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Animal and Plant Health Inspection Service, USDA.
Final rule.
We are amending the Animal Welfare Act regulations to include more specific requirements in the regulations concerning the submission of itineraries by any person who is subject to the Animal Welfare Act regulations and who intends to exhibit any animal at any location other than the person's approved site when travel will extend overnight. APHIS inspectors need access to animals, facilities, and records for unannounced inspections when animals are exhibited at a location other than at a regulated person's approved site to improve compliance with the regulations and the Animal Welfare Act.
Dr. Barbara Kohn, Senior Staff Veterinarian, Animal Care, APHIS, 4700 River Road, Unit 84, Riverdale, MD 20737–1234; (301) 851–3751.
The rule will facilitate enforcement of the Animal Welfare Act regulations for traveling exhibitors and thereby help to ensure the humane handling, housing, treatment, and transportation of the animals in their care.
This rule will require the advance submission of itineraries by any person who is subject to the Animal Welfare Act regulations and who intends to exhibit any animal at any location other than the person's approved site when travel will extend overnight.
Costs of the rule for exhibitors are expected to be small. The estimated time needed to prepare and submit an itinerary once arrangements have been made is about 15 minutes. Many traveling animal exhibitors are already submitting itineraries in a timely manner in accordance with existing Agency policy when a regulated animal is exhibited away from its approved site for 4 days or more. This rule is expected to cost the estimated affected 425 exhibitors a total of about $15,375 per year to prepare and submit itineraries.
The rule is expected to eliminate costs APHIS incurs in attempting to inspect animals that are not at locations where APHIS expected them to be, and to reduce some costs associated with responding to inquiries and complaints about traveling exhibitors alleged to have violated Animal Welfare Act regulations and standards. Money saved on these activities can be put toward inspections and other activities that will benefit animal welfare.
The Animal Welfare Act (Act) (7 U.S.C. 2131–2159) authorizes the Secretary of Agriculture to promulgate rules and standards and other requirements governing the humane handling, housing, care, treatment, and transportation of certain animals by dealers, exhibitors, and other regulated entities. The Secretary of Agriculture has delegated the responsibility for enforcing the Act to the Administrator of the U.S. Department of Agriculture's Animal and Plant Health Inspection Service (APHIS). Regulations and standards established under the Act are contained in title 9 of the Code of Federal Regulations (CFR), parts 1, 2, and 3. The APHIS Animal Care (AC) program ensures compliance with the Act regulations and standards by conducting unannounced inspections of premises with regulated animals.
The regulations contained in 9 CFR part 2 establish certain responsibilities of regulated persons under the Act. These responsibilities include requirements for the licensing and registration of dealers, exhibitors, and research facilities, and standards for veterinary care, identification of animals, and recordkeeping.
On October 1, 2009, we published in the
We proposed that the itinerary include:
• The name and license or registration number under the Act of the person who will exhibit the animals, and if any animals are leased, borrowed, loaned, or under some similar arrangement, the name of the person who owns the animals;
• The name, identification number or identifying characteristics, species (common or scientific name), sex and age of each animal; and
• The names, dates, and locations where the animals will travel, be housed, and be exhibited, including all anticipated dates and locations for any stops and layovers.
We proposed to require that the itinerary be revised as necessary and the AC Regional Director notified of any changes.
We explained that our reason for proposing to require such itineraries to be submitted no fewer than 2 days before the start of travel was to ensure that AC inspectors have advance notice of the locations where animals will be exhibited so that they can make unannounced inspections to ensure compliance with regulations and standards for animal welfare.
We solicited comments concerning our proposal for 60 days ending November 30, 2009. We received 790 comments by that date. They were from
A large number of commenters supported the proposed rule as written. Among the reasons provided for their support, commenters stated that the proposed provisions would make it easier for APHIS to monitor adherence to the regulations and that the rule would have little impact on the majority of exhibitors who already submit itineraries in a timely manner. One commenter expressed the hope that the proposed provisions would allow APHIS to ensure that animals are afforded the minimum space requirements for primary enclosures when not in actual transport and to better monitor the time animals spend in an exercise pen or its equivalent.
Exhibitors who are in continuous travel status shall update their itinerary as often as necessary to ensure AC [Animal Care] knows their whereabouts at all times.
Circuses, petting zoos, and acts with an established route shall notify AC in advance of departing their home facility and update travel information as needed.
Exhibitors who take animals from their facilities from time to time shall notify AC when any animal is gone more than four (4) consecutive days. Upon request, a licensee shall provide an itinerary of absences of less than four (4) days.
Providing notification ensures the opportunity for access for an unannounced inspection, eliminates unnecessary AC visits when a licensee has been inspected recently, and minimizes resources needed to locate the exhibitor.
The itinerary should provide the following:
1. Dates away from the home facility.
2. City and State for all stops.
3. Site name or location of all stops.
Similar information must be provided for all periods of “lay-over” while traveling.
• The name(s) of the person(s) who intends to exhibit the animal(s) and transport the animal(s) for exhibition purposes, including any business name(s) and current Act license or registration number(s) and, in the event that any animal is leased, borrowed, loaned, or under some similar arrangement, the name of the person who owns such animal;
• The name, identification number or identifying characteristics, species (common or scientific name), sex and age of each animal; and
• The names, dates, and locations (with addresses) where the animals will travel, be housed, and be exhibited, including all anticipated dates and locations (with addresses) for any stops and layovers.
Several commenters stated the required information is duplicative of information the exhibitor is already required to file. Several commenters stated that all animals already must be accompanied by a valid, current health certification, which indicates the animal's age, sex, species, and identification number where applicable. One commenter stated that the proposed requirements would be duplicative of information the exhibitor already files each year as part of its license renewal. The commenter stated that the information already submitted includes a complete list of cities and precise engagement dates and venues.
One commenter, a representative of the AZA, estimated that because many AZA-accredited zoos and aquariums conduct offsite outreach programs at locations such as schools and nursing homes, the AZA's 221 accredited zoos and aquariums alone would make a total of at least 50,000 to 70,000 submissions annually. Another commenter stated that adjustments to itineraries would require more than 15 minutes each.
We have revised our estimates of the number of exhibitors who will be affected by this rule. Our original estimate that 300 exhibitors would be affected by the rule was based on the number of active licensees that had inspections at traveling sites. We have increased that number by 125, based on our estimate that approximately 6 percent of nontraveling exhibitors may occasionally take animals away from their facility overnight for exhibition. We further estimate that those 425 exhibitors would provide a total of about 4,100 responses each year. We derived this number through discussion with AC regional offices and after looking at the size and histories of traveling exhibitors. For example, large circuses usually have itineraries planned a year or more in advance. Some smaller exhibitors may not know their schedules until a week before a performance. Thus, we estimated that about 100 of the affected exhibitors would submit itineraries about twice a year (200 submissions), and that the
In this final rule, we are making several nonsubstantive editorial changes to what appeared in the proposed rule. Instead of making joint references to the singular and plural as, e.g., “animal(s),” we are using the singular to signify also the plural. This is consistent with the style used in the definitions in § 1.1 of the regulations. In the regulatory text of this rule, when referring to the AC Regional Director, we use the term “AC Regional Director,” which is consistent with usage elsewhere in the regulations.
Therefore, for the reasons given in the proposed rule and in this document, we are adopting the proposed rule as a final rule, with the changes discussed in this document.
This final rule has been determined to be significant for the purposes of Executive Order 12866 and, therefore, has been reviewed by the Office of Management and Budget.
We have prepared an economic analysis for this rule. The economic analysis provides a cost-benefit analysis, as required by Executive Orders 12866 and 13563, which direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. The economic analysis also examines the potential economic effects of this rule on small entities, as required by the
APHIS is amending the Animal Welfare Act (AWA) regulations to require a person who intends to exhibit regulated animals at any location other than the person's approved site to submit an itinerary at least 2 days in advance when travel extends overnight. In those instances when exhibitors are offered engagements with less than 2 days' notice, APHIS will accept itineraries less than 48 hours in advance of travel.
The rule will facilitate enforcement of the AWA regulations for traveling exhibitors, and thereby help to ensure the humane handling, housing, treatment, and transportation of the animals in their care.
Costs of the rule for exhibitors are expected to be small. The AC program has estimated that preparation and submission of an itinerary takes about 15 minutes. Many traveling animal exhibitors are already submitting itineraries in a timely manner in accordance with existing Agency policy when a regulated animal is exhibited away from its approved site for 4 days or more.
The time required to prepare the estimated 4,100 itineraries that will be required because of this rule is expected to cost the approximately 425 affected exhibitors a total of $15,375 per year.
Most of the traveling exhibitors affected by the rule are small entities. Regardless of size, we do not expect the exhibitors to be significantly affected.
The rule is expected eliminate costs APHIS incurs in attempting to inspect animals that are not at locations where APHIS expected them to be, and to reduce some costs associated with responding to inquiries and complaints about traveling exhibitors alleged to have violated Animal Welfare regulations and standards. Money saved on these activities can be put toward inspections and other activities that will benefit animal welfare.
Under these circumstances, the Administrator of the Animal and Plant Health Inspection Service has determined that this action will not have a significant economic impact on a substantial number of small entities.
This program/activity is listed in the Catalog of Federal Domestic Assistance under No. 10.025 and is subject to Executive Order 12372, which requires intergovernmental consultation with State and local officials. (See 7 CFR part 3015, subpart V.)
This final rule has been reviewed under Executive Order 12988, Civil Justice Reform. It is not intended to have retroactive effect. The Act does not provide administrative procedures which must be exhausted prior to a judicial challenge to the provisions of this rule.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
The Animal and Plant Health Inspection Service is committed to compliance with the E-Government Act to promote the use of the Internet and other information technologies, to provide increased opportunities for citizen access to Government information and services, and for other purposes. For information pertinent to E-Government Act compliance related to this rule, please contact Mrs. Celeste Sickles, APHIS' Information Collection Coordinator, at (301) 851–2908.
Animal welfare, Pets, Reporting and recordkeeping requirements, Research.
Accordingly, we are amending 9 CFR part 2 as follows:
7 U.S.C. 2131–2159; 7 CFR 2.22, 2.80, and 371.7.
(c) Any person who is subject to the Animal Welfare regulations and who intends to exhibit any animal at any location other than the person's approved site (including, but not limited to, circuses, traveling educational exhibits, animal acts, and petting zoos), except for travel that does not extend overnight, shall submit a written itinerary to the AC Regional Director. The itinerary shall be received by the AC Regional Director no fewer than 2 days in advance of any travel and shall contain complete and accurate information concerning the whereabouts of any animal intended for exhibition at any location other than the person's approved site. If the exhibitor accepts an engagement for which travel will begin with less than 48 hours' notice, the exhibitor shall immediately contact the AC Regional Director in writing with the required information. APHIS expects such situations to occur infrequently, and exhibitors who repeatedly provide less than 48 hours' notice will, after notice by APHIS, be subject to increased scrutiny under the Act.
