimize further erosion in this area (BCIRT 2008, p. 9). Erosion barriers have likely impacted sediment transport within the dune ecosystem and may lead to dune and vegetation stabilization (BCIRT 2008, p. 7).

According to a document cited by the petitioners, the shoreline of the Puget Sound region “consists of a diverse suite of coastal landforms ranging from rocky cliffs to beaches and broad river deltas” (cited as Shipman 2008 in Shipman 2009, unnumbered p. 2). This diversity results in complex relationships among and between landforms (Shipman 2009, unnumbered p. 3); each landform responds differently to coastal erosion (Shipman 2009, unnumbered p. 3). For example, erosion from coastal bluffs may provide sediment to beaches and spits, thus providing new area for yellow sand verbena to colonize.

According to the BCIRT (2007, p. 6), in British Columbia sand verbena moth habitat occurs within 100 m (328 ft) of shoreline (BCIRT 2008, p. 6). The petitioners did not present any information, nor could we find any readily available in our files, regarding habitat at known sand verbena moth locations in Washington. Information lacking thus includes the distance from shoreline in which suitable habitat occurs, habitat structure and configuration, and total area of yellow sand verbena needed to support the sand verbena moth. Thomas (2010, pers. comm.) noted that erosion is occurring in dune habitat at San Juan Island NHP; however, new sand deposition occurs simultaneously with the erosion process, which may provide new areas for yellow sand verbena to colonize. Lewis (2006, p. 3) found that taproots of the plant grow deep in the sand. A seedling with four leaves was found to have taproots growing to a depth of more than 25 cm (10 in). Taproots can easily reach 1 m (3.28 ft) or greater in depth (Thomas 2010, pers. comm.). In addition, roots of yellow sand verbena are tough, leathery, and well-designed to resist desiccation from exposure.

The petitioners did not provide any information, nor do we have information in our files, directly relating to the claim that wildfire, heavy winds, or severe winter storms may be factors threatening the continued existence of sand verbena moth or its habitat. The frequency or existence of coastal zone wildfires is poorly understood. However, very little fuel is available in coastal habitats; therefore any fires would be short in duration and likely infrequent.

The petitioners did not present any information, nor do we have any in our files, that indicate bulkheads and other `hard protection' techniques may be a factor threatening the continued existence of sand verbena moth throughout its range. At San Juan Island NHP and Dungeness NWR, no bulkheads or other types of hard structures exist, and natural processes dominate. In British Columbia, erosion barriers have decreased sand transport to Goose Spit; however, dunes were stabilized at this location and yellow sand verbena populations have been augmented by transplants (BCIRT 2008, p. 9).

Based on the above evaluation, we find that the information provided in the petition, as well as other information readily available in our files, fails to meet our standard for substantial scientific or commercial information indicating that coastal erosion may be a threat to the sand verbena moth such that the petitioned action may be warranted.

The petitioners state that rising sea levels and increasingly severe coastal storms and summer droughts as a result of climate change threaten the sand verbena moth (Petition, p. 13, citing BCIRT 2008, p. 8). Sand verbena moth populations in Canada are located less than 5 m (16.4 ft) above sea level, and most habitat occurs within 25 m (82 ft) of the shoreline (BCIRT 2008, pp. 6, 8). According to the petitioners (Petition, p. 13), the Puget Sound region is projected to experience sea level rises estimated at 22 in (55 cm) by 2050 and 50 in (128 cm) by 2100 (Moteet al.2008, p. 10).

The BCIRT (2008, p. 8) considers climate change to be a potential, but poorly understood, threat to sand verbena moth habitat. Although we acknowledge that climate change may lead to sea level rise (IPCC 2007, p. 30; Moteet al.2008, p. 3; Karlet al.2009, p. 84), it is important to note that “the present shoreline of the Salish Sea has formed and is maintained under a regime of gradually rising sea levels” (Shipman 2009, unnumbered p. 2). Projections of future sea levels are highly uncertain, vary across regions, and are unpredictable (Moteet al.2008, pp. 3, 9; Shipman 2009, unnumbered p. 1). Moteet al.(2008, p. 9) stress that these “estimates have not formally quantified the probabilities, sea level rise cannot be estimated accurately at specific locations, and the estimates are for advisory purposes only.” Moteet al.(2008, p. 10) present sea level rise estimates in three categories: very low, medium, and very high. The sea level rise estimates presented in the petition are those categorized as very high for the Puget Sound region. Moteet al.(2008, p. 10) consider the very low and very high sea level rise estimates to be low probability scenarios; a formal framework to quantify the probabilities of the very high or very low sea level rise estimates has not been developed.

