We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under theADDRESSESsection. Include “Docket No. FAA-2011-0816; Directorate Identifier 2011-CE-022-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD because of those comments.

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

The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Community, has issued EASA AD No.: 2011-0063-E, dated April 6, 2011 (referred to after this as “the MCAI”), to correct an unsafe condition for the specified products. The MCAI states:

Costruzioni Aeronautiche Tecnam has issued Service Bulletin No. SB 047-CS, Revision 1, dated April 4, 2011. The actions described in this service information are intended to correct the unsafe condition identified in the MCAI.

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

We have reviewed the MCAI and related service information and, in general, agree with their substance. But we might have found it necessary to use different words from those in the MCAI to ensure the AD is clear for U.S. operators and is enforceable. In making these changes, we do not intend to differ substantively from the information provided in the MCAI and related service information.

We might also have proposed different actions in this AD from those in the MCAI in order to follow FAA policies. Any such differences are highlighted in a NOTE within the proposed AD.

We estimate that this proposed AD will affect 3 products of U.S. registry. We also estimate that it would take about 1 work-hour per product to comply with the basic requirements of this proposed AD. The average labor rate is $85 per work-hour.

Based on these figures, we estimate the cost of the proposed AD on U.S. operators to be $255, or $85 per product.

In addition, we estimate that any necessary follow-on actions would take about 1 work-hour and require parts costing $800, for a cost of $885 per product. We have no way of determining the number of products that may need these actions.

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

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

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

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

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

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

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

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

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

We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under theADDRESSESsection. Include “Docket No. FAA-2011-0811; Directorate Identifier 2011-CE-026-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD because of those comments.

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

The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Community, has issued AD No. 2011-0110, dated June 16, 2011 (referred to after this as “the MCAI”), to correct an unsafe condition for the specified products. The MCAI states:

Diamond Aircraft Industries GmbH has issued Service Bulletin No. MSB 36-105/1, dated May 2, 2011, and Work Instruction WI-MSB 36-105, dated April 21, 2011. The actions described in this service information are intended to correct the unsafe condition identified in the MCAI.

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

We have reviewed the MCAI and related service information and, in general, agree with their substance. But we might have found it necessary to use different words from those in the MCAI to ensure the AD is clear for U.S. operators and is enforceable. In making these changes, we do not intend to differ substantively from the information provided in the MCAI and related service information.

We might also have proposed different actions in this AD from those in the MCAI in order to follow FAA policies. Any such differences are highlighted in a NOTE within the proposed AD.

We estimate that this proposed AD will affect 9 products of U.S. registry. We also estimate that it would take about 4.5 work-hours per product to comply with the basic requirements of this proposed AD. The average labor rate is $85 per work-hour. Required parts would cost about $172 per product.

Based on these figures, we estimate the cost of the proposed AD on U.S. operators to be $4,990.50, or $554.50 per product.

In addition, we estimate that any necessary follow-on actions would take about 5 work-hours and require parts costing $275, for a cost of $700 per product. We have no way of determining the number of products that may need these actions.

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

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

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

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

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

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

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

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

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

Comments Invited

We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under theADDRESSESsection. Include “Docket No. FAA-2011-0723; Directorate Identifier 2010-NM-080-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD because of those comments.

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

On December 5, 1995, we issued AD 95-20-04 R1, Amendment 39-9454 (60 FR 63414, December 11, 1995), for all Lockheed Model L-1011-385-1 series airplanes. That AD requires implementation of a Supplemental Inspection Document (SID) program of structural inspections to detect fatigue cracking, and repair, if necessary, to ensure continued airworthiness of these airplanes as they approach the manufacturer's original fatigue design life goal. That AD resulted from a structural re-evaluation by the manufacturer that identified certain structural details where fatigue damage is likely to occur. We issued that AD to prevent fatigue cracking that could compromise the structural integrity of these airplanes.

Since we issued AD 95-20-04 R1, an evaluation by the manufacturer of usage and flight data provided additional information about certain SSDs where fatigue damage is likely to occur. Therefore, this proposed AD changes certain inspection thresholds and intervals for Model L-1011-385-1, L-1011-385-1-14, and L-1011-385-1-15 airplanes, adds three new SSDs, and removes an SSD that has been addressed by AD 99-08-20, amendment 39-11128 (64 FR 18324, April 14, 1999). AD 99-08-20 requires repetitive inspections to detect cracking of the bulkhead web and cap at fuselage station 1363, and repair if necessary.

When we issued AD 95-20-04 R1, Model L-1011-385-3 airplanes were not included in the applicability. These long-range airplanes flew less frequently and were neither imminently approaching nor had exceeded the manufacturer's original fatigue design life goal. In the NPRM for AD 95-20-04, Amendment 39-9382 (60 FR 51713, October 3, 1995) we stated that as these airplanes accumulated more hours time-in-service, and as the critical area selection was developed and identified, we anticipated that these airplanes would be addressed in future rulemaking actions. We now have determined that further rulemaking is indeed necessary for these airplanes, and we have added them to the applicability of this proposed AD.

We reviewed Lockheed Document Number LG92ER0060, “L-1011-385 Series Supplemental Inspection Document,” revised April 2009 (hereafter referred to as “the Lockheed Document”). The Lockheed Document describes procedures for supplemental inspections of SSDs for all Model L-1011 series airplanes. The Lockheed Document identifies SSDs in fuselage, stabilizer, and wing-critical areas. The Lockheed Document changes certain inspection thresholds, adds Model L-1011-353-3 airplanes to the effectivity, adds SSDs 57-3-10, 57-3-11, 57-4-1C, and removes SSD 53-4-3. The Lockheed Document also specifies that operators submit the results of these inspections to Lockheed.

We are proposing this AD because we evaluated all the relevant information and determined the unsafe condition described previously is likely to exist or develop in other products of the same type design.

This proposed AD would retain all requirements of AD 95-20-04 R1. This proposed AD would add Model L-1011-385-3 airplanes to the applicability, change certain inspection thresholds and intervals for Model L-1011-385-1, L-1011-385-1-14, and L-1011-385-1-15 airplanes, add three new SSDs for Model L-1011-385-3 airplanes, and remove an SSD that has been addressed by a different AD action. This proposed AD would also require accomplishing the actions specified in the service information described previously. This proposed AD would also require sending the inspection results to the manufacturer.

This proposed AD would retain all requirements of AD 95-20-04 R1. Since AD 95-20-04 R1 was issued, the AD format has been revised, and certain paragraphs have been rearranged. As a result, the corresponding paragraph identifiers have changed in this proposed AD, as listed in the following table:

We estimate that this proposed AD affects 26 airplanes of U.S. registry.

We estimate the following costs to comply with this proposed AD:

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

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

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

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

(1) Is not a “significant regulatory action” under Executive Order 12866,

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

(3) Will not affect intrastate aviation in Alaska, and

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

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

On December 29, 2009, we published a final rule requiring manufacturers of durable infant or toddler products to: (1) Provide with each product a postage-paid consumer registration form; (2) keep records of consumers who register such products with the manufacturer; and (3) permanently place the manufacturer's name and contact information, model name and number, and the date of manufacture on each such product. 74 FR 68668. The rule specified formatting and text requirements for the registration forms. Subsequently, we published a correction notice on February 22, 2010. 75 FR 7550. Since December 29, 2010, registration forms have been required for all durable infant or toddler products covered by the rule.

Some manufacturers and testing laboratories have brought to our attention the need to clarify or correct certain aspects of the rule. We are proposing this amendment for that purpose.

We note that, although manufacturers of durable infant or toddler products must comply with the registration requirements, they are not required to have a third party testing laboratory “test” their product's compliance with the registration requirements.

The rule specifies requirements for the format of registration forms in § 1130.6 and requirements for the text of registration forms in § 1130.7. Given the geometry of the registration forms, which have four surfaces (front, back, top, and bottom), we believe that it is confusing to explain the requirements in this way. Therefore, the proposed amendment would eliminate this framework, essentially collapsing the requirements from §§ 1130.6 and 1130.7 into one section and clarifying them. Proposed § 1130.6 would describe the registration form more clearly, moving logically from the front top of the formto the front bottom of the form, to the back top of the form, and ending with the back bottom of the form. We believe that structuring the requirements this way will also align the text more closely with the illustration of the registration form in Figures 1 and 2. We are not eliminating any of the requirements for the registration forms but proposing to organize the requirements more clearly.

Restructuring the rule would require several corresponding changes. For example, the proposed rule would, in essence, combine the existing §§ 1130.6 and 1130.7 into a revised § 1130.6. The proposal would then renumber existing §§ 1130.8 and 1130.9 as §§ 1130.7 and 1130.8 respectively. Thus, any other sections in part 1130 that refer to §§ 1130.6 through 1130.9 (such as § 1130.3(a)(2), which refers to § 1130.9) would, themselves, need to be amended to reflect the renumbered sections.

Currently, § 1130.6(c) requires that registration forms use 12-point and 10-point type. Manufacturers and testing labs have reported confusion concerning the physical size required for the type. The dictionary defines a “point” as 1/72 of an inch. However, according to font charts, font sizes used in printing do not follow this formula and are actually smaller than this measurement.

To settle this confusion, the proposed amendment would specify the physical measurement of the type, rather than refer to “point.” For example, instead of requiring “12-point” type, the proposed amendment would require “0.12-inch (3.0 mm) type.” This change would be made in proposed § 1130.6(b)(2).

The rule requires firms to provide a form at least the size of two standard postcards connected together by a perforated line so that the two portions can be separated. The consumer retains the top portion which contains a statement of the purpose of the card and the manufacturer's contact information. According to several manufacturers, consumers have been confused about what they need to return to the manufacturer, and some consumers have been sending in the entire form or the top portion of the form only.

Currently, § 1130.7(b) requires that the back of the top portion of the form state the manufacturer's name and contact information (a U.S. mailing address, a telephone number, toll-free, if available), among other things. The example shown in Figure 1 of the rule shows this information to be center justified, which makes this look like a mailing address.

To resolve this confusion, proposed § 1130.6(d)(1)(i) would specify that the manufacturer's name and contact information on the top portion of the form is to be stated in sentence format and appear underneath the heading: “Manufacturer's Contact Information.”In Figure 2 of the proposed amendment, the order of the manufacturer's contact information and the model name, model number, and manufacture date would be reversed from the order in the original Figure 2. This would place the manufacturer's contact information on top and further decrease the likelihood that a consumer would return the top part of the form.

In addition, proposed § 1130.6(d)(1)(ii) would add a new provision requiring that just above the perforation line, each form must state in capital letters: “KEEP THIS TOP PART FOR YOUR RECORDS. FILL OUT AND RETURN BOTTOM PART.”

Finally, the proposed amendment would revise the wording in the purpose statement to clarify that consumers should mail the bottom part of the form. Currently, § 1130.7(a) and Figure 1 state: “please complete and mail this card.” Proposed § 1130.6(c)(1) and proposed Figure 1 would state: “please complete and mail the bottom part of this card.”

Currently, § 1130.7(d), as corrected in February 2010, requires that the bottom back portion of the form state the manufacturer's name with the product information. However, the illustration in Figure 2 of the rule does not show the manufacturer's name in this location. Some manufacturers have pointed out that there is limited space on this part of the form, and they have suggested that omitting the manufacturer's name would allow more space for the consumer's information. Others have indicated that the manufacturer's name may be useful on the back of the form when they use a third party to process the registration cards. Because the front of the bottom portion of the form will always have the manufacturer's name even when they use a third party to process the card, we believe it is not necessary to include the manufacturer's name at this location of the form. However, the Commission will allow a manufacturer to include its name on the back portion of the card if it wants to do so and further seeks comments on whether some additional latitude is necessary to assist firms using a third party vendor to process their registration cards.

Proposed § 1130.6(d)(2) would omit the requirement, currently in § 1130.7(d), that the manufacturer's name be stated along with the product information at the back bottom portion of the form. It would continue to allow a manufacturer to include its name on the card should it choose to do so.

Currently, § 1130.6(b)(3) requires that the registration form be pre-addressed “with the manufacturer's name and mailing address where registration information is to be collected.” As discussed in the preamble to the final rule (74 FR at 68670), a manufacturer is allowed to contract with a third party who would be responsible for maintaining the registration information. Some manufacturers have asked whether the third party's name could appear in the mailing information on the form in these circumstances.

Proposed § 1130.6(c)(2) would specify that, if a manufacturer uses a third party to process the registration forms, the third party's name may be included as a “c/o” on the form.

Several manufacturers have asked whether the consumer registration information they receive must be maintained at a location in the United States. The rule does not specifically address this issue.

Because so much data and information is kept electronically and can be retrieved quickly, we do not believe it is necessary to require that registration information be maintained in the United States. However, manufacturers must be able to access the information when requested. Therefore, proposed § 1130.8(d) would state that registration records shall be made available within 24 hours of a request by CPSC.

Currently, § 1130.7(a) provides, in part, that: “The front top portion of each form shall state ‘PRODUCT REGISTRATION FOR SAFETY ALERT OR RECALL. We will use the information provided on this card to contact you only if there is a safety alert or recall for this product. We will notsell, rent, or share your personal information. To register your product, please complete and mail this card or visit our online registration athttp://www.websitename.com.’” There are two discrepancies between the wording of the text and the illustration in Figure 1.

To make the text and Figure 1 consistent, proposed § 1130.6(c)(1) would make two changes to the text. The word “ONLY” would be added at the end of the first sentence, and “http//” would be deleted from the Web site name.

This proposed amendment would clarify and correct several provisions of the consumer registration rule. It would not alter the substantive requirements of the existing rule. We recognize that manufacturers may have an existing inventory of registration forms. Because the proposed changes to the forms are minor and would not affect safety, we believe that it is appropriate to allow sufficient time for manufacturers to use their existing stock of registration forms before they must meet the amended requirements. Thus, we propose that this amendment would take effect 12 months after publication of a final rule. Until the proposed amendment takes effect, we would consider registration forms that meet either the existing rule or the proposed amendment to be in compliance.

The Regulatory Flexibility Act (“RFA”) generally requires that agencies review proposed rules for their potential economic impact on small entities, including small businesses. However, section 104(d)(1) of the CPSIA removes this requirement for the rule implementing the CPSIA's consumer registration provision. Consequently, no regulatory flexibility analysis or certification is necessary for this proposed amendment clarifying and correcting the consumer registration rule. Moreover, the proposed changes are minor and would not alter the impact that the registration rule has on small entities.

Section 104(d)(1) of the CPSIA also excludes the consumer registration rule from requirements of the Paperwork Reduction Act, 44 U.S.C. sections 3501 through 3520. Consequently, no Paperwork Reduction Act analysis is necessary for this proposed amendment clarifying and correcting the consumer registration rule. Moreover, the proposed changes are minor and would not alter any collection of information required under the registration rule.

The Commission's regulations provide a categorical exemption for the Commission's rules from any requirement to prepare an environmental assessment or an environmental impact statement as they “have little or no potential for affecting the human environment.” 16 CFR 1021.5(c)(2). This proposed amendment falls within the categorical exemption.

Accordingly, we propose to amend 16 CFR part 1130 as follows:

The Federal Food, Drug, and Cosmetic Act (the FD&C Act), as amended by the Medical Device Amendments of 1976 (the 1976 amendments) (Pub. L. 94-295), the Safe Medical Devices Act of 1990 (the SMDA) (Pub. L. 101-629), and the Food and Drug Administration Modernization Act of 1997 (FDAMA) (Pub. L. 105-115), the Medical Device User Fee and Modernization Act of 2002 (Pub. L. 107-250), the Medical Devices Technical Corrections Act (Pub. L. 108-214), and the Food and Drug Administration Amendments Act of 2007 (Pub. L. 110-85), establish a comprehensive system for the regulation of medical devices intended for human use. Section 513 of the FD&C Act (21 U.S.C. 360c) established three categories (classes) of devices, reflecting the regulatory controls needed to provide reasonable assurance of their safety and effectiveness. The three categories of devices are class I (general controls), class II (special controls), and class III (premarket approval).

Under section 513 of the FD&C Act, devices that were in commercial distribution before the enactment of the 1976 amendments, May 28, 1976 (generally referred to as preamendments devices), are classified after FDA has: (1) Received a recommendation from a device classification panel (an FDA advisory committee); (2) published the panel's recommendation for comment, along with a proposed regulation classifying the device; and (3) published a final regulation classifying the device. FDA has classified most preamendments devices under these procedures.

Devices that were not in commercial distribution prior to May 28, 1976 (generally referred to as postamendments devices), are automatically classified by section 513(f) of the FD&C Act into class III without any FDA rulemaking process. Those devices remain in class III and require premarket approval unless and until the device is reclassified into class I or II or FDA issues an order finding the device to be substantially equivalent, in accordance with section 513(i) of the FD&C Act, to a predicate device that does not require premarket approval. The Agency determines whether new devices are substantially equivalent to predicate devices by means of premarket notification procedures in section 510(k) of the FD&C Act (21 U.S.C. 360(k)) and 21 CFR part 807.

A preamendments device that has been classified into class III may be marketed by means of premarket notification procedures (510(k) process) without submission of a PMA until FDA issues a final regulation under section 515(b) of the FD&C Act (21 U.S.C. 360e(b)) requiring premarket approval. Section 515(b)(1) of the FD&C Act (21 U.S.C. 360e(b)(1)) establishes the requirement that a preamendments device that FDA has classified into class III is subject to premarket approval. A preamendments class III device may be commercially distributed without an approved PMA or a notice of completion of a PDP until 90 days after FDA issues a final rule requiring premarket approval for the device, or 30 months after final classification of the device under section 513 of the FD&C Act, whichever is later. Also, a preamendments device subject to the rulemaking procedure under section 515(b) of the FD&C Act is not required to have an approved investigationaldevice exemption (IDE) (see 21 CFR part 812) contemporaneous with its interstate distribution until the date identified by FDA in the final rule requiring the submission of a PMA for the device. At that time, an IDE is required only if a PMA has not been submitted or a PDP completed.

Section 515(b)(2)(A) of the FD&C Act provides that a proceeding to issue a final rule to require premarket approval shall be initiated by publication of a notice of proposed rulemaking containing: (1) The regulation; (2) proposed findings with respect to the degree of risk of illness or injury designed to be eliminated or reduced by requiring the device to have an approved PMA or a declared completed PDP and the benefit to the public from the use of the device; (3) an opportunity for the submission of comments on the proposed rule and the proposed findings; and (4) an opportunity to request a change in the classification of the device based on new information relevant to the classification of the device.

Section 515(b)(2)(B) of the FD&C Act provides that if FDA receives a request for a change in the classification of the device within 15 days of the publication of the notice, FDA shall, within 60 days of the publication of the notice, consult with the appropriate FDA advisory committee and publish a notice denying the request for change in reclassification or announcing its intent to initiate a proceeding to reclassify the device under section 513(e) of the FD&C Act. Section 515(b)(3) of the FD&C Act provides that FDA shall, after the close of the comment period on the proposed rule and consideration of any comments received, issue a final rule to require premarket approval or publish a document terminating the proceeding together with the reasons for such termination. If FDA terminates the proceeding, FDA is required to initiate reclassification of the device under section 513(e) of the FD&C Act, unless the reason for termination is that the device is a banned device under section 516 of the FD&C Act (21 U.S.C. 360f).

If a proposed rule to require premarket approval for a preamendments device is finalized, section 501(f)(2)(B) of the FD&C Act (21 U.S.C. 351(f)(2)(B)) requires that a PMA or notice of completion of a PDP for any such device be filed within 90 days of the date of issuance of the final rule or 30 months after the final classification of the device under section 513 of the FD&C Act, whichever is later. If a PMA or notice of completion of a PDP is not filed by the later of the two dates, commercial distribution of the device is required to cease since the device would be deemed adulterated under section 501(f) of the FD&C Act.

The device may, however, be distributed for investigational use if the manufacturer, importer, or other sponsor of the device complies with the IDE regulations. If a PMA or notice of completion of a PDP is not filed by the later of the two dates, and the device does not comply with IDE regulations, the device is deemed to be adulterated within the meaning of section 501(f)(1)(A) of the FD&C Act, and subject to seizure and condemnation under section 304 of the FD&C Act (21 U.S.C. 334) if its distribution continues. Shipment of devices in interstate commerce will be subject to injunction under section 302 of the FD&C Act (21 U.S.C. 332), and the individuals responsible for such shipment will be subject to prosecution under section 303 of the FD&C Act (21 U.S.C. 333). In the past, FDA has requested that manufacturers take action to prevent the further use of devices for which no PMA or PDP has been filed and may determine that such a request is appropriate for the class III device that is the subject of this regulation.

The FD&C Act does not permit an extension of the 90-day period after issuance of a final rule within which an application or a notice is required to be filed. The House Report on the 1976 amendments states that: “[t]he thirty month grace period afforded after classification of a device into class III * * * is sufficient time for manufacturers and importers to develop the data and conduct the investigations necessary to support an application for premarket approval (H. Rept. 94-853, 94th Cong., 2d sess. 42 (1976)).”

The SMDA added section 515(i) to the FD&C Act requiring FDA to review the classification of preamendments class III devices for which no final rule requiring the submission of PMAs has been issued, and to determine whether or not each device should be reclassified into class I or class II or remain in class III. For devices remaining in class III, the SMDA directed FDA to develop a schedule for issuing regulations to require premarket approval. The SMDA does not, however, prevent FDA from proceeding immediately to rulemaking under section 515(b) of the FD&C Act on specific devices, in the interest of public health, independent of the procedures of section 515(i). Proceeding directly to rulemaking under section 515(b) of the FD&C Act is consistent with Congress' objective in enacting section 515(i), i.e., that preamendments class III devices for which PMAs have not been previously required either be reclassified to class I or class II or be subject to the requirements of premarket approval. Moreover, in this proposal, interested persons are being offered the opportunity to request reclassification of the device.

In accordance with section 515(b) of the FD&C Act, FDA is proposing to require that a PMA or a notice of completion of a PDP be filed with the Agency for class III devices within 90 days after issuance of any final rule based on this proposal. An applicant whose device was legally in commercial distribution before May 28, 1976, or whose device has been found to be substantially equivalent to such a device, will be permitted to continue marketing such class III devices during FDA's review of the PMA or notice of completion of the PDP. FDA intends to review any PMA for the device within 180 days, and any notice of completion of a PDP for the device within 90 days of the date of filing. FDA cautions that under section 515(d)(1)(B)(i) of the FD&C Act, the Agency may not enter into an agreement to extend the review period for a PMA beyond 180 days unless the Agency finds that “the continued availability of the device is necessary for the public health.”

FDA intends that under § 812.2(d), the preamble to any final rule based on this proposal will state that, as of the date on which the filing of a PMA or a notice of completion of a PDP is required to be filed, the exemptions from the requirements of the IDE regulations for preamendments class III devices in § 812.2(c)(1) and (c)(2) will cease to apply to any device that is: (1) Not legally on the market on or before that date, or (2) legally on the market on or before that date but for which a PMA or notice of completion of a PDP is not filed by that date, or for which PMA approval has been denied or withdrawn.

If a PMA or notice of completion of a PDP for a class III device is not filed with FDA within 90 days after the date of issuance of any final rule requiring premarket approval for the device, commercial distribution of the device must cease. The device may be distributed for investigational use only if the requirements of the IDE regulations are met. The requirements for significant risk devices include submitting an IDE application to FDA for its review and approval. An approved IDE is required to be in effect before an investigation of the device may be initiated or continued under § 812.30. FDA, therefore, cautions that IDE applications should be submitted to FDA at least 30 days before the end ofthe 90-day period after the issuance of the final rule to avoid interrupting investigations.

As required by section 515(b) of the FD&C Act, FDA is publishing its proposed findings regarding: (1) The degree of risk of illness or injury designed to be eliminated or reduced by requiring that this device have an approved PMA or a declared completed PDP, and (2) the benefits to the public from the use of the device.

These findings are based on the reports and recommendations of the advisory committee (panel) for the classification of this device along with information submitted in response to the 515(i) order (74 FR 16214, April 9, 2009) and any additional information that FDA has encountered. Additional information regarding the risks as well as classification associated with this device type can be found in the following proposed and final rules and notices published in theFederal Registeron these dates: (45 FR 7907 at 7971, February 5, 1980; 52 FR 17736, May 11, 1987; and 60 FR 41986, August 14, 1995).

Cardiovascular Permanent or Temporary Pacemaker Electrode; Permanent Pacemaker Electrode (21 CFR 870.3680(b)).

A permanent pacemaker electrode is a device consisting of flexible insulated electrical conductors with one end connected to an implantable pacemaker pulse generator and the other end applied to the heart. The device is used to transmit a pacing electrical stimulus from the pulse generator to the heart and/or to transmit the electrical signal of the heart to the pulse generator.

The Cardiovascular Devices Classification Panel recommended that this device be classified into class III as permanent pacemaker electrodes are permanent implants providing life-supporting or life-sustaining therapy. Over time, the devices that have been designed and developed have evolved and are widely variable from model to model as well as from manufacturer to manufacturer. These designs are generally more complex and of smaller sizes which may increase risk of failure and introduce new failure modes. Accordingly, this has limited the ability to develop comprehensive performance standards which would apply to all aspects of pacemaker lead design, testing, and use. Adequate performance standards have not yet been developed. The potential safety and effectiveness risks, unsuitability of general and special controls, long-term use as permanent implants of life-sustaining therapy, and documented field failures warrant classification of this device as class III.

• Material risks.The material properties of pacemaker leads, including mechanical, electrical, biostability, biocompatibility, corrosion and other characteristics can affect acute and chronic performance.

• Design risks.Lead designs may introduce features or geometries that depart from traditional designs, geometries, or sizes and which may result in degradation of performance and safety of use.

• Manufacturing risks.Manufacturing variation, the introduction of more complex and smaller designs, or quality system failures may introduce device defects that may not be identified with bench testing or acute in vivo studies.