(1) The itinerary shall include the following:
(i) The name of the person who intends to exhibit the animal and transport the animal for exhibition purposes, including any business name and current Act license or registration number and, in the event that any animal is leased, borrowed, loaned, or under some similar arrangement, the name of the person who owns such animal;
(ii) The name, identification number or identifying characteristics, species (common or scientific name), sex and age of each animal; and
(iii) The names, dates, and locations (with addresses) where the animals will travel, be housed, and be exhibited, including all anticipated dates and locations (with addresses) for any stops and layovers that allow or require removal of the animals from the transport enclosures. Unanticipated delays of such length shall be reported to the AC Regional Director the next APHIS business day. APHIS Regional offices are available each weekday, except on Federal holidays, from 8 a.m. to 5 p.m.
(2) The itinerary shall be revised as necessary, and the AC Regional Director shall be notified of any changes. If initial notification of a change due to an emergency is made by a means other than email or facsimile, it shall be followed by written documentation at the earliest possible time. For changes that occur after normal APHIS business hours, the change shall be conveyed to the AC Regional Director no later than the following APHIS business day. APHIS Regional offices are available each weekday, except on Federal holidays, from 8 a.m. to 5 p.m.
Animal and Plant Health Inspection Service, USDA.
Final rule.
We are amending the Animal Welfare Act regulations to add requirements for contingency planning and training of personnel by research facilities and by dealers, exhibitors, intermediate handlers, and carriers. We are taking this action because we believe all licensees and registrants should develop a contingency plan for all animals regulated under the Animal Welfare Act in an effort to better prepare for potential disasters. This action will heighten the awareness of licensees and registrants regarding their responsibilities and help ensure a timely and appropriate response should an emergency or disaster occur.
Dr. Jeanie Lin, Eastern Region Emergency Programs Manager, Animal Care, APHIS, 920 Main Campus Drive, Raleigh NC 27606; (919) 855–7100.
Under the Animal Welfare Act (AWA) (7 U.S.C. 2131
The only requirement for contingency planning by licensees and registrants in the regulations has been in § 3.101(b), which covers water and power supply requirements at facilities housing marine mammals. Specifically, this section requires such facilities to submit written contingency plans to the Deputy Administrator of Animal Care (AC) regarding emergency sources of water and electric power should primary sources fail. Among other things, the plans must include evacuation plans in the event of a disaster and a description of backup systems and/or arrangements for relocating marine mammals requiring artificially cooled or heated water.
Following the events experienced during the 2005 hurricane season, a Federal document, “The Federal Response to Katrina: Lessons Learned,” which can be found on the Internet at
We solicited comments concerning our proposal for 60 days ending on December 22, 2008. On December 19, 2008, we published a notice in the
Many commenters had comments or questions that were not germane to the proposed rule, such as asking the Animal and Plant Health Inspection Service (APHIS) to end the trade of exotic animals. We are not addressing those comments in this final rule because they are outside of its scope.
Many commenters objected to APHIS mandating contingency plans. One commenter stated that, since no plan can be 100 percent successful, it does not make sense to mandate plans. One commenter stated that the AWA has language prohibiting prescribing methods of research and that the proposed rule violates this by prescribing emergency planning methods.
As stated in the proposed rule, the events experienced during the 2005 hurricane season highlighted the need for planning to minimize the impact of disasters on the health and welfare of all animals covered by the AWA. The intent of the proposed rule was to safeguard the health and welfare of animals in emergency situations. We understand that contingency plans may not be 100 percent successful. However, we do not agree that plans should not be mandated because, to promote animal welfare, entities should be able to demonstrate a reasonable effort to address emergency situations. The rule does not prescribe emergency planning methods. In addition, we do not consider a contingency plan to be a research method.
One commenter suggested that instead of mandated plans, APHIS should provide guidance materials, training videos, or classes, as it would be cheaper for both APHIS and the regulated entities.
APHIS plans to provide guidance materials, which may include videos and classes. However, this does not replace a need for contingency plans as contingency plans are more adaptable to the unique circumstances of each licensee and registrant and will determine what training is needed. In addition, as facilities have widely varying needs, allowing licensees and registrants to determine and implement their own unique training allows
Several commenters stated that they already had contingency plans in place or followed other accreditation standards (e.g., Association of Zoos and Aquariums standards), which they stated were sufficient to address the contingency plan components we proposed to require. Some of these commenters asked that they be exempt from the requirements of the rule because they already had plans in place or that APHIS work with other organizations that have accreditation standards to draft a standard document so that the regulations are not redundant. One commenter stated that APHIS should have done a better job of talking to facilities that already have contingency plans in place.
We recognize that many AWA licensees and registrants may already have contingency plans in place. Although many of these plans may be sufficient to satisfy the new contingency plan requirements in this final rule, exemption is not practical as those nongovernmental accreditation standards are not mandatory, nor are they linked by regulatory processes to the AWA. However, before developing the proposed rule, we gathered information on regulated entities that currently have contingency plans in place. This information was used as a basis for the proposed criteria for developing contingency plans.
Many commenters asked how APHIS will review the contingency plans, and in particular whether we will require submission of contingency plans to APHIS. Many commenters objected to submitting contingency plans because they were concerned that the plans would be subject to the Freedom of Information Act (FOIA) and that disclosure of contingency plans would put at risk the safety and security of facilities, employees, and animals by giving animal rights extremists important information. Many other commenters supported submitting contingency plans to APHIS or other agencies or making them available to the public or making relevant portions of plans available to local services identified by facilities as potentially important to the execution of their contingency plan. One commenter suggested posting contingency plans online while another suggested electronic submission. Several commenters stated that licenses should be revoked or not renewed if contingency plans are not submitted to APHIS or that plans that have been modified due to personnel changes or updates should be submitted to APHIS.
We do not intend to require submission of contingency plans. As stated in the analysis of significant alternatives to the rule in the proposed rule, there are over 10,000 licensees and registrants and requiring each of them to submit plans to APHIS for review would take an enormous amount of resources for the Agency to process, review, and store. Therefore, we proposed that each research facility, dealer, exhibitor, intermediate handler, or carrier will be required to review their contingency plan on at least an annual basis. We would expect that each licensee and registrant would maintain documentation of their annual reviews, including documenting any amendments or changes made to their plan since the previous year's review, such as changes made as a result of recently predicted, but historically unforeseen, circumstances (e.g., weather extremes). We are making this clarification in § 2.38(l)(2) and § 2.134(b). We are also clarifying that APHIS will have the opportunity to review annual review documentation and training records, as well as contingency plans, as a part of our routine inspection process. It is the regulated facility's decision whether or not to share its plan with outside entities. The AWA does not require licensees and registrants to disclose documentation to outside entities. However, if a contingency plan details coordination with other government entities, an inspector may check for evidence supporting this coordination.
Several commenters stated that there is no evidence that APHIS has more expertise in contingency planning than other organizations, such as universities. One commenter stated that APHIS should consult with other agencies such as the Federal Emergency Management Agency (FEMA) in the development of requirements for contingency plans or in the implementation of contingency plans.
APHIS already has the technical expertise to ensure that regulated entities protect the health and well-being of animals in accordance with the AWA. Further, in 2008, APHIS launched an Animal Care Emergency Programs unit, which is a full-time unit dedicated to collaborating with other organizations to support the safety and well-being of animals during emergencies and disasters. As required by the AWA, APHIS consults and cooperates with other Federal agencies concerned with the welfare of animals used for research, experimentation, or exhibition. APHIS also routinely works closely with FEMA and other organizations on animal welfare issues prior to and during disasters and emergencies.
Several commenters stated that the facility and not the Government should decide what should be in contingency plans.
As stated in the proposed rule, because we recognize that individual circumstances for regulated entities may be different, it is difficult to go into specific detail as to what elements must be included in all contingency plans. Therefore, we have not sought to develop a one-size-fits-all plan but have instead provided a framework of four criteria, in § 2.38(l)(1) for research facilities and § 2.134 for dealers, exhibitors, intermediate handlers, and carriers, that we believe are the minimum criteria necessary to ensure a successful contingency plan. We have largely left to the discretion of each regulated entity how best to develop contingency plans that:
• Identify common emergencies such as electrical outages, faulty HVAC systems, fires, animal escapes, and natural disasters the facility is most likely to experience.
• Outline specific tasks required to be carried out in response to the identified emergencies including, but not limited to, specific animal evacuation plans or shelter-in-place plans and provisions for providing backup sources of food and water as well as sanitation, ventilation, bedding, veterinary care, etc.
• Identify a chain of command and who (by name or by position title) will be responsible for fulfilling these tasks.
• Address how response and recovery will be handled in terms of materials, resources, and training needed.
We believe that fulfilling these criteria is essential to the success of a contingency plan. In addition, we believe that these criteria provide an adequate degree of flexibility to allow all regulated entities to comply with the provisions of this final rule. These criteria are essential because they form a framework of what potential events to address, who has responsibility, and how to mitigate the potential events. These criteria form the basis of FEMA's “Ready Business” campaign, which
One commenter stated that the contingency plan should identify and evaluate the location of the facility and the probable specific emergency situations that location is likely to experience. The commenter further stated that any facility-specific vulnerability should be identified and addressed. One commenter stated that facility grounds should be in areas not prone to flooding or earthquakes and that it is preferable to provide onsite care during an emergency.
One of the proposed criteria for development of contingency plans is that the plan identify situations, such as emergencies and natural disasters, that a regulated entity is most likely to experience that would trigger the need for the measures identified in a contingency plan to be put into action. We expect that, if a facility-specific vulnerability would impact the humane handling and care of AWA-regulated animals during an emergency, the vulnerability would be addressed within the regulated entity's contingency plan. While we agree that ideally a regulated entity would not be located in an area prone to flooding or earthquakes, we realize that is not always feasible to ensure. As stated in the proposed rule, such disasters, if likely to be encountered by a particular regulated entity, would be expected to be addressed in that regulated entity's contingency plan.
Several commenters stated that euthanasia should be considered a viable option in the event of a disaster. Several commenters stated that marine mammals should be microchipped to facilitate recovery in the event they are released into the wild. One commenter stated that all tasks necessary for ensuring the welfare of animals should be itemized and the time required for each task estimated. Several commenters recommended providing criteria for development of contingency plans by animal group or by species and, for marine mammals, criteria by geographic location. Several commenters stated that agreements with alternative facilities for evacuation should be part of the contingency plan.
Since each regulated entity has different needs, we have largely left to the discretion of each regulated entity how best to fulfill the criteria of this final rule. Details about elements to include in a contingency plan, such as whether to use microchip identification methods or euthanasia or whether to itemize and time tasks, are to be decided upon by the regulated entity. In addition, as long as a regulated entity addresses each of the elements required for contingency plans, it may divide its plan according to criteria such as animal group, species, or geographic location. While we encourage regulated entities to explore cost-efficient options such as entering into mutual aid agreements with nearby similar entities, we are not requiring them to do so, as long as their contingency plans are adequate to protect the animals' welfare.
As noted previously, the only contingency planning currently required for licensees and registrants are those requirements in § 3.101(b) which cover water and power supply requirements for facilities housing marine mammals. One commenter suggested that the requirements in § 3.101(b) be revised to require that contingency plans submitted for marine mammals include the proposed criteria for contingency plans included in § 2.134.