According to Moteet al.(2008, p. 10), the medium sea level rise estimate for Puget Sound is 6 in (15 cm) by 2050. Assuming that sand verbena moth populations and yellow sand verbena habitat in Washington are located similarly to those in Canada with respect to distance from shoreline and location above sea level, this level of projected sea level rise would not inundate yellow sand verbena and thus sand verbena moth populations in Washington. Moteet al.(2008, p. 10) also provide medium sea level rise estimates along the entire coast of Washington. Because uplifting occurs in the Northwest Olympic Peninsula, they estimated no sea level rise by 2050. Along the central and southern coast of Washington, sea level rise was estimated to be 5 in (12.5 cm) by 2050. The petition did not present, nor do we have in our files, sea level rise estimates along the coasts of British Columbia, Oregon, or California.

According to the COSEWIC (2003, p. 20), the potential effects of climate change on the sand verbena moth are complex, and they state, “climate change may be associated with sea level rise which could threaten coastal dune habitats directly. However, accelerated coastal disturbance and sediment transport associated with increased storm frequency may result in increased development of open sand habitats, which would have a positive effect.”

The petitioners also state that climate change may cause an increase in summer drought, which may result in early senescence (aging) of yellow sand verbena. The petitioners assert that this will detrimentally affect the sand verbena moth, larvae of which feed on leaves and shoots throughout the summer in preparation for winter diapause (a state of dormancy) (Petition, p. 14).

The petitioners did not provide any evidence, nor could we find any in our files, documenting any increase in summer drought conditions resulting from climate change as causing a loss of leaves, early dormancy, or early senescence of yellow sand verbena. According to BCIRT (2008, p. 8), climate change is a potential, but poorly understood, threat to the sand verbena moth, but they do acknowledge that during drought conditions the plant may lose leaves and enter dormancy early, thus reducing forage for the larvae of the sand verbena moth.

Yellow sand verbena has unique adaptations including deep taproots with high water storage capacity, prostrate growth, and succulent leaves with a thick epidermis (COSEWIC 2003, p. 12) that would enable it to withstand drought conditions. Because changes in precipitation in Puget Sound have been highly variable over recent decades, no particular trend has been observed. Moteet al.(2005, p. 7) state that in Puget Sound, “there is little indication that annual and interannual variation in precipitation in the 21st century will be vastly different from those in the 20th century. Secondly, properties or characteristics of the living and non-living environment that respond to precipitation have probably already experienced the range that they will experience in the next century.” We could not locate any information in our files, nor was any provided in the petition, concerning evidence of increases in drought over the range of yellow sand verbena.

Based on the above evaluation, we find that the information provided in the petition, as well as other information readily available in our files, fails to meet our standard for substantial scientific or commercial information indicating that climate change may be a threat to the yellow sand verbena moth such that the petitioned action may be warranted.

Given the uncertainties regarding the potential significance of the threat of dune stabilization and habitat conversion on the sand verbena moth throughout all or a significant portion of its range, as well as the determination by the Committee on the Status of Endangered Wildlife in Canada that these factors pose a significant threat to the sand verbena moth within its range in that country, we find that the questions raised by information presented in the petition are sufficient to meet the “substantial information” standard for a positive 90-day finding, according to our regulations (50 CFR 424.14(b)). In cases where we have no information in our files that would contradict the opinion of a credible expert on the species, we defer to that expert's opinion for purposes of a 90-day finding. Therefore, we find that the information presented in the petition, as well as other information in our files, presents substantial scientific or commercial information to indicate that dune stabilization and habitat conversion may be threats potentially resulting in the present or threatened destruction, modification, or curtailment of the habitat or range of the sand verbena moth such that the petitioned action may be warranted.