• Clinical-use risks.Thromboembolism, perforation, tissue reaction (exit block), dislodgement, infection, air embolism, muscle/nerve stimulation, stenosis, and erosion/extrusion may occur as a result of the clinical use and/or device malfunction.

A PMA for this device must include the information required by section 515(c)(1) of the FD&C Act. Such a PMA should also include a detailed discussion of the risks identified previously, as well as a discussion of the effectiveness of the device for which premarket approval is sought. In addition, a PMA must include all data and information on: (1) Any risks known, or that should be reasonably known, to the applicant that have not been identified in this document; (2) the effectiveness of the device that is the subject of the application; and (3) full reports of all preclinical and clinical information from investigations on the safety and effectiveness of the device for which premarket approval is sought.

A PMA must include valid scientific evidence to demonstrate reasonable assurance of the safety and effectiveness of the device for its intended use (see § 860.7(c)(2) (21 CFR 860.7(c)(2)). Valid scientific evidence is “evidence from well-controlled investigations, partially controlled studies, studies and objective trials without matched controls, well-documented case histories conducted by qualified experts, and reports of significant human experience with a marketed device, from which it can fairly and responsibly be concluded by qualified experts that there is reasonable assurance of the safety and effectiveness of a device under its conditions of use. * * * Isolated case reports, random experience, reports lacking sufficient details to permit scientific evaluation, and unsubstantiated opinions are not regarded as valid scientific evidence to show safety or effectiveness.” (§ 860.7(c)(2)).

A PDP for this device may be submitted instead of a PMA, and must follow the procedures outlined in section 515(f) of the FD&C Act. A PDP must provide: (1) A description of the device; (2) preclinical trial information (if any); (3) clinical trial information (if any); (4) a description of the manufacturing and processing of the device; (5) the labeling of the device; and (6) all other relevant information about the device. In addition, the PDP must include progress reports and records of the trials conducted under the protocol on the safety and effectiveness of the device for which the completed PDP is sought.

Before requiring the filing of a PMA or notice of completion of a PDP for a device, FDA is required by section 515(b)(2)(A)(i) through (b)(2)(A)(iv) of the FD&C Act and 21 CFR 860.132 to provide an opportunity for interested persons to request a change in the classification of the device based on new information relevant to the classification. Any proceeding to reclassify the device will be under the authority of section 513(e) of the FD&C Act.

A request for a change in the classification of this device is to be in the form of a reclassification petition containing the information required by § 860.123 (21 CFR 860.123), including new information relevant to the classification of the device.

The Agency advises that to ensure timely filing of any such petition, any request should be submitted to the Division of Dockets Management (seeADDRESSES) and not to the address provided in § 860.123(b)(1). If a timely request for a change in the classification of this device is submitted, the Agency will, within 60 days after receipt of the petition, and after consultation with the appropriate FDA resources, publish an order in theFederal Registerthat either denies the request or gives notice of its intent to initiate a change in theclassification of the device in accordance with section 513(e) of the FD&C Act and § 860.139 (21 CFR 860.130) of the regulations.

The Agency has determined under 21 CFR 25.30(h) that this action is of a type that does not individually or cumulatively have a significant effect on the human environment. Therefore, neither an environmental assessment nor an environmental impact statement is required.

FDA has examined the impacts of the proposed rule under Executive Order 12866, Executive Order 13563, the Regulatory Flexibility Act (5 U.S.C. 601-612), and the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4). Executive Orders 12866 and 13563 direct Agencies to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). The Agency believes that this proposed rule is not a significant regulatory action as defined by Executive Order 12866.

The Regulatory Flexibility Act requires Agencies to analyze regulatory options that would minimize any significant impact of a rule on small entities. Because none of the manufacturers of affected products are small businesses, the Agency proposes to certify that the final rule would not have a significant economic impact on a substantial number of small entities.

Section 202(a) of the Unfunded Mandates Reform Act of 1995 requires that Agencies prepare a written statement, which includes an assessment of anticipated costs and benefits, before proposing “any rule that includes any Federal mandate that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100,000,000 or more (adjusted annually for inflation) in any one year.” The current threshold after adjustment for inflation is $136 million, using the most current (2010) Implicit Price Deflator for the Gross Domestic Product. FDA does not expect this proposed rule to result in any one-year expenditure that would meet or exceed this amount.

Under the proposed rule, FDA would require producers in the cardiovascular permanent pacemaker electrode industry to obtain PMA or establish a PDP before marketing new products. Similarly, producers of cardiovascular permanent pacemaker electrodes that are already on the market would need to submit PMA applications or establish PDPs in order to continue commercial distribution of these products. Based on an analysis of registration and listing data, manufacturer Web sites, and responses to previousFederal Registerrequests for comment; FDA estimates that 5 to 10 manufacturers are marketing approximately 18 to 23 devices that would be affected by this proposed rule. We therefore estimate that the proposed rule would generate between 18 and 23 PMA or PDP submissions. FDA has estimated an upper bound on the cost of PMA at approximately $1,000,000 (see, for example, 73 FR 7501, February 8, 2008), and we assume that the cost of a PDP is roughly equal to that of a PMA; this yields a rule-induced upfront cost of between $18 and $23 million. We lack data with which to estimate how the burden of this cost would be distributed among device manufacturers, patients and insurance providers.

For a new product (i.e.,a cardiovascular permanent pacemaker electrode not currently on the market), the rule-induced cost would be the difference between the cost of preparing and submitting a premarket approval application and the cost of preparing and submitting a 510(k) application. However, FDA has not received any submissions for new devices of the type subject to the proposed rule since August 2004. We expect the recent pattern of zero submissions to continue; therefore, the proposed rule would not generate submission costs on an ongoing basis.

Some producers of devices that are subject to the proposed rule could be dissuaded from seeking approval by the cost of submitting a PMA application or by a low expectation that FDA would grant approval for their products. In these cases, producers would experience a rule-induced cost equal to the foregone expected profit on the withdrawn or withheld cardiovascular permanent pacemaker electrodes, which is necessarily less than the cost of PMA submission (otherwise, the producers in question would not be dissuaded from seeking PMA). Additionally, there would be a welfare loss experienced by consumers who would, in the absence of the proposed rule, use the cardiovascular permanent pacemaker electrodes that would be withdrawn or withheld from the market as a result of the call for PMA or PDP. Due to the lack of sufficient market data, we cannot quantify these consumers' welfare loss. FDA requests comment on this issue and on all methods and results of our cost estimation.

In addition to the cost to industry of preparing and submitting PMAs or PDPs, the proposed rule would impose incremental review costs on FDA. Geiger (2005) (Ref. 1) estimated that, for devices reviewed by FDA's Center for Devices and Radiological Health in 2003 and 2004, review costs averaged $563,000 per PMA. Updated for inflation (using U.S. Department of Commerce, 2011) (Ref. 2) to 2010 dollars, this average review cost becomes $653,000 per PMA. Thus, the proposed rule's review-related costs are expected to be between $11.8 million (18 × $653,000) and $15.0 million (23 × $653,000). A portion of this total would be paid by industry in the form of user fees, with the remainder coming from general revenues. FDA's Data universal numbering system database reveals that the manufacturers affected by this proposed rule have annual revenues over $100 million, so they would not be eligible for small business user fees. The standard user fee is currently set at $236,298 for a premarket application (PMA or PDP) (75 FR 45632 at 45643), so user fees would likely cover $4.3 million (= 18*$236,298) to $5.4 million (= 23*$236,298) of FDA review costs, with the remaining $7.5 to $9.6 million coming from general revenues.

The proposed requirement for premarket approval applications or product development protocols for cardiovascular permanent pacemaker electrodes would produce social benefits equal to the value of the information generated by the safety and effectiveness tests that producers would be required to conduct as part of the PMA or PDP process. Provided first to FDA, this information would eventually assist physicians, patients and insurance providers in making more informed decisions about these devices. FDA expects there to be approximately 18 to 23 PMA or PDP submissions as a result of the proposed rule, but we are unable to quantify the value of information associated with each submission. We request comment on this issue.

This proposed rule refers to previously approved collections of information found in FDA regulations. These collections of information are subject to review by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995(44 U.S.C. 3501-3520). The collections of information in 21 CFR part 812 have been approved under OMB control number 0910-0078; the collections of information in 21 CFR part 807, subpart E have been approved under OMB control number 0910-0120; the collections of information in 21 CFR part 814, subpart B have been approved under OMB control number 0910-0231; and the collections of information under 21 CFR part 801 have been approved under OMB control number 0910-0485.

FDA is proposing that any final rule based on this proposal become effective on the date of its publication in theFederal Registeror at a later date if stated in the final rule.

Interested persons may submit to the Division of Dockets Management (seeADDRESSES), either electronic or written comments regarding this document. It is only necessary to send one set of comments. It is no longer necessary to send two copies of mailed comments. Identify comments with the docket number found in brackets in the heading of this document. Received comments may be seen in the Division of Dockets Management between 9 a.m. and 4 p.m., Monday through Friday.

The following references have been placed on display in the Division of Dockets Management (HFA-305), Food and Drug Administration, 5630 Fishers Lane, Rm. 1061, Rockville, MD 20852, and may be seen by interested persons between 9 a.m. and 4 p.m., Monday through Friday. (FDA has verified the Web site address, but FDA is not responsible for any subsequent changes to the Web site after this document publishes in theFederal Register.)

Therefore, under the Federal Food, Drug, and Cosmetic Act and under authority delegated to the Commissioner of Food and Drugs, it is proposed that 21 CFR part 870 be amended as follows:

The Federal Food, Drug, and Cosmetic Act (the FD&C Act), as amended by the Medical Device Amendments of 1976 (the 1976 amendments) (Pub. L. 94-295), the Safe Medical Devices Act of 1990 (SMDA) (Pub. L. 101-629), and the Food and Drug Administration Modernization Act of 1997 (FDAMA) (Pub. L. 105-115), the Medical Device User Fee and Modernization Act of 2002 (MDUFMA) (Pub. L. 107-250), the Medical Devices Technical Corrections Act (Pub. L. 108-214), and the Food and Drug Administration Amendments Act of 2007 (Pub. L. 110-85), among other amendments, establish a comprehensive system for the regulation of medical devices intended for human use. Section 513 of the FD&C Act (21 U.S.C. 360c) established three categories (classes) of devices, reflecting the regulatory controls needed to provide reasonable assurance of their safety and effectiveness. The three categories of devices are class I (general controls), class II (special controls), and class III (premarket approval).

Under section 513 of the FD&C Act, devices that were in commercial distribution before the enactment of the 1976 amendments, May 28, 1976 (generally referred to as preamendments devices), are classified after FDA has: (1) Received a recommendation from a device classification panel (an FDA advisory committee); (2) published the panel's recommendation for comment, along with a proposed regulation classifying the device; and (3) published a final regulation classifying the device. FDA has classified most preamendments devices under these procedures.

Devices that were not in commercial distribution prior to May 28, 1976 (generally referred to as postamendments devices) are automatically classified by section 513(f) of the FD&C Act into class III without any FDA rulemaking process. Those devices remain in class III and require premarket approval unless, and until, the device is reclassified into class I or II or FDA issues an order finding the device to be substantially equivalent, in accordance with section 513(i) of the FD&C Act, to a predicate device that does not require premarket approval. The Agency determines whether new devices are substantially equivalent to predicate devices by means of premarket notification procedures in section 510(k) of the FD&C Act (21 U.S.C. 360(k)) and 21 CFR part 807.

A preamendments device that has been classified into class III may be marketed by means of premarket notification procedures (510(k) process) without submission of a PMA) until FDA issues a final regulation under section 515(b) of the FD&C Act (21 U.S.C. 360e(b)) requiring premarket approval. Section 515(b)(1) of the FD&C Act establishes the requirement that a preamendments device that FDA has classified into class III is subject to premarket approval. A preamendments class III device may be commercially distributed without an approved PMA or a notice of completion of a PDP until 90 days after FDA issues a final rule requiring premarket approval for the device, or 30 months after final classification of the device under section 513 of the FD&C Act, whichever is later. Also, a preamendments device subject to the rulemaking procedure under section 515(b) of the FD&C Act is not required to have an approved investigational device exemption (IDE) (see part 812 (21 CFR part 812)) contemporaneous with its interstate distribution until the date identified by FDA in the final rule requiring the submission of a PMA for the device. At that time, an IDE is required only if a PMA has not been submitted or a PDP completed.

Section 515(b)(2)(A) of the FD&C Act provides that a proceeding to issue a final rule to require premarket approval shall be initiated by publication of a notice of proposed rulemaking containing: (1) The regulation; (2) proposed findings with respect to the degree of risk of illness or injury designed to be eliminated or reduced by requiring the device to have an approved PMA or a declared completed PDP and the benefit to the public from the use of the device; (3) an opportunity for the submission of comments on the proposed rule and the proposed findings; and (4) an opportunity to request a change in the classification of the device based on new information relevant to the classification of the device.

Section 515(b)(2)(B) of the FD&C Act provides that if FDA receives a request for a change in the classification of the device within 15 days of the publication of the notice, FDA shall, within 60 days of the publication of the notice, consult with the appropriate FDA advisory committee and publish a notice denying the request for change in reclassification or announcing its intent to initiate a proceeding to reclassify the device under section 513(e) of the FD&C Act. Section 515(b)(3) of the FD&C Act provides that FDA shall, after the close of the comment period on the proposed rule and consideration of any comments received, issue a final rule to require premarket approval or publish a document terminating the proceeding together with the reasons for such termination. If FDA terminates the proceeding, FDA is required to initiate reclassification of the device under section 513(e) of the FD&C Act, unless the reason for termination is that the device is a banned device under section 516 of the FD&C Act (21 U.S.C. 360f).

When a proposed rule to require premarket approval for a preamendments device is finalized, section 501(f)(2)(B) of the FD&C Act (21 U.S.C. 351(f)(2)(B)) requires that a PMA or notice of completion of a PDP for any such device be filed within 90 days of the date of issuance of the final rule or 30 months after the final classification of the device under section 513 of the FD&C Act, whichever is later. If a PMA or notice of completion of a PDP is not filed by the later of the two dates, commercial distribution of the device is required to cease since the device would be deemed adulterated under section 501(f) of the FD&C Act.

The device may, however, be distributed for investigational use if the manufacturer, importer, or other sponsor of the device complies with the IDE regulations. If a PMA or notice of completion of a PDP is not filed by the later of the two dates, and the device does not comply with IDE regulations, the device is deemed to be adulterated within the meaning of section 501(f)(1)(A) of the FD&C Act, and subject to seizure and condemnation under section 304 of the FD&C Act (21 U.S.C. 334) if its distribution continues. Shipment of devices in interstate commerce will be subject to injunction under section 302 of the FD&C Act (21 U.S.C. 332), and the individuals responsible for such shipment will be subject to prosecution under section 303 of the FD&C Act (21 U.S.C. 333). In the past, FDA has requested that manufacturers take action to prevent the further use of devices for which no PMA or PDP has been filed and may determine that such a request is appropriate for the cranial electrotherapy stimulator.

The FD&C Act does not permit an extension of the 90-day period after issuance of a final rule within which an application or a notice is required to be filed. The House Report on the 1976 amendments states that: “[t]he thirty month grace period afforded afterclassification of a device into class III * * * is sufficient time for manufacturers and importers to develop the data and conduct the investigations necessary to support an application for premarket approval (H. Rept. 94-853, 94th Cong., 2d sess. 42 (1976)).”

The SMDA added section 515(i) to the FD&C Act requiring FDA to review the classification of preamendments class III devices for which no final rule requiring the submission of PMAs has been issued, and to determine whether or not each device should be reclassified into class I or class II or remain in class III. For devices remaining in class III, the SMDA directed FDA to develop a schedule for issuing regulations to require premarket approval. The SMDA does not, however, prevent FDA from proceeding immediately to rulemaking under section 515(b) of the FD&C Act on specific devices, in the interest of public health, independent of the procedures of section 515(i). Proceeding directly to rulemaking under section 515(b) of the FD&C Act is consistent with Congress' objective in enacting section 515(i), i.e., that preamendments class III devices for which PMAs have not been previously required either be reclassified to class I or class II or be subject to the requirements of premarket approval. Moreover, in this proposal, interested persons are being offered the opportunity to request reclassification of the cranial electrotherapy stimulator.

In accordance with section 515(b) of the FD&C Act, FDA is proposing to require that a PMA or a notice of completion of a PDP be filed with the Agency for the cranial electrotherapy stimulator within 90 days after issuance of any final rule based on this proposal. An applicant whose device was legally in commercial distribution before May 28, 1976, or whose device has been found to be substantially equivalent to such a device, will be permitted to continue marketing such class III devices during FDA's review of the PMA or notice of completion of the PDP. FDA intends to review any PMA for the device within 180 days, and any notice of completion of a PDP for the device within 90 days of the date of filing. FDA cautions that under section 515(d)(1)(B)(i) of the FD&C Act, the Agency may not enter into an agreement to extend the review period for a PMA beyond 180 days unless the Agency finds that “the continued availability of the device is necessary for the public health.”

FDA intends that under § 812.2(d), the preamble to any final rule based on this proposal will state that, as of the date on which the filing of a PMA or a notice of completion of a PDP is required to be filed, the exemptions from the requirements of the IDE regulations for preamendments class III devices in § 812.2(c)(1) and (c)(2) will cease to apply to any device that is: (1) Not legally on the market on or before that date or (2) legally on the market on or before that date but for which a PMA or notice of completion of a PDP is not filed by that date, or for which PMA approval has been denied or withdrawn.

If a PMA or notice of completion of a PDP for the cranial electrotherapy stimulator is not filed with FDA within 90 days after the date of issuance of any final rule requiring premarket approval for the device, commercial distribution of the device must cease. The device may be distributed for investigational use only if the requirements of the IDE regulations are met. The requirements for significant risk devices include submitting an IDE application to FDA for its review and approval. An approved IDE is required to be in effect before an investigation of the device may be initiated or continued under § 812.30. FDA, therefore, cautions that IDE applications should be submitted to FDA at least 30 days before the end of the 90-day period after the issuance of the final rule to avoid interrupting investigations.

As required by section 515(b) of the FD&C Act, FDA is publishing its proposed findings regarding: (1) The degree of risk of illness or injury designed to be eliminated or reduced by requiring that the cranial electrotherapy stimulator have an approved PMA or a declared completed PDP and (2) the benefits to the public from the use of the cranial electrotherapy stimulator.

These findings are based on the reports and recommendations of the advisory committee (panel) for the classification of this device along with information submitted in response to the 515(i) Order, (74 FR 16214, April 9, 2009), and any additional information that FDA has encountered. Additional information regarding the risks as well as classification associated with this device type can be found in the following documents published in theFederal Registeron these dates: November 28, 1974 (43 FR 55716), September 4, 1979 (44 FR 51770), January 6, 1989 (54 FR 550), August 31, 1993 (58 FR 45865), August 24, 1995 (60 FR 43967), November 22, 1996 (61 FR 59448), January 28, 1997 (62 FR 4023), and June 4, 1997 (62 FR 30456 and 62 FR 30600).

Cranial electrotherapy stimulator (21 CFR 882.5800)

A cranial electrotheraphy stimulator is a device that applies electrical current to a patient's head to treat insomnia, depression, or anxiety.

The Neurological Devices Panel that discussed original classification for the cranial electrotherapy stimulator (CES) device in 1977 and 1978 ultimately recommended that the device be classified into class III because satisfactory device effectiveness had not been demonstrated. The panel considered information from the National Research Council, which reviewed 88 published studies on CES and concluded that the device has not been shown to be effective in treating any of the conditions for which it was prescribed. In addition, the panel indicated that it was not possible to establish an adequate performance standard for CES because the characteristics of the electrical current necessary for potential effectiveness were not known. The panel believed that general controls would not provide sufficient control over these characteristics, and that the device presented a potential unreasonable risk of illness or injury to the patient if the practitioner relied on the device, and it was ineffective in treating the patient's illness. Therefore, the panel recommended that premarket approval was necessary to assure the safety and effectiveness of CES devices.

In support of a subsequent proposed rule in 1993 for classification of CES into class III, FDA performed a literature review and identified additional studies that had been performed for CES. After a review of the scientific literature, FDA concluded that the effectiveness of CES had still not been established by adequate scientific evidence.

FDA has performed a literature search for studies of CES published after the 1993 proposed rule (January 1, 1993, to present). Many studies were excluded from further review because they were conducted on very specific populations (e.g.,alcoholics or other types of substance abuse), and therefore were not representative of the general population suffering from insomnia, anxiety, or depression. Six studies were identified for further review (Refs. 1 through 6). FDA also identified two relevant meta-analyses (Refs. 7 and 8).

The Bystritsky et al. study (Ref. 1) was conducted open-label, and on only 12subjects. The study involved observational baseline versus post-treatment without a control and therefore provided insufficient evidence of safety and effectiveness. The Heffernan study (Ref. 2) concludes that a single CES treatment may have physiologic effects; however, no outcomes of anxiety, depression or insomnia were measured and the study was conducted on only 20 subjects. The Overcash study (Ref. 3) was a retrospective study design and used an anxiety rating scale that was not validated. The Voris study (Ref. 4) analyzed only a subgroup of “psychiatric subjects” which included many types of anxiety disorders as well as non-anxiety psychiatric disorders. The subgroup represents a diagnostically heterogeneous group. The subgroup analysis was not pre-specified and the number of subjects per subgroup was not specified. The Hyun study (Ref. 5) was a randomized controlled trial of 60 subjects. However, the indication under investigation was preoperative anxiety, which may not be indicative of an Axis I anxiety disorder. Moreover, the outcome measure, a 5-point Likert scale rating of anxiety, was not a standardized validated rating instrument. The Winick study (Ref. 6), which was a randomized controlled trial of 33 subjects with anxiety prior to dental procedures and utilized a 7-point Likert scale, suffers from the same limitations as the Hyun study.

The O'Conner meta-analysis (Ref. 7) examined the effect of CES on reduction of primary and secondary withdrawal symptoms among various chemically dependent populations. The results of this analysis do not relate to the question of safety and effectiveness since the labeled indications for CES currently include insomnia, depression, or anxiety, and not withdrawal symptoms of chemical dependence. The Klawansky meta-analysis (Ref. 8) was based on an examination of literature on CES versus sham treatment. Although the analysis showed CES to be more effective than sham for anxiety, the study populations showed great heterogeneity of diagnostic categories (e.g.,in many cases anxiety was not the primary diagnosis, but rather one of a number of symptomatic outcome measures collected during a trial). Therefore, it is unclear whether the finding can be generalized to support the effectiveness of CES in homogeneous populations of individuals suffering from anxiety, depression, or insomnia. Also, many of the studies evaluated in the Klawansky meta-analysis involved insufficient blinding.

FDA has concluded from a review of the scientific literature and the information provided in the 515(i) call for information (74 FR 16214) that the effectiveness of CES has not been established by adequate scientific evidence and the Agency continues to agree with the panel's recommendation.

•Worsening of the condition being treated—If the device is not effective and the patient is not treated in a conventional manner, the patient's psychological condition may worsen.

•Skin irritation—The electrodes or the conductive cream used with the electrodes may cause skin irritation.

•Headaches—Reported cases of adverse effects of CES devices include headaches following treatment with electrical stimulation.

•Potential risk of seizure—electrical stimulation of the brain may result in seizures, particularly in patients with a history of seizure.

•Blurred vision—placement of electrodes over the eyes may cause blurred vision.

•Potential adverse effects from electrical stimulation of the brain—The physiological effects associated with electrical stimulation of the brain by these devices have not been studied systematically; therefore, adverse effects which may be caused by these electrical stimuli remain unknown.

A PMA for the cranial electrotherapy simulator must include the information required by section 515(c)(1) of the FD&C Act. Such a PMA should also include a detailed discussion of the risks identified previously, as well as a discussion of the effectiveness of the device for which premarket approval is sought. In addition, a PMA must include all data and information on: (1) Any risks known, or that should be reasonably known, to the applicant that have not been identified in this document; (2) the effectiveness of the device that is the subject of the application; and (3) full reports of all preclinical and clinical information from investigations on the safety and effectiveness of the device for which premarket approval is sought.

A PMA must include valid scientific evidence to demonstrate reasonable assurance of the safety and effectiveness of the device for its intended use (see § 860.7(c)(2)). Valid scientific evidence is “evidence from well-controlled investigations, partially controlled studies, studies and objective trials without matched controls, well-documented case histories conducted by qualified experts, and reports of significant human experience with a marketed device, from which it can fairly and responsibly be concluded by qualified experts that there is reasonable assurance of the safety and effectiveness of a device under its conditions of use. * * * Isolated case reports, random experience, reports lacking sufficient details to permit scientific evaluation, and unsubstantiated opinions are not regarded as valid scientific evidence to show safety or effectiveness. * * *” (21 CFR 860.7(c)(2)).

A PDP for the cranial electrotherapy stimulator may be submitted in lieu of a PMA, and must follow the procedures outlined in section 515(f) of the FD&C Act. A PDP must provide: (1) A description of the device, (2) preclinical trial information (if any), (3) clinical trial information (if any), (4) a description of the manufacturing and processing of the device, (5) the labeling of the device, and (6) all other relevant information about the device. In addition, the PDP must include progress reports and records of the trials conducted under the protocol on the safety and effectiveness of the device.

Before requiring the filing of a PMA or notice of completion of a PDP for a device, FDA is required by section 515(b)(2)(A)(i) through (b)(2)(A)(iv) of the FD&C Act and § 860.132 to provide an opportunity for interested persons to request a change in the classification of the device based on new information relevant to the classification. Any proceeding to reclassify the device will be under the authority of section 513(e) of the FD&C Act.

A request for a change in the classification of these devices is to be in the form of a reclassification petition containing the information required by § 860.123, including new information relevant to the classification of the device.