The regulations added in this final rule in § 2.134 for developing contingency plans apply to all dealers, exhibitors, intermediate handlers, and carriers, including those that handle marine mammals. We are amending § 3.101(b) in this final rule to make it clear that facilities housing marine mammals must comply with the contingency planning requirements in § 2.134.
Several commenters stated that carriers and intermediate handlers should not have to develop contingency plans because it would be costly for them, because the number of animals lost or harmed in transit is miniscule, or because they have limited resources to respond to emergency situations. Given this, several commenters expressed concern that, if forced to comply with the proposed rule, carriers may not want to do business with research facilities.
We believe that all research facilities, dealers, exhibitors, intermediate handlers, and carriers should be required to develop a contingency plan for all animals regulated under the AWA. Although there may be costs associated with developing contingency plans, we expect such costs to be reasonable given that we have largely left it up to the discretion of regulated entities to determine the best way to fulfill the contingency plan criteria provided in this final rule for their own unique circumstances (i.e., size, type of entity, location, etc.). Therefore, we do not expect that developing contingency plans will cause a significant financial burden on carriers and intermediate handlers. At a minimum, we would expect that carriers, intermediate handlers, and traveling exhibitors would have provisions in place to respond to weather-related problems and animal escapes, as well as other problems, such as mechanical failures, most likely to be experienced during transit. We do not necessarily expect carriers and intermediate handlers to have backup sources of food and water on hand when traveling, but we would expect that their contingency plan would document how and where to get them if needed. In addition, we are clarifying in § 2.134(b) that all traveling entities must carry a copy of their contingency plan with them at all times and make it available for inspection while in travel status. Having a copy of their contingency plan on hand will allow regulated entities to refer directly to their plan in the event of an emergency while traveling. We believe this will result in preventing the loss or harm of regulated animals.
Several commenters stated that facilities should have backup carriers if their plans require evacuation. Also, the commenters stated that carriers should include in their plans which facility to service first in the event that a major disaster happens and multiple facilities are impacted.
While we do not require regulated entities to employ backup carriers, if a regulated entity's contingency plan includes a backup carrier, we expect that the regulated entity will ensure that the carrier is compliant with the elements of the contingency plan. In addition, we believe that carriers should coordinate with the facilities they serve.
Because we realize that some dealers, exhibitors, intermediate handlers, and carriers do not have stationary facilities, we are making a change to the requirements in § 2.134(a)(1) by removing the word “facility” and replacing it with the more inclusive words “licensees and registrants.” In addition, we are adding “mechanical breakdowns” to the list of likely emergencies that may be addressed in a contingency plan.
Several commenters stated that licensees who travel with animals should be required to submit contingency plans both for at home and on the road. Several commenters stated that travel as part of contingency plans for dangerous animals or for marine mammals should be prohibited unless necessary for the welfare of the animals because of the risks to public safety and animal welfare, particularly in emergency situations. One commenter asked how animals that cannot be
The intent of the proposed rule was to safeguard the welfare of animals in emergency situations. There is no requirement to travel with animals unless it is part of a facility's contingency plan. As stated in the proposed rule, the contingency plan would have to provide detailed instructions for evacuation or shelter-in-place. Therefore, if a contingency plan includes provisions for evacuation, we expect that the plan will also include details on how and by whom the animals would be moved in a way that would be as humane as possible given the disaster circumstances a facility may be facing.
One commenter asked whether an outside carrier's equipment, if called upon, would have to comply with AWA requirements.
Regulated entities are expected to ensure that their routine and back-up carriers are compliant with all AWA requirements.
Several commenters stated that detailed evacuation or shelter-in-place plans may be possible for emergencies, but are impractical for natural disasters because regulated entities rarely have advance notice of disasters and because there are so many variations in facilities and disasters that it does not make sense to have a one-size-fits-all plan. The commenters further stated that the rule should acknowledge this and allow for a “best efforts” approach when making contingency plans for unpredictable natural disasters. Several commenters expressed concern that the proposal seemed to require that all potential disasters be addressed no matter how likely they are to occur. However, one commenter stated that all potential disasters that might occur should be addressed in the contingency plan.
We recognize that it is not practical to prescribe detailed contingency plans for all situations. Therefore, we have not sought to develop a one-size-fits-all plan, but have largely left to the discretion of each regulated entity how best to fulfill the criteria described in the proposed rule. This rule intends to set the minimum criteria necessary to ensure a successful contingency plan. We believe this provides an adequate degree of flexibility to allow all regulated entities to comply with the provisions of the rule. As stated in the proposal, we would require that regulated entities address those emergencies and disasters most likely to occur, rather than requiring them to address all possible disasters and emergencies regardless of likelihood. We encourage regulated entities to consider all scales of emergencies, but recognize that highly localized events such as power disruptions and road closures (e.g., from a vehicular accident) are most likely. APHIS encourages the regulated communities to address these more routine events in their contingency plans, and to work with their local emergency management organization. APHIS understands that disaster and emergency events may be unpredictable and that it is impossible for every possible event to be addressed in a contingency plan.
One commenter stated that the contingency planning requirements are inconsistent with Homeland Security Presidential Directive 8: National Preparedness (HSPD–8) because terms used in the rule, such as “major disaster” and “emergency,” are not consistent with those used in the directive.
HSPD–8 establishes policy for dealing with terrorist attacks, major disasters, and other events of national scope. Section 2(e) of the directive states that the terms “major disaster” and “emergency” are defined in section 102 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act. Under that Act, “emergency” is defined as any occasion or instance, as determined by the President, where Federal assistance is needed to save lives, protect property and public health and safety, or to lessen or avert a catastrophe. A “major disaster” is defined as any natural catastrophe, as determined by the President, which causes damage of sufficient severity and magnitude to warrant major disaster assistance in order to supplement the efforts and available resources of States, local governments, and disaster relief organizations in alleviating the damage, loss, hardship, or suffering caused by the catastrophe. The Stafford Act is largely a framework for Federal assistance to State and local governments for disaster relief, and these terms require Presidential involvement. The scope of this rule is broader, and thus we use the terms “disaster” and “emergency” in more general terms. This rule considers “disaster” and “emergency” to mean those events which disrupt the ability of a licensee or registrant to continue with normal business routine and which are expected to be detrimental to the good health and well-being of the animals in the licensee's or registrant's care. A core concept of emergency management is that emergencies are managed at the most local level possible. The National Incident Management System, December 2008, supports this in stating that “incidents typically begin and end locally, and are managed on a daily basis at the lowest possible geographical, organizational, and jurisdictional level.” The document is available from the FEMA Web site at
One commenter stated that contingency plans should be integrated into the overall hazard response plan for facilities.
Although we do not require regulated entities to integrate animal contingency plans into their business continuity plans, we encourage them to do so. APHIS believes that having a business continuity plan supports animal health and welfare as well as overall good business practices.
The proposed requirements in §§ 2.38(l)(1)(ii) and 2.134(a)(2) stated that regulated entities must include in their contingency plans provisions for providing backup sources of food and water as well as sanitation, ventilation, bedding, veterinary care, etc. Several commenters recommended that we remove the words “backup sources of” from this provision and insert the words “as described in the contingency plan” after the phrase “as well as sanitation, ventilation, bedding, veterinary care, etc.” These commenters stated that it may not be possible to maintain all of the veterinary care provisions listed in § 2.33(b) during a disaster.
While it may not be possible to provide the same level of veterinary care during an emergency or disaster as during normal business operations, APHIS believes that the veterinary care requirements in § 2.33(b) are the minimum requirements necessary to ensure the health and welfare of regulated animals. As with the contingency plan criteria, these veterinary care requirements are general rather than specific to allow regulated entities the discretion to determine how best to fulfill the requirements based on
Several commenters expressed concern regarding APHIS' ability to provide adequate inspection and review of plans, stating that the review of plans would present an excessive burden to APHIS. One commenter suggested that APHIS could reduce the inspection burden by reviewing a random sampling of plans. Two commenters suggested that, at a minimum, APHIS should review the contingency plans of facilities with dangerous animals such as elephants, nonhuman primates, or large carnivores. One commenter asked who APHIS would pay to obtain the extra staff to enforce the rule. One commenter suggested that licensing fees be increased to fund additional inspectors or that APHIS stop issuing licenses until numbers of facilities drop to a manageable level.
We do not believe that our review of contingency plans would present an excessive burden on APHIS. As noted above, we would review contingency plans as a part of the routine inspection process, similar to the process for our review of dog exercise and nonhuman primate environment enhancement plans. We believe in this way we will be able to provide adequate review of the contingency plans for all regulated entities. We do not anticipate that additional APHIS staff will need to be hired as a result of this rule. Neither do we anticipate needing to contract out to other organizations to obtain additional staff.
Many commenters were concerned that there were not enough specifics about what would make a contingency plan acceptable and that facilities could be cited for failing to include certain items in their plans or for not following their plans exactly. Several commenters suggested punishments for facilities that either do not submit their plans or whose plans are inadequate. One commenter asked whether the judgment of noncompliance will be affected by whether animals were harmed in any way.
We have issued a guidance document along with this final rule that will assist licensees and registrants in determining what elements to include in their contingency plans. The guidance document is intended only to provide suggestions for how regulated entities may satisfy the criteria in the regulations rather than to prescribe specific measures that must be undertaken or equipment that must be purchased. For example, a regulated entity has multiple options to mitigate the potential failure of an HVAC system besides purchasing a backup generator, some of which are no-cost solutions. These no-cost solutions might include the use of a borrowed generator, opening windows, using existing fans, and/or moving the animals to a cooler location. Any of these actions could be considered adequate ways of responding to the potential failure of an HVAC system and could therefore be included in a contingency plan as long as the action listed is actually feasible. For instance, if a regulated entity's contingency plan calls for opening windows, but the facility's windows are incapable of opening, opening windows would not be a valid mitigation measure. We wish to emphasize that compliance with this final rule will be achieved through the development of an appropriate contingency plan and the training of facility personnel with respect to that plan. Nothing in this rule should be construed as requiring affected entities to make capital expenditures—for example, purchasing backup generators or making structural changes to a facility—in order to comply with the rule. As we do currently when enforcing the regulations, APHIS will assess the adequacy of a regulated entity's contingency plan using the Animal Welfare Act and Animal Welfare Regulations. This may be demonstrated by the plan itself, training records, the presence of materials and resources mentioned in the plan, or a documented history of responses to similar situations. An adequate contingency plan is one in which the minimum criteria considered necessary for a successful contingency plan have been addressed. Enforcement action may be taken on a case-by-case basis.
One commenter asked if missing the training deadline by a few days would result in noncompliance with the training requirements in the regulations regarding the contingency plan.
All noncompliant items, including failure to train employees on the components of the contingency plan, found during inspection would be documented on the inspection report and may be subject to enforcement action on a case-by-case basis. Enforcement actions may include issuance of official warnings, civil monetary penalties, license suspension, or license revocation. Licensees and registrants are expected to comply with all requirements of the regulations and standards, including training deadlines.