The petitioners state that collection is not known to threaten the sand verbena moth, but the rarity of the species may make it attractive to collectors (Petition, p. 11). According to the petitioners, small populations are especially vulnerable to overcollection (2010, p. 11). The petitioners did not offer any supporting documentation for their statements.

According to COSEWIC (2003, p. 20), collection of the sand verbena moth is considered to have a very minor effect on population size. Direct human-caused mortality is low (NatureServe 2009, [online]). Under Federal regulations, the collection of living or dead wildlife, fish, or plants, or the parts or products thereof, is prohibited on lands under National Park Service and NWR jurisdiction without a permit (36 CFR 2.1(a)(1)(i) and (a)(1)(ii)). Similar regulations exist on Washington State lands (Washington Administrative Code (WAC) section 232-12-064). Thesand verbena moth is thus protected from collection within its known range in the United States and apparently is only minimally impacted by collection within its range in Canada.

The petitioners did not provide any information, nor did we have any available in our files, to indicate that overutilization may have a significant negative impact on sand verbena moth populations. Therefore, we find the petition does not present substantial scientific or commercial information to indicate that overutilization for commercial, recreational, scientific, or educational purposes may present a threat to the yellow sand verbena moth such that the petitioned action may be warranted.

The petitioners state the sand verbena moth is likely subject to predation by bats, birds, and small mammals (Petition, p. 11, citing BCIRT 2008, p. 7). The petitioners also assert that alien parasitic tachinid flies, if introduced to control gypsy moths, may harm the sand verbena moth (Petition, p. 11). According to the petitioners (Petition, p. 11), herbivory of yellow sand verbena is considered a minor threat at all sand verbena moth locations (BCIRT 2008, p.7).

All species are subjected to endemic levels of disease and predation under natural conditions. Gypsy moths attack conifers and broadleaf trees (Boersmaet al.2006, p. 126), habitat the sand verbena moth is not known to occupy. Between 1974 and 2007, only 14 gypsy moths have been collected in the three Washington counties where sand verbena moth is known to occur (Washington State Department of Agriculture (WSDA), 2008, [online]). Between 2007 and 2009, only one moth was collected in these counties (WSDA, 2009, [online]). Alien tachinid flies have not been introduced to the western United States and Canada (BCIRT 2008, p. 7), nor do we have any evidence that such an introduction is planned or likely to occur. While we agree that introducing the fly, should it ever occur, may have a negative effect on the moth, at this time we have no evidence, and the petitioners have offered none, that supports the claim that these threats may rise to the level of acting as a significant limiting factor to the sand verbena moth throughout its range.

We reviewed our files and the information provided by the petitioners, and did not find substantial information to indicate that disease or predation may be outside the natural range of variation such that it could be considered a threat to the sand verbena moth. Therefore, we find the petition does not present substantial scientific or commercial information to indicate that disease or predation may present a threat to the yellow sand verbena moth such that the petitioned action may be warranted.

The petitioners state that Federal or State laws or policies do not adequately protect the sand verbena moth from endangerment or extinction (Petition, p. 12). In Canada, the sand verbena moth is listed as Endangered under the Species At Risk Act. According to the petitioners (Petition, p. 12), actions that provide protection and recovery of the species are well underway for populations in Canada (BCIRT 2008, pp. 8-9, 12). The petitioners (Petition p. 12) claim the designation of the sand verbena moth as a candidate species by the State of Washington does not provide protection for the sand verbena moth. The petitioners further state (Petition, p. 12) that the sand verbena moth is included in the State of Washington's Priority Habitat and Species (PHS) List (WDFW 2008, p. 30). According to the petitioners (Petition, p. 12), the habitats and species included on the PHS List are considered to be priorities for conservation and management, and the PHS List is used to aid in developing management strategies and mapping purposes (WDFW 2008, pp. 1-2).