The Agency advises that to ensure timely filing of any such petition, any request should be submitted to the Division of Dockets Management (seeADDRESSES) and not to the address provided in § 860.123(b)(1). If a timely request for a change in the classification of these devices is submitted, the Agency will, within 60 days after receipt of the petition, and after consultation with the appropriate FDA resources, publish an order in theFederal Registerthat either denies therequest or gives notice of its intent to initiate a change in the classification of the device in accordance with section 513(e) of the FD&C Act and 21 CFR 860.130 of the regulations.

The Agency has determined under 21 CFR 25.30(h) that this action is of a type that does not individually or cumulatively have a significant effect on the human environment. Therefore, neither an environmental assessment nor an environmental impact statement is required.

FDA has examined the impacts of the proposed rule under Executive Order 12866, Executive Order 13563, the Regulatory Flexibility Act (5 U.S.C. 601-612) and the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4). Executive Orders 12866 and 13563 direct Agencies to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). The Agency believes that this proposed rule is not a significant action under Executive Order 12866.

The Regulatory Flexibility Act requires Agencies to analyze regulatory options that would minimize any significant impact of a rule on small entities. The Agency proposes to certify that the rule would not have a significant economic impact on a substantial number of small entities.

Section 202(a) of the Unfunded Mandates Reform Act of 1995 requires that Agencies prepare a written statement, which includes an assessment of anticipated costs and benefits, before proposing “any rule that includes any Federal mandate that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100,000,000 or more (adjusted annually for inflation) in any one year.” The current threshold after adjustment for inflation is $136 million, using the most current (2010) Implicit Price Deflator for the Gross Domestic Product. FDA does not expect this proposed rule to result in any one-year expenditure that would meet or exceed this amount.

The proposed requirement for PMAs or PDPs for CES would generate social benefits equal to the value of the information generated by the safety and effectiveness tests that CES producers would be required to conduct under the proposed call for PMAs or PDPs. Provided first to FDA, this information would eventually assist physicians, patients and insurance providers in making more informed decisions about CES.

There is reason to believe that current decisions about CES use are based on incomplete information. In their 1995 meta-analysis of CES research, Klawansky et al. (Ref. 8) find that most CES studies in the literature are beset with weaknesses, such as small sample size, incomplete statistical reporting, and potential bias from authors who have commercial interests in CES products. Klawansky and coauthors also express concern that only three of the 18 studies they examined were truly double-blinded, and patient blinding may have been insufficient in some cases due to the difficulty of mimicking in sham treatment the sensation produced by CES. More recent literature indicates that there is still much uncertainty about the safety and effectiveness of CES.

If consumers, up until now, have been overestimating the safety and effectiveness of CES devices, then demand for these products would decrease as a result of the call for PMAs or PDPs, and consumers would purchase fewer CES devices and services than under the previous process whereby CES devices were cleared under the 510(k) process. For all the units purchased under the 510(k) clearance process that would not be purchased under the PMA or PDP approval process, society is currently incurring a cost equal to the difference between the producer's cost of producing that unit and the dollar value of the health benefit experienced by the consumer. The avoidance of this cost represents the per-unit benefit to society of the proposed requirement for PMAs or PDPs; summing over all currently-marketed units yields society's total benefit. This sum is bounded above by current consumer expenditure on CES devices (further discussion of this point appears in the Technical Appendix in section IX.D of this document).

Consumer expenditure on CES can be approximated by finding total producer revenue (this is only an approximation because any applicable taxes drive a wedge between expenditure and revenue). FDA estimates that there are approximately 11 producers currently marketing CES devices. Six of these producers appear in FDA's Data universal numbering system database, with sales revenue for the six ranging from $100,000 to $1.2 million per year. Manta.com (Ref. 9) reports sales revenue of less than $0.5 million for one of the producers not appearing in Data universal numbering system. (It appears that few CES producers market non-CES goods or services, so most of the firms' revenue can be attributed to CES sales.) The average annual sales revenue of the 7 producers for whom we have data is $515,000. Assuming that this average equals the CES industry's overall average yields an estimate of annual CES producer revenue of 11 × $515,000=$5.67 million. As mentioned previously, in the case where additional safety and effectiveness information decreases demand, this revenue total provides an upper bound on the estimated benefit to society of requiring PMAs or PDPs for CES devices.

If the additional testing associated with class III PMA or PDP were to reveal that CES devices are safer and more effective than consumers currently believe, then demand for these products would increase. In this case, consumers currently purchase too few rather than too many CES devices as a result of incomplete information, and the benefit of the requirement for PMAs or PDPs would come from the increased use and associated health benefits of the devices. As discussed in the Technical Appendix in section IX.D of this document, FDA cannot in this case estimate a bound on the total social benefit of requiring PMAs or PDPs. FDA requests comment on this issue and on all methods and results of our benefits estimation.

Under the proposed rule, FDA would require producers in this industry to obtain PMA or establish a PDP before marketing new products. Currently, a CES producer receives clearance to market by submitting a 510(k). Therefore, the rule-induced cost per new product would be the difference between the cost of preparing and submitting a PMA application (which we assume to be approximately the same with PDP as with traditional PMA) and the cost of preparing and submitting a 510(k) application. Blozan and Tucker (Ref. 10) estimate the cost of an average 510(k) at $500; since the mean number of pages for the 510(k) submissions in their sample is 24, the estimated cost per page is $21, or $36 after adjusting for inflation (Ref. 11). FDA records indicate that, recently, the one or two cranial electrotherapy stimulator 510(k) submissions received per year have consisted of several hundred pages each. Assuming an average of 300 pages per submission and a cost per page of $36 yields an average cost of preparing and submitting a 510(k) of $11,000. FDAhas estimated an upper bound on the cost of PMA at approximately $1,000,000 (see, for example, 73 FR 7498 at 7501, February 8, 2008); this yields a difference of $989,000 between the costs of PMA and 510(k) preparation. Multiplying this cost difference by the recent average of 1.5 new CES submissions per year yields an annual rule-induced cost equal to $1.48 million. Additionally, producers of CES products that are already on the market would need to submit PMA applications, costing approximately $1 million each. FDA believes that there are approximately 13 such products, so there would be a rule-induced upfront cost of $13 million.

These cost estimates are only correct if no producers would be dissuaded from introducing new products or seeking approval for currently-marketed products by the cost of submitting a PMA application or by changes in the possibility that FDA grants approval. In cases where producers are dissuaded from entering or attempting to stay in the market, the cost to industry of the proposed rule would be the foregone expected profit on the withdrawn or withheld CES devices, which is necessarily less than the cost of PMA submission (otherwise, the producers in question would not be dissuaded from seeking PMA); the $13 million upfront and $1.48 million annual estimates mentioned previously thus provide upper bounds on the submission-related cost that would be borne by industry. Excluded from these totals is the welfare loss that would be borne by consumers who would, in the absence of the proposed rule, use the CES devices that would be withdrawn or withheld from the market as a result of the call for PMAs or PDPs. Due to the lack of sufficient market data, we cannot quantify these consumers' welfare loss. FDA requests comment on this issue and on all methods and results of our cost estimation.

In addition to the cost to industry of preparing and submitting PMAs or PDPs, the proposed rule would impose review costs on FDA. Geiger (Ref. 12) estimated that, for devices reviewed by FDA's Center for Devices and Radiological Health in 2003 and 2004, review costs were $563,000 per PMA and $13,400 per 510(k). Updated for inflation (with Ref. 11) to 2010 dollars, these review costs become $653,000 per PMA and $15,500 per 510(k). Thus, the proposed rule's review-related costs are expected to equal $8.49 million (= 13 × $653,000) upfront and $956,000 (= 1.5 × [$653,000 −$15,500]) per subsequent year. A portion of this total will be paid by industry in the form of user fees, with the remainder coming from general revenues. The CES manufacturers currently registered with FDA have annual revenues well under $100 million, so they would likely be eligible for small business user fees, which are currently set at $59,705 for a premarket application (PMA or PDP) and $2,174 for a 510(k) submission (75 FR 45641 at 45643). Thus, user fees would likely cover $776,000 (= 13 × $59,705) of upfront and $86,000 (= 1.5 × [$59,705 −$2,174]) of subsequent annual rule-induced review costs. Because annual revenues for CES manufacturers are also below $30 million, CES manufacturers submitting first premarket applications may qualify for user fee waivers; such cases would increase the portion of FDA review costs coming from general revenues above the current estimates of $7.71 million upfront and $870,000 per subsequent year and decrease the anticipated rule-induced change in user fee collections.

Table 1 of this document displays all quantified benefits and costs of the proposed rule. We reiterate that most of our estimates represent extreme upper bounds. For both benefits and costs, the likely effects of the rule would be much smaller than the estimates appearing in table 1.

The Regulatory Flexibility Act requires Agencies to prepare an initial regulatory flexibility analysis if a proposed rule would have a significant effect on a substantial number of small businesses, non-profit organizations, local jurisdictions or other entities. Even though the producers of CES devices do tend to be small, only a very few entities participate in this market. FDA estimates that there are approximately 11 producers currently marketing CES devices; there may also be a handful of affiliated businesses that would be affected by the requirement for PMAs or PDPs. Therefore, FDA tentatively concludes that this proposed rule would not have a significant economic impact on a substantial number of small entities. We request comment on this issue.

The supply-demand diagrams of figure 1 of this document illustrate the changes in the market for CES devices and services that would occur if the additional testing associated with class III pre-market approval were to reveal that CES devices are less safe and effective than consumers currently believe. In Panel A, the benefit of proposed requirement for PMAs or PDPs is represented by the shaded area belowthe current market supply curve, above the better-informed, post-call for PMA demand curve (Demand 1) and between the old and new quantities purchased (determined by the intersections of the pre- and post-call for PMAs or PDPs demand curves with the current supply curve or the vertical axis). A similar shaded benefit area appears in Panel B, but in that case, there is an offsetting loss (shown as the shaded triangle between the pre- and post-call for PMAs or PDPs supply curves) caused by CES producers passing on some costs related to PMAs and PDPs to consumers and consumers therefore purchasing even fewer CES devices or services than new information indicates they should. The overall benefit of the rule in Panel B is the difference between the areas of the Benefit and Loss triangles. In both panels of Figure 1, total CES spending by consumers, equal to the revenue collected by CES producers and shown as the rectangleLMNO,provides an upper bound on the amount of the shaded rule-induced social benefit. While total spending/revenue always provides an overestimate of the social benefit, the amount of the over-estimation may range from moderate, as in Panel A (the case in which CES products disappear from the market), to extreme, as in Panel B (the case in which there is continued use of at least some CES products).

If the additional testing associated with class III marketing approval increases consumers' confidence in the safety and effectiveness of CES devices, then demand for these products would increase, as depicted in figure 2 of this document. In this case, consumers currently purchase too few rather than too many CES devices and services as a result of incomplete information. The benefit to society of providing information can, as in Panel A of figure 1, be depicted graphically as the area between the pre-call for PMA or PDP supply curve and the post-call for PMA or PDP demand curve, and between the old and new quantities consumed (determined by the intersections of the pre- and post-call for PMA or PDP demand curves with the pre- and post-call for PMA or PDP supply curves), but because the revenue rectangleLMNOdoes not contain the shaded benefit area, FDA cannot in this case estimate a bound on the total social benefit.

FDA has analyzed this proposed rule in accordance with the principles set forth in Executive Order 13132. FDA has determined that the proposed rule, if finalized, would not contain policies that would have substantial direct effects on the States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of government. Accordingly, the Agency tentatively concludes that the proposed rule does not contain policies that have federalism implications as defined in the Executive order and, consequently, a federalism summary impact statement is not required.

This proposed rule refers to currently approved collections of information found in FDA regulations. These collections of information are subject to review by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). The collections of information in 21 CFR part 812 have been approved under OMB control number 0910-0078; the collections of information in 21 CFR part 814, subpart B, have been approved under OMB control number 0910-0231; and the collections of information under 21 CFR part 801 have been approved under OMB control number 0910-0485.

FDA is proposing that any final rule based on this proposal become effective on the date of its publication in theFederal Registeror at a later date if stated in the final rule.

Interested persons may submit to the Division of Dockets Management (seeADDRESSES), either electronic or written comments regarding this document. It is only necessary to send one set of comments. It is no longer necessary to send two copies of mailed comments. Identify comments with the docket number found in brackets in the heading of this document. Received comments may be seen in the Division of Dockets Management between 9 a.m. and 4 p.m., Monday through Friday.

The following references have been placed on display in the Division of Dockets Management (seeADDRESSES), and may be seen by interested persons between 9 a.m. and 4 p.m., Monday through Friday. (FDA has verified the Web site addresses, but we are not responsible for any subsequent changes to the Web sites after this document publishes in theFederal Register.)

Therefore, under the Federal Food, Drug, and Cosmetic Act and under authority delegated to the Commissioner of Food and Drugs, it is proposed that 21 CFR part 882 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-2011-0254), 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-2011-0254” 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 81/2; by 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 maychange 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-2011-0254” 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 September 7, 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 Zidell Waterfront Property is placing an engineered sediment cap over contaminated sediments adjacent to the west bank of the Willamette River between approximate river miles 13.5 and 14.2 as part of an Oregon Department of Environmental Quality (DEQ) required remedial action. Geographically this location starts at approximately the West bank of the Marquam Bridge and continues southerly, along the west bank of the Willamette River to the North end of Ross Island.

The engineered sediment cap is designed to be compatible with normal port operations, but could be damaged by other maritime activities including anchoring, dragging, dredging, grounding of large vessels, deployment of barge spuds, etc. Such damage could disrupt the function or impact the effectiveness of the cap to contain the underlying contaminated sediment and shoreline soil in these areas. As such, this RNA is necessary to help ensure the cap is protected and will do so by prohibiting certain maritime activities that could disturb or damage it.

The engineered sediment cap will also reduce the depth of the water close to the west bank of the Willamette River and, as a result, may limit some vessels from using that area of the river.

The proposed rule would create an RNA covering all waters adjacent to the Zidell Waterfront Property on the Willamette River extending from the west bank of the river out 200 to 400 feet into the river depending on the exact location between approximate river mile 14.2 near the Ross Island Bridge and approximate river mile 13.5 near the Marquam Bridge.

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. The Coast Guard has made this determination based on the fact that the RNA is limited in size and will not limit vessels from transiting or using the waters covered, except for activities that may damage the engineered sediment cap.

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 operating in the area covered by the RNA. The RNA would not have a significant economic impact on a substantial number of small entities, however, because the RNA is limited in size and will not limit vessels from transiting or using the waters covered, except for activities that may damage the engineered sediment cap.

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 (seeADDRESSES) 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 MST1 Jaime Sayers, Waterways Management Division, Marine Safety Unit Portland, Coast Guard; telephone 503-240-9319, e-mailJaime.A.Sayers@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 aState, 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 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 the creation of a regulated navigation area. 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:

The proposal for which the EPA is holding a public hearing was published in theFederal Registeron August 1, 2011, (76 FR 46084) and is available on the following Web site:http://www.epa.gov/ttn/naaqs/standards/no2so2sec/cr_fr.html.

The public hearing will provide interested parties the opportunity to present data, views, or arguments concerning the proposed rule. The EPA may ask clarifying questions during the oral presentations, but will not respond to the presentations at that time. Written statements and supporting information submitted during the comment period will be considered with the same weight as any oral comments and supporting information presented at the public hearing. Written comments must be postmarked by the last day of the comment period, as specified in the proposal.

The public hearing will be held in Arlington, Virginia on August 25, 2011. The public hearing will begin at 10 a.m. and continue until 7 p.m. or later, if necessary, depending on the number of speakers wishing to participate. The EPA will make every effort to accommodate all speakers that arrive and register before 7 p.m. The EPA is scheduling a lunch break from 1 until 2:30 p.m. If you would like to present oral testimony at the hearing, please notify Mrs. Sherry Russell, (C504-02) U.S. Environmental Protection Agency, Research Triangle Park, North Carolina 27711, e-mail (preferred method for registering):russell.sherry@epa.gov;telephone: (919) 541-0306 no later than 5 p.m. on August 23, 2011. She will arrange a general time slot for you to speak. The EPA will make every effort to follow the schedule as closely as possible on the day of the hearing.

Oral testimony will be limited to five (5) minutes for each commenter to address the proposal. We will not be providing equipment for commenters to show overhead slides or make computerized slide presentations unless we receive special requests in advance. Commenters should notify Mrs. Russell if they will need specific audiovisual (AV) equipment. Commenters should also notify Mrs. Russell if they need specific translation services for non-English speaking commenters. The EPA encourages commenters to provide written versions of their oral testimonies either electronically on computer disk or CD-ROM or in paper copy.

The hearing schedule, including lists of speakers, will be posted on EPA's Web site for the proposal athttp://www.epa.gov/ttn/naaqs/standards/no2so2sec/cr_fr.htmlprior to the hearing. A verbatim transcript of the hearing and written statements will be included in the rulemaking docket.

The EPA has established the official public docket for the “Secondary National Ambient Air Quality Standards for Oxides of Nitrogen and Sulfur” under Docket Number EPA-HQ-OAR-2007-1145. The EPA has also developed a Web site for the proposal at the address given above. Please refer to the proposal, published in theFederal Registeron August 1, 2011, (76 FR 46084) for detailed information on accessing information related to the proposal.

This is a proposed regulation. If finalized, this rule may apply to generators, transporters, and owners or operators of treatment, storage, and disposal facilities engaged in the management of carbon dioxide streams that would otherwise be regulated as hazardous wastes under the RCRA subtitle C hazardous waste regulations as part of geologic sequestration activities. This includes entities in the following industries: Operators of carbon dioxide injection wells used for geologic sequestration; and certain industries identified by their North American Industry Classification System (NAICS) code: oil and gas extraction facilities (NAICS 211111); utilities (NAICS 22); transportation (NAICS 48-49); and manufacturing (NAICS 31-33). More detailed information on the potentially affected entities is presented in Section VI of this preamble. If you have questions regarding the applicability of this action to a particular entity, consult the person listed in the precedingFOR FURTHER INFORMATION CONTACTsection.

1. Submitting CBI.Do not submit this information to EPA throughhttp://www.regulations.govor e-mail. Clearly mark the part or all of the information that you claim to be CBI. For CBI information on a disk or CD-ROM that you mail to EPA, mark the outside of the disk or CD-ROM as CBI and then identify electronically within the disk or CD-ROM the specific information that is claimed as CBI. In addition to one complete version of the comment that includes information claimed as CBI, a copy of the comment that does not contain the information claimed as CBI must be submitted for inclusion in the public docket. Information so marked will not be disclosed except in accordance with the procedures set forth in 40 CFR part 2.

2. Tips for Preparing Your Comments.When submitting comments, remember to:

• Identify the rulemaking by docket number and other identifying information (subject heading,Federal Registerdate and page number).

• Follow directions—The agency may ask you to respond to specific questions or organize comments by referencing a Code of Federal Regulations (CFR) part or section number.

• Explain why you agree or disagree, suggest alternatives, and substitute language for your requested changes.

• Describe any assumptions and provide any technical information and/or data that you used.

• If you estimate potential costs or burdens, explain how you arrived at your estimate in sufficient detail to allow for it to be reproduced.

• Provide specific examples to illustrate your concerns, and suggest alternatives.

• Explain your views as clearly as possible.

• Make sure to submit your comments by the comment period deadline identified.

3. Docket Copying Costs.The Docket Center no longer has hard copies of original OSWER documents. The documents were converted to PDF format. Oversized documents were retained and may be copied. Patrons are allowed 93 free copied-pages. Thereafter, they are charged 15 cents per page. When necessary, an invoice stating how many copies were made, the cost of the order, and where to send a check will be issued to the patron. There is also an administrative fee of $14.00 added to the cost of the order.

Documents also are available on microfilm. The EPA/DC staff can help patrons locate needed documents and operate the microfilm machines. There is no fee for printing documents from microfilm or microfiche.

Patrons who are outside of the metropolitan Washington, DC, area can request documents by telephone, however, patrons are asked to submit requests by e-mail to ensure accuracy. The photocopying fee is the same as for walk-in patrons. There is no charge for converting microfilm/microfiche to PDF format and sending it to a customer. If an invoice is necessary, EPA/DC staff can mail one with the order.

These regulations are proposed under the authority of sections 2002, 3001-3009 and 3013 of the Solid Waste Disposal Act (SWDA) of 1970, as amended by the Resource Conservation and Recovery Act (RCRA) of 1976, and the Hazardous and Solid Waste Amendments of 1984 (HSWA), 42 U.S.C. 6912, 6921-6929, 6934.

Authorized representative:The person responsible for the overall operation of a facility or an operational unit (i.e.,part of a facility),e.g.,the plant manager, superintendent or person of equivalent responsibility.

Carbon dioxide (CO 2 ) stream:Carbon dioxide that has been captured from an emission source (e.g.,power plant), plus incidental associated substances derived from the source materials and the capture process, and any substances added to the stream to enable or improve the injection process.

Enhanced Oil or Gas Recovery (EOR/EGR):Typically, the process of injecting a fluid (e.g.,water, brine, or CO2) into an oil or gas bearing formation to recover residual oil or natural gas. The injected fluid thins (decreases the viscosity) or displaces small amounts of extractable oil and gas, which is then available for recovery. This is also known as secondary or tertiary recovery.

Supercritical CO 2 :Carbon dioxide that is above its critical temperature (31.1 ° C, or 88 °F) and pressure (73.8 bar, or 1070 psi). Supercritical substances have physical properties intermediate to those of gases and liquids.

Geologic Sequestration (GS) is the process of injecting carbon dioxide (CO2) captured from an emission source (e.g.,a power plant or industrial facility) into deep subsurface rock formations in order to isolate the CO2. GS is a key component of a set of climate change mitigation technologies referred to as “carbon capture and storage” or CCS. CCS can be described as a three-step process, beginning with the capture and compression of the CO2stream from fossil-fuel power plants or other industrial sources, after which the CO2stream is transported (usually in pipelines) to an on-site or off-site location, where it is then injectedunderground for purposes of sequestration.1

To transport the captured CO2stream for GS, the CO2stream will typically be compressed into a supercritical fluid.2 CO2exists as a supercritical fluid at approximately 1,070 pounds per square inch (psi) and 88 °Fahrenheit (F), and in this state it exhibits physical properties intermediate to those of a liquid and a gas. As mentioned, the majority of CO2is expected to be delivered to the sequestration site by dedicated pipeline;3 however, transport by truck, rail, barge or supertanker may also occur, but these have been described as “logistically impractical” for large-scale CCS operations.4 Whether by pipeline, or these other means, the transportation of supercritical CO2is regulated by the U.S. Department of Transportation (DOT) under regulations found in 49 CFR parts 171-180 (governing the transportation by air, rail, highway, and water) and parts 190 and 195-199 (governing the transportation of hazardous liquids and carbon dioxide by pipeline). The CO2stream is then injected into deep subsurface rock formations via one or more wells, using technologies that have been developed and refined by the oil and gas and chemical manufacturing industries over the past several decades. To sequester the CO2stream, EPA believes that many GS site owners or operators will inject the CO2stream to depths of greater than 800 meters (or 2,625 feet), for the purpose of maximizing capacity and storage, and where ambient pressure and temperature are sufficient to maintain the CO2stream in a supercritical state. December 10, 2010 (75 FR at 77233).

When injected in an appropriate receiving formation, the CO2stream is sequestered by a combination of trapping mechanisms, including physical and geochemical processes, as summarized below.

○Physical trappingoccurs when the relatively buoyant CO2rises in the formation until it reaches a stratigraphic zone with low fluid permeability (i.e.,geologic confining system) that inhibits further upward migration. Physical trapping can also occur as residual CO2is immobilized in formation pore spaces. A portion of the CO2will dissolve into the groundwater and hydrocarbons present in the receiving formation, and CO2molecules can also attach onto the surfaces of coal and certain organic-rich shales (a process called preferential sorption), displacing other molecules, such as methane. The effectiveness of physical CO2trapping is demonstrated by natural analogs worldwide in a range of geologic settings, where CO2has remained trapped for millions of years. For example, CO2has been trapped for more than 65 million years under the Pisgah Anticline, northeast of the Jackson Dome in Mississippi and Louisiana, with no evidence of leakage from the confining formation.5

○Geochemical trappingoccurs when chemical reactions between the dissolved CO2and minerals in the receiving formation result in the precipitation of solid carbonate minerals.6 The timeframe over which CO2will be trapped by these mechanisms depends on the properties of the receiving formation and the injected CO2stream. Research is currently ongoing to further understand these mechanisms and the time required to trap CO2under various conditions.

Additional background information on the GS of CO2streams can also be found in the final rule and associated record for the final rule for UIC Class VI wells published on December 10, 2010 (75 FR 77230).

Climate change is happening now, and the effects can be seen on every continent and in every ocean. While certain effects of climate change can be beneficial, particularly in the short term, current and future effects of climate change pose considerable risks to human health and the environment.7 There is now clear evidence that the Earth's climate is warming:8

○ Global surface temperatures have risen by 1.3 °F when estimated by a linear trend from 1906 to 2005.9

○ Worldwide, the last decade has been the warmest on record.10

○ Ocean temperatures and sea levels are rising and glaciers are retreating around the world.11

In addition, fossil fuels are expected to remain the main source of energy production well into the 21st century, and increased concentrations of CO2are expected unless energy producers reduce CO2emissions to the atmosphere. For example, CCS could enable the continued use of coal in a manner that greatly reduces the associated CO2emissions, while other alternative energy sources are developed in the coming decades. CCS has the potential to be key to achieving domestic GHG emissions reductions, and as already mentioned, GS is a key component of CCS.14

GS is therefore one of a portfolio of options that could be deployed to reduce CO2emissions to the atmosphere and help to mitigate climate change. Other options include, but are not limited to, energy conservation, efficiency improvements, and the use of alternative fuels and renewable energy sources, including solar and wind power.