Several commenters asked who would be determining the adequacy of plans and what training they would have.
APHIS inspectors will review and determine the adequacy of contingency plans. We will provide training to the inspection personnel on evaluating contingency plans pursuant to the criteria set forth in this rule.
One commenter asked on what basis regulated entities would be expected to determine what natural disasters they may face and whether and how this determination will be evaluated by inspectors.
In the proposed rule we provided links to the U.S. Geological Survey “Hazards” Web site and the Weather Channel “WeatherREADY” Web site. These Web sites are good resources for determining the natural disasters facilities are most likely to encounter in their location. We would largely leave it up to the regulated entity to determine which natural disasters they may face. However, if it is apparent the regulated entity is likely to encounter a disaster that the contingency plan does not address (e.g., a facility in Florida that has experienced hurricanes in the past), APHIS inspectors will notify the entity and give the entity time to add provisions for responding to the disaster in the contingency plan. We anticipate that inspectors, who are typically stationed in the local area surrounding the facility, will be able to provide further guidance on potential natural disasters.
One commenter stated that the rule should be revised to include language relieving a regulated facility of responsibility if a higher emergency response authority steps in.
We expect that most emergencies will be of a local nature, such as facility fires or water main breaks. For emergencies or disasters of a larger scale, APHIS will consider the roles of jurisdictional emergency response authorities with respect to contingency plan implementation. It is not the intent of the rule to interfere with local, State, or Federal jurisdictional emergency response activities.
As stated in the proposed rule, training of personnel could be developed and offered by the research facility, dealer, exhibitor, intermediate handler, or carrier or provided by an outside entity. Several commenters stated that training requirements should be identified, including how facilities will document training. One commenter stated that a checklist should be
As stated previously, because we recognize that individual circumstances for regulated entities may be different, it is difficult to go into specific detail as to what elements must be included in all contingency plans. Therefore, we do not believe it appropriate to provide technical and tactical requirements, such as protocols for personnel replacement and training, in the regulations. We anticipate that inspectors may confirm that contingency plan training is delivered in a similar manner to their current process for confirming that other required training has been delivered (e.g., for husbandry practices and veterinary care protocols). Such confirmation may include reviewing training documentation maintained by the regulated entity or asking involved employees questions about facility practices. While we have not specifically mandated trial runs of contingency plans, training may include trial runs in order to prepare licensees and registrants adequately in the event of a disaster or emergency.
One commenter stated that both position title and name of employees who play a part in implementing the contingency plan should be included in the contingency plan.
As stated in the proposed rule, regulated entities would need to identify a chain of command and who (by name or position title) will be responsible for fulfilling required tasks. We would leave it up to the regulated entity whether to include both position title and name or whether to include one or the other.
Several commenters stated that training should only apply to individuals who have a role to play within the contingency plan.
We believe the decision of which individuals should be trained is a decision best left up to the discretion of the regulated entity. However, we would expect all personnel who may be involved in or impacted by an emergency or disaster to be trained at an appropriate level.
In the proposed rule, we proposed to require that contingency plans be in place 180 days after the effective date of this final rule. In addition, we proposed that training of personnel would have to take place within 60 days following the adoption of a contingency plan by the research facility, dealer, exhibitor, intermediate handler, or carrier. Employees hired within 30 days or less after adoption of the contingency plan would have to be trained in that 60-day period while employees hired more than 30 days after adoption of the contingency plan would have to be trained within 30 days of their start date.
Several commenters asked that we further push back the effective date of the regulations to allow time to finalize contingency plans. One commenter stated that it was unclear whether the adoption date mentioned in the proposed rule is the date the rule is adopted or the date plans must be in place and that, if it is the former, the rule needs to be revised since this would require training to be completed before the contingency plan, which will guide the training, is in place. The commenter further stated that the 180-day period for having plans in place should begin at the later of either the effective date of the final rule or the date of issuance of guidance documents by APHIS. Two commenters asked whether the 180-day timeframe for having contingency plans in place includes procuring all necessary materials and resources for implementing the contingency plan. The commenters stated that if such is the case, it is too short of a timeframe to gather materials and resources that are not currently available within a facility.
As stated in the proposed rule, the adoption date is the date the contingency plan must be in place. For current licensees and registrants, this date is 180 days after the effective date of this final rule. For future licensees and registrants, we expect the licensee or registrant to have a contingency plan in place prior to conducting regulated activities. We are making changes to paragraphs (l)(2) and (l)(3) in § 2.38 and paragraphs (b) and (c) in § 2.134(b) in order to make it clearer that the adoption date is the date the contingency plans must be finalized. Training of personnel must take place within 60 days after the adoption date. We believe 180 days is a sufficient length of time to ensure that contingency plans are in place and to procure any necessary materials and resources for implementing contingency plans.
Several commenters stated that the 30-day training requirement for newly hired personnel is unnecessary and not in keeping with the lack of specificity for the rest of the plan.
We believe that it is important to ensure that employees of a regulated entity are familiar with the regulated entity's contingency plan. Therefore, it is appropriate to require that training occur within 30 days.
One commenter stated that guidance documents for developing contingency plans should be developed by a lead organization with expertise in collaboration with outside organizations. One commenter stated that guidance documents should not be developed by entities outside of APHIS but that stakeholders/licensees should have input. Several commenters objected to guidance documents or other means for providing criteria outside of the regulations at all. Several commenters stated that the guidance document should be made available via the Internet, and released with the final rule.
APHIS has expertise in collaborating with outside organizations and is also responsible for enforcing the AWA. Therefore, it is appropriate for us to take the lead role in developing guidance documents to support contingency planning. As stated previously, we are providing a guidance document with this final rule. During the comment period for the proposed rule, we asked for public comment, including comment from stakeholders and licensees, on what elements should be included in the guidance document. To reiterate, APHIS will assess the adequacy of a regulated entity's contingency plan using the Animal Welfare Act and Animal Welfare Regulations. The guidance document provides suggestions for how regulated entities may satisfy the criteria in the regulations.
One commenter said that USDA should provide guidance on how contingency plans might address elements unique to each facility. One commenter suggested that APHIS create a Web site with more information that includes guidelines, checklists, and templates. Several commenters supplied examples of contingency plans, links to contingency plans, or resources for drafting contingency plans.
We are issuing a guidance document that may assist regulated entities in addressing the circumstances unique to their location or facility. We also reviewed the information provided by the commenters and will make a list of helpful resources available on our Web site (see footnote 2). The guidance document is intended to be only a tool
Many commenters stated that the proposed rule will cause a serious financial impact, especially on small businesses, which make up the majority of those affected. Several commenters stated that a cost-benefit study has not been conducted and asked that APHIS withdraw the rule until one has been conducted or until APHIS has evaluated whether the rule is truly necessary.
A preliminary regulatory impact analysis was conducted for the proposed rule and a final regulatory impact analysis has been conducted for this rule. A summary of the final regulatory impact analysis appears in this document under the heading “Executive Orders 12866 and 13563 and Regulatory Flexibility Act.” The full analysis may be viewed on the Regulations.gov Web site (see footnote 1) or obtained by contacting the person listed under
One commenter stated that the rule does not comply with the Regulatory Flexibility Act because it shifts the burden of investigating what would be required for a contingency plan to businesses. One commenter expressed concern that the Small Business Administration was not consulted when developing the proposed rule.
The Regulatory Flexibility Act requires that Federal agencies endeavor to fit regulatory and informational requirements to the scale of the businesses, organizations, and governmental jurisdictions subject to regulation. To achieve this principle, agencies are required to solicit and consider flexible regulatory proposals and to explain the rationale for their actions to assure that such proposals are given serious consideration. APHIS recognizes that each regulated entity is the best judge of the particular measures that should be included in its contingency plan. APHIS is minimizing the burden of the rule for small entities by allowing each one to determine for itself how best to meet the requirements in accordance with the general criteria and guidance documents. APHIS also consulted with the Small Business Administration in the preparation of the proposed rule and this final rule.
One commenter stated that since the rule is significant and an Initial Regulatory Flexibility Analysis was prepared that APHIS is required to publish a compliance guide which will help regulated industries comply with the regulation.
The guidance document that we are making available concurrently with this rule will assist licensees and registrants in complying with the regulation. Any additional compliance guides will be posted on the APHIS Web site (see footnote 2) and made available to the public to further assist small entities in complying with this rule.
Two commenters asked whether they would have to build additional alternative facilities, or, if not, what shelter would be acceptable on a temporary basis, and whether USDA is ready to help shoulder some of the costs until a facility can be repaired. One commenter expressed concern that they would need to purchase disaster insurance.
We do not intend to require the building of alternative facilities. While the costs for development and execution of the plan are expected to be borne by the regulated entity, they will be determined based on the emergencies and potential natural disasters most likely to be experienced by the regulated entity. As stated previously, we expect that these costs will be reasonable. The purpose of a contingency plan is to help ensure that licensees and registrants are able to respond in a timely and appropriate manner should an emergency or disaster occur. Disaster insurance is not required by this rule, and promoting the purchase of disaster insurance is not an objective of this rule.
Three commenters expressed concern that the number of animals lost during Hurricane Katrina as stated in the economic analysis of the proposed rule is greater than the total number of regulated animals in Louisiana.
In the preliminary regulatory impact analysis, APHIS may have inadvertently implied that the number of animals covered under the Animal Welfare Act that were harmed or killed as a result of Hurricane Katrina was comparable to the 50,000 pets that reportedly were negatively impacted by the disaster. This is incorrect. There is a difference in scale between the number of animals for which pet owners are responsible versus the number of animals for which research facilities and other licensed and registered facilities are responsible. Therefore, AWA licensees and registrants caring for large numbers of animals who did not have contingency plans in place likely found it difficult to evacuate or otherwise ensure the animals' safety during Hurricane Katrina. Our intent in the proposed rule was to illustrate this fact rather than to compare the number of regulated animals negatively impacted to the number of pets that were negatively impacted. We have reexamined the available data and we present our findings in the full final regulatory flexibility analysis, which can be viewed on the Regulations.gov Web site (see the address listed in footnote 1).
One commenter suggested that a tiered contingency plan system be implemented to accommodate small businesses.
As a practical matter, one would expect that the smaller the business, the smaller the scale of the contingency
Several commenters expressed concern regarding the costs of and time for drafting a contingency plan. One commenter stated that the rule may be imposing redundant paperwork requirements because of similar requirements at the State and local levels.
Many regulated facilities are currently required to have contingency plans by other organizations (e.g., accrediting institutions, State and local regulators). Many of these plans will meet the proposed contingency plan requirements, and paperwork redundancies for entities with such plans should be minimal. Those regulated facilities that do not already have plans in place may incur an additional burden to develop contingency plans. However, we believe that having an established contingency plan promotes animal welfare and will aid in business continuity, therefore reducing the burden on facilities and regulated animals in the event of a natural disaster or emergency.
Therefore, for the reasons given in the proposed rule and in this document, we are adopting the proposed rule as a final rule, with the changes discussed in this document.
This proposed rule has been determined to be significant/economically significant for the purposes of Executive Order 12866 and, therefore, has been reviewed by the Office of Management and Budget.