The petitioners further provide a discussion of the Global, National, and State or Provincial rankings of the sand verbena moth on NatureServe (Petition, p. 12). However, we note the NatureServe rankings are not regulatory in nature and thus are not relevant to Factor D under the Act.

Information provided by the petitioners suggests existing regulatory mechanisms in Canada are adequate for the conservation of the species (Petition, p. 12). Within its range in the United States, the sand verbena moth populations in Washington occur primarily on public lands. Under Federal regulations, the collection of living or dead wildlife, fish, or plants, or the parts or products thereof, is prohibited on lands under National Park Service and National Wildlife Refuge jurisdiction without a permit (36 CFR 2.1(a)(1)(i) and (a)(1)(ii)). Similar regulations exist on Washington State lands (WAC section 232-12-064). Additional protection is provided to sand verbena moth habitat and therefore the sand verbena moth at Dungeness NWR. Yellow sand verbena is distributed in a research natural area there that is closed to the public (Thomas 2010, pers. comm.).

The petitioners do not identify any threats presumably impacting the sand verbena moth that are inadequately controlled by existing regulatory mechanisms within its range in the United States. The petitioners have not provided any information, nor do we find any available in our files, to suggest that existing regulatory mechanisms in Washington are inadequate to protect the sand verbena moth from any specific factors that may threaten its continued existence.

Within the framework of a 90-day finding we are not required to conduct a far-reaching assessment of the adequacy of existing regulatory mechanisms for the sand verbena moth, and neither the information presented in the petition nor in our files supports this factor as a threat to the sand verbena moth. We find the petition did not present, nor could we locate in our files, substantial scientific or commercial information to indicate that the lack of regulatory mechanisms may be a factor threatening the continued existence of the sand verbena moth throughout its range such that the petitioned action may be warranted.

According to the petitioners, the use of insecticides such asBacillus thuringiensisvar.kurstaki(Btk) near sand verbena moth locations can harm the sand verbena moth (Petition, p. 14, citing BCIRT 2008, p. 7). Btk is typically applied from early April to early May to control gypsy moths,Lymantria dispar.The petitioners state that spraying would overlap with the larval feeding period of sand verbena moth and wouldresult in high mortalities (Petition, p. 14).

Gypsy moths attack conifers and broadleaf trees (Boersmaet al.2006, p. 126), habitat the sand verbena moth is not known to occupy. In fact, between 1974 and 2009, only 15 gypsy moths have been collected in the three Washington counties where the sand verbena moth is currently known to occur (Washington Department of Agriculture 2009, [online]). To date, Btk has never been sprayed near sand verbena moth populations, but is named as a potential threat by BCIRT (2008, p. 7).

While we agree that use of insecticides such as Btk near sand verbena moth populations would potentially have a negative effect on the species, at this time we have no evidence that such usage is likely to occur, since Btk is utilized in forested environments and the sand verbena moth inhabits coastal dunes. We have no information available in our files, and the petitioners have offered none, that supports the claim that the threat of insecticides may rise to the level of acting as a significant limiting factor to the sand verbena moth throughout its range.

Based on the above evaluation, we find the petition did not present, nor could we locate in our files, substantial scientific or commercial information to indicate that insecticides may be a threat to the sand verbena moth such that the petitioned action may be warranted.

According to the petitioners (Petition, p. 14), chemical control of European beachgrass is the most cost-effective method for, and may be the most common approach to, its eradication (Pickart 1997, p. 6). The petitioners (Petition, p. 14) suggest the Service consider whether mechanical, chemical, or manual means used to control European beachgrass may have an adverse effect on yellow sand verbena and therefore the sand verbena moth. However, they offer no supporting evidence in support of the argument that these control methods may impact yellow sand verbena.