In an effort to establish a regulatory framework that supports the future development and deployment of CCS technologies, EPA has set out a goal to provide the regulatory certainty needed to foster industry adoption of CCS. As mentioned above, EPA believes that GS is a key climate change mitigation technology. Therefore, providing a consistent regulatory approach to GS will promote its future use in the United States. Two important EPA rulemakings that directly address GS activities are requirements under theGreenhouse Gas (GHG) Reporting Program;andFederal Requirements under the Underground Injection Control (UIC) Program for Carbon Dioxide (CO 2 ) Geologic Sequestration (GS) Wells.These are described in more detail below.

•EPA Greenhouse Gas (GHG) Reporting Program:The GHG Reporting Program was established under authority of the Clean Air Act (CAA) and requires reporting of GHG emissions and other relevant information from certain source categories in the United States. On October 30, 2009, EPA issued a final rule (74 FR 56260) that requires reporting by facilities with production process units that capture a CO2stream under subpart PP of the program. These facilities are required to report the amount of CO2in a stream captured, and provide information on the downstream CO2end use (e.g.,food and beverage, EOR, GS, etc.). On December 1, 2010, EPA issued a final rule (75 FR 75060) that requires reporting from facilities that inject CO2underground for GS under subpart RR of the program. The rule requires facilities that inject CO2underground for GS to report basic information on CO2received for injection, develop and implement an EPA-approved site-specific monitoring, reporting and verification plan, and report the amount of CO2sequestered using a mass balance approach and annual monitoring activities.

•EPA Class VI Underground Injection Control (UIC) Rule:On July 25, 2008, EPA proposed to amend the UIC program (73 FR 43492) to establish a new class of injection well (Class VI) and to establish minimum Federal requirements under the Safe Drinking Water Act (SDWA) for the underground injection of CO2for the purpose of GS. The proposed requirements would ensure that GS is conducted in a manner that protects Underground Sources of Drinking Water (USDWs) from endangerment, by tailoring existing components of the UIC program to address the unique nature of GS. On December 10, 2010, EPA finalized the new UIC Class VI injection well standards. These requirements are intended to provide certainty to industry and the public about the requirements that would apply to injection for purposes of GS, by providing consistency regarding the requirements across the U.S., and transparency about what requirements apply to permitted UIC Class VI facility owners or operators. For a more detailed discussion of these requirements, see the final rule in the December 10, 2010Federal Register(75 FR 77230).

In response to the July 25, 2008 proposed rule for UIC Class VI wells, EPA received a number of comments regarding the potential applicability of RCRA subtitle C to CO2streams being geologically sequestered. As a result of those comments, EPA decided to initiate work on today's proposal. EPA also considered those RCRA-related comments in the development of today's proposed rule. EPA notes, however, that should persons wish to comment on the RCRA applicability issues raised by today's proposal, it is necessary to submit comments to the docket established for today's proposed rule as described above in theADDRESSESsection of thisFederal Registernotice. EPA will not provide further responses to comments submitted on the UIC rule as part of this rulemaking. In addition, today's proposal is not reopening the UIC Class VI final rule, nor will EPA respond to comments related only to that rule.

At this time, EPA has little information to conclude that CO2streams would qualify as RCRA hazardous wastes, which would make them subject to EPA's comprehensive RCRA hazardous waste management regulations. However, commenters have cited the potential for RCRA hazardous waste requirements to attach to some CO2streams (i.e.,some CO2streams might be classified as hazardous waste and therefore, would be subject to RCRA subtitle C), as a significant impediment to widespread deployment of CCS technologies. Today's proposal seeks to address this concern and provide regulatory clarity through a revised RCRA regulatory approach for CO2streams. Simultaneously, as discussed below, EPA expects that management in accordance with the conditions in today's proposal will provide no reduced protection to human health and the environment.

After issuance of the proposed UIC Class VI rule, EPA received public comments that the proposed requirements were unclear as to whether the CO2stream would be a RCRA hazardous waste, and expressed concern that this created uncertainty regarding the type of permit needed for GS. Many commenters stated that a CO2stream should not be treated as a RCRA hazardous waste on the grounds that it is neither a listed hazardous waste nor exhibits a hazardous characteristic, or is even a solid waste. Other commenters, however, asserted that CO2in the presence of water could exhibit the RCRA corrosivity characteristic. Additionally, some commenters raised the issue of whether the analytic procedures used under RCRA (in particular, the toxicity characteristic leaching procedure, TCLP)15 can be applied to supercritical CO2streams, and whether or not the UIC Class VI regulations would better ensure the proper management of CO2streams, compared with the RCRA subtitle C hazardous waste requirements.

EPA believes that the RCRA hazardous waste regulations can apply to CO2streams being geologically sequestered. Subtitle C of RCRA and its implementing regulations establish a “cradle to grave” regulatory scheme over certain “solid wastes” which are also “hazardous wastes.” RCRA defines solid waste as “any garbage, refuse, sludge from a waste treatment plant, water supply treatment plant, or air pollution control facility and other discarded material, including solid, liquid, semisolid, or contained gaseous material * * *.” See RCRA 1004(27), 42 U.S.C. 6903(27). EPA has further defined the term “solid waste” for purposes of its RCRA hazardous waste regulations. 40 CFR 261.2. To be considered a hazardous waste, a material first must be classified as a solid waste. Under EPA's regulations, generators of solid waste are required to determine whether their wastes are hazardous wastes. 40 CFR 262.11. A solid waste is a hazardous waste if it exhibits any of four characteristics (ignitability, corrosivity, reactivity, or toxicity), 40 CFR 261.20-.24, or is a listed waste, 40 CFR 261.30-.33 (these include wastes from non-specific sources, such as spent solvents; by-products from specific industries; and discarded, unused commercial chemical products).

A supercritical CO2stream injected into a permitted UIC Class VI well forpurposes of GS is a RCRA solid waste, as it is a “discarded material” within the plain meaning of the term in RCRA § 1004(27). Courts have stated that the plain meaning of “discarded material” refers to materials that have been disposed of, abandoned or thrown away.16 This clearly applies to supercritical CO2stream (which, as already stated, is rather unique in that it has properties intermediate between a liquid and a gas) injected into UIC Class VI wells, regardless of whether the material is a hazardous waste or not. An entity involved in the CCS process may generate CO2that qualifies as a solid waste under the RCRA hazardous waste regulations by making the decision to discard the material through abandonment by disposing of the material (see 40 CFR 261.2(a)(2)(i) and (b)(1)). Once the decision is made that the supercritical CO2stream will be sent to a UIC Class VI well for discard, EPA considers this material to be a solid waste. This decision may be made upstream of the injection well facility. As discussed above, EPA's regulations require that generators of a solid waste determine whether their wastes are hazardous wastes, and if so, manage them in accordance with EPA's RCRA hazardous waste regulations. 40 CFR 262.11.

One commenter to the UIC proposed rule suggested that the captured CO2stream was exempt from the RCRA hazardous waste regulations under the exemption for “fly ash waste, bottom ash waste, slag waste, and flue gas emission control waste, generated primarily from the combustion of coal or other fossil fuels,” also referred to as the “Bevill exemption.” (See 40 CFR 261.4(b)(4).)

EPA studied the fossil fuel combustion wastes as directed by Congress, and published two Reports to Congress,17 and issued two Regulatory Determinations on the management and use of coal and other fossil fuel combustion products, one on August 9, 1993 and a second one on May 22, 2000 (58 FR 42466 and 65 FR 32214, respectively). CO2captured for purposes of GS was not included in either of these Regulatory Determinations, or in the underlying studies upon which these determinations were based. The Agency has consistently interpreted the § 261.4(b)(4) exemption as only encompassing those wastes that were studied, and EPA did not study CO2that has been captured for GS. Therefore, EPA believes that the CO2streams discussed in today's proposed rule are not included within the Bevill exemption under § 261.4(b)(4).18

EPA notes that CO2streams are not listed RCRA hazardous wastes (i.e.,CO2streams are not specifically identified as one of the hazardous wastes listed in 40 CFR part 261, subpart D). However, the CO2stream would be a hazardous waste if it exhibits any of the hazardous characteristics in 40 CFR part 261, subpart C, or, is mixed with a listed hazardous waste. See § 261.3(a)(iv). Under the UIC Class VI final rule, injection site owners and operators must determine whether the CO2stream is hazardous under the RCRA regulations, and if so, injection of the CO2stream may only occur in a UIC Class I hazardous waste injection well.19 Conversely, UIC Class VI wells cannot be used for the injection of RCRA hazardous wastes. Today's proposal, if finalized, would allow CO2streams that would otherwise qualify as RCRA hazardous wastes to be managed in a Class VI well, provided that they meet the conditions of this proposed rule.

As already noted, commenters to the UIC Class VI proposed rule also raised questions about the appropriateness and feasibility of applying the RCRA hazardous waste characteristics to CO2streams and, in particular, the Toxicity Characteristic (TC). See § 261.24. Some commenters stated that the TCLP test method associated with the TC could not be used on materials other than solids or liquids, and that EPA would have to develop new testing regulations and guidelines specifically for evaluating supercritical CO2. Commenters also stated that the TC regulation was inappropriate for CO2streams because the TC was “* * * designed to assess the threat waste would have in a municipal landfill disposal scenario, a scenario that * * * is inherently inapplicable to uncontained supercritical CO2.” Many commenters also expressed concern over the uncertainty in determining how the RCRA hazardous waste regulations, including the hazardous waste identification issues described here, apply to CO2streams being sequestered in UIC Class VI wells.

In light of these comments, EPA reiterates that no hazardous waste listings apply specifically to CO2streams; therefore, a CO2stream could only be defined as a hazardous waste if it exhibits a hazardous waste characteristic as defined in 40 CFR part 261, subpart C.20 Regarding the feasibility of testing CO2streams, EPA acknowledges the commenter's concern, but also notes that the hazardous waste regulations allow generators to apply their knowledge—in lieu of testing—of the hazard characteristic of a waste, in light of the materials or processes used, to determine whether that waste is a characteristic hazardous waste under RCRA.21 40 CFR 262.11(c)(2). EPA also notes that methods exist for sampling and analyzing gaseous emissions in order to identify and quantify hazardous constituents that may be present.22 Regarding whether a TCLP leach test can be applied to a supercritical CO2stream, EPA notes that the TC regulation, and the TCLP test method, allow for measurement of total constituent concentrations in a waste, in lieu of running the leach test, and under certain circumstances even require it (such as where wastes are liquids that contain less than 0.5% solids).23 However, EPA acknowledges the commenters' underlying concerns related to RCRA characterization, and requests comment on this issue.

As noted above, EPA is proposing to conditionally exclude from thedefinition of hazardous waste CO2streams captured, transported (or otherwise delivered to) and injected into permitted UIC Class VI wells for purposes of GS. At this time, EPA has little information to conclude that CO2streams would qualify as RCRA hazardous wastes, which would make them subject to EPA's comprehensive RCRA hazardous waste management regulations. Today's proposal is intended to provide clarity for deployment of CCS under conditions that EPA believes would not present a substantial risk to human health and the environment. However, EPA acknowledges that at this time, it does not have full knowledge of the range of possible CO2stream compositions. Today's proposed conditional exclusion is based upon EPA's existing knowledge of the composition of CO2streams, and its analysis that compliance with the existing standards and regulations designed to prevent any exposure of CO2(and any associated impurities) would render additional regulation under RCRA subtitle C unnecessary.

Nevertheless, EPA is proceeding with this proposal, and notes that the UIC Class VI regulations include requirements that the owner or operator of the injection well provide an analysis of the physical and chemical characteristics of the CO2stream, both during permit application and periodically during operation (See 40 CFR 146.82, 146.90 and 146.91). The permit-issuing authority is also authorized under EPA's UIC permit regulations to add any additional conditions to the permit, as necessary, to assure compliance with applicable SDWA requirements (40 CFR 146.52(b)). Under this authority, the UIC Program Director (EPA or a State permitting authority) may add specific testing or chemical/waste limitations to the permit to prevent endangerment of USDWs, or to assure that unauthorized wastes are not injected with the CO2stream.

EPA has reviewed estimates of CO2stream composition that were calculated using information, such as the composition of flue gas from the burning of fossil fuels and other likely sources, existing flue gas emission control technologies (e.g.,electrostatic precipitators and scrubbers), and data from applied capture technology.24 These estimates indicate that captured CO2could contain (based upon the information used in developing those estimates) low concentrations of hazardous constituents (e.g.,estimated concentrations expressed in parts per million by volume, or ppmv, are: 0.0022-0.0097 arsenic, 0.0462-0.4623 barium, 0.0002-0.0085 cadmium, 0.0016-0.0171 chromium, 0.0022-0.0028 mercury, 0.0011-0.0045 lead, and 0.0074-0.0244 selenium). EPA notes that these contaminants derived from the combustion flue gas are relevant to the TC regulation in § 261.24.25 These estimates also indicate that the types of impurities and their concentrations would likely vary by facility, coal composition, plant operating conditions, and pollutant removal and carbon capture technologies.

EPA solicited comment in the July 25, 2008 proposed UIC Class VI rule on the presence of impurities in CO2streams, but did not receive any analytical data on the composition of captured CO2streams in response. As various CCS pilot projects26 move forward and continue to generate information, EPA expects the amount of available analytical data on captured CO2to increase. In addition, EPA expects that data will become available under the recently promulgated UIC Class VI regulations. As discussed above, the final UIC Class VI regulations require that prior to issuance of a permit, the owner or operator of the well must submit to the Director27 proposed operating data for the proposed GS site, including an analysis of the chemical and physical properties of the CO2stream (40 CFR 146.82(a)(7)(iv)). The UIC rule also requires that, throughout the operational life of the Class VI well, the injected CO2stream be analyzed by owners or operators with sufficient frequency to yield data representative of its physical and chemical characteristics (40 CFR 146.90(a)). Owners or operators must also submit semi-annual reports that include any changes to the physical, chemical, and other relevant characteristics of the CO2stream from the proposed operating data (40 CFR 146.91(a)(1)). While guidance is still being developed regarding these requirements, at a minimum, the physical characteristics of the CO2stream will include temperature and pressure, while the chemical characteristics will include pH, carbon dioxide purity (as a percent), as well as concentrations of non-CO2constituents (either in ppmv or in percent). These non-CO2constituents may include, but are not limited to, sulfur dioxide (SO2), hydrogen sulfide (H2S), nitrous oxides (NOX), carbon monoxide (CO), methane (CH4), other hydrocarbons, water vapor (H2O), as well as certain contaminants, that are also defined as hazardous contaminants in 40 CFR 261.24, such as arsenic, mercury, and selenium. EPA expects that these data will provide an indication of any impurities that may be present, their concentrations, and whether such impurities might alter the corrosivity or other properties of the CO2stream after injection.

EPA today requests analytical data on the physical and chemical characteristics of captured CO2, including the concentrations of hazardous contaminants, CO2content, information on the type of CO2capture process used, and how the samples were collected and analyzed. This data will allow EPA to gain a better understanding of the nature and characteristics of captured CO2streams.

EPA is proposing to revise the regulations for hazardous waste management under RCRA to exclude from the definition of hazardous waste CO2streams that would otherwise be defined as hazardous, when these CO2streams are managed under certain conditions. The Agency believes that this amendment to the RCRA hazardous waste rules, if finalized, will substantially reduce the uncertainty associated with defining and managing these CO2streams under RCRA subtitle C. For the reasons discussed below, EPA believes that the management of these CO2streams in accordance with the proposed conditions does not present a substantial risk to human health and the environment. These proposed conditions include, but are not limited to, compliance with the existing regulatory regimes governing the transportation of the CO2stream, and its injection in a UIC Class VI permitted well.

EPA has previously interpreted RCRA section 3001(a) to authorize the issuance of “conditional exemptions” from the requirements of subtitle C, where it determines that “a waste might pose a hazard only under limited management scenarios, and other regulatory programs already address such scenarios.” 62 FR at 6636 (February 12, 1997); 66 FR at 27222-27223 (May 16, 2001). Today's proposal takes a similar approach to those earlier rules.

Section 3001(a) provides the Agency with flexibility to consider the need for regulation in deciding whether to list or identify a waste as hazardous. Specifically, RCRA section 3001(a) requires that EPA, in determining whether to list a waste as a hazardous waste, or to otherwise identify a waste as a hazardous waste, decide whether a waste “should be subject to” the requirements of subtitle C. Hence, RCRA section 3001 authorizes EPA to determine when subtitle C regulation is appropriate. EPA has consistently interpreted section 3001 of RCRA to give it broad flexibility in fashioning criteria for hazardous wastes to enter or exit the subtitle C regulatory system. EPA's longstanding regulatory criteria for determining whether wastes pose hazards that require regulatory control incorporate the idea that a waste that is otherwise hazardous may not present a hazard if already subject to adequate regulation. (See,e.g.,40 CFR 261.11(a)(3)(x), which requires EPA to consider action taken by other governmental agencies or regulatory programs based on the health or environmental hazard posed by the waste.)

EPA's interpretation is further supported by the text of RCRA sections 1004(5), and 3002-3004, and RCRA's legislative history. This interpretation has also been upheld upon judicial review. See,e.g., Military Toxics Projectv.EPA,146 F.3d 948 (D.C. Cir. 1998) (upholding conditional exemption for storage of military munitions, based on EPA determination that such wastes are subject to binding standards that meet or exceed RCRA standards, in addition to an institutional oversight process).

The statutory definition of hazardous waste, section 1004(5)(B), informs EPA's interpretation that EPA may consider good management practices in determining the need to regulate waste as hazardous. That section defines a `hazardous waste' as “a solid waste, or combination of solid wastes, which because of its quantity, concentration, or physical, chemical or infectious characteristics may * * * (B) pose a substantial present or potential hazard to human health or the environmentwhen improperly treated, stored, transported, or disposed of, or otherwise managed.”(Emphasis added.) EPA has interpreted the statutory definition as incorporating the idea that a waste that is otherwise hazardous does not require regulation so long as it is properly managed. For example, EPA's standards for listing hazardous wastes require consideration of a waste's potential for mismanagement. See 40 CFR 261.11(a)(3)(vii) (incorporating the language of RCRA section 1004(5)(B) and requiring EPA to consider “plausible types of improper management”).

The statute also directs EPA to regulate hazardous waste generators (RCRA § 3002(a)), transporters (RCRA § 3003(a)) and treatment, storage and disposal facilities (RCRA § 3004(a)) “as may be necessary to protect human health and the environment.” By extension, the decision of when a waste should be subject to the regulatory requirements of subtitle C is a question of whether such regulatory controls are necessary to protect human health and the environment.

Thus, where a waste might pose a hazard only under limited management scenarios, and other regulatory programs already address such scenarios, EPA is not required to classify a waste as hazardous waste subject to regulation under subtitle C. At least three decisions by the U.S. Court of Appeals for the D.C. Circuit provide support for this approach to regulating wastes as hazardous waste only where necessary to protect human health and the environment. InMilitary Toxics Projectv.EPA,146 F.3d 948 (D.C. Cir. 1998), the court upheld a conditional exemption whereby the storage and transportation of certain military munitions are not considered hazardous waste subject to regulation under RCRA subtitle C, provided the munitions are stored and transported in compliance with regulations issued by the Department of Defense and the Department of Transportation, respectively. See 40 CFR 266.203, 266.205. The court ruled that EPA's interpretation of RCRA as authorizing a conditional exemption is “a permissible construction of the statute.” 146 F.3d at 958. The court cited its own precedent as recognizing “`that Congress intended the agency to have substantial room to exercise its expertise in determining the appropriate grounds for listing,' ”id.(citingNRDCv.EPA,25 F.3d 1063, 1070 (D.C. Cir. 1994)), and concluded that, although the military munitions rule “does not involve the listing regulations at issue inNRDCv.EPA,we think the principle at work there also supports the conditional exemption at issue here.”Id.

InNRDCv.EPA,the court held that EPA appropriately used its discretion in relying on several existing regulatory frameworks governing used oil in determining not to list certain used oils as a hazardous waste.NRDC,25 F.3d at 1071. Similarly, inEdison Electric Institutev.EPA,2 F.3d 438 (D.C. Cir. 1993), the court upheld a temporary exemption from subtitle C for petroleum-contaminated media based on the fact that the potential hazards of such materials are already controlled under the underground storage tank regulations under RCRA subtitle I. In reaching its decision, the court considered the fact that the subtitle I standards could prevent threats to human health and the environment to be an important factor supporting the exemption.Id.at 453.

The legislative history of RCRA subtitle C also supports this interpretation, stating that “the basic thrust of this hazardous waste title is to identify what wastes are hazardous in what quantities, qualities, and concentrations,and the methods of disposal which may make such wastes hazardous.”H. Rep. No. 94-1491, 94th Cong., 2d Sess. 6 (1976), reprinted in A Legislative History of the Solid Waste Disposal Act, as Amended, Congressional Research Service, Vol.1, 567 (1991) (emphasis added). Finally, as discussed above, in proposing this conditional exemption from RCRA, EPA is in part relying on the regulatory controls for Class VI wells, under the UIC program of the SDWA, 42 U.S.C. 300fet seq.EPA notes that such reliance is also consistent with the direction provided in section 1006(b) of RCRA, which directs EPA to integrate the provisions of RCRA, for purposes of administration and enforcement and to avoid duplication, to the maximum extent practicable, with those of certain other statutes, including the SDWA, to the extent that it can be done in a manner that is consistent with the goals and policies of both RCRA and the other relevant statute(s).

Under the subtitle C hazardous waste program, the generator requirements (40 CFR part 262) contain provisions designed to ensure that hazardous wastes are properly managed by persons who generate the wastes. This is accomplished through certain requirements governing the temporarystorage (i.e.,accumulation) of hazardous wastes, in units, such as tanks or containers, at the site of generation. These requirements include technical requirements for the tanks or containers, and time limits on hazardous waste storage, if the waste is to be sent off-site to a treatment, storage or disposal facility.28 These requirements also include recordkeeping and reporting, and certain pre-transport requirements, such as packaging, labeling, and preparing a hazardous waste manifest to accompany the waste. Generators must also notify EPA of their hazardous waste management activity, and obtain an EPA identification (ID) number. Likewise, hazardous waste transporters (e.g.,persons transporting waste, including over the highway or by rail) have certain requirements in 40 CFR part 263, to ensure that the hazardous wastes are properly transported to a hazardous waste treatment, storage, or disposal facility. These transporter requirements include notifying EPA and obtaining an EPA ID number, recordkeeping, and compliance with the hazardous waste manifest. EPA notes that under the RCRA subtitle C regulations, a hazardous waste manifest is not required for hazardous wastes sent off-site via pipeline.29

For CO2streams that are captured, compressed, and transported to a UIC Class VI well, EPA believes that the full set of subtitle C generator and transporter requirements are not necessary, because they do not provide any additional protection over existing regulatory requirements. Regarding the generator requirements, EPA believes that the process of capturing and compressing CO2prior to delivery to a UIC Class VI facility via a pipeline, as the Agency understands it, will not involve storage at the generator facility (i.e.,at the CO2source), but rather will occur in a continuous fashion (capture process → compression/dehydration → pipeline insertion). Once in the pipeline, EPA believes the applicable DOT requirements (which apply to supercritical CO2streams regardless of whether or not these materials meet the definition of hazardous waste) will ensure that CO2streams are managed in a manner that addresses the potential risks to human health and the environment that these materials may pose, prior to arrival at a Class VI injection well facility.

While certain technologies for removing (capturing) CO2have been in use commercially for over 60 years (e.g.,natural gas processing, production of food-grade CO2), research has been underway to develop more cost-effective technologies to capture CO2for purposes of CCS. Regardless of the capture technology that is ultimately implemented, information currently available to EPA indicates that once the CO2stream is captured at the source (e.g.,coal-fired power plant), it will be dehydrated (to meet pipeline specifications preventing corrosion) and compressed (to match designated pipeline pressures) in preparation for transport, primarily via CO2pipeline.30 31

However, evaluating in more detail how CO2streams will be managed at the CO2source prior to GS in a UIC Class VI facility, and what regulations or other standards might apply to these activities in lieu of the RCRA generator standards, has proven somewhat difficult based on a review of the literature. This is either because many of the newer capture technologies are still in the developmental stages, or because the more established capture technologies used in commercial CO2capture have not yet been scaled up to large facilities, such as coal-fired power plants. Nonetheless, EPA attempted to assess how captured CO2streams would be managed in the context of the RCRA generator requirements identified above (e.g.,EPA notification, standards for tanks or containers, time limits for on-site storage, recordkeeping and reporting, packaging, labeling, manifesting, etc.).

First, it is unclear from existing information sources whether captured CO2has been or will be stored at the generator site prior to insertion into a pipeline, so EPA examined the feasibility of storing captured CO2streams at the source, since storage is a hazardous waste management activity of concern at RCRA generator sites generally.32 EPA looked at estimates of CO2capture rates both in the CCS projects currently underway, as well as future scenarios where CO2capture is deployed at full scale. A review of commercially-available CO2capture facilities in 2009 identified 17 facilities, with CO2capture rates ranging from 50,000 metric tons/year to 3.63 million metric tons per year.33 According to the 2010 CCS Task Force Report, the largest of these capture rates (3.63 million metric tons/yr) is close to the volume of CO2required for capture at electric utility generating plants. It is also estimated that a 500MW (megawatt) coal-fired power plant emits close to 3 million metric tons of CO2per year.34 Similarly, the Mountaineer, West Virginia CCS project, which is currently capturing 100,000 metric tons CO2/year, will eventually scale up to 1.5 million metric tons of CO2per year from an emission slipstream representing 235MW. See 75 FR 32171, June 7, 2010. An annual CO2capture rate of 1.5 million metric tons translates to approximately 4,100 metric tons CO2per day, or (at temperatures and pressures close to supercritical) 34,000 cubic meters, which is approximately 9 million gallons of CO2per day. Even the smallest annual capture rate mentioned above (50,000 metric tons per year) equates to approximately 137 metric tons of CO2per day, or 1,142 cubic meters, which is approximately 301,568 gallons per day.