We have prepared an economic analysis for this rule. The economic analysis provides a cost-benefit analysis, as required by Executive Orders 12866 and 13563, which direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. The economic analysis also examines the potential economic effects of this rule on small entities, as required by the Regulatory Flexibility Act. The economic analysis is summarized below. Copies of the full analysis are available on the Regulations.gov Web site (see footnote 1 in this document for a link to Regulations.gov) or by contacting the person listed under
Preparedness for emergencies and disasters can reduce the harm to animals and their loss of life. The devastating impact of the 2005 hurricane season underscores the need for contingency planning for all animals covered under the Animal Welfare Act. Currently, only facilities that house marine mammals are required under 9 CFR 3.101 to develop contingency plans. The final rule requires that all of the more than 10,000 licensees and registrants develop and document contingency plans for all other animals covered under the Act. In addition, training to carry out contingency plans will be required of a regulated entity's employees. The majority of establishments that will be affected by this rule are small, based on industry estimates obtained from the Economic Census and the Census of Agriculture.
The full final regulatory flexibility analysis identifies breeders, wholesale dealers, licensed and registered exhibitors, registered research facilities, and registered transport carriers and handlers as those entities most likely to be impacted by the requirement for the development of contingency plans. While no economic data are available on business size for the specific entities, we may assume the majority of the potentially impacted establishments are small, based on the industry estimates obtained from the Economic Census and the Census of Agriculture.
The final rule will impose certain costs to develop and document the contingency plans and provide employee training, but these costs are not expected to be excessive. The cost of training personnel will vary depending on the type and size of business. However, many organizations offer training courses on general disaster planning specific to the type of animals at the particular facility or operation. FEMA offers free training, while some organizations offer courses with prices ranging from $50 to $300. These courses cover the development and implementation of contingency plans. In addition, many of the larger facilities, in particular, already have contingency plans in place. APHIS recognizes that each entity is the best judge of the particular measures that should be included in its contingency plan, and will provide general criteria and guidance documents to minimize compliance costs. Each entity will determine for itself how best to meet the rule's requirements.
This program/activity is listed in the Catalog of Federal Domestic Assistance under No. 10.025 and is subject to Executive Order 12372, which requires intergovernmental consultation with State and local officials. (See 7 CFR part 3015, subpart V.)
This final rule has been reviewed under Executive Order 12988, Civil Justice Reform. It is not intended to have retroactive effect. The Act does not provide administrative procedures which must be exhausted prior to a judicial challenge to the provisions of this rule.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
The Animal and Plant Health Inspection Service is committed to compliance with the E-Government Act to promote the use of the Internet and other information technologies, to provide increased opportunities for citizen access to Government information and services, and for other purposes. For information pertinent to E-Government Act compliance related to this rule, please contact Mrs. Celeste Sickles, APHIS' Information Collection Coordinator, at (301) 851–2908.
Animal welfare, Pets, Reporting and recordkeeping requirements, Research.
Animal welfare, Marine mammals, Pets, Reporting and recordkeeping requirements, Research, Transportation.
Accordingly, we are amending 9 CFR chapter I, subchapter A, as follows:
7 U.S.C. 2131–2159; 7 CFR 2.22, 2.80, and 371.7.
(i) * * *
(4) The other person or premises must either be directly included in the research facility's contingency plan required under paragraph (l) of this section or must develop its own contingency plan in accordance with paragraph (l) of this section.
(l)
(i) Identify situations the facility might experience that would trigger the need for the measures identified in a contingency plan to be put into action including, but not limited to, emergencies such as electrical outages, faulty HVAC systems, fires, and animal escapes, as well as natural disasters the facility is most likely to experience.
(ii) Outline specific tasks required to be carried out in response to the identified emergencies or disasters including, but not limited to, detailed animal evacuation instructions or shelter-in-place instructions and provisions for providing backup sources of food and water as well as sanitation, ventilation, bedding, veterinary care, etc.;
(iii) Identify a chain of command and who (by name or by position title) will be responsible for fulfilling these tasks; and
(iv) Address how response and recovery will be handled in terms of materials, resources, and training needed.
(2) For current registrants, the contingency plan must be in place by July 29, 2013. For research facilities registered after this date, the contingency plan must be in place prior to conducting regulated activities. The plan must be reviewed by the research facility on at least an annual basis to ensure that it adequately addresses the criteria listed in paragraph (l)(1) of this section. Each registrant must maintain documentation of their annual reviews, including documenting any amendments or changes made to their plan since the previous year's review, such as changes made as a result of recently predicted, but historically unforeseen, circumstances (e.g., weather extremes). Contingency plans, as well as all annual review documentation and training records, must be made available to APHIS and any funding Federal agency representatives upon request. Facilities maintaining or otherwise handling marine mammals in captivity must also comply with the requirements of § 3.101(b) of this subchapter.
(3) The facility must provide and document participation in and successful completion of training for its personnel regarding their roles and responsibilities as outlined in the plan. For current registrants, training of facility personnel must be completed by September 27, 2013; for research facilities registered after July 29, 2013, training of facility personnel must be completed within 60 days of the facility putting its contingency plan in place. Employees hired 30 days or more before the contingency plan is put in place must also be trained by that date. For employees hired less than 30 days before that date or after that date, training must be conducted within 30 days of their start date. Any changes to the plan as a result of the annual review must be communicated to employees through training which must be conducted within 30 days of making the changes.
(a) * * *
(4) The other person or premises must either be directly included in the dealer's or exhibitor's contingency plan required under § 2.134 or must develop its own contingency plan in accordance with § 2.134.
(b) * * *
(3) The other person or premises must either be directly included in the intermediate handler's contingency plan required under § 2.134 or must develop its own contingency plan in accordance with § 2.134.
(a) Dealers, exhibitors, intermediate handlers, and carriers must develop, document, and follow an appropriate plan to provide for the humane handling, treatment, transportation, housing, and care of their animals in the event of an emergency or disaster (one which could reasonably be anticipated and expected to be detrimental to the good health and well-being of the animals in their possession). Such contingency plans must:
(1) Identify situations the licensee or registrant might experience that would trigger the need for the measures identified in a contingency plan to be put into action including, but not limited to, emergencies such as electrical outages, faulty HVAC systems, fires, mechanical breakdowns, and animal escapes, as well as natural disasters most likely to be experienced;
(2) Outline specific tasks required to be carried out in response to the identified emergencies or disasters including, but not limited to, detailed animal evacuation instructions or shelter-in-place instructions and provisions for providing backup sources of food and water as well as sanitation, ventilation, bedding, veterinary care, etc.;
(3) Identify a chain of command and who (by name or by position title) will be responsible for fulfilling these tasks; and
(4) Address how response and recovery will be handled in terms of materials, resources, and training needed.
(b) For current licensees and registrants, the contingency plan must be in place by July 29, 2013. For new dealers, exhibitors, intermediate handlers, and carriers licensed or registered after this date, the contingency plan must be in place prior to conducting regulated activities. The plan must be reviewed by the dealer, exhibitor, intermediate handler, or carrier on at least an annual basis to ensure that it adequately addresses the criteria listed in paragraph (a) of this section. Each licensee and registrant must maintain documentation of their annual reviews, including documenting any amendments or changes made to their plan since the previous year's review, such as changes made as a result of recently predicted, but historically unforeseen, circumstances (e.g., weather extremes). Contingency plans, as well as all annual review documentation and training records, must be made available to APHIS upon request. Traveling entities must carry a copy of their contingency plan with them at all times and make it available for APHIS inspection while in travel status. Dealers, exhibitors, intermediate handlers, and carriers maintaining or otherwise handling marine mammals in
(c) Dealers, exhibitors, intermediate handlers, and carriers must provide and document participation in and successful completion of training for personnel regarding their roles and responsibilities as outlined in the plan. For current licensees and registrants, training of dealer, exhibitor, intermediate handler, and carrier personnel must be completed by September 27, 2013. For new dealers, exhibitors, intermediate handlers, or carriers licensed or registered after July 29, 2013, training of personnel must be completed within 60 days of the dealer, exhibitor, intermediate handler, or carrier putting their contingency plan in place. Employees hired 30 days or more before their contingency plan is put in place must also be trained by that date. For employees hired less than 30 days before that date or after that date, training must be conducted within 30 days of their start date. Any changes to the plan as a result of the annual review must be communicated to employees through training which must be conducted within 30 days of making the changes.
7 U.S.C. 2131–2159; 7 CFR 2.22, 2.80, and 371.7.
(b) * * * Facilities handling marine mammals must also comply with the requirements of § 2.134 of this subchapter.
Food Safety and Inspection Service, USDA.
Final rule.
The Food Safety and Inspection Service (FSIS) is establishing January 1, 2016, as the uniform compliance date for new meat and poultry product labeling regulations that are issued between January 1, 2013, and December 31, 2014. FSIS periodically announces uniform compliance dates for new meat and poultry product labeling regulations to minimize the economic impact of label changes.
This rule is effective December 31, 2012. Comments on this final rule must be received on or before January 30, 2013.
FSIS invites interested persons to submit relevant comments on this proposed rule. Comments may be submitted by either of the following methods:
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Rosalyn Murphy-Jenkins, Director, Labeling and Program Delivery Division, Office of Policy and Program Development, Food Safety and Inspection Service, U.S. Department of Agriculture, Telephone: 301–504–0879.
FSIS periodically issues regulations that require changes in the labeling of meat and poultry food products. Many meat and poultry establishments also produce non-meat and non-poultry food products that are subject to the jurisdiction of the Food and Drug Administration (FDA). FDA also periodically issues regulations that require changes in the labeling of products under its jurisdiction.
On December 14, 2004, FSIS issued a final rule that established January 1, 2008, as the uniform compliance date for new meat and poultry labeling regulations issued between January 1, 2005, and December 31, 2006. The 2004 final rule also provided that the Agency would set uniform compliance dates for new labeling regulations in 2-year increments and periodically issue final rules announcing those dates. Consistent with that final rule, the Agency has published three final rules establishing the uniform compliance dates of January 1, 2010, January 1, 2012, and January 1, 2014 (72 FR 9651, 73 FR 75564, and 75 FR 71344).
This final rule establishes January 1, 2016, as the uniform compliance date for new meat and poultry product labeling regulations that are issued between January 1, 2013 and December 31, 2014, and is consistent with the previous final rules that established uniform compliance dates. In addition, FSIS' approach for establishing uniform compliance dates for new food labeling regulations is consistent with FDA's approach. FDA is also planning to publish a final rule establishing a new compliance date.
Two-year increments enhance the industry's ability to make orderly adjustments to new labeling requirements without unduly exposing consumers to outdated labels. With this approach, the meat and poultry industry is able to plan for use of label inventories and to develop new labeling materials that meet the requirements of all labeling regulations made within the two year period, thereby minimizing the economic impact of labeling changes.
This compliance approach also serves consumers' interests because the cost of multiple short-term label revisions that
FSIS encourages meat and poultry companies to comply with new labeling regulations as soon as it is feasible. If companies initiate voluntary label changes, they should consider incorporating any new requirements that have been published as final regulations.