Neither COSEWIC (2003), nor BCIRT (2008), nor NatureServe (2009, [online]; 2010, [online]) identify herbicides as being a threat to yellow sand verbena and therefore the sand verbena moth. The petitioners did not provide any information, nor could we locate any in our files, that documents specific methods in which beachgrass is controlled at any of the known sand verbena moth locations. Yellow sand verbena, distributed throughout Graveyard Spit in Dungeness National Wildlife Refuge, is located in a research natural area and supports a relatively intact native strand community (Thomas 2010, pers. comm.); efforts to control beachgrass at this sand verbena moth location using herbicides are not planned. Although not a current sand verbena moth location, efforts to restore dune habitat at Willapa NWR involve a variety of mechanical, manual, and chemical means (Ritchie 2009, p. 2). As a result of these actions, a self-sustaining pink sand verbena (Abronia umbellata) population now exists on the refuge (Ritchie 2009, p. 4). Since yellow sand verbena may be outcompeted by beachgrass and may not occur in established beachgrass zones (Lewis 2006, unnumbered p. 3), the long-term positive effects of habitat restoration through control of beachgrass, regardless of means, is likely to significantly outweigh any short-term impacts that may occur to yellow sand verbena, and therefore the sand verbena moth.

Based on the above evaluation, we find the petition did not present, nor could we locate in our files, substantial scientific or commercial information to indicate that herbicides may be a threat to the sand verbena moth such that the petitioned action may be warranted.

The petitioners state the sand verbena moth's dependence on yellow sand verbena is a biologically limiting factor (BCIRT 2008, pp. 5-6) that may compound any threats to the species (Petition, p. 14). According to the petitioners, the sand verbena moth's small population size, restricted range, and vulnerability to weather events may increase the likelihood of its extinction. The petitioners go on to say that the sand verbena moth's narrow range should be considered a threat to the species (Petition, p. 15).

We acknowledge that small population size and restricted range increases the vulnerability of a species to extinction and that complete dependence on one host plant is a potentially limiting factor for the sand verbena moth. However, not all species with limited ranges and small population sizes warrant listing under the Act (seeour 12-month finding on a petition to list the island marble butterfly (Euchloe ausonides insulanus) as threatened or endangered at 71 FR 66292; November 14, 2006), and to date, the global population size, distribution, and status of the sand verbena moth is uncertain. According to NatureServe (2009, [online]), “distribution data for U.S. states and Canadian provinces is known to be incomplete or has not been reviewed for this taxon.” In addition, Troubridge and Crabo note the sand verbena moth may have a limited distribution, “* * * although it could also be an artifact of lack of collecting in suitable habitats” (Troubridge and Crabo 1995, p. 89). We have evidence of only two surveys that were completed outside of the Puget Sound region. One survey, which was unsuccessful in capturing the sand verbena moth, was conducted by hand-searching patches of yellow sand verbena in Oregon (COSEWIC 2003, p. 9). According to COSEWIC (2003, p. 9), additional sampling in Oregon and California is needed to determine the presence or absence of the sand verbena moth. The petitioners state that surveys conducted on the Long Beach peninsula in Washington were not successful in locating the species (cited as L. Crabo, 2010, pers. comm. in the Petition, p. 7). However, we could not verify or access this information because the petitioners do not have a record of this conversation (Jepsen 2010, pers. comm.).

Based on the available information, the surveys conducted to date are not sufficient to constitute substantial information indicating that the sand verbena moth is distributed over a narrow range. Yellow sand verbena is distributed over approximately 1,500 miles (mi) (2,414 kilometers (km)) of shoreline. To date, 90 percent of the range of the yellow sand verbena has not been surveyed for the sand verbena moth. In 2006, all sandy beaches from the North Jetty of the Columbia River to the tip of Leadbetter Point, approximately 28 mi (45 km), were surveyed for yellow sand verbena (Lewis 2006, unnumbered p. 2). This survey documented the existence of a metapopulation and recruitment of yellow sand verbena (Lewis 2006, unnumbered p. 3). Yellow sand verbena also occurs along the Oregon and California coast, indicating both suitablehabitat and that the sand verbena moth may be present in additional locations as yet unsearched in Washington, Oregon, and California. However, for the purposes of this finding based on the assessments of NatureServe (2009, [online]) and COSEWIC (2003), we defer to their expert opinion that the sand verbena moth currently has a narrow known range.