Based on these estimates, the volume of CO2streams either being captured, or anticipated to be captured, are quite large, and would require pressure vessels (i.e.,tanks engineered for pressurized material) of inordinate size at the low end of these estimates, and are not likely to exist or be practicable at the upper end of these estimates. Therefore, EPA does not envision these large volumes of captured CO2streams being stored on-site, and instead assumes that the CO2streams will be dehydrated, compressed, and either injected on-site, or sent off-site, in a continuous fashion. EPA believes that even if the CO2were defined as a hazardous waste, under the scenario described above, where captured CO2streams are delivered in a continuous fashion to either on-site injection wells,or to a pipeline for off-site injection (and presumably in a totally-enclosed manner, due to the need to maintain proper pressures) there would not be any substantive35 RCRA subtitle C requirements applicable to this activity. EPA notes that there are no RCRA hazardous waste standards for pipelines, unless the pipelines are ancillary to a regulated hazardous waste tank, which does not appear to be the case here.36

Regarding other generator requirements, such as notification to EPA of hazardous waste activity, and recordkeeping and reporting, EPA believes there will be equivalent notice and reporting for facilities engaged in CO2capture for purposes of GS. The new GHG reporting requirements promulgated on October 30, 2009 (74 FR 56260) will provide information to the Agency regarding individual facilities engaged in CO2capture activities. Under 40 CFR part 98, subpart PP, of the GHG rule, facilities with production process units that capture a CO2stream must annually report certain information to EPA, such as the amount of CO2in the stream captured, and information on the fate of the CO2stream (i.e.,the downstream `end use' of the CO2), including GS. See 40 CFR 98.426. The GHG rule also requires comprehensive recordkeeping, and records that must be retained for three years. See § 98.3(g) and § 98.427. EPA points out that these GHG requirements apply irrespective of whether a facility claims the RCRA exclusion being proposed today, if finalized.

Therefore, with respect to generators of CO2streams, EPA believes there would not be any additional protection to human health or the environment through the RCRA hazardous waste regulations of these operations. Absent any storage, the regulation of the movement of captured CO2streams from the point of capture to either an on-site UIC Class VI injection well, or to an off-site DOT-regulated pipeline (discussed below), would not be significantly different in the presence or absence of today's proposed conditional exclusion. While it is not clear what would be the procedure during maintenance or upset circumstances (such as if the capture process could not function), EPA assumes that the source emissions would be diverted for release under the facility's Clean Air Act permit.

EPA requests information on whether EPA's estimates for captured CO2volumes are accurate and reasonable, and whether the CO2that is captured could be stored on-site prior to being sent elsewhere for GS or any other purpose; if so, EPA requests detailed information on the duration and method of storage, and what existing regulatory or voluntary controls and standards apply to such storage. EPA also requests information on the units and processes involved after the CO2is captured, and before it is either injected on-site, or sent off-site. Finally, EPA requests comment and information on the procedures that have been or are expected to be used during maintenance and upset circumstances of the carbon capture system.

While there may be instances where captured CO2streams are injected on-site, most generators will likely transport their captured CO2streams to UIC Class VI wells located off-site, and therefore EPA considered the transportation of CO2streams under today's proposed conditional exclusion. Carbon dioxide itself is listed under the DOT regulations as a Class 2.2 hazardous material (non-flammable gas). See definitions in 49 CFR 172.101 and 173.115(b). By this designation as a hazardous material, CO2becomes subject to regulations established by DOT for the safe and secure transportation of hazardous materials in commerce. DOT's Pipeline Hazardous Materials Safety Administration (PHMSA) is charged with overseeing the movement of hazardous materials, including CO2, over all modes of transportation. For purposes of this proposal, EPA examined existing requirements for pipeline, and non-pipeline, modes of transportation.

Pipeline Transport—EPA presumes that pipeline transport of CO2streams will be the principal mode of transport for CCS activities, either using existing or newly-built pipelines. For example, in 2008, a Congressional Research Service report stated that “[t]ransporting captured CO2in relatively limited quantities is possible by truck, rail, and ship, but moving the enormous quantities of CO2implied by a widespread implementation of CCS technologies would likely require a dedicated interstate pipeline network.”37 In the United States, there are approximately 3,600 miles of dedicated CO2pipelines, carrying about 50 million metric tons of CO2per year, primarily for EOR activities in the oil and gas industry.38 Experience and knowledge gained by the oil and gas industry, which has used CO2pipelines over the past 35 years to transport large volumes of CO2to oil fields, is directly applicable to carbon capture and GS operations and, thus, there is much experience with this activity.

Pipeline transportation of CO2is subject to the PHMSA requirements in 49 CFR part 195, which apply to pipeline facilities used in the transportation of hazardous liquids or supercritical CO2.39 As defined in 49 CFR 195.2, carbon dioxide is “a fluid consisting of more than 90 percent carbon dioxide molecules compressed to a supercritical state,” which would include supercritical CO2streams transported for purposes of CCS. The requirements in 49 CFR part 195 govern pipeline design, construction, operation and maintenance, and emergency response planning, and EPA believes that by addressing these areas, the PHMSA requirements are consistent with the RCRA subtitle C goal of preventing releases in order to protect human health and the environment.

Additionally, PHMSA's goal is to improve the overall integrity of pipeline systems and reduce risks. See January 10, 2011Federal Register(76 FR 1504). To evaluate risk adequately, the Hazardous Liquid and Gas Transmission Pipeline Integrity Management (IM) requirements were created (49 CFR 195.450 and § 195.452), which supplement PHMSA's safety regulations mentioned above. The goal of the IM requirements is to identify and evaluate the physical and operational characteristics of each individual pipeline system, in order to ensure the quality of pipeline integrity in areas with a higher potential for adverse consequences (high consequence areas or HCAs).40 In addition, PHMSA's IMrequirements promote a more rigorous and systematic management of pipeline integrity and risk by operators; maintain the government's prominent role in the oversight of pipeline operator integrity plans and programs; and increase the public's confidence in the safe operation of the nation's pipeline network. EPA believes that these requirements, which focus on preventing releases that might affect human populations and ecologically-sensitive areas, further support the conclusion in today's proposal that additional regulation of pipeline transportation under RCRA subtitle C is not necessary in order to protect human health and the environment.

With respect to there being no requirement to use a hazardous waste manifest under today's proposal for CO2streams that are conditionally excluded, it is important to note that under the RCRA subtitle C regulations, moving hazardous waste off-site through a pipeline does not trigger the use of a manifest, because pipelines are not included in the definition of “transportation” under RCRA subtitle C.41 With respect to the use of a manifest, because the applicable requirements would not change under either the existing RCRA subtitle C regulations, or when managed in accordance with today's proposed conditional exclusion, there is no change in protection to human health and the environment under today's proposed rule. In fact, EPA notes that were CO2streams to be subject to RCRA subtitle C as hazardous waste, they would not be regulated any differently under the part 195 regulations that are applicable to supercritical CO2streams. Consultations with PHMSA staff indicate that whether a CO2stream is defined as hazardous waste under RCRA subtitle C (in this instance, if it were to exhibit a RCRA characteristic) does not change the technical and other requirements applicable to the transportation of supercritical CO2under PHMSA.42

Finally, EPA notes that it may be the case that some pipelines used to transport CO2are not subject to the DOT requirements, because they are located on-site at the generator facility or at the UIC Class VI facility. See,e.g.,49 CFR 195.1(b)(8). EPA requests information on how these pipelines are currently regulated, including any design and operating standards that apply to such pipelines. As discussed earlier in today's preamble, EPA assumes that in the typical case, captured CO2will not be stored at the generator facility, and will be transferred in a continuous manner either to an on-site or off-site UIC Class VI well. EPA is not proposing to apply RCRA subtitle C requirements to these pipelines as a condition of today's proposed rule (as stated earlier, absent storage of hazardous waste by generators, piping alone would not be subject to subtitle C regulation in any event); but EPA still requests comment on the appropriateness of applying the RCRA subtitle C standards to these non-DOT regulated pipelines.

Non-Pipeline Transport—While EPA expects that pipelines will be the most commonly used transportation method for moving supercritical CO2from its source to a UIC Class VI injection well, other forms of transportation other than pipeline (e.g.,highway, rail) are still possible. Supercritical CO2streams being transported by means other than by pipeline must comply with applicable DOT hazardous materials transportation regulations, which address (for these modes of transportation) requirements, such as packaging, labeling, marking, placarding, emergency response, training, and shipping documentation. These regulations are found in 49 CFR parts 100-180 (hazardous materials regulations). EPA believes that these DOT requirements will adequately address risks to human health and the environment from the transportation of CO2and, therefore, additional RCRA subtitle C requirements specifically relating to transportation will not provide substantially more protection.

Where a hazardous waste manifest would otherwise be required for transporting CO2streams that meet the definition of hazardous waste, under today's proposed conditional exclusion, no hazardous waste manifest would be required. While the DOT hazardous materials shipping paper ensures that important information regarding the CO2stream accompanies the shipment, and that persons offering the CO2stream for transport must keep copies of the DOT shipping paper for two years, there is no tracking feature provided by the DOT shipping paper (as is the case for a hazardous waste manifest). EPA believes, however, that today's proposed rule will provide adequate incentive to ensure that the CO2stream is delivered to a UIC Class VI facility (for example, as discussed later in today's preamble, EPA is proposing a condition requiring generators to certify that any CO2stream, which they claim to be excluded from RCRA subtitle C, has been delivered to a UIC Class VI facility). EPA believes that this proposed certification statement, which must be signed by the generator, provides a strong incentive to ensure delivery to the designated UIC Class VI facility; this is because generators who claim the exclusion, but fail to ensure delivery of their CO2stream that is hazardous to a Class VI facility, risk losing the exclusion and invoking the full hazardous waste requirements. Nonetheless, EPA notes that this certification statement does not provide the same type of tracking as a hazardous waste manifest would provide. Therefore, EPA requests comment on the extent to which non-pipeline transportation will be used specifically for transporting CO2streams to UIC Class VI facilities, and whether the use of the certification statement, together with compliance with applicable DOT hazardous material transportation requirements, are effective substitutes for the RCRA hazardous waste regulations that would apply to these specific circumstances.

The UIC Class VI regulations specifically preclude CO2streams that are defined as RCRA hazardous waste from being injected into a UIC Class VI well. See 40 CFR 146.81(d) (definition of Carbon Dioxide Stream in the UIC Class VI regulation). Instead, under the existing UIC and RCRA regulations, hazardous wastes (including CO2streams that meet the definition of hazardous waste)—if injected—must be injected into a Class I hazardous waste well. As already discussed, EPA has little information about whether CO2streams would exhibit a RCRA hazardous waste characteristic (in particular, the TC). However, because it is possible that captured CO2streams could contain low concentrations of contaminants which could cause a waste to be identified as hazardous by the TC (e.g.,arsenic, mercury, selenium),43 EPA considered whether the injection of captured CO2streams into UIC Class VI wells would be properly managed, such that subtitle C regulation was duplicative and unnecessary.

Here are the contents of today's preamble.

Entities that would be affected by this proposed rule are those organizations and facilities subject to Section 312 of the Emergency Planning and Community Right-to-Know Act (EPCRA) and its implementing regulations found in 40 CFR part 370. If you have questions regarding the applicability of this action to a particular entity, consult the person listed in the precedingFOR FURTHER INFORMATION CONTACTsection.

Tips for Preparing Your Comments.When submitting comments remember to:

• Identify the rulemaking by docket number and other identifying information (subject heading,Federal Registerdate and page number).

• Follow directions—The Agency may ask you to respond to specific questions or organize comments by referencing a Code of Federal Regulations (CFR) part or section number.

• Explain why you agree or disagree, suggest alternatives, and substitute language for your requested changes.

• Describe any assumptions and provide any technical information and/or data that you used.

• If you estimate potential costs or burdens, explain how you arrived at your estimate in sufficient detail to allow for it to be reproduced.

• Provide specific examples to illustrate your concerns, and suggest alternatives.

• Explain your views as clearly as possible.

• Make sure to submit your comments by the comment period deadline identified.

This proposed rule is being issued under EPCRA, which was enacted as Title III of the Superfund Amendments and Reauthorization Act (SARA) of 1986 (Pub. L. 99-499). The Agency relies on sections 312 and 328 of EPCRA for general rulemaking authority.

Title III of SARA (EPCRA) establishes authorities for emergency planning and preparedness, emergency release notification reporting, community right-to-know reporting, and toxic chemical release reporting. It is intended to encourage State and local planning and preparedness for releases of extremely hazardous substances (EHSs) and to provide the public, local governments, fire departments and other emergency officials with information concerning chemical releases and the potential chemical risks in their communities. EPCRA consists of emergency planning notification and community right-to-know reporting of hazardous and toxic chemicals. The implementing regulations as well as substances and reporting thresholds are codified in 40 CFR parts 355 and 370.

Under the emergency planning provisions of EPCRA, codified in 40 CFR part 355, a facility is required to provide a one-time notification to the State Emergency Response Commission (SERC) and the local emergency planning committee (LEPC) if the facility has any EHS present at the site in excess of its threshold planning quantity (TPQ). EHSs and their TPQs are listed in 40 CFR part 355, Appendix A and B. The emergency planning notification occurred approximately seven months after the law was passed for facilities that existed at that time. Any facilities that became subject to the notification requirement after that date are required to comply as provided in 40 CFR part 355. Facilities that are currently covered by these regulations are required to report only changes occurring at the facility that may be relevant to emergency planning. LEPCs use the information obtained from facilities to develop emergency response plans required under section 303 of EPCRA. Section 303 of EPCRA also requires LEPCs to review these plans annually and to adjust them accordingly, for changes that have occurred in their community.

Reporting requirements under the community right-to-know provisions, sections 311 and 312 of EPCRA are on-going obligations. Sections 311 and 312 of EPCRA apply to owners and operators of facilities that are required to prepare or have available a material safety data sheet (MSDS) for a hazardous chemical defined under the Occupational Safety and Health Act (OSHA) Hazard Communication Standard (HCS). If the hazardous chemical is present at or above the reporting thresholds specified in 40 CFR part 370, the facility owner or operator is required to submit a MSDS or a list that contains the hazardous chemical under section 311 of EPCRA. Under section 312 of EPCRA, if a hazardous chemical is present at or above the reporting threshold specified in 40 CFR part 370, the facility owner or operator is required to submit an emergency and hazardous chemical inventory form (Tier I or Tier II) to the SERC, LEPC and the local fire department annually by March 1.

As required by section 312(g) of EPCRA, EPA published two emergency and hazardous chemical inventory reporting forms, Tier I and Tier II. The Tier I inventory form requires facilities to report minimum information on the general types and locations of hazardous chemicals present at the facility. The Tier II inventory form requires facilities to report specific information on the amounts and locations of hazardous chemicals present at the facility. The information required under Tier I and Tier II can be found in §§ 370.41 and 370.42 of the regulations.

Section 312(a)(2) of EPCRA states that the owner or operator of a facility shall submit the Tier I inventory form annually by March 1 to the SERC, LEPC and the local fire department. However, section 312(e) states that the owner or operator of a facility shall submit the Tier II inventory form upon request by their SERC, LEPC or the fire department with jurisdiction over the facility. Currently, all states require facilities to submit the federal Tier II inventory form or the state developed inventory reporting form.

In addition to the information obtained under the emergency planningprovisions of EPCRA, LEPCs use the information provided on the facility's annual emergency and hazardous chemical inventory form to update the emergency response plan for their communities. States were always given the flexibility to implement the EPCRA program as appropriate for their State to meet the goals of EPCRA, which is to prepare for and respond to releases of EHSs and to provide the public with information on potential chemical risks in their communities. This flexibility includes adding more chemicals, setting lower reporting thresholds and creating a reporting form or format that includes more information than is required by the federal reporting requirements. Some States developed their own inventory reporting form, including electronic reporting format. Other States use the federal inventory reporting form or the federal electronic reporting format, Tier2 Submit.

Over the years, stakeholders requested that EPA add new data elements to the forms that would be useful to improve their community emergency response plans. In this action, EPA is proposing new data elements to make the forms more useful for State and local agencies and to better inform the public on chemical hazards in their communities. We are also proposing to revise some existing data elements to make reporting easier for facilities. The elements proposed herein are intended to meet the purpose of EPCRA (Title III of SARA) which is “* * * to encourage and support State and local planning for emergencies caused by the release of hazardous chemicals and to provide citizens and governments with information concerning potential chemical hazards present in their communities.”See 55 FR 30632, Community Right-to-Know Reporting Requirements, Final Rule, July 26, 1990.

The Tier I and Tier II forms were first published in 1987 and were amended in 1990. Recently, State and local agencies requested that EPA modify these forms to include new data elements and revise existing data elements to make it more useful for emergency planning and response. EPA requests public comment on each of the new and revised data elements proposed by EPA in this notice for the Tier I and Tier II forms. These elements are described below.

Information requirements for the Tier I and Tier II forms can be found in 40 CFR 370.41 and 370.42, respectively. Current Tier I and II forms are available on the Agency's Web site athttp://www.epa.gov/emergencies.Additionally, the current Tier I and Tier II inventory forms and the proposed Tier I and II inventory forms with the additional elements and changes highlighted are in the docket for today's rulemaking under the docket number EPA-HQ-SFUND-2010-0763.

In addition to the information currently required on the Tier I and Tier II forms under facility identification, we are proposing to add new data elements for facility phone number, latitude and longitude, and number of full-time employees.

Section 312 covers a broad range of chemicals and facilities. Some of the facilities covered under section 312 also may be subject to the Chemical Accident Prevention under section 112 (r) of the Clean Air Act (CAA), also known as the Risk Management Program or the Toxic Release Inventory (TRI) Program under section 313 of EPCRA. For those facilities that are subject to these programs, EPA is also proposing to add data elements for facility identification numbers that are assigned under these two programs. These data elements should be readily available to facilities that are covered by these two programs. Stakeholders have requested that EPA add these data elements in order to provide more complete information on the facilities to the public and to the State and local agencies responsible for emergency planning and response.

In addition to reporting the number of full-time employees, local emergency responders requested that EPA require facilities such as hotels, colleges, universities, and convention centers to report the total number of people that may occupy a building at any given time, to assist them in emergency planning and response. While EPA is not including this additional element in today's proposal, EPA requests comments if number of occupants should also be added as a data element to the Tier I and II inventory forms.

States and LEPCs informed EPA that some facilities have sites in remote locations and do not have operators present at all times. Thus, if there is a need to contact someone in an emergency, emergency response officials and State and local agencies need the contact information of the facility's parent company or the owner or operator of the facility. Therefore, under the facility identification section, EPA is also proposing to require facilities to provide information on the facility's parent company and the owner or operator of the facility, such as name, address and phone number, as well as the Dun and Bradstreet number of the facility's parent company. EPA is also proposing that the facility owner or operator provide their e-mail address.

Under EPCRA section 303(d)(1), a facility is required to provide the LEPC with the name and contact information of a facility representative who will participate in the emergency planning process as a facility emergency coordinator. The regulations in § 355.20 (c) require facilities to notify LEPCs of any changes relevant to the emergency planning within 30 days after the changes have occurred. However, EPA also believes that this information should be provided on the facility's annual inventory form since LEPCs and other emergency response coordinators may need this information during an emergency. Therefore, EPA is proposing to add this data element to the Tier I and Tier II forms.

Since the information reported under EPCRA section 312 is used by LEPCs to improve emergency response plans, these entities may need to contact the facility regarding information that is reported on the Tier I and Tier II reporting forms. The information filed under section 312 is also used by emergency response officials during an emergency situation. As requested by these entities, the Agency is proposing to require the name, title, phone number and e-mail address of the person knowledgeable or responsible for completing the information on the Tier I and Tier II forms.

EPCRA section 302(c) requires facilities to notify their SERC and LEPC that they are subject to emergency planning if there is an EHS present at the facility at or above its threshold planning quantity (TPQ). For facilities in existence when EPCRA was enacted, this was a one-time notification that occurred approximately seven months after enactment (in May 1987). Facilities that became subject to the emergency planning notification requirement after this date are required to provide notification to their SERC and LEPC within sixty days of becoming subject to the requirements.

EPCRA section 303(a) requires each LEPC to develop an emergency response plan for their communities. Such plans were to be developed in two years after the enactment of EPCRA (October 1988). EPCRA section 303(a) also requires LEPCs to review the emergency response plan once a year. LEPCs use the information reported by facilities under section 302(c) to develop or update the emergency response plans in their community. The Agency believes that some of the facilities which complied with the requirements under section 302(c) may no longer be subject to emergency planning, for a number of reasons, including using a chemical that is safer than an EHS, having an EHS below the TPQ, etc. The Agency also believes that facilities that may become subject to the annual inventory reporting under EPCRA section 312 may not be aware of the requirements under EPCRA section 302. The EPCRA section 312 reporting requirement covers a broad range of chemicals, including EHSs that are subject to emergency planning.

The reporting thresholds and requirements for EHSs are different under sections 302 and 312. The reporting requirement for EHSs under section 302 is to provide notification to the SERC and LEPC if the facility has any EHS at or above the TPQ in order to complete emergency planning requirements for the community. The reporting requirement for EHSs under section 312 is to submit an inventory form annually by March 1 to the SERC, LEPC and the local fire department if the EHS is present at a facility at any one time in an amount equal to or greater than 500 pounds or the TPQ, whichever is less in order to inform the public of chemical hazards in their community.

Since the notification under section 302(c) is a one-time notification which occurred in 1987 for most facilities, and since section 303(a) requires LEPCs to update the emergency plan annually, it would be useful for LEPCs to get an update from facilities clarifying whether they are still subject to emergency planning. This will help ensure that local emergency plans are up-to-date and include all appropriate facilities.

To better account for facilities subject to emergency planning and for LEPCs to use this information to improve the emergency response plans in their community, LEPCs requested that EPA require facilities to report if they are subject to emergency planning notification under EPCRA section 302. As a result, the Agency is proposing to add a new data element to indicate if facilities are subject to the emergency planning notification under EPCRA section 302.

Section 112(r) of the Clean Air Act (CAA) amendments of 1990 requires certain facilities to develop and implement a risk management program to prevent accidental releases of regulated chemicals. Facilities subject to section 112(r) of the CAA are required to implement an accident prevention program and an emergency response program, conduct hazard assessment and summarize and submit to EPA information about these programs and hazards in a risk management plan (RMP). The implementing regulations are codified in 40 CFR part 68, Chemical Accident Prevention, also known as the Risk Management Program.

In addition to the information reported under EPCRA section 312, LEPCs and States use the information reported in RMPs to improve the emergency response plans in each community. In order to better serve this purpose, EPA is proposing to add a new data element to both the Tier I and Tier II forms to indicate whether the facility is subject to chemical accident prevention under section 112(r) of the CAA.

As stated in EPCRA section 312(d), the information requirements in 40 CFR 370.41 and 370.42 for the Tier I and Tier II forms currently list range codes for reporting the maximum amount and average daily amounts of hazardous chemicals present at the site in the preceding calendar year. The range codes currently listed in the regulations are very broad. Such information is not as useful as specific quantity information for effective emergency response planning. Since the statute specifically states that an estimate in ranges for the maximum amount and average daily amount should be reported on the Tier I and II inventory forms, the regulations would still require facilities to report in ranges. However, in order for the States, local agencies and emergency response officials to have information on the maximum amount and average daily amount that are closer to the actual amounts present at the facility, EPA is proposing to narrow the ranges that are in the existing regulations. EPA specifically seeks comments if the range codes and the ranges proposed below would be more useful to LEPCs for effective emergency response planning or for responding to emergencies, and if not, what ranges would be more useful to the LEPCs for effective emergency response planning or for responding to emergencies.

Facilities are required to report specific information about hazardous chemicals on the Tier II inventory form. Some states may require additional information than that which is required under the federal reporting requirements. In addition to the new data elements proposed in the previous section of this document, EPA is proposing to revise some existing data elements on the Tier II federal inventory form.

In the final rule published on November 3, 2008 (73 FR 65452), EPA clarified how to report a hazardous chemical mixture after determining if the mixture or its hazardous components meet or exceed the reporting thresholds specified in 40 CFR part 370. In that notice, the Agency clarified that if a hazardous chemical in the mixture is an EHS, the facility has to aggregate any and all amounts of that EHS present throughout the facility in mixtures and in pure form to determine if the reporting threshold for EHS has been met or exceeded. If the reporting threshold for that EHS is exceeded, then the facility would have an option to report the mixture or the EHS component.

To determine if the reporting threshold has been met or exceeded for a mixture that contains a non-EHS hazardous chemical component, a facility has the option to either add upall the amounts of that non-EHS hazardous chemical present as a component in all mixtures and all other quantities of that non-EHS hazardous chemical present throughout the facility or consider the total quantity of that mixture present throughout the facility. Once it is determined that the reporting threshold is met or exceeded for either the non-EHS hazardous chemical component or the mixture, the facility has the option to report the non-EHS hazardous chemical component or the mixture itself. See § 370.14 for requirements on reporting mixtures. As stated in § 370.14(b), EPA encourages facilities to be consistent with their reporting under EPCRA section 311 when reporting mixtures.

In this notice, EPA is proposing to modify the chemical information reporting section of the Tier II inventory form to make it more user-friendly for States and local agencies, as well as the emergency response officials. This revision will also benefit facilities by clarifying how to report mixtures on the Tier II form. Specifically, the current form requires facilities to reportthe name of the mixture, indicate whether the mixture contains an EHS, indicate the physical and health hazards of the mixture, and report the amount present on-site, as well as the type of storage and storage locations. The regulated community and the state and local agencies, however, are unsure if the amount present on-site refers to the mixture or the non-EHS hazardous chemical or the EHS in the mixture. In order to clarify the reporting of pure chemicals vs. mixtures, the proposed Tier II form has separate entries for mixtures and pure chemicals. The entry for mixtures includes a separate line for mixture name, amount of mixture present (i.e.maximum and average daily amount), the EHS(s) name, and the amount of EHS(s) present (i.e.maximum and average daily amount). Facilities still have the option to report the mixture or the hazardous chemical component as stated in § 370.14.