The new uniform compliance date will apply only to final FSIS regulations that require changes in the labeling of meat and poultry products and that are published after January 1, 2013, and before December 31, 2014. For each final rule that requires changes in labeling, FSIS will specifically identify January 1, 2016, as the compliance date. All meat and poultry food products that are subject to labeling regulations promulgated between January 1, 2013 and December 31, 2014, will be required to comply with these regulations when introduced into commerce on or after January 1, 2016. If any food labeling regulation involves special circumstances that justify a compliance date other than January 1, 2016, the Agency will determine an appropriate compliance date and will publish that compliance date in the rulemaking.
In rulemaking that began with the May 4, 2004, proposed rule, FSIS provided notice and solicited comment on the concept of establishing uniform compliance dates for labeling requirements (69 FR 24539). In the March 5, 2007, final rule, FSIS noted that the Agency received only four comments in response to the proposal, all fully supportive of the policy to set uniform compliance dates. Therefore, in the March 5, 2007, final rule, FSIS determined that further rulemaking for the establishment of uniform compliance dates for labeling requirements is unnecessary (72 FR 9651). The Agency did not receive comments on the final rule. Consistent with its statement in 2007, FSIS finds at this time that further rulemaking on this matter is unnecessary. However, FSIS is providing an opportunity for comment on the uniform compliance date established in this final rule.
This final rule has been reviewed under the Executive Order 12988, Civil Justice Reform. Under this final rule: (1) All state and local laws and regulations that are inconsistent with this rule will be preempted; (2) no retroactive effect will be given to this rule; and (3) no retroactive proceedings will be required before parties may file suit in court challenging this rule.
Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order (E.O.) 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This final rule has been reviewed under E.O. 12866. The Office of Management and Budget (OMB) has determined that it is not a significant regulatory action under section 3(f) of E.O. 12866 and, therefore, it has not been reviewed by OMB.
This rule does not have a significant economic impact on a substantial number of small entities; consequently, a regulatory flexibility analysis is not required (5 U.S.C. 601–612).
There are no paperwork or recordkeeping requirements associated with this policy under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501–3520).
FSIS and USDA are committed to achieving the purposes of the E-Government Act (44 U.S.C. 3601,
The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race, color, national origin, gender, religion, age, disability, political beliefs, sexual orientation, and marital or family status. (Not all prohibited bases apply to all programs.)
Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact USDA's Target Center at 202–720–2600 (voice and TTY).
To file a written complaint of discrimination, write USDA, Office of the Assistant Secretary for Civil Rights, 1400 Independence Avenue SW., Washington, DC 20250–9410 or call 202–720–5964 (voice and TTY).
FSIS will announce this rule online through the FSIS Web page located at
FSIS will also make copies of this
Office of Energy Efficiency and Renewable Energy, Department of Energy.
Final rule.
The U.S. Department of Energy (DOE or the “Department”) is adopting amendments to the compliance dates for manufacturers to submit certification reports for certain commercial and industrial equipment covered under the Energy Policy and
This rule is effective December 31, 2012.
This rulemaking can be identified by docket number EERE–2012–BT–CE–0048 and/or RIN number 1904–AC90.
For further information on how to submit or review public comments or view hard copies of the docket in the Resource Room, contact Ms. Brenda Edwards at (202) 586–2945 or email:
Ms. Ashley Armstrong, U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Program, EE–2J, 1000 Independence Avenue SW., Washington, DC 20585–0121. Email:
Title III of the Energy Policy and Conservation Act of 1975, as amended (“EPCA” or “the Act”) sets forth a variety of provisions designed to improve energy efficiency. Part A of Title III (42 U.S.C. 6291–6309) provides for the Energy Conservation Program for Consumer Products Other Than Automobiles. The National Energy Conservation Policy Act (NECPA), Public Law 95–619, amended EPCA to add Part A–1 of Title III, which established an energy conservation program for certain industrial equipment. (42 U.S.C. 6311–6317)
Sections 6299–6305, and 6316 of EPCA authorize DOE to enforce compliance with the energy and water conservation standards (all non-product specific references herein referring to energy use and consumption include water use and consumption; all references to energy efficiency include water efficiency) established for certain consumer products and commercial equipment. (42 U.S.C. 6299–6305 (consumer products), 6316 (commercial equipment)) DOE has promulgated enforcement regulations that include specific certification and compliance requirements.
On March 7, 2011, DOE published a final rule in the
The March 2011 Final Rule provided for the revised certification provisions to be effective on July 5, 2011. Certain manufacturers of particular types of commercial and industrial equipment
In the June 30 Final Rule, DOE stated that it believed 18 months would be sufficient to provide manufacturers with the time necessary to develop the data and supporting documentation needed to populate the certification reports and certify compliance with DOE's regulations, including the existing testing and sampling procedures. DOE also emphasized that all covered equipment must meet the applicable energy conservation standard and that all testing procedures and sampling provisions were unaffected by the final rule.
On May 31, 2012, DOE published a proposed rule to revise and expand its regulations regarding alternative efficiency determination methods (AEDMs). (77 FR 32038). AEDMs reduce testing burdens by allowing manufacturers to use computer simulations, mathematical models, and other alternative methods to determine the amount of energy used or efficiency by a particular basic model. AEDM provisions for commercial HVAC equipment and commercial WH equipment already exist, but DOE has proposed to revise those regulations and to allow manufacturers of commercial refrigeration equipment to use AEDMs. DOE has not yet finalized the AEDM rulemaking.
In an October 2012 letter to the Secretary of Energy, the Air Conditioning, Heating and Refrigeration Institute (AHRI) requested another certification compliance date extension. (AHRI, No. 1 at pp. 1–2). Specifically, AHRI requested that the compliance date for certification be extended a minimum of 18 months from the date of publication of the AEDM final rule.
On December 6, 2012, the Department proposed to extend compliance date an additional 12 months for commercial refrigeration equipment; commercial HVAC equipment; and commercial WH equipment (December 2012 NOPR). 77 FR 72763. DOE requested comment on its assumption regarding the existence of test data and on whether a longer or shorter period of time would be more appropriate. DOE also proposed to modify the regulatory text to reflect that the compliance dates for certification requirements for walk-in coolers and freezers, distribution transformers, and metal halide lamp ballasts have passed by removing the delayed compliance dates.
Lastly, the Department proposed to correct a technical drafting error for packaged terminal air conditioners and heat pumps that was implemented in the reprinting of Table 5 in 10 CFR 431.97 in a final rule published on May 16, 2012. 77 FR 28994. More specifically, DOE adopted changes to the applicable energy conservation standards for standard size and non-standard size packaged terminal air conditioners and heat pumps with a cooling capacity of 15,000 Btu/h. DOE proposed to correct this error and adopt the original standards for standard size and non-standard size packaged terminal air conditioners and heat pumps with a cooling capacity of 15,000 Btu/h as presented in a final rule evaluating and originally adopting the amended energy conservation for this equipment published on April 7, 2008. 73 FR 18915.
The Department received 14 written comments on the NOPR from a number of interested commenters, including various manufacturers, trade associations, and advocacy groups. The following parties submitted comments for this rule:
As stated above, DOE proposed an additional 12-month extension to the compliance date for filing complete certification reports for manufacturers of commercial refrigeration equipment; commercial HVAC equipment; and commercial WH equipment. 77 FR 72763. Most commenters supported an extension of at least twelve months. (Seasons, No. 4 at p. 1; UTC, No. 8 at pp. 1–2; AAON, No. 9 at pp. 1–2; Ingersoll Rand, No. 10 at pp. 1–2; Lennox, No. 11 at pp. 1–2; Joint Comment, No. 12 at pp. 1–2; Rheem, No. 13 at p. 3; AHRI, No. 14 at p. 1; Traulsen, No. 15 at pp. 2–3, Burnham, No. 16 at p. 1; Goodman, No. 17 at pp. 1–2; and Mitsubishi, No. 18 at pp. 1–2)
Many commenters believed that the compliance date should be tied to the completion of the AEDM rule. (Seasons, No. 4 at p. 1; UTC, No. 8 at pp 1–2; Lennox, No. 11 at p.2; Rheem, No. 13 at p. 3; AHRI, No. 14 at pp. 1–2, Traulsen, No. 15 at p. 2–3; Goodman, No. 17 at pp. 1–2; and Mitsubishi, No. 18 at pp. 1–2) Similarly, AAON commented that the AEDM rule would impact the length of the extension needed. (AAON, No. 9 at p. 2) In addition, AAON, Lennox AHRI, Goodman, and Mitsubishi commented that they believe that the compliance date should be extended a minimum of 18 months from the publication of the AEDM final rule. (AAON, No. 9 at p.2; Lennox, No. 11 at p.2; AHRI, No. 14 at p. 2; Goodman, No. 17 at pp. 1–2; and Mitsubishi, No. 18 at pp. 1–2) Goodman detailed a view shared by Seasons, UTC, AAON, Lennox, and AHRI that the length of the extension required would depend upon the actual results of the testing (due to measurement uncertainties, variances in testing set-ups and product variances) and the tolerances allowed by DOE (for both individual test-to-simulation results as well as average test-to-simulation results), additional testing or a significant amount of effort in development/specification of the internal AEDM procedure may be required. (Goodman, 17 at p. 1; Seasons, No. 4 at p. 1; UTC, No. 8 at pp. 1–2; AAON, No. 9 at p. 2; Lennox, No. 11 at p. 2 and AHRI, No. 14 at p. 2) Ingersoll Rand commented that it was concerned that a December 31, 2013 compliance date may not be sufficient to permit the Department to conduct a negotiated rulemaking and allow manufacturers to develop a means to comply with any modified requirements. (Ingersoll Rand, No. 10 at p. 1–2) In particular, Ingersoll Rand stated that it “hope[s] the Department recognizes [the December 2013 date] is only a stopgap measure, not truly a feasible date for future
One commenter supported the 12-month extension as proposed by the Department without modification. Specifically, Burnham commented in favor of a compliance extension similar to that proposed by the AHRI organization regarding the publication of the AEDM final rule. However, Burmham also clarified that a shorter timeframe would be feasible as well. (Burnham, No. 16 at p. 1)
Several commenters suggested that a significantly longer extension was needed. UTC noted that it believes an additional 12 to 36 months will be necessary after the issuance of a final AEDM rule prior to manufacturers being in a position to submit certification reports. (UTC, No. 8 at p.2) Hoshizaki requested a two-year extension for certification of commercial refrigeration equipment as it has not completed testing of its basic models and is waiting for DOE action on the AEDM rulemaking. (Hoshizaki, No. 6 at p. 1)
In light of the comments above, DOE is extending the compliance date for the certification provisions for commercial refrigeration equipment; commercial warm air furnaces, commercial packaged boilers, and commercial air conditioners and heat pumps (collectively referred to as commercial HVAC equipment); and commercial water heaters, commercial hot water supply boilers, and unfired hot water storage tanks (collectively referred to as commercial WH equipment) to December 31, 2013. DOE believes 12 months is a reasonable extension and will allow DOE time to complete the AEDM rulemaking and allow manufacturers to develop ratings in accordance with any revised AEDM provisions.