BCIRT (2008, p. 8) identifies small and isolated populations as biological limiting factors for the sand verbena moth. In addition, BCIRT states that the sand verbena moth's dependence on a single host plant may increase its risk of extinction. However, both of these factors are not specifically identified as threats to the species. Many species have limited distributions or small population sizes, but these two factors alone (i.e., rarity), without additional information regarding threats, do not meet the substantial information threshold indicating that the species may warrant listing. Information indicating whether the range or abundance of a species has been significantly curtailed helps us assess whether the species has always been rare, or if it was once more widespread and has been reduced in response to threats.

Based on the above evaluation, we find the petition did not present, nor could we locate in our files, substantial scientific or commercial information to indicate that inherent biological vulnerability may be a threat to the sand verbena moth such that the petitioned action may be warranted.

The petitioners (Petition, p. 14) state that human population growth in the Puget Sound region has been more than twice that of the U.S. national average for the past 50 years (Moteet al.2005, p. 3). According to the petitioners, the population growth has caused degradation to the Puget Sound Region that includes conversion of natural habitat, armoring of the shoreline with riprap and concrete, spread of nonnative plants, and an increase in recreational use of coastal dune habitats (Petition, p. 14).

These factors relating to habitat and recreational use have been addressed under Factor A, The Present or Threatened Destruction, Modification, or Curtailment of Its Habitat or Range, as they relate to the sand verbena moth and its host plant, yellow sand verbena.

Based on our evaluation of the information submitted by the petitioners and available in our files, we did not find evidence suggesting that insecticides, herbicides, or inherent biological vulnerability may pose a significant threat to the sand verbena moth. With regard to inherent biological vulnerability, in particular, we note that many species have limited distributions or small population sizes, but we do not consider these two factors alone (i.e.,rarity) to meet the substantial information threshold indicating that the species may warrant listing without additional information regarding threats. In the absence of information identifying threats to the species, and linking those threats to the rarity of the species, we do not consider rarity itself to be a threat. Therefore, we find the petition does not present substantial scientific or commercial information indicating that other natural or manmade factors may affect the continued existence of the sand verbena moth such that the petitioned action may by warranted.

According to the petitioners (Petition, p. 15), the Service should consider whether the aforementioned threats intersect and act synergistically to increase the likelihood of extinction or endangerment of the sand verbena moth.

We have no information in our files, nor was any presented in the petition, that suggests these threats, acting synergistically or collectively, are likely to threaten the continued existence of the sand verbena moth. However, as noted under our Summary of Factor A, we find the questions raised by the petitioners regarding the possible impacts of dune stabilization and habitat conversion are sufficient to meet our “substantial information” standard for a positive 90-day finding under our implementing regulations (50 CFR 424.14(b)).

On the basis of our evaluation of the information presented under section 4(b)(3)(A) of the Act, we find that the petition presents substantial scientific or commercial information indicating that listing the sand verbena moth may be warranted based on potential threats posed under Factor A, The Present or Threatened Destruction, Modification, or Curtailment of Its Habitat or Range. Specifically, we find that dune stabilization and habitat conversion may pose a threat to the sand verbena moth throughout all or a significant portion of its range such that the petitioned action may be warranted. Because we find the petition presents substantial information indicating that listing the sand verbena moth throughout its range may be warranted, we are initiating a status review to determine whether listing the sand verbena moth under the Act is warranted.

The “substantial information” standard for a 90-day finding differs from the Act's “best scientific and commercial data” standard that applies to a status review to determine whether a petitioned action is warranted. A 90-day finding does not constitute a status review under the Act. In a 12-month finding, we will determine whether the petitioned action is warranted after we have completed a thorough status review of the species, which is conducted following a substantial 90-day finding. Because the Act's standards for 90-day and 12-month findings are different, as described above, a substantial 90-day finding does not mean that the 12-month finding will result in a warranted finding.

A complete list of references cited is available on the Internet athttp://www.regulations.govand upon request from the Washington Fish and Wildlife Office (see FOR FURTHER INFORMATION CONTACT).

The primary authors of this notice are the staff members of the Washington Fish and Wildlife Office (see FOR FURTHER INFORMATION CONTACT).

The authority for this action is the Endangered Species Act of 1973, as amended (16 U.S.C. 1531et seq.).