The Tier II form currently requires facilities to report the codes for types of storage (i.e.above ground tank, steel drum) and storage conditions (i.e.temperature, pressure). A code is currently listed for each type of storage and storage conditions in § 370.43. In order to make the form more user-friendly and also to have information readily available to emergency response officials in an emergency, EPA proposes that facilities list the types of storage (i.e.above ground tank, steel drum) and storage conditions (i.e.ambient temperature, ambient pressure) on the Tier II form rather than noting the reporting codes.

EPA seeks public comment on all the proposed new data elements and revisions of the existing data elements described in this proposed rule. The Agency also requests that commenters, including State and local agencies suggest any additional information that should be added to the Tier I and Tier II forms in order to make them more useful for emergency planning and response.

Finally, we would note that the Agency is not proposing to revise the introductory paragraph to §§ 370.41 and 370.42. However, since we are proposing to add some new data elements and proposing to revise some existing data elements, we re-arranged and re-numbered all the paragraphs to be consistent with how each data element appears on the Tier I and Tier II inventory forms.

This action is not a “significant regulatory action” under the terms of Executive Order 12866 (58 FR 51735, October 4, 1993) and is therefore not subject to review under the Executive Orders 12866 and 13563 (76 FR 3821, January 21, 2011). We believe this action is administrative and non-controversial. The proposed data elements are readily available to the facility. Stakeholders requested that EPA add these new data elements because the additional information would improve community emergency response planning. In addition, revising the existing data elements will make the forms more user-friendly.

The proposed regulation will not have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities.

The information collection requirements in this proposed rule have been submitted for approval to the Office of Management and Budget (OMB) under the Paperwork Reduction Act, 44 U.S.C. 3501et seq.The Information Collection Request (ICR) document prepared by EPA has been assigned EPA ICR number 1352.13. This action may impose only minimal reporting burden on facilities since the data elements proposed are readily available to the facility. Revising the existing data elements will make the forms more user-friendly and ease reporting requirements for facilities. Stakeholders requested that EPA add the new data elements since the additional information would be useful to develop or modify their community emergency response plans. New data elements, such as facility emergency coordinator needs to be updated annually for LEPCs to coordinate the emergency plans and response to emergencies in their community.

The Office of Management and Budget (OMB) has previously approved the information collection requirements contained in regulations at 40 CFR part 370 which includes information requirements for the Tier I and Tier II inventory forms, under the provisions of thePaperwork Reduction Act,44 U.S.C. 3501et seq.and has assigned OMB control number 2050-0072, EPA ICR number 1352.11. The OMB control numbers for EPA's regulations are listed in 40 CFR part 9. Burden is defined at 5 CFR 1320.3(b). An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations are listed in 40 CFR part 9.

To comment on the Agency's need for this information, the accuracy of the provided burden estimates, and any suggested methods for minimizing respondent burden, EPA has established a public docket for this rule, which includes this ICR, under Docket ID number EPA-HQ-SFUND-2010-0763. Submit any comments related to the ICR to EPA and OMB. SeeADDRESSESsection at the beginning of this notice for where to submit comments to EPA. Send comments to OMB at the Office of Information and Regulatory Affairs, Office of Management and Budget, 725 17th Street, NW., Washington, DC 20503, Attention: Desk Office for EPA. Since OMB is required to make a decision concerning the ICR between 30 and 60 days after August 8, 2011, a comment to OMB is best assured of having its full effect if OMB receives it by September 7, 2011. The final rule will respond to any OMB or public comments on the information collection requirements contained in this proposal.

The Regulatory Flexibility Act (RFA) generally requires an agency to prepare a regulatory flexibility analysis of any rule subject to notice and commentrulemaking requirements under the Administrative Procedure Act or any other statute unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small organizations, and small governmental jurisdictions.

For purposes of assessing the impacts of today's proposed rule on small entities, small entity is defined as: (1) A small business as defined by the Small Business Administration's (SBA) regulations at 13 CFR 121.201; (2) a small governmental jurisdiction that is a government of a city, county, town, school district or special district with a population of less than 50,000; and (3) a small organization that is any “not-for-profit enterprise which is independently owned and operated and is not dominant in its field.”

After considering the economic impacts of today's proposed rule on small entities, I certify that this action will not have a significant economic impact on a substantial number of small entities. In determining whether a rule has a significant economic impact on a substantial number of small entities, the impact of concern is any significant adverse economic impact on small entities, since the primary purpose of the regulatory flexibility analyses is to identify and address regulatory alternatives “which minimize any significant economic impact of the rule on small entities.” 5 U.S.C. 603 and 604. Thus, an agency may certify that a rule will not have a significant economic impact on a substantial number of small entities if the rule relieves regulatory burden, or otherwise has a positive economic effect on all of the small entities subject to the rule.

The new data elements that we are proposing to add have been requested by stakeholders in an effort to develop or modify their community emergency response plans. In addition, revising the existing data elements will make the forms more user-friendly, and thus, will make reporting easier for facilities and will make the forms more user-friendly for state and local officials.

This action contains no Federal mandates under the provisions of Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C. 1532-1538 for State, local, or tribal governments or the private sector. This proposed rule does not impose any new requirements on State, local or tribal governments. The data elements we are proposing to add to the Tier I and Tier II inventory forms will be useful to state, local and tribal governments to develop or modify their community emergency response plans. In addition, the proposed revision to the existing data elements will make the forms more user-friendly.

This action is also not subject to the requirements of section 203 of UMRA because it contains no regulatory requirements that might significantly or uniquely affect small governments.

This action does not have federalism implications. It will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132. The data elements we are proposing to add to the Tier I and Tier II inventory forms will be useful to state, local and tribal governments to develop or modify their community emergency response plan. In addition, the proposed revision to the existing data elements will make the forms more user-friendly.

In the spirit of Executive Order 13132, and consistent with EPA policy to promote communications between EPA and State and local governments, EPA specifically solicits comment on this proposed action from State and local officials.

This action does not have tribal implications, as specified in Executive Order 13175, (65 FR 67249, November 9, 2000). The data elements we are proposing to add to the Tier I and Tier II inventory forms will be useful to the tribal governments to develop or modify their community emergency response plans. In addition, the proposed revision to the existing data elements will make the forms more user-friendly. This action does not impose any new requirements on tribal governments. Thus, Executive Order 13175 does not apply to this action.

This action is not subject to EO 13045 (62 FR 19885, April 23, 1997) because it is not economically significant as defined in Executive Order 12866 and because the Agency does not believe the environmental health or safety risks addressed by this action present a disproportionate risk to children. The additional information that we are proposing to add to the Tier I and Tier II inventory forms will be useful to State and local officials to assist them in preparing the community in an emergency situation.

This action is not a “significant energy action” as defined in Executive Order 13211 (66 FR 28355 (May 22, 2001)), because it is not likely to have a significant adverse effect on the supply, distribution, or use of energy.

Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (“NTTAA”), Public Law 104-113, 12(d) (15 U.S.C. 272 note) directs EPA to use voluntary consensus standards in its regulatory activities unless doing so would be inconsistent with applicable law or would otherwise be impractical. Voluntary consensus standards are technical standards (e.g.,materials specifications, test methods, sampling procedures, and business practices) that are developed or adopted by voluntary consensus standards bodies. NTTAA directs EPA to provide Congress, through OMB, explanations of when the Agency decides not to use available and applicable voluntary consensus standards.

This proposed rule does not involve technical standards. Therefore, EPA does not consider the use of any voluntary consensus standards.

Executive Order (EO) 12898 (59 FR 7629 (February 16, 1994)) establishes Federal executive policy on environmental justice. Its main provision directs federal agencies, to the greatest extent practicable and permitted by law, to make environmental justice part of their mission by identifying and addressing, as appropriate, disproportionately high and adverse human health or environmental effects of their programs, policies, and activities on minority populations and low-income populations in the United States.

EPA has determined that this proposed rule does not have disproportionately high and adverse human health or environmental effects on minority or low-income populations because it does not affect the level of protection provided to human health or the environment. The new data elements that the Agency is proposingwould be useful to develop or modify the community's emergency response plan. In addition, revising the existing data elements will make the forms more user-friendly.

For the reasons discussed in the preamble, title 40, chapter I of the Code of Federal Regulations is proposed to be amended as follows:

On August 2, 2011 (76 FR 46217), the Coast Guard published a notice of public meetings and request for comments on a supplemental notice of proposed rulemaking (SNPRM) entitled “Implementation of the Amendments to the International Convention on Standards of Training, Certification and Watchkeeping for Seafarers, 1978, and Changes to Domestic Endorsements.” Subsequent to the publication of that notice, the Coast Guard discovered that the publication date of the SNPRM on page 46217 was incorrect.

In the notice (FR Doc. 2011-19459) published on August 2, 2011 (76 FR 46217) make the following correction. On page 46217, in the first sentence of the second paragraph in the third column, the date should read “August 1, 2011” instead of “August 1, 2001.”

Federal odometer law, which is largely based on the Motor Vehicle Information and Cost Savings Act (Cost Savings Act)1 and Truth in Mileage Act of 1986, as amended (TIMA),2 contains a number of provisions to limit odometer fraud and assure that the buyer of a motor vehicle knows the true mileage of the vehicle. The Cost Savings Act requires the Secretary of Transportation to promulgate regulations requiring the transferor (seller) of a motor vehicle to provide a written statement of the vehicle's mileage registered on the odometer to the transferee (buyer) in connection with the transfer of ownership. This written statement is generally referred to as the odometer disclosure statement. Further, under TIMA, vehicle titles themselves must have a space for the odometer disclosure statement and States are prohibited from licensing vehicles unless a valid odometer disclosure statement on the title is signed and dated by the transferor. Titles must also be printed by a secure process. With respect to leased vehicles, TIMA provides that the regulations promulgated by the Secretary require written mileage disclosures be made by lessees to lessors upon the lessor's transfer of the ownership of the leased vehicle. Lessors must also provide written notice to lessees about odometer disclosure requirements and the penalties for not complying with them. Federal law also contains document retention requirements for odometer disclosure statements.

TIMA's motor vehicle mileage disclosure requirements apply in a State unless the State has alternate requirements approved by the Secretary. The Secretary has delegated administration of the odometer program to NHTSA. Therefore, a State may petition NHTSA for approval of such alternate odometer disclosure requirements.

Seeking to implement an electronic vehicle title transfer system, the State of Florida has petitioned for approval of alternate odometer disclosure requirements. In 2009, NHTSA reviewed certain requirements for alternative state programs and approved the Commonwealth of Virginia's alternate odometer disclosure program. 74 FR 643, 650 (January 7, 2009). Florida's program is similar to Virginia's program in some respects and appears broader in scope than Virginia's in others. Like Virginia's program, the scope of Florida's proposed program does not include transactions involving an out-of-state party. Unlike Virginia's program, Florida's proposed program encompasses transactions involving leased vehicles and odometer disclosures by power of attorney. In addition, Florida's proposed program would use different mechanisms to document mileage than Virginia's.

As discussed below, NHTSA's initial assessment is that the portions of Florida's proposed program involving private sales satisfy the requirements for approval under Federal odometer law, while other portions involving transfers between individual owners and dealers, transfers of leased vehicles and transfers in which a power of attorney is used for purposes of mileage disclosure, do not.

NHTSA recently reviewed the statutory background of Federal odometer law in its consideration and approval of Virginia's petition for alternate odometer disclosure requirements.See73 FR 35617 (June 24, 2008) and 74 FR 643 (January 7, 2009). The statutory background of the Cost Savings Act and TIMA and the purposes behind TIMA, as they relate to odometer disclosure, other than in the transfer of leased vehicles and vehicles subject to liens where a power of attorney is used in the disclosure, are discussed at length in NHTSA's Final Determination granting Virginia's petition. 74 FR 643, 647-48. A brief summary of the statutory background of Federal odometer law and the purposes of TIMA, including odometer disclosure requirements for leased vehicles, follows.

In 1972, Congress enacted the Cost Savings Act, among other things, to prohibit tampering with odometers on motor vehicles and to establish certain safeguards for the protection of buyers with respect to the sale of motor vehicles having altered or reset odometers.SeePublic Law 92-513, § 401, 86 Stat. 947, 961-63 (1972). The Cost Savings Act required that, under regulations to be published by the Secretary, the transferor of a motor vehicle provide a written vehicle mileage disclosure to the transferee, prohibited odometer tampering and provided for enforcement.See id,§ 408.3 In general, the purpose for the disclosure was to assist buyers to know the true mileage of a motor vehicle.

A major shortcoming of the odometer provisions of the Cost Savings Act was their failure to require that the odometer disclosure statement be on the vehicle's title. In a number of States, the disclosures were on separate documents that could be easily altered or discarded and did not travel with the title.See74 FR 644. Consequently, the disclosure statements did not necessarily deter odometer fraud employing altered documents, discarded titles, and title washing.Id.

Another significant shortcoming involved leased vehicles. The lessor is considered the transferor of the vehicle in leased vehicle sales. Titles to leased vehicles are often transferred without the lessor obtaining possession of the vehicle. Lessors without direct access to their vehicles had to rely solely on their lessees to provide actual mileage information. However, lessees had no obligation to provide actual mileage information to lessors upon vehicle transfer. This environment facilitated roll backs of odometers.

Congress enacted TIMA in 1986 to address the Cost Savings Act's shortcomings. It amended the Cost Savings Act by adding section 408(d) to prohibit States from licensing vehicles unless the new owner (transferee) submitted a title from the seller (transferor) containing the seller's signed and dated vehicle mileage statement.SeePublic Law 99-579, 100 Stat. 3309 (1986); 74 FR 644 (Jan. 7, 2009). TIMA also prohibits the licensing of vehicles, for use in any State, unless the title issued to the transferee is printed using a secure printing process or other secure process, indicates the vehicle mileage at the time of transfer and contains additional space for a subsequent mileage disclosure by the transferee when it is sold again.Id.

TIMA also added section 408(e) to the Cost Savings Act to require the Secretary to issue regulations regarding odometer disclosures for leased vehicles.4 The regulations promulgated by the Secretary were to require written mileage disclosures by lessees to lessors upon the lessor's transfer of the ownership of the leased vehicle. Lessors must also provide written notice to lessees about the odometer disclosure requirements and the penalties for not complying with them. Federal law also contains document retention requirements for odometer disclosure statements. TIMA required lessors to retain disclosures made by lessees for at least four years following the date that the lessor transfers that vehicle.5 Id.

TIMA added a provision to the Cost Savings Act allowing States to have alternate odometer disclosure requirements with the approval of the Secretary of Transportation. Section 408(f) of the Cost Savings Act states that the odometer disclosure requirements of subsections (d) and (e)(1) shall apply in a State unless the State has in effect alternate motor vehicle mileage disclosure requirements approved by the Secretary. Section 408(f)(2) further states that the Secretary shall approve alternate motor vehicle mileage disclosure requirements submitted by a State unless the Secretary determines that such requirements are not consistent with the purpose of the disclosure required by subsection (d) or (e), as the case may be.

In 1988, Congress amended section 408(d)(1) of the Cost Savings Act to permit the use of a secure power of attorney for purposes of odometer mileage disclosure in circumstances where the title was held by a lienholder, if allowed by state law. Public Law 100-561 § 40, 102 Stat. 2805, 2817 (1988). Congress required NHTSA to issue a rule ensuring that disclosures be made on the power of attorney document of the actual mileage at the time of transfer and that the mileage be restated exactly by the person exercising power of attorney on the title in the space therefor.Id.The rule, consistent with the purposes of the Act and the need to facilitate enforcement thereof, was to prescribe that the power of attorney form be issued by the State to the transferee using a secure process, as provided for titles, and provide for retention of a copy with the original submitted back to the State.Id.In 1989, NHTSA implemented the 1988 statutory amendments by promulgating amendments to the odometer disclosure regulations, providing that a transferor may give a secure power of attorney to a transferee for the purpose of mileage disclosure in two circumstances—when the transferor's title is physically held by a lienholder or when the title is lost. In either instance, use of a power of attorney document for mileage disclosure is permissible only if otherwise permitted by State law.6

In 1990, Congress again amended section 408(d) of the Cost Savings Act.7 The amendment provided that the rule adopted under the 1988 amendment not require that a vehicle be titled in the State in which the power of attorney was issued and addressed retention of powers of attorneys by States.SeePublic Law 101-641 § 7(a), 104 Stat. 4654, 4657 (1990).8

In 1994, in the course of the recodification of various laws pertaining to the Department of Transportation, the Cost Savings Act, as amended, was repealed, reenacted and recodified without substantive change.SeePublic Law 103-272, 108 Stat. 745, 1048-1056, 1379, 1387 (1994). The odometer statute is now codified at 49 U.S.C. 32701et seq.In particular, Section 408(a) of the Cost Savings Act was recodified at 49 U.S.C. 32705(a). Sections 408(d) and (e), which were added by TIMA (and later amended), were recodified at 49 U.S.C. 32705(b) and (c). The provisions pertaining to approval of State alternate motor vehicle mileage disclosure requirements were recodified at 49 U.S.C. 32705(d).

As discussed above, the Cost Savings Act, as amended by TIMA in 1986, states that NHTSA “shall approve alternate motor vehicle mileage disclosure requirements submitted by a State unless the [NHTSA] determines that such requirements are not consistent with the purpose of the disclosure required by subsection (d) or (e) as the case may be.” (Subsections 408(d), (e) of the Cost Savings Act were recodified to 49 U.S.C. 32705(b) and (c)). In light of this provision, we now turn to our interpretation of the purposes of these subsections, as germane to Florida's petition.9

Our Final Determination granting Virginia's petition for alternate odometer disclosure requirements identified the purposes of TIMA germane to petitions for approval of odometer disclosure requirements that did not include disclosures involving reassignment documents, leased vehicles, or disclosures by power of attorney.10 74 FR 643, 647-48 (January7, 2009). In addition, because the Florida proposal encompasses reassignment documents, transfers of leased vehicles, and disclosures by power of attorney, we identify the purposes of TIMA relevant to odometer disclosures for leased vehicles (see Initial Determination on Wisconsin's petition for alternate odometer disclosure requirements, 75 FR 20965, 20972-73 (Apr. 22, 2010)) and purposes of allowing for disclosures by power of attorney in limited circumstances.

One purpose of TIMA is to assure that the form of the odometer disclosure precludes odometer fraud. 74 FR 647. To prevent odometer fraud facilitated by disclosure statements that were separate from titles, TIMA required mileage disclosures to be on a secure vehicle title instead of a separate document. These titles also had to contain space for the seller's attested mileage disclosure and a new disclosure by the buyer when the vehicle was sold again. This discouraged mileage alterations on titles and limited opportunities for obtaining new titles with lower mileage than the actual mileage.Id.This concern applies to reassignment documents.11

A second purpose of TIMA is to prevent odometer fraud by processes and mechanisms making odometer mileage disclosures on the title a condition of any application for a title, and a requirement for any title issued by a State. 74 FR 647. This provision was intended to eliminate or significantly reduce abuses associated with lack of control of the titling process.Id.

Third, TIMA sought to prevent alterations of disclosures on titles and to preclude counterfeit titles through secure processes. 74 FR 648. In furtherance of these purposes, paper titles (incorporating the disclosure statement) must be produced using a secure printing process or protected by “other secure process.”12 Id.

A fourth purpose is to create a record of vehicle mileage and a paper trail. 74 FR 648. The underlying purposes of this record and paper trail were to better inform consumers and provide mechanisms for tracing odometer tampering and prosecuting violators. TIMA's requirement that new applications for titles include signed mileage disclosure statements on the titles from the prior owners creates a permanent record that is easily checked by subsequent owners or law enforcement officials. This record provides critical snapshots of vehicle mileage at every transfer, which are the fundamental links of this paper trail.

Finally, the general purpose of TIMA is to protect consumers by assuring that they receive valid representations of the vehicle's actual mileage at the time of transfer based on odometer disclosures. 74 FR 648.

TIMA recognized that additional mechanisms were needed to assure accurate odometer disclosures for leased vehicles. In vehicle leases, the lessor typically retains ownership of the vehicle, but does not possess it. The lessor, as a transferor, must comply with Federal odometer disclosure requirements when it subsequently transfers title to a leased vehicle. However, prior to TIMA, lessees were not obligated by Federal odometer law to provide lessors with accurate odometer disclosure statements. TIMA addressed this issue, as discussed above. A number of purposes can be derived from TIMA's provisions, discussed above, relating to the transfer of ownership of leased vehicles.

One purpose of TIMA's leased vehicle provisions is to assure that lessors have the vehicle's actual odometer mileage at the time of transfer.

A second purpose of TIMA's leased vehicle provisions is to assure that lessees provide lessors with an odometer disclosure statement.

A related purpose is to assure that lessees are formally notified of their odometer disclosure obligations and the penalties for failing to comply by not providing complete and truthful information.

A fourth purpose is to set the ground rules for the lessors, providing for lessors to indicate the mileage provided by the lessee on the title, unless the lessor has reason to believe that the disclosure by the lessee does not reflect the actual mileage of the vehicle.

A fifth purpose of TIMA's leased vehicle provisions is to create records and a paper trail. This is an expansion of the fourth general purpose of TIMA stated above. The paper trail includes the written, dated and signed odometer disclosure statement by the lessee. Unlike odometer disclosure statements on vehicle titles that are filed with the State, a lessee's odometer disclosure statement is separate from the title and not filed with the State. Instead, the disclosure statement is sent to the lessor, who must retain a copy for at least five years. The retention of lessee odometer disclosure statements by lessors permits law enforcement officials to trace fraudulent disclosure statements back to lessees, if necessary.

Last, the overall purpose of TIMA's leased vehicle provisions, consistent with the general purposes of TIMA, is to ensure that there are valid representations of the vehicle's actual mileage at the time of transfer.SeeH.R. Rep. No. 99-833, at 33 (1986).

NHTSA's rule implementing TIMA provided that “[n]o person shall sign an odometer disclosure statement as both the transferor and the transferee in the same transaction.”13 In general, this provision, which was intended to limit fraud, was not questioned. However, in instances when a lienholder holds title to a vehicle being sold this, as a practical matter, presented a considerable regulatory burden, because when a dealer bought a used vehicle, it would be required to go to the lienholder and obtain the title, and then go back to the seller so that the seller could record the mileage on the title. The last step often was difficult and could be avoided if the seller executes a power of attorney to the buyer authorizing the buyer to record the mileage upon receipt of the title.14

In 1988, Congress amended TIMA to provide for the limited use of powers of attorney for recording mileage, when the title is physically held by a lienholder at the time of the transfer and is authorized by State law. See Pipeline Safety Reauthorization Act of 1988 (PSRA) § 401, 15 U.S.C. 1988(d)(1) (1988). (Section 401 of the PSRA, as amended in 1990 (see below), was recodified at 49 U.S.C. 32705(b)(2)(A).) The amendment required NHTSA to issue a rule. The rule, which was to address the form and reasonableconditions of the limited power of attorney, was to ensure disclosure on the power of attorney document of the actual mileage at the time of transfer and ensure that such mileage will be restated exactly by the person exercising the power of attorney in the space referred to in TIMA. Further, consistent with the purposes of the Cost Savings Act as amended and the need to facilitate enforcement thereof, the rule was to prescribe the form of the power of attorney to be issued by the State to the transferee and for retention of a copy of such power of attorney. As amended in 1990, this statutory provision provided that the rule promulgated by NHTSA must require the person granted the power of attorney to retain a copy of the power of attorney form and submit the original form to the State along with a copy of the title showing the restatement of the mileage. The statute also permitted the agency to prescribe that the State retain the power of attorney and copy of the title for an appropriate period or that the State adopt alternative measures consistent with the purposes of the statute. The statute mandated that the rule not require that a vehicle be titled in the State in which the power of attorney was issued. Public Law 101-641, 104 Stat. 4654, 57 (Nov. 28, 1990).

In 1989, NHTSA implemented the PSRA by promulgating amendments to the odometer disclosure regulations.15 The rule provides that a transferor may give a secure power of attorney to a transferee for the purpose of mileage disclosure in two circumstances—when the transferor's title is physically held by a lienholder or when the title is lost.16 In either instance, use of a power of attorney document for mileage disclosure is permissible only if otherwise permitted by State law. In this rule, NHTSA narrowly amended its earlier rule prohibiting any party from signing an odometer disclosure statement as both the transferor and transferee in the same transaction to add an exception. The amendment allowed the same person to so sign the odometer disclosure statement if he or she satisfied the detailed, specific provisions on powers of attorney added to the regulations in 49 CFR 580.13 or 14. These provisions state the form and conditions of the power of attorney. Also, the power of attorney document must be issued by the State and be set forth by a secure process.17 While providing for powers of attorney, NHTSA expressed concern that powers of attorney that allow a person to sign a disclosure as both the transferor and transferee result in only one party to the transaction being aware of the previous mileage disclosures, which could jeopardize the integrity of the paper trail—the evidence of rollbacks that Congress intended to enhance by enacting TIMA.18

A number of purposes can be derived from the statute directing NHTSA to issue a rule and the implementing rule.