As noted above, the Department is reviewing the feasibility of a negotiated rulemaking to revise the certification requirements for commercial HVAC equipment and commercial refrigeration equipment. DOE is also considering the formation of an advisory committee in conjunction with such a rulemaking. Whether DOE proceeds with a negotiated rulemaking, and the outcome of a negotiated rulemaking, however, is uncertain. DOE believes that, should it proceed with a negotiated rulemaking, the process would, of its nature, involve discussion of any need to extend the new deadline further. Moreover, DOE believes that interested parties would raise the extension issue well in advance of December 31, 2013. Accordingly, DOE believes the 12-month extension is sufficient.
Many commenters submitted additional thoughts regarding the AEDM rulemaking, about the definition of “basic model” and about the potential for a negotiated rulemaking. (AAON, No. 9 at p.1; Ingersoll Rand, No. 10 at p. 1–2; Joint Comment, No. 12 at pp. 1–2; Rheem, No. 13 at pp. 1–3; AHRI, No. 14 at pp. 1–2, Goodman, No. 17 at pp. 1–2, and Mitsubishi, No. 18 at p. 2) DOE appreciates the information provided by parties on these matters. The substance of these comments is the subject of other rulemakings and should be raised in those proceedings. This rulemaking is limited to an extension of the compliance date for the March 2011 certification provisions for commercial HVAC equipment, commercial WH equipment, and commercial refrigeration equipment.
DOE emphasizes that the testing and sampling requirements for commercial refrigeration equipment; commercial HVAC equipment; and commercial WH equipment are unchanged by this extension. These regulations can be found on a per product basis in subpart B to part 429 (sampling plans for testing) and 10 CFR 431.64, 431.76, 431.86, 431.96, 431.106, and 431.134 (uniform test methods).
In the December 2012 NOPR, DOE initially proposed to retain the December 31, 2012 deadline to certify compliance but sought comment on whether an extension was needed. Several commenters requested a six-month extension of time for submitting certification reports for automatic commercial ice makers (ACIM). (Scotsman, No. 5 at p. 1; Hoshizaki, No. 6 at p. 1; AHRI, No. 14 at p. 2) Scotsman requested additional time to work with AHRI so that AHRI could build a database to collect the required information and submit the certification reports on Scotsman's behalf. (Scotsman, No. 5 at p. 1) Hoshizaki explained that it has the required test reports but that AHRI's portal for reporting test data is not ready. (Id.) Scotsman, however, indicated that it will need to conduct additional testing prior to submitting certification reports. (Scotsman, No. 5 at p. 1) AHRI requested a six-month extension to allow manufacturers time to complete testing. (AHRI, No. 14 at p. 2)
Scotsman and Hoshizaki commented that DOE released the templates for certification of ACIM in December 2012 and stated that they did not have an automated process to provide many of the data elements contained in the templates. (Scotsman, No. 5 at p. 1; Hoshizaki, No. 6 at p. 1)
Traulsen, on the other hand, noted that it did not have a concern with the Department's proposed certification deadline of December 31, 2012 for ACIMs even though it does not manufacture or supply this type of equipment. (Traulsen, No. 15 at p. 3)
DOE expresses no view regarding an automated process that a regulated entity may develop to provide its certification reports. DOE notes that the data elements required for certification have been public since March 2011 and the CCMS templates for certification are available to manufacturers online. Given the concerns expressed by manufacturers, DOE is extending the compliance date for ACIM to align the compliance date with the next annual certification reporting date. Manufacturers would be required to submit only one certification report in 2013 for current basic models unless they implement design changes to those models resulting in lower efficiency or increased consumption. Consequently, DOE is adopting a compliance date of August 1, 2013, for submission of certification reports for ACIM.
DOE emphasizes that all covered equipment must meet the applicable energy conservation standard. ASAP, ACEEE, ASE, and NRDC also noted in their joint comment that parties are not absolved of their obligations to comply with current standards and encouraged DOE to enforce those standards effectively. (Joint Comment, No. 12 at pp. 1–2) Furthermore, all testing procedures and sampling provisions are unaffected by this final rule. DOE is adopting a 12-month extension to the compliance date for certification only for the commercial refrigeration equipment; commercial HVAC equipment; and commercial WH equipment reporting requirements in the March 2011 final rule. DOE is adopting an 8-month extension to the compliance date for certification only for the ACIM reporting requirements in the March 2011 final rule.
DOE encourages manufacturers to become familiar with the CCMS prior to the certification deadline. The CCMS has templates currently available for all covered equipment available for manufacturers to use when submitting certification data to DOE.
DOE conducts assessment testing of products available for purchase in the United States, pursuant to 10 CFR 429.104. While certification is not required for commercial refrigeration equipment; commercial HVAC equipment; and commercial WH equipment until December 31, 2013, and for ACIM until August 1, 2013, DOE encourages manufacturers to submit to CCMS certification reports to DOE voluntarily prior to the compliance date required for certification. The Department will refrain from selecting models for assessment testing for which the manufacturer has submitted a valid certification report in CCMS. Specifically, in 2013, DOE will, in its enforcement discretion, limit any assessment testing of commercial refrigeration equipment, commercial HVAC equipment, commercial WH equipment, and automatic commercial ice makers to those models for which DOE does not have a valid certification report on file. If DOE purchases a unit for assessment testing prior to a manufacturer submitting a valid certification report, DOE will continue with the assessment test. A valid certification report is one that meets the requirements of 10 CFR part 429, including the manufacturer's determination of compliance being based either on testing in accordance with DOE sampling and test procedures (parts 429 and 431) or on the AEDM procedures in part 429.
DOE will continue to conduct enforcement testing when it has a reason to believe that products do not meet the applicable standard. In addition, DOE will continue to conduct limited testing in support of its rulemaking activities for these equipment types. DOE will also continue to conduct verification testing in support of the ENERGY STAR program.
AHRI commented that it supports DOE's enforcement policy. (AHRI, No. 14 at p. 2–3) DOE appreciates AHRI's support and notes that the enforcement policy is not tied to participation in a voluntary industry certification program and is based upon the voluntary submittal of a valid CCMS certification report to DOE in advance of the compliance date required for certification of the applicable equipment.
DOE proposed to modify the regulatory text to reflect that the compliance dates for walk-in coolers and freezers, distribution transformers, and metal halide lamp ballasts have passed. DOE did not receive any comments on this proposal. Thus, DOE is adopting these amendments to 10 CFR 429.12(i).
The Department proposed to correct a technical drafting error for packaged terminal air conditioners and heat pumps that was implemented in the reprinting of Table 5 in 10 CFR 431.97 in a final rule published on May 16, 2012. 77 FR 28994. More specifically, DOE adopted changes to the applicable energy conservation standards for standard size and non-standard size packaged terminal air conditioners and heat pumps with a cooling capacity of 15,000 Btu/h. DOE did not receive any comments on this proposal.
Consequently, DOE is correcting this error in today's final rule by adopting the original standards for standard size and non-standard size packaged terminal air conditioners and heat pumps with a cooling capacity of 15,000 Btu/h as presented in a final rule evaluating and originally adopting the amended energy conservation for this equipment published on April 7, 2008. 73 FR 18915.
Today's regulatory action is not a “significant regulatory action” under section 3(f) of Executive Order 12866. Accordingly, this action was not subject to review under the Executive Order by the Office of Information and Regulatory Affairs (OIRA) in the Office of Management and Budget (OMB).
DOE has determined, pursuant to authority at 5 U.S.C. 553(d)(1), that this final rule is not subject to a 30-day delay in effective date because this rule extending the compliance date for a requirement relieves a restriction.
The Regulatory Flexibility Act (5 U.S.C. 601
DOE reviewed this rule under the provisions of the Regulatory Flexibility Act and the procedures and policies published on February 19, 2003. This rule merely extends the compliance date of a rulemaking already promulgated. To the extent such action has any economic impact it would be positive in that it would allow regulated parties additional time to come into compliance. DOE did undertake a full regulatory flexibility analysis of the original Certification, Compliance, and Enforcement for Consumer Products and Commercial and Industrial Equipment rulemaking. That analysis considered the impacts of that rulemaking on small entities. As a result, DOE certifies that this rule will not have a significant economic impact on a substantial number of small entities.
DOE has determined that this rule falls into a class of actions that are categorically excluded from review under the National Environmental Policy Act of 1969 (42 U.S.C. 4321
The Secretary of Energy has approved publication of today's final rule.
Administrative practice and procedure, Energy conservation, Commercial equipment, Reporting and recordkeeping requirements.
Administrative practice and procedure, Energy conservation, Commercial equipment, Reporting and recordkeeping requirements.
For the reasons set forth in the preamble, DOE amends chapter II, subchapter D, of Title 10 of the Code of Federal Regulations to read as follows:
42 U.S.C. 6291–6317.
(i)
(1) Automatic commercial ice makers, August 1, 2013;
(2) Commercial refrigeration equipment, December 31, 2013;
(3) Commercial heating, ventilating, and air-conditioning equipment, December 31, 2013; and
(4) Commercial water heating equipment, December 31, 2013.
42 U.S.C. 6291–6317.
Office of Energy Efficiency and Renewable Energy, Department of Energy.
Final rule.
In an earlier final rule, the U.S. Department of Energy (DOE) prescribed amendments to its test procedures for residential furnaces and boilers to include provisions for measuring the standby mode and off mode energy consumption of those products, as required by the Energy Independence and Security Act of 2007. These test procedure amendments were primarily based on provisions incorporated by reference from the International Electrotechnical Commission (IEC) Standard 62301 (First Edition), “Household electrical appliances—Measurement of standby power.” In this current final rule, DOE further amends its test procedure to incorporate by reference the latest edition of the IEC Standard, specifically IEC Standard 62301 (Second Edition). The new version of this IEC standard includes a number of methodological changes designed to increase accuracy while reducing testing burden. This final rule also clarifies the rounding guidance and sampling provisions for the new measurement of standby mode and off mode wattage.
This rule is effective January 30, 2013. The incorporation by reference of certain publications listed in the rule is approved by the Director of the Federal Register on January 30, 2013.
For purposes of compliance with energy conservation standards, compliance with the amended test procedures is required on and after May 1, 2013 (for non-weatherized gas and oil furnaces including mobile home furnaces, and all electric furnaces). The compliance date for any representations relating to standby mode and off mode of residential furnaces and boilers is July 1, 2013; on and after this date, any such representations must be based upon results generated under these test procedures and sampling plans.