One purpose was to provide limited exception(s) to a rule prohibiting a person from signing an odometer disclosure statement as both the transferor and transferee in the same transaction, which had the effect of prohibiting the use of powers of attorney for purposes of recording mileage on titles of motor vehicles.19 More particularly, a purpose was to permit a power of attorney for disclosure of the odometer reading at the time of sale of a vehicle to be given by the seller to the buyer, in the limited situation when the owner's title is physically held by a lienholder at the time of the transaction and the power of attorney is allowed by State law.20 Another limited situation in which a power of attorney may be used, as recognized in the implementing regulation, is where the title is not present because it has been lost by the person to whom it was issued by the State, if permitted by State law.21 In order for a power of attorney to be used in the lost title situation, the transferee (e.g.,the dealer) must apply for the duplicate title on behalf of the transferor. Under these circumstances, a power of attorney is available to facilitate consumer vehicle sales transactions, but is not available in other than consumer sales transactions, where the risk of fraud is considerably greater.22

A second purpose was to assure that the form of the power of attorney document issued by a State precluded odometer fraud. While under the limited circumstances discussed above and if allowed under State law, with use of a power of attorney one person may sign the odometer disclosure on the title as both the transferor and transferee, to limit fraud, the power of attorney form must meet certain minimum requirements.23 Congress specified that NHTSA would prescribe a form by rule. Under the rule, the form must be separated into part A, and if permitted by State law, B and C.24

The transferor's power of attorney to the transferee for mileage disclosure must be on part A of a secure form issued by the State to the transferee.25 Using this form, the transferor appoints the transferee his/her attorney-in-fact for the purpose of mileage disclosure. The form provides for written disclosure by the transferor to the transferee of the information that is stated on a vehicle title under 49 CFR 580.5 when ownership of the vehicle is transferred.26 Among other things, there must be a space in part A for the transferor and transferee to sign the power of attorney form and print their names and a space for the transferor to disclose the mileage. Part A must also contain a reference to the Federal odometer law and state that providing false information or the failure of the person granted the power of attorney to submit the form to the State may result in fines and/or imprisonment. The disclosure on part A of the power of attorney form is commonly made by theseller when he or she trades-in a vehicle at a dealer.

After part A of the power of attorney form has been used, part B may be executed when a vehicle addressed on part A is resold.27 Part B of the secure power of attorney form, if permitted by State law, allows a subsequent transferee to give a power of attorney to his transferor to review the title and any reassignment documents for mileage discrepancies, and if no discrepancies are found, to acknowledge disclosure on the title, while maintaining the integrity of the first seller's disclosure. The disclosure required to be made by the transferor to the transferee for this transaction on part B of the power of attorney form tracks information required to be made by the transferor to the transferee on the title when ownership of a vehicle is transferred on a title under 49 CFR 580.5.28 Among other things, the power of attorney must contain a space for the transferor to disclose the mileage to the transferee and sign and date the form, and a space for the transferee to sign and date the form.

Commonly, part B is used in the sale of a trade-in vehicle by a dealer. If for example, a dealer does not have possession of the title, because the vehicle was a trade-in and the lienholder has not yet released the title, or because the title was lost and the dealer has not yet obtained a duplicate title on behalf of the transferor who sold the vehicle to the dealer, the subsequent buyer of the used vehicle (the transferee) is permitted to give a power of attorney to the transferor/selling dealer to acknowledge the mileage disclosure on their behalf. This power of attorney from the transferee to the transferor allows the transferor (who is the original seller's attorney in fact under Part A) to sign the title as both the transferor and transferee in the same transaction.29 In addition, because the same person signs the title as the transferor and transferee, the appointment of the transferor as the transferee's attorney-in-fact must be made on part B of the same secure power of attorney form, issued by a State, upon which the transferor was appointed the attorney-in-fact by the original transferor on part A.30 This form enables purchasers to examine the previously issued power of attorney for alterations, erasures, and other marks, and to learn the name of the prior owner without the additional cost of a title search. This is the same information that purchasers would receive if the title was not held by a lienholder since, under TIMA, the transferor is required to disclose mileage on the vehicle's title.

The secure power of attorney form with a part B must contain a certification in part C.31 To ensure that a person exercising a power of attorney under both sections 580.13 and 580.14 (parts A and B) is fully aware of his/her obligation and their liability for any action that is inconsistent with the power of attorney, the rule (§ 580.15) requires the completion, on part C, of a certification attesting that the signer has disclosed the mileage on the title document consistent with the mileage disclosed on the power of attorney form. The signer of part C also attests that he or she has examined the title, and that the mileage disclosure made on the title executed under the power of attorney is greater than the mileage previously stated on the title and any reassignment form.32

The part C certification requirement need only apply to the subsequent sale situation (typically a trade-in) where the second purchaser's only link to the title will be the transferor (dealer). Thus, section 580.15 provides that the certification requirement applies only when the transferor is exercising a power of attorney for both the first sale and second sale customers, as provided for in sections 580.13 and 580.14. If the title is present at the time of the second sale, the purchaser will be able to review the title himself/herself to assure that the mileage is entered in accordance with the initial transferor's power of attorney and is higher than the mileage appearing on the title and reassignment documents.

Finally, the State itself must issue the power of attorney form.33

A third purpose was to set ground rules for transferors and transferees, providing that both parties provide all of the information and signatures required in parts A, and as applicable B, and C of the secure power of attorney form. This ensures that upon receipt of the first transferor's title, the transferee (typically a dealer) must complete the space for mileage disclosure on the title exactly as the mileage was disclosed by the first transferor on the power of attorney form.

A fourth purpose was to prevent odometer fraud by establishing processes, mechanisms and conditions calculated to result in the disclosure of the actual mileage on the title.34 As provided in the PSRA of 1988, NHTSA's rule is to ensure that transferors disclose the actual mileage at the time of the transfer on the power of attorney document and that persons exercising the power of attorney restate that mileage exactly on the title in the space provided. Toward these ends, one condition, required by the implementing rule, is inclusion of the printed names and signatures of the first transferor and the first transferee (typically a dealer) accompanying the mileage disclosure, as well as a statement of liability for fines for false statements. The transferor shall also certify on the power of attorney form that to the best of the transferor's knowledge, either: (1) The odometer reading reflects the actual mileage; or (2) if the transferor knows that the odometer reading reflects mileage in excess of the designed odometer limit, he shall include a statement to that effect; or (3) if the transferor knows that the odometer reading differs from the mileage and the difference is greater than that caused by a calibration error, he shall include a statement that the odometer reading does not reflect the actual mileage and should not be relied upon, and a warning notice to alert the transferee that a discrepancy existsbetween the odometer reading and the actual mileage.

There are additional mechanisms employed in the power of attorney regulations to ensure accurate disclosures of the odometer reading and to limit fraud. As provided in the rule, upon receipt of the first transferor's title, the transferee has a duty to complete the space for mileage disclosure on the title exactly as the mileage was disclosed by the first transferor on the power of attorney form.35 Further, the certification provision discussed above provides a mechanism applicable to the second sale. As provided by section 580.15, the person completing part C of the secure power of attorney form issued by the State certifies that he or she has disclosed the mileage on the title document consistent with the mileage disclosed to him or her on the power of attorney form, that he or she examined the title and the mileage disclosure on that title and the mileage disclosure he or she is making on the power of attorney is greater than the mileage previously stated on the title.

In addition, the PSRA, as amended in 1990, provided another process to ensure accurate disclosure of the odometer reading. It required that the rule ensure that the person granted a power of attorney must submit the completed original power of attorney to the state along with a copy of the title (showing the restatement of mileage) and must also retain a copy. As directed, NHTSA issued implementing regulations providing that the transferee must submit the completed original power of attorney form to the State that issued it along with either a copy or the actual transferor's title when submitting a new title application. This allowed for review of the mileage on the power of attorney form and corresponding title.

NHTSA's regulations provide an additional mechanism facilitating verification of previous mileage statements by affording subsequent purchasers access to previous title and power of attorney documents. Under section 580.16(a), if the second-sale transferee applies for title in his own name (in other words, if the second-sale transferee does not give power of attorney to his transferor to review the title and reassignment documents), then that transferor must show him, upon his request, a copy of the power of attorney form completed by the previous owner. In any event, under section 580.16(b) of the rule, a transferor who was given power of attorney by his transferor and who holds title to the vehicle in his name, must, upon request of the purchaser (second-sale transferee), show his/her purchaser a copy of the previous owner's title and a copy of the power of attorney form completed by the previous owner.

A further mechanism in the rule was its voiding mechanism. As provided by the rule, 49 CFR 580.15(b), any mileage discrepancies void the power of attorney. NHTSA has characterized this provision as vital;36 if the mileage reflected by the transferor on the power of attorney is less than that previously stated on the title and any reassignment documents, the power of attorney shall be void. The power of attorney is voided by the existence of a discrepancy, not by an action causing a discrepancy.

A fifth purpose is to prevent alterations on odometer disclosures by powers of attorney and to preclude counterfeit powers of attorney through secure processes. In furtherance of these purposes, the power of attorney (incorporating the disclosure statement) must be on a form issued by the State that is set forth by means of a secure printing process or other secure process. It has to be no less secure than the title document itself.

A sixth purpose is to create a record of the mileage on vehicles and a paper trail. The PSRA referred to the need to facilitate enforcement. In addition, and more specifically, the amended statute provided “the person granted such power of attorney * * * shall submit the original back to the State with a copy of the title showing a restatement of the mileage.”37 This paper trail includes the written, signed (by both the transferor and transferee), and dated odometer disclosure statement on the secure power of attorney form, and the corresponding entry on the vehicle title, which, as discussed above, must read exactly as it was disclosed by the transferor on the power of attorney document. The transferee is required to file the original power of attorney form with the State that issued it, with a copy of the transferor's title or with the actual title when the transferee submits a new title application at the same time. The transferee is required to return a copy of the power of attorney form to the transferor. The State shall retain the original power of attorney form for the shorter of (a) Three years or (b) a period equal to the State titling record retention period. As stated in the rulemaking, the State may retain the copy in any medium by which such information may be stored, provided there is no loss of information. States are not limited to retaining the records in paper form.

The retention of the power of attorney form by the State permits law enforcement officials to trace fraudulent disclosure statements back to transferors, if necessary.

Moreover, Section 401 of the PSRA, as amended in 1991, requires NHTSA's rules to provide for the retention of the power of attorney form. The rule added section 580.8(c), which concerns odometer disclosure statement retention. Under this paragraph, motor vehicle dealers and distributors who are assigned a power of attorney by their transferors are required to retain, for five years, a copy of each power of attorney they receive. These documents must be retained at the primary place of business of the dealer or distributor in an order that is appropriate with business requirements and that permits systematic retrieval.

Seventh, the overall purpose is to protect consumers by assuring that they receive valid representations of a vehicle's actual mileage at a time of transfer. This includes the ground rules for transferors and transferees, providing that both parties provide all of the information and signatures required in parts A, B, and C of the secure power of attorney form. This ensures that upon receipt of the transferor's title, the transferee shall complete the space for mileage disclosure on the title exactly as the mileage was disclosed by the transferor on the power of attorney form.

Florida, which is in the process of implementing an electronic title transfer system (e-title), petitions for approval of alternate odometer disclosure requirements.38 Florida requests alternate disclosure requirements for transfers of motor vehicles in transactions between private parties (casual sales) and transfers of motor vehicles, whether subject to a lien39 ornot subject to a lien, between private parties and motor vehicle dealers. Florida also requests alternate disclosure requirements for transactions involving leased vehicles.

Florida law authorizes the Florida Department of Highway Safety and Motor Vehicles (the Department) to accept any application for vehicle title by electronic means.See Fla. Stat. Ann. § 319.40 (1997). The Department is proposing amendments to the Florida statutes to allow the continuation of an electronic certificate of title in lieu of a paper certificate of title for transfers of motor vehicles. With electronic titling there would not be a paper certificate of title on which to disclose the vehicle's mileage at the time of transfer of ownership.

Currently Florida stores its titling and registration information (including images of all supporting title documentation) in a secure database referred to as the Florida Real-time Vehicle Information System, or FRVIS. According to Florida's petition, either a Department employee or an authorized tag agent at a state-authorized tag office enters information into this database. Only a Department employee or tag agent can change FRVIS title information, including owner information and the odometer disclosure. For title images (scanned, electronic copies of vehicle title documents), FRVIS stores all applicable data and stores images of documents that remain in the title history for the vehicle. Florida law also requires that the Department retain all documents regarding applications for, and issuance of, certificates of title—including titles, manufacturers' statements of origin, applications, and supporting documents submitted with the application such as odometer statements, VIN verifications, bills of sale, indicia of ownership, dealer reassignments, photographs, and any personal identification, affidavits, or documents required by or submitted to the Department—for a period of at least 10 years.Fla. Stat. Ann. § 319.23(11). The title resides as an electronic record in FRVIS; however, secure paper copies of the title can be generated from FRVIS if needed.

Florida intends to use a secure reassignment form in lieu of a paper title to capture odometer disclosure and transfer of e-titles. Florida law currently allows licensed dealers to use a secure reassignment form when making dealer reassignments and odometer disclosures after all reassignment and odometer disclosure spaces on the reverse side of the Certificate of Title have been used. The form links the vehicle to the title record by the VIN and includes the required odometer disclosure statements. The Department scans the form and stores it in the title history for the vehicle. Florida proposes to use a similar form for odometer disclosure in its e-title program.

In Florida, lienholders hold the title to the vehicles securing the loan. Florida began its electronic title and lien (ELT) program in 2001. Under the current process, the Department contracts with vendors who provide secure electronic interface with Florida's titling system to participating lienholders. The vendors then contract with financial institutions who wish to participate in Florida's electronic title and lien program. The participating lienholders allow their titles to remain electronic. Electronic liens are satisfied through the secure electronic interface and the title is retained electronically until a paper copy is requested.40

Florida's proposed e-Odometer program can be divided into three transaction types: (1) Casual or private sales; (2) sales involving licensed motor vehicle dealers (including sales from private owners to licensed dealers, sales between licensed dealers, and sales from licensed dealers to private buyers); and (3) sales involving leased vehicles. The Agency understands that the program, as proposed, applies only when the transferred vehicle is electronically titled at the time of transfer of the vehicle.

Currently, a Florida resident wishing to sell his/her vehicle in a casual or private sale needs to have a paper title. The seller signs the paper title and discloses the odometer reading to the buyer on the title. The buyer then signs the paper title verifying the odometer reading. (The odometer disclosure is made on the title and signed by the buyer and seller at the time of transfer, in accordance with 49 U.S.C. 32705 and 49 CFR 580.5.) The buyer takes the paper title to a tag office, which processes the transfer of ownership and prints a new paper title in the buyer's name, or, if the buyer so elects, creates an e-title to be held by the Department.41 Whether the buyer elects to maintain the title electronically or in paper form, the tag office sends the old paper title and any other supporting documentation to the Department for scanning into FRVIS.

Under Florida's proposed e-title program,42 if a seller of a vehicle has an electronic title and wants to transfer that title, the seller and buyer would visit an authorized tag office together. After providing adequate identification to the tag agent, the buyer and seller would sign, in the presence of the tag agent, a secure reassignment form transferring ownership and disclosing the odometer reading. A title is then issued in the buyer's name and is stored electronically, or the buyer may choose to have a paper title issued. The secure reassignment form and copies of the identification are scanned into the title record in FRVIS.43 Florida maintains that these would travel with the title.

Currently, when a licensed motor vehicle dealer is involved, the process for transferring a title to a vehicle with an e-title and not subject to a lien is as follows. The seller with e-title brings the vehicle to a dealership. The seller and dealer complete a secure power of attorney with odometer disclosure. The dealer obtains the paper title from a tag agency or online from the Department. The dealer transfers the odometer disclosure information from the secure power of attorney to the title and signs the title as buyer and seller. When the dealer sells the vehicle to another buyer, the dealer and buyer complete the reassignment on the paper title with anodometer disclosure. The dealer takes both the secure power of attorney and the paper title to a tag agency. The title is then transferred to the buyer and a receipt is provided. The buyer has the option to obtain a new paper title or have the Department hold the title electronically. The secure power of attorney and old paper title are scanned and stored with title history in FRVIS.

Under Florida's proposed program, a seller with e-title would bring the vehicle to a dealership. The seller and dealer complete a secure reassignment form with odometer disclosure. When the dealer sells the vehicle to another buyer, the dealer and buyer complete another secure reassignment form with odometer disclosure. The dealer takes both of the secure reassignment forms to a tag agency. The vehicle title is then transferred to the buyer and a receipt is provided. The buyer has the option to obtain a paper title or have the Department hold the title electronically. The secure reassignment forms are scanned and stored with the vehicle title history in FRVIS.

Currently, when a licensed motor vehicle dealer is involved, the process for transferring a vehicle subject to an e-lien with e-title is as follows. A seller with e-title/e-lien brings the vehicle to a dealership. The seller and dealer complete a secure power of attorney with odometer disclosure. The dealer pays off the lien and the lienholder electronically releases the lien via a secure electronic interface with the Department (ELT). The dealer then obtains the paper title from a tag agency or online from the Department. The dealer transfers the odometer information from the secure power of attorney to the title and signs the title as buyer and seller. When the dealer sells the vehicle to another buyer, the dealer and buyer complete the reassignment on the title with odometer disclosure. The dealer takes both the secure power of attorney and the paper title to the tag agency. The vehicle title is transferred to the buyer and a receipt is provided. The buyer has the option to obtain a new paper title or have the Department hold the title electronically. The secure power of attorney and old paper title are scanned and stored with title history in FRVIS.

Under Florida's proposed program, a seller with e-title would bring the vehicle to a dealership. The seller and dealer complete a secure reassignment form with an odometer disclosure. The dealer pays off the lien and the lienholder electronically releases the lien via secure electronic interface with the Department (ELT). When the dealer sells the vehicle to another buyer, the dealer and buyer complete another secure reassignment form with an odometer disclosure. The dealer then takes both secure reassignment forms to a tag agency, where the title is transferred to the buyer and a receipt is provided. The buyer has the option to obtain a paper title or have the Department hold the title electronically. The secure reassignment forms are scanned and stored with the vehicle title history in FRVIS.

Florida currently does not allow for an e-title in the dealer reassignment process. A dealer must obtain a paper title prior to being able to resell the vehicle. Once there is a paper title, the dealer uses the current paper process. The dealer uses the back of the title to include reassignments, including odometer disclosure. Once this form is full (Florida allows for three reassignments on the title), the dealer will use a secure title reassignment supplement (HSMV 82994). This form also includes the required odometer disclosures. When a vehicle is ultimately sold to a customer, the paper title and all secure title reassignment supplements are provided to the tag agency and forwarded to the Department for scanning and storing in the title record.

For an e-title, the Department is proposing that the dealer use a secure reassignment supplement instead of having to obtain a paper title. Any subsequent reassignments would also use the secure reassignment supplement. When the vehicle is ultimately sold to a retail customer, all secure reassignment supplements would be provided to the tag agency for verification of the chain of ownership and verification of the odometer disclosure. All documents would be forwarded to the Department for scanning and storing in FRVIS.

In the case of leased vehicles, the lessor typically retains ownership of the vehicle, but does not possess it. The lessor, as a transferor, must comply with the federal odometer disclosure requirements when it subsequently transfers title of a leased vehicle. As noted by Florida, Federal laws require written mileage disclosures be made by lessees to lessors upon the lessor's transfer of the ownership of the leased vehicle.

Currently, Florida's process for transferring leased vehicles is as follows. The lessor holds the vehicle's paper title. When the lease ends (for example, in a trade-in or buyout situation), the lessee brings the vehicle to a dealership. The lessee signs an odometer disclosure Statement. The lessor then transfers the odometer reading to the title. The lessor signs title over to the dealer (or other party) along with the odometer disclosure statement. When the dealer sells the vehicle to a buyer, the dealer and buyer complete the reassignment on the paper title with the odometer disclosure. The documents are then sent to an authorized tag agency, where the title is transferred to the buyer and a receipt is provided. The buyer has the option to obtain a new paper title or have the Department hold the title electronically. The old paper title and supporting documentation are scanned and stored with the vehicle title history in FRVIS.

Under Florida's proposal, the lessor holds an e-title. When the lease ends, the lessee would bring the vehicle to a dealership. The lessee signs an odometer disclosure statement. The lessor then signs a secure power of attorney to the dealer which includes the odometer disclosure. The dealer signs a secure reassignment form agreeing with the odometer disclosure. When the dealer sells the vehicle to another buyer, the dealer takes the documents (bill of sale, reassignment document, and power of attorney) to the tag agency, where the title is transferred to the buyer and a receipt is provided. The buyer has the option to obtain a new paper title or have the Department hold the vehicle title electronically. All documents are sent to Department and scanned into the vehicle title history in FRVIS.

Florida is implementing its electronic title or “e-title” system in three phases. Under the first phase, which Florida states is complete, participating lienholders are allowed, but not required, to have their titles and liens held electronically by the Department. This option allows lienholders to avoid maintaining paper lien portfolios. The Department and the lienholders encourage owners who satisfy their liens to continue to maintain the title electronically.

Under the second phase of the e-title project, dealers would be allowed to buy and sell e-title vehicles and take e-title vehicles in on trade without acquiring a paper title. It is the Agency's understanding that the program will extend to leased vehicles, including end-of-lease vehicles coming back to thedealer and vehicles being traded in prior to the end of the lease. Lessors will give the dealer power of attorney to disclose the vehicle mileage, as indicated by the lessee on an odometer disclosure statement, on a secure reassignment form, which will then be used to transfer title from the Lessor to a subsequent purchaser. This process will obviate the need for the dealer to obtain a paper title.

The third phase of the project would extend e-title capability to private or casual sales. Under the proposal, the seller (transferor) and buyer (transferee) will have two options for completing a motor vehicle sale. Currently, the vehicle's title is either held physically by the vehicle owner or the vehicle is titled electronically. If the vehicle is titled electronically, the owner now must acquire a secure paper copy of the title prior to transferring the vehicle. The transferor makes the required odometer disclosure on the title and both parties sign the title, effectuating transfer of the vehicle. Under Florida's proposed program, if the vehicle has an e-title, the transferor would not be required to obtain a paper title to transfer it. The transferor and transferee will have the option to go to a tag agent or tax collector's office and, after providing adequate identification to the agent, execute a secure reassignment form to transfer title from the transferor to the transferee without the need to first acquire a paper title.44

Florida submits that its e-Odometer program meets the purposes of TIMA as described by NHTSA summarized above and described more fully in the Agency's Final Determination on the Commonwealth of Virginia's petition for alternate odometer disclosure requirements.See74 FR 643, 647-48 (January 7, 2009). The petition identified the purposes of TIMA and the State's assessment on how its proposed program would comply with each purpose.

One purpose is to assure that the form of the odometer disclosure precludes odometer fraud. Florida asserts that the secure reassignment form will have the same security features currently included on title paper and will travel with the title record in FRVIS; both parties will be present together in a tag agency with identification in order to process the title transfer, which includes execution of the odometer disclosure statement on the secure reassignment form.

A second purpose of TIMA is to prevent odometer fraud by processes and mechanisms making the disclosure of an odometer's mileage on the title both a condition of the application for a title and a requirement for title issuance by a state. Florida states that under its proposal, odometer disclosure would remain a required data input for application of a title and a required output on the title. By having both parties present with required identification, Florida states the process would be more secure than the current process, which allows the owner to sign the title over to the buyer who then produces the document when obtaining title without the seller present.

A third purpose is to prevent alterations of disclosures on title and to preclude counterfeit titles through secure processes. Florida states in its petition that, with both parties present at a tag agency with identification, this process will prevent alterations and preclude counterfeit titles. If changes are necessary, a new secure document will be signed by both parties present in front of an authorized tag agent.

A fourth purpose is to create a record of the mileage on vehicles and a paper trail. Florida states that under its proposal, the secure document, whether a secure reassignment form or secure paper title, signed by both the buyer and seller will be scanned and stored as evidence of the agreement by both the buyer and seller of the odometer reading. This creates a permanent record that is easily checked by subsequent owners or law enforcement officials.

A fifth purpose is to protect consumers by assuring that they received valid representations of the vehicle's actual mileage at the time of transfer based on odometer disclosures. Under its proposal, Florida states this purpose is served because consumers (buyers) will be present with sellers at the time the title is transferred (currently this is not usually the case).

One purpose is to assure that the form of the odometer disclosure precludes odometer fraud. Florida states its proposal would meet this purpose because the secure reassignment form will have the same security features currently included on title paper. The dealer will use secure reassignment forms, which will travel with the title, which the dealer would sign with the previous owner and with the new buyer.

A second purpose is to prevent odometer fraud by processes and mechanisms making the disclosure of an odometer's mileage on the title a condition of the application for a title and a requirement for the title issued by the State. Florida states that the e-title process requires disclosure of an odometer's mileage on a secure document. The secure reassignment forms would have the same security features currently included on title paper and would travel with the title record.

A third purpose is to prevent alterations of disclosures on a title and to preclude counterfeit titles through secure processes. Florida states that a title would not be issued to a buyer if the chain of ownership cannot be established. The submission of all secure reassignment forms would establish the chain of ownership. Odometer disclosures would be part of those forms.

A fourth purpose is to create a record of the mileage on vehicles and a paper trail. Florida notes that the secure document signed by the previous owner, the dealer, and the buyer would be scanned and stored as evidence of the agreement by both the buyer and seller of the odometer reading.

A fifth purpose is to protect consumers by assuring that they received valid representations of the vehicle's actual mileage at the time of transfer based on odometer disclosures. According to Florida, the secure reassignment forms would allow for valid representation of the odometer during both transactions (the original owner to dealer transaction and the subsequent dealer to buyer transaction).

One purpose is to assure that lessors have the vehicle's actual odometer mileage at the time of transfer. Florida states that the only change proposed by its e-title proposal from the current process is that, instead of signing an actual paper title, the lessor would sign a power of attorney and disclose the odometer reading as provided to it bythe lessee. This power of attorney would then transfer this odometer information to the dealer to sell the vehicle.

A second purpose is to assure that lessees provide lessors with an odometer disclosure statement. Florida states that its proposed e-title process would not affect this requirement.

A third purpose is to assure that lessees are formally notified of their odometer disclosure obligations and the penalties for failing to comply by not providing complete and truthful information. Florida states that its proposed e-title process would not affect this requirement.

A fourth purpose is to set rules for accurate disclosure by lessors, directing them to indicate on the title the mileage provided by the lessee, unless the lessor has reason to believe that the disclosure by the lessee does not reflect the actual mileage of the vehicle. Florida states that its proposal would satisfy this purpose by allowing the lessor to indicate the mileage on a secure reassignment form that would travel with the title.

A fifth purpose is to create records and a paper trail, including the written, dated and signed odometer disclosure statement by the lessee. Florida states that its proposal would not change this requirement. The title would remain in electronic form; however, the secure reassignment form with the lessor's odometer disclosure, the power of attorney form and bill of sale would all be scanned into the title history. The Department's database would store these documents with the title.

Florida's proposed program incorporates mileage disclosure by power of attorney in one circumstance—when a lessee brings a leased vehicle to a dealer, the lessor would give a power of attorney to the dealer for the purpose of mileage disclosure on the secure reassignment form to effect transfer of the vehicle from the lessor to a third party. NHTSA has not previously had occasion to identify and discuss these purposes when addressing prior petitions for alternate odometer disclosure requirements from other states because other states' proposals did not encompass the use of powers of attorney for mileage disclosure.

Under TIMA, NHTSA “shall approve alternate motor vehicle mileage disclosure requirements submitted by a State unless the [NHTSA] determines that such requirements are not consistent with the purpose of the disclosure required by subsection (d) or (e) as the case may be.” The purposes are discussed above, as is Florida's proposed program. We now provide our initial assessment whether Florida's proposal satisfies TIMA's purposes as relevant to its petition.45 We first address casual or private sales, followed by sales involving a licensed dealer of vehicles with and without a lien, sales of leased vehicles, and finally sales using a power of attorney for purposes of odometer disclosure.

One purpose of TIMA is to assure that the form of the odometer disclosure precludes odometer fraud. In this regard, NHTSA has initially determined that Florida's proposed alternate disclosure requirements satisfy this purpose as the proposal relates to casual or private sales. Under Florida's proposal, there would be an e-title. A required part of the data to be entered in the transfer of title would be the vehicle's odometer reading. In casual/private sales, the seller and buyer would visit a tag office together, provide identification to the tag agent, and sign a secure reassignment form transferring ownership and disclosing the odometer reading. This is one document and it would be signed before a tag agent. The secure reassignment form including the required odometer disclosure statement would be scanned and reside as an electronic record within the Department's database that would be linked to the vehicle's title through title number and VIN. If a hard copy of the title is needed or desired, Florida can generate a paper title with the odometer disclosure statement on the title using a secure printing process. As to the form of the title containing a space for the transferor to disclose the vehicle's mileage, the proposed Florida program would provide an electronic equivalent to these requirements for use in a subsequent sale of the vehicle, as transfers would be effected electronically on secure reassignment forms or paper titles that provide space for the required odometer disclosure in keeping with TIMA and current practice.46

Another purpose of TIMA is to prevent odometer fraud by processes and mechanisms making the disclosure of odometer mileage on the title a condition of the application for a title and a requirement for the title issued by the State. NHTSA has initially determined that Florida's proposed electronic process satisfies this purpose as it relates to casual or private sales. Florida's proposed electronic title transfer process would require proper identification of the seller and buyer and disclosure and acceptance of odometer information on a secure reassignment form in front of a tag agent before the transaction can be completed. While the form is referred to as a reassignment form, viewed from a e-title transactional standpoint, it appears to be an information entry form used in the context where the buyer and seller both appear before the tag agent and simply use the document to convey odometer information, with their signatures, for the tag agent to record in the e-title system. We note that Florida's use of the term “secure reassignment form” in this situation appears to be a misnomer. The transfer of title in casual or private sales is not a reassignment as there is no prior assignment. The document is more accurately described as a secure State title transfer form for use when a vehicle has e-title and the title cannot be physically signed.

Another purpose of TIMA is to prevent alterations of disclosures on titles and to preclude counterfeit titles through secure processes. The Agency has initially determined that Florida's proposed program satisfies this purpose as it relates to casual or private sales. Florida's alternate disclosure requirements appear to be as secure as current paper titles in casual or private sales. As we understand Florida's proposal, the odometer statement would be disclosed initially on secure paper—either on the paper title itself or on a secure reassignment form at one of Florida's authorized tag agency offices. First, both buyer and seller would sign the reassignment form in front of a tag agent, which would ensure the security of that aspect of the proposed process. Second, Florida's reassignment form would be secure; it would be set forth by means of a secure printing process or other secure process in compliance with 49 CFR 580.4. On subsequent title transfers in casual or private sales, the transferor and transferee would have tocomplete the odometer disclosure and acceptance—either on a secure paper title issued in a conventional manner by the Department or on a secure reassignment form in front of a tag agent for the transaction to be completed.

Another purpose of TIMA is to create a record of the mileage on vehicles and a paper trail. The underlying purposes of this record and paper trail are to enable consumers to be better informed and provide a mechanism through which odometer tampering can be traced and violators prosecuted. In NHTSA's preliminary view, Florida's proposed program relating to casual or private sales satisfies this purpose. It would create a scheme of records equivalent to the current “paper trail” that assists law enforcement in identifying and prosecuting odometer fraud. Under the Florida proposal, creation of a paper trail would start with the requirement that a title cannot be transferred until and unless both the transferor and transferee execute a secure paper title consistent with the Federal regulations or a secure reassignment form, including the required odometer disclosure statement in front of a tag agent. Scanned copies of the title and secure reassignment form(s) would be stored in the vehicle's title record in FRVIS. If a paper title is requested, the odometer disclosure statement would be provided on the secure paper title.

The Department would retain an electronic copy of the prior titles (including the prior odometer disclosure statements) and any supporting documentation, including secure reassignment forms. The Department would scan these documents and store them with the vehicle's electronic title history. For title images, the Department would store all applicable data and images of documents in the title history for the vehicle in FRVIS. Furthermore, Florida requires that all documents used to issue a title be retained for a period of at least ten (10) years. These electronic records would create the electronic equivalent to a paper trail in a paper-based system that would be readily available to law enforcement. Additionally, the vehicle mileage would be available for public view via an online motor vehicle check available to Florida customers.

Whether Florida's program as it relates to casual or private sales conforms to TIMA's overall purpose is discussed in subpart D below.

One purpose of TIMA is to assure that the form of the odometer disclosure precludes odometer fraud. As discussed above, to prevent odometer fraud facilitated by disclosure statements that were separate from titles, TIMA required mileage disclosures to be on a secure vehicle title, containing space for the seller's attested mileage disclosure and a new disclosure by the buyer when the vehicle was sold again, instead of a separate document.47 NHTSA has initially determined that the form of disclosure in Florida's proposal for retail vehicle sales to dealers of vehicles without or with a lien would not satisfy this purpose, for the reasons discussed below.48

In instances when a private seller sells a vehicle to a dealer, Florida proposes that the seller and dealer complete a secure reassignment form to make the odometer disclosure. Florida's assessment of its proposal in light of the purposes of TIMA states that the reassignment forms will travel with the title. But from a TIMA perspective, when there is a transfer involving a transferor in whose name the vehicle is titled, the transferor must disclose the mileage on a title, and not on a separate reassignment document such as one that is supposed to travel with the title. Thus, Florida's proposed program is not consistent with a purpose of the disclosure required by TIMA pertaining to the form of the disclosure.

Another purpose of TIMA is to prevent odometer fraud by processes and mechanisms making odometer mileage disclosure on the title a condition for the application for a title and a requirement for the title issued by the State. As explained above, a major shortcoming of the odometer provisions of the Cost Savings Act prior to TIMA, was the absence of a requirement that the odometer disclosure statement be on the vehicle's title that, following the sale of the vehicle, was presented to the State for retitling. NHTSA has initially determined that Florida's proposed alternate disclosure requirements for vehicles transferred from a private owner to a licensed dealer, do not satisfy this purpose. We have initially determined that Florida's proposed alternate disclosure requirements for subsequent vehicle transfers between licensed dealers satisfy this purpose.

As discussed above, Florida's proposal for sales to dealers provides for disclosure and acceptance of odometer information on a secure reassignment form, not on a title. Following the ultimate re-sale of a vehicle to a consumer by a dealer (possibly not the same dealer that took the vehicle as a trade-in), that dealer would take secure reassignment forms to the tag agency for titling. In this respect, Florida does not propose making the disclosure of odometer mileage on the title in the initial transaction involving a transferor in whose name the vehicle is titled a condition for the application for a title and a requirement for the title issued by the State. Florida would provide for issuance of a new title based on secure reassignment forms. Such a form can be easily discarded and another secure reassignment form bearing an inaccurate odometer disclosure could be created by an unscrupulous dealer somewhere in the chain of transfers. We have tentatively concluded that, in order for the proposed program to be consistent with a purpose of TIMA, in the first transfer of title of a vehicle from a private seller to a dealer Florida may not provide for a mileage disclosure on a secure reassignment form.

A third purpose of TIMA is to prevent alterations of disclosures on titles and to preclude counterfeit titles through secure processes. In view of the shortcomings of Florida's proposed program regarding the use of secure reassignment forms instead of titles in sales between private parties and dealers discussed above, NHTSA believes that it is inappropriate to reach a conclusion regarding the security aspects of those forms in that context. The Agency has initially determined that Florida's proposed alternate disclosure requirements for the subsequent transfer of vehicles between dealers satisfy this purpose. As we understand Florida's proposal, the secure reassignment form would be produced by the State and would be comparable to reassignment forms now in use in transfers between dealers.

A fourth purpose of TIMA is to create a record of the mileage on vehicles and a paper trail. The underlying purposes of this record and paper trail are to inform consumers and provide a mechanism to trace and prosecute odometer tampering. NHTSA's initial determination is that Florida's proposed alternative scheme would not, in one critical respect, create a scheme of records equivalent to the current “papertrail” used for identifying and prosecuting odometer fraud. Florida proposes widespread use of secure reassignment forms in transfers from private parties to dealers. In particular, Florida proposes that, instead of a title, a reassignment form would be used to create the record of the mileage on the odometer in the case of a transferor in whose name the vehicle is titled. This recorded mileage figure establishes a critical benchmark for evaluating the remaining mileage declarations that will follow. NHTSA has initially determined that in these circumstances use of reassignment documents would not create the records and paper trail contemplated by TIMA. Our concerns about odometer disclosures on these forms in lieu of disclosure on the title itself are described above.

NHTSA tentatively concludes the remainder of Florida's proposal would otherwise meet the record creation purposes of TIMA. Regardless of whether the buyer requests a paper title or surrenders the title to the Department to maintain electronically, the Department would retain an electronic copy of the prior titles (including the prior odometer disclosure statements) and any supporting documentation, including secure reassignment forms and powers of attorney. The Department would scan these documents and store them in FRVIS with the vehicle's electronic title history. For title images, FRVIS would store all applicable data and stores images of documents that remain in the title history for the vehicle. Furthermore, Florida requires that all documents used to issue a title be retained for a period of at least ten (10) years. These electronic records would create the electronic equivalent of a paper based system that would be readily available to law enforcement. Additionally, the vehicle mileage would be available for public view via an online motor vehicle check available to Florida customers.

Whether Florida's program as it relates to sales involving licensed dealers conforms to TIMA's overall purpose is discussed in subpart D below.

One purpose of TIMA's leased vehicle provisions is to assure that the lessor has the vehicle's actual odometer mileage at the time the lessor transfers ownership. The Agency has initially determined that Florida's proposed program requirements satisfy this purpose. As we understand Florida's proposal, the State proposes to require vehicle lessees to sign an odometer disclosure statement that would be provided to the buyer by the lessor.

A second purpose of TIMA's leased vehicle provisions is to assure that the lessee provides the lessor with an odometer disclosure statement regarding the mileage of the vehicle at the time of transfer. The Agency has initially determined that Florida's proposed program requirements satisfy this purpose. As discussed above, the lessee would provide this to the lessor via an odometer disclosure statement when the lessee surrenders the leased vehicle to the dealer, and the lessor would provide this statement to the buyer.

A related purpose is to assure that lessees are formally notified of their odometer disclosure obligations and the penalties for failing to comply by not providing complete and truthful information. We have initially determined that Florida's proposal does not satisfy this purpose. As described in the petition, Florida's alternate disclosure requirements do not address this purpose other than a statement in the petition that the e-title process does not change the current requirement. We recognize that Florida's odometer disclosure law requires lessors to conform to Federal disclosure regulations under 49 CFR 580.7.Fla. Stat. Ann. § 319.225(4) (2010). Florida law also provides that State statutes regarding vehicle transfer and reassignment forms and odometer disclosure statements be construed to conform to 49 CFR part 580.Fla. Stat. Ann.§ 319.225(9) (2010). Further, according to Florida, the requirement that the lessee provide the lessor with an odometer disclosure statement when the lessee surrenders the vehicle typically is part of the lease agreement, which provides notice of the requirement and the penalties for failing to comply. But this is not a formal requirement. Underlying the adoption of the leased vehicles provisions of TIMA, there was significant concern about considerable understatements of mileage on leased vehicles that were turned-in and resold. Our initial determination is that this reliance on what is typically in a lease is not sufficient to assure that lessees are formally notified of their odometer disclosure obligations and the penalties for failing to comply by not providing complete and truthful information.

A fourth purpose is to set the ground rules for the lessors, providing for lessors to indicate the mileage provided by the lessee on the title, unless the lessor has reason to believe that the disclosure by the lessee does not reflect the actual mileage of the vehicle. We have initially determined that Florida's proposal does not satisfy this purpose. A lessee would make an odometer disclosure by executing an odometer disclosure statement upon relinquishing the leased vehicle. The lessor may transfer the odometer disclosure statement from the lessee's statement to a secure power of attorney unless the lessor has reason to believe that the lessee's statement does not reflect the vehicle's actual mileage, in which case the lessor would be required to indicate on the title “true mileage unknown” or words to that effect.49 As explained in the discussion on powers of attorney above, odometer disclosure can be made using a secure power of attorney document only in the limited circumstances when the transferor's title is physically held by a lienholder at the time of the transfer or the transferor to whom the title was issued by the State has lost the title and the transferee obtains a duplicate title on behalf of the transferor. These limited circumstances do not include lessors giving power of attorney to dealers for purposes of odometer disclosure. Under Florida's proposal, the vehicle title is not unavailable to the lessor—the lessor, as the titled owner of the vehicle in Florida, can simply request a paper copy of the title from the State and effect transfer of the vehicle on the secure paper title.

A fifth purpose of TIMA's leased vehicle provisions is to create records and a paper trail. The paper trail includes the signed odometer disclosure statement by the lessee. The Agency has initially determined that Florida's proposed alternate disclosure requirements do not satisfy this purpose. Under Florida's proposal as we understand it, the lessee would be required to sign an odometer disclosure statement when the vehicle is surrendered. The lessor would not be required to sign this document. The lessor would execute a power of attorney to the dealer that would include the odometer disclosure statement as provided by the lessee. The dealer then would sign the secure reassignment form (apparently for the transferor/lessor and as transferee), providing an odometer disclosure provided by the lessor on the secure power of attorney. When the dealer sells the vehicle to another buyer, the dealer would take the documents (bill of sale, reassignment form, and power ofattorney) to the tag agency. The title would be transferred to the buyer. Whether the buyer elects a new paper title or e-title, the related documents—including the old title and any supporting documentation—would be scanned and stored with the vehicle title history by the Department. Florida does not state whether the lessee's odometer disclosure statement to the lessor would be scanned. The electronic documents would be associated with the vehicle title history by title number and VIN.

Florida's proposed program for leased vehicle transactions would not create a scheme of records equivalent to the current “paper trail” now assisting consumers and law enforcement. Under TIMA as implemented, dealers and lessors are required to retain all odometer disclosure statements that they issue and receive. However, Florida's proposed program does not specify that the dealer and lessor would be required to maintain a copy of the lessee's odometer disclosure statement, and does not provide an alternative mechanism such as a provision that the statement would be forwarded to either a tag agent for mileage verification or the Department for scanning and maintaining as part of the vehicle's title history. We have tentatively concluded that, in the transfer of title of vehicles subject to a lease agreement, Florida's proposed program does not satisfy the purposes of TIMA because it does not require dealers and lessors to retain odometer disclosure statements from lessees.

The overall purpose of TIMA's leased vehicle provisions is to ensure that vehicles subject to leases have adequate odometer disclosure statements executed on titles at the time of transfer. The Agency has initially determined that Florida's proposed program does not meet TIMA's overall requirement. Under Florida's proposal, upon the termination of the lease, a lessee would sign an odometer disclosure statement. This is an important document that the lessor must sign. But under Florida's proposal, the lessor signs a separate secure power of attorney to the dealer which only assumedly includes the odometer reading. In any event, the lessor's power of attorney to a dealer for purposes of odometer disclosure allows the same person to sign an odometer disclosure for both parties. That is fraught with potential problems of incorrect odometer statements. Congress did not extend the use of power of attorney to this circumstance.

Florida's proposal provides for odometer disclosure in transfer of leased vehicles to be made on a secure reassignment form. Lessors (transferors) are titled owners in Florida. But as explained above, in the case of a transferor in whose name the vehicle is titled, the transferor shall disclose the mileage on the title, and not on a reassignment document. Florida's proposal runs counter to this requirement.

The dealer would take the documents (bill of sale, reassignment document, and power of attorney) to the tag agency; thereafter, the documents would be sent to the Department and scanned into the title history. However, Florida's proposal does not require the odometer disclosure statement made by the lessee to be co-signed by the lessor, submitted with title documents, or to be retained by any party. In the Agency's view, this is an important link in the chain of odometer disclosure for a leased vehicle. This link should be preserved as much as any other.

Because of the above-identified problems, the Agency tentatively concludes that Florida's proposed program on leased vehicles does not meet TIMA's overall purpose of ensuring that vehicles subject to leases have adequate odometer disclosure statements executed on titles at the time of transfer.

One purpose of the power of attorney provision in TIMA as amended was to provide limited exception(s) to a rule prohibiting a person from signing an odometer disclosure statement as both the transferor and transferee in the same transaction, which had the effect of prohibiting the use of powers of attorney for purposes of recording mileage on titles of motor vehicles. Florida's proposal does not fit within the narrow confines of this exception. Under Florida's proposed program, a lessor (not a lienholder) would execute a power of attorney. No lienholder would be involved nor is there a requirement that the title be lost. The overall purposes of TIMA as amended are not preserved by this proposed expansion of the Congressional amendment of TIMA. We have initially determined that Florida's proposed program is not consistent with a purpose of the disclosure required by TIMA, including amendments thereto.50

A second purpose was to assure that the form of the power of attorney document issued by a State precluded odometer fraud. We have not made a determination as to whether Florida's proposal meets this purpose. Florida's proposal does not address the form of the secure power of attorney documents it would use. The requirements for form are discussed in section III.C above.

A third purpose is to set the ground rules for transferors and transferees, providing that both parties provide all of the information and signatures required in parts A, and as applicable B and C of the secure power of attorney form. We have not made a determination as to whether Florida's proposal meets this purpose. Florida's proposal does not address this purpose.

A fourth purpose was to prevent odometer fraud by processes, mechanisms, and conditions calculated to result in the disclosure of the actual mileage on the title. We have not made a determination as to whether Florida's proposal meets this purpose. Florida's proposal does not address the processes, mechanisms and conditions related to use of the secure power of attorney for the purposes of odometer disclosure.

A fifth purpose is to prevent alterations of odometer disclosures by powers of attorney and to preclude counterfeit powers of attorney through secure processes. NHTSA has initially concluded that Florida's proposed process does not satisfy this purpose. Under NHTSA regulations, power of attorney forms shall be issued by the State and shall be set forth by a secure process. 49 CFR 580.13(a). As we understand Florida's proposal, the power of attorney document used by the lessor would not be State-issued and would not be secure. As noted above, TIMA was written in part to prevent alterations of disclosures on titles and precludes counterfeit titles by requiring secure processes. In furtherance of these purposes, paper titles (incorporating the disclosure statement) must be produced using a secure printing process or protected by “other secure process.” Allowing lessors to transfer title and make the required odometer disclosurethrough a non-secure power of attorney directly contradicts odometer disclosure requirements. While this process may add convenience to the process of transferring leased vehicles, it does so at the expense of the security requirements that are a foundation of TIMA. We have tentatively determined that Florida's proposed program does not meet this purpose. The power of attorney form—and any document used to reassign a vehicle title— must be issued by the State and produced by a secure process.

A sixth purpose is to create a record on the mileage on vehicles and a paper trail. We have not made a determination as to whether Florida's proposal meets this purpose. Florida's proposal does not address this purpose.

Seventh, the overall purpose is to protect consumers by assuring that they receive valid representations of a vehicle's actual mileage at a time of transfer. To the extent Florida's proposal addresses this purpose—providing for secure powers of attorney for purposes of mileage disclosure in the transfer of leased vehicles—NHTSA has initially concluded that Florida's proposed process does not satisfy it.

We note that Florida's proposed program would eliminate a current practice by Florida that does not comport with Federal odometer disclosure statutes and associated regulations. Florida's petition indicates that when an owner transfers a vehicle not subject to a lien to a dealer, the owner and dealer would execute a secure power of attorney, including an odometer disclosure statement, granting the dealer the power to make the odometer disclosure on the vehicle's paper title (which it needs to procure from the State before transfer of title can occur) and sign the title as transferor and transferee. Presumably, this practice would facilitate title transfer when the vehicle title is maintained electronically and neither the transferor nor dealer has immediate access to the paper title. Under TIMA and Agency regulations, a power of attorney may be used in making the odometer disclosure statement only if the title is lost or is in the possession of a lienholder when the transferor transfers ownership of the vehicle.51 A party may not sign an odometer disclosure statement as transferor and transferee except as set forth in 49 CFR 580.13 or 580.14.52 These regulations do not allow transferring vehicles not subject to a lien by power of attorney as is the current Florida practice. The Agency encourages Florida to discontinue its current practice of using a secure power of attorney to transfer title and disclose mileage for vehicles not subject to a lien without lost titles and require title transfer in these situations in a manner complying with current Federal statutes and regulations.

TIMA's overall purpose is to protect consumers by assuring that they receive valid odometer disclosures representing a vehicle's actual mileage at the time of transfer. In Florida in casual or private sales, the transferor and transferee currently sign the title, disclosing the odometer and effecting transfer of title. The transferee then goes to a tag agent and presents the title for processing and printing of a new paper title in the transferee's name (or the transferee elects e-title and the new title, the old title, and any supporting documentation is scanned and maintained electronically by the Department). This comports with Federal law. Under Florida's proposal, both parties would meet at a tag office, provide identification information to the tag agent, and execute a secure reassignment form transferring ownership and disclosing the odometer reading, which is witnessed by the tag agent. The representation of a vehicle's mileage on the secure reassignment form in the presence of a tag agent would be at least as valid as that in the current paper title transfer—there would be an identification requirement and the disclosure would be made in the presence of a tag agent who has confirmed the identification of the transferor and transferee.53 Further, copies of the identification documents, the prior title, supporting documents, and (when elected by the transferee) the new title, would be maintained electronically by the Department. This process likely would provide more (and provides no less) assurance of the validity of the odometer disclosure than a paper process. In addition, Florida's proposal would offer the public the opportunity to view the most recent odometer reading and date of that reading through an Internet application. A prospective buyer would be able to access the public e-Odometer information using the vehicle's VIN to assess a vehicle's true value by comparing the vehicle's current odometer reading to the electronic record stored with the Department.54

In sales involving licensed dealers (vehicles subject to a lien or not subject to a lien), as discussed above, Florida's proposed program relies on reassignment documents. Except in transactions following the first sale by the transferor in whose name the vehicle is titled, this is problematic, as discussed above. In view of this fundamental concern, which needs to be addressed by Florida, at this juncture, NHTSA is unable to further address the Florida program.

As discussed above, Florida's proposed program involving sales of leased vehicles, does not satisfy the overall purpose of TIMA protecting consumers by assuring that they receive valid odometer disclosures representing a vehicle's actual mileage at the time of transfer.

For the foregoing reasons, NHTSA preliminarily grants Florida's petition regarding proposed alternate disclosure requirements for vehicle transfers involving casual or private sales. NHTSA preliminarily denies Florida's petition regarding proposed alternate disclosure requirements for sales involving licensed dealers. NHTSA preliminarily denies Florida's petition regarding proposed alternate disclosure requirements for sales of leased vehicles.

This is not a final agency action. NHTSA invites comments within the scope of this notice from the public including Florida.

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

Your comments must not be more than 15 pages long (see49 CFR 553.21). We established this limit to encourage you to write your primary comments in a concise fashion. However, you may attach necessary additional documents to your comments. There is no limit on the length of the attachments.

Please submit two copies of your comments, including the attachments, to Docket Management at the address given underADDRESSES.

You may also submit your comments to the docket electronically by logging onto the Dockets Management System Web site athttp://dms.dot.gov.Click on “Help & Information,” or “Help/Info” to obtain instructions for filing the document electronically.

If you wish Docket Management to notify you upon its receipt of your comments, enclose a self-addressed, stamped postcard in the envelope containing your comments. Upon receiving your comments, Docket Management will return the postcard by mail.

If you wish to submit any information under a claim of confidentiality, you should submit three copies of your complete submission, including the information you claim to be confidential business information, to the Chief Counsel, NHTSA, at the address given above underFOR FURTHER INFORMATION CONTACT. In addition, you should submit two copies, from which you have deleted the claimed confidential business information, to Docket Management at the address given above underADDRESSES. When you send a comment containing information claimed to be confidential business information, you should include a cover letter setting forth the information specified in our confidential business information regulation (49 CFR part 512).

We will consider all comments that Docket Management receives before the close of business on the comment closing date indicated above underDATES. To the extent possible, we also will consider comments that Docket Management receives after that date. If Docket Management receives a comment too late for us to consider it in developing the final rule, we will consider that comment as an informal suggestion for future rulemaking action.

You may read the comments received by Docket Management at the address given underADDRESSES. The hours of the Docket are indicated above in the same location.

You also may see the comments on the Internet. To read the comments on the Internet, go tohttp://www.regulations.gov,and follow the instructions for accessing the Docket.

Please note that even after the comment closing date, we will continue to file relevant information in the Docket as it becomes available. Further, some people may submit late comments. Accordingly, we recommend that you periodically check the Docket for new material.