The docket for this rulemaking is available for review at
A link to the docket Web page can be found at:
For further information on how to review the docket, contact Ms. Brenda Edwards at (202) 586–2945 or by email:
Mr. Mohammed Khan, U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Program, EE–2J, 1000 Independence Avenue SW., Washington, DC, 20585–0121. Telephone: (202) 586–7892. Email:
Mr. Eric Stas, U.S. Department of Energy, Office of the General Counsel, GC–71, 1000 Independence Avenue SW., Washington, DC, 20585–0121. Telephone: (202) 586–9507. Email:
Title III, Part B
Under the Act, this program consists essentially of four parts: (1) Testing; (2) labeling; (3) Federal energy conservation standards; and (4) certification and enforcement procedures. The testing requirements consist of test procedures that manufacturers of covered products must use as the basis for certifying to DOE that their products comply with applicable energy conservation standards adopted pursuant to EPCA and for making representations about the efficiency of those products. (42 U.S.C. 6293(c); 42 U.S.C. 6295(s)) Similarly, DOE must use these test procedures in any enforcement action to determine whether covered products comply with these energy conservation standards. (42 U.S.C. 6295(s))
Under 42 U.S.C. 6293, EPCA sets forth criteria and procedures for DOE's adoption and amendment of such test procedures. Specifically, EPCA provides that “[a]ny test procedures prescribed or amended under this section shall be reasonably designed to produce test results which measure energy efficiency, energy use * * * or estimated annual operating cost of a covered product during a representative average use cycle or period of use, as determined by the Secretary [of Energy], and shall not be unduly burdensome to conduct.” (42 U.S.C. 6293(b)(3)) In addition, if DOE determines that a test procedure amendment is warranted, it must publish proposed test procedures and offer the public an opportunity to present oral and written comments on them. (42 U.S.C. 6293(b)(2)) Finally, in
On December 19, 2007, the Energy Independence and Security Act of 2007 (EISA 2007), Public Law 110–140, was enacted. The EISA 2007 amendments to EPCA, in relevant part, require DOE to amend the test procedures for all covered products to include measures of standby mode and off mode energy consumption. Specifically, section 310 of EISA 2007 provides definitions of “standby mode” and “off mode” (42 U.S.C. 6295(gg)(1)(A)) and permits DOE to amend these definitions in the context of a given product (42 U.S.C. 6295(gg)(1)(B)). The statute requires integration of such energy consumption into the overall energy efficiency, energy consumption, or other energy descriptor for each covered product, unless the Secretary determines that: (1) The current test procedures for a covered product already fully account for and incorporate the standby mode and off mode energy consumption of the covered product; or (2) such an integrated test procedure is technically infeasible for a particular covered product, in which case the Secretary shall prescribe a separate standby mode and off mode energy use test procedure for the covered product, if technically feasible. (42 U.S.C. 6295(gg)(2)(A))
Under the statutory provisions adopted by EISA 2007, any such amendment must consider the most current versions of IEC Standard 62301,
DOE's current test procedure for residential furnaces and boilers is found at 10 CFR part 430, subpart B, appendix N,
As discussed above, EISA 2007 amended EPCA to require that DOE test procedures for covered products include provisions for measuring standby mode and off mode energy consumption. (42 U.S.C. 6295(gg)(2)(A)) In establishing test procedures to address standby mode and off mode energy consumption, EISA 2007 requires consideration of the most current version of IEC Standard 62301 to support the added measurement provisions.
However, since that time, DOE has continued to address the requirements of EISA 2007 as it relates to standby mode and off mode for other products. For example, DOE has issued similar test procedure amendments for other heating products (water heaters, direct heating equipment, and pool heaters), and during that rulemaking, commenters identified improvements to IEC Standard 62301 that were under development and nearly finalized. These commenters, representing both manufacturers and energy conservation advocacy groups, are presumably the same as those that would comment on the proposals for furnaces and boilers, and they supported the draft revisions to IEC Standard 62301 as applied to the other heating products. The second edition of IEC Standard 62301 has now been finalized. In the abstract of its January 27, 2011 publication, the IEC reports that the second edition provides practical improvement and possible reduction in testing burden. DOE has reviewed IEC Standard 62301 (Second Edition) and agrees that the second edition does provide for improvement in terms of measurement accuracy and, in addition, provides for possible reduced testing burden by allowing for direct meter reading techniques, where appropriate. DOE believes these improvements would be applicable to a variety of heating products, including furnaces and boilers, as well as the other heating products discussed above. Accordingly, after careful review, in a notice of proposed rulemaking (NOPR) published on September 13, 2011 (76 FR 56339; “the September 2011 NOPR”). DOE decided to exercise its discretion to consider incorporation of the revised version of the industry standard into the DOE test procedure for residential furnaces and boilers. (42 U.S.C. 6293(b)(2)) In the September 2011 NOPR, DOE proposed to incorporate by reference the second edition of the IEC Standard 62301 standard in its entirety, calling out the appropriate provisions of that standard in DOE's test procedure regulations for residential furnaces and boilers. 76 FR 56339, 56341 (Sept. 13, 2011). This proposal also clarified the rounding guidance and sampling provisions for the new measurements of standby mode and off mode wattage. A public meeting was held on October 3, 2011 to discuss and receive comments on the issues presented in the September 2011 NOPR. The comment period ended on November 28, 2011.
The September 2011 proposed rule was part of the continued efforts of DOE to address the requirements of EISA 2007 as it relates to standby mode and off mode for all covered products. In particular, after the standby mode and off mode amendments were developed for furnaces and boilers, DOE considered similar test procedure amendments for other heating products (water heaters, direct heating equipment, and pool heaters), and during that rulemaking, commenters identified improvements to IEC Standard 62301 that were under development and nearly finalized. These commenters, which are largely the same as those that would comment on the proposals for furnaces and boilers, supported the draft revisions to
More specifically, DOE's technical review of IEC Standard 62301 (Second Edition) determined that some improvement to the current DOE test procedure is possible with the incorporation of the second edition of the IEC standard as it applies to residential furnaces and boilers. First, a more comprehensive specification of required accuracy is provided in IEC Standard 62301 (Second Edition) that depends upon the characteristics of the power being measured. DOE believes that this most recent revision to the IEC standard provides improved and realistic accuracy provisions for a range of electricity consumption patterns, thereby making the updated test method appropriate for the variety of electricity-consuming devices that form part of residential furnaces and boilers. The new specification can be met by typical, commercially-available test equipment, whereas requirements in the first version may have necessitated specialized instrumentation that is not readily available.
Another important change in IEC Standard 62301 (Second Edition) that relates to the measurement of standby mode and off mode power consumption in residential furnaces and boilers involves the specification of the stability criteria required to measure that power. IEC Standard 62301 (Second Edition) contains more detailed techniques to evaluate the stability of the power consumption and to measure the power consumption for loads with different stability characteristics. In IEC Standard 62301 (First Edition), the stability of the system is determined by measuring the power consumption over a 5-minute period. If the variation over that period is less than 5 percent, the signal is considered to be stable. There are potential operational modes, however, that could show variation over longer time frames. For example, an electronic component could go into a sleep mode after a 10-minute period. This change in power consumption would not be captured in the 5-minute stability test. IEC Standard 62301 (Second Edition) acknowledges the existence of these different types of modes by creating stability tests for these variable power modes. For constant power modes, the test method specified in the second edition of IEC Standard 62301 matches that specified in the first edition. For cyclical power consumption, the second edition of IEC Standard 62301 adds measurement provisions for situations in which the variation in the signal might not be constant over a 5-minute period. The power measurements would take at least 60 minutes; a test period of this duration is required to accurately capture standby mode and off mode energy consumption for equipment with varying power consumption and is an improvement introduced by IEC Standard 62301 (Second Edition) compared to IEC Standard 62301 (First Edition). These techniques will result in more complete and accurate measures of standby mode and off mode energy consumption over a variety of operational modes. The manufacturer is given a choice of measurement procedures, including less burdensome methods such as direct meter reading methods if certain clearly-described stability conditions are met. DOE believes that the changes incorporated in IEC Standard 62301 (Second Edition) will allow for use of less burdensome methods when appropriate and will ensure accurate measures of standby energy consumption over a range of operating conditions that may be present in residential furnaces and boilers.
Accordingly, for the reasons discussed above, DOE proposed to incorporate IEC Standard 62301 (Second Edition) in its entirety into the overall list of incorporated references in 10 CFR 430.3 and to call out the appropriate provisions of that standard in DOE's test procedure regulations for residential furnaces and boilers.
In addition, the September 2011 NOPR clarified that the rounding guidance in the IEC Standard 62301 (Second Edition) should be used for the new proposed wattage measurements. Specifically, it was proposed that the following sentence be added to the measurement provisions in sections 8.6.1 and 8.6.2: “The recorded standby power (P
Finally, DOE proposed to apply the existing DOE sampling plans used by residential furnace and boiler manufacturers to determine the representative values for annual energy consumption to the newly proposed standby mode and off mode ratings (P
In response to the September 2011 NOPR, DOE received very little in the way of comment on this matter. In particular, there was no objection expressed as to the use of the updated version of the IEC standard. Only two comments were received from Crown Boiler and the Air-Conditioning, Heating, and Refrigeration Institute (Crown, No. 5 and AHRI, No. 7, respectively), and they are discussed in detail below. In overview, these comments dealt with the overall burden of measuring standby mode and off mode energy consumption and the associated rounding guidance. No comments were received on the added clarification provisions related to sampling.
Comments from Crown Boiler were supportive of the September 2011 NOPR, in that the company agreed that the use of the second edition of IEC Standard 62301 in lieu of the first edition would result in reduced cost of testing. However, despite this reduction in cost, Crown Boiler opposed testing provisions for standby mode and off mode energy consumption generally, applying to both the current rulemaking and the October 2010 final rule, stating,
Initially, DOE notes that most of Crown Boiler's comment involves provisions prescribed by the October 2010 final rule rather than those proposed in the September 2011 NOPR, which are matters beyond the scope of the current rulemaking. However, DOE is addressing the concerns of Crown Boiler here because of the interrelationship between these rules. Crown Boiler maintained that the energy savings potential associated with limiting the standby mode and off mode power consumption of residential boilers would be insignificant because of the small magnitude of energy consumption in these modes. In support of this position, Crown Boiler estimated that most residential boilers would consume less than 5W of standby mode and off mode power and that the annual shipments are only 400,000 units. In response, as summarized in the September 2011 NOPR and as Crown Boiler acknowledges, the EISA 2007 amendments to EPCA, in relevant part, statutorily require DOE to amend the test procedures for all covered products (including furnaces and boilers) to include measures of standby mode and off mode energy consumption. 76 FR 56339, 56341 (Sept. 13, 2011). Specifically, the statute requires integration of such energy consumption into the overall energy efficiency, energy consumption, or other energy descriptor for each covered product, unless the Secretary determines that: (1) The current test procedures for a covered product already fully account for and incorporate the standby mode and off mode energy consumption of the covered product; or (2) such an integrated test procedure is technically infeasible for a particular covered product, in which case the Secretary shall prescribe a separate standby mode and off mode energy use test procedure for the covered product, if technically feasible. (42 U.S.C. 6295(gg)(2)(A))
Furthermore, although DOE realizes that, as pointed out by Crown Boiler, the level of standby mode and off mode energy consumption of boilers is inherently smaller than that of other products, such as forced air furnaces, it nevertheless represents a significant level of energy consumption when viewed in the aggregate. For example, the cost of annual standby mode and off mode energy consumption for the commenter's estimate of annual shipments (400,000 units) and wattage would be nearly $2 million each year for a single year's shipments of boilers (400,000 × 8000 hours × 5W × .00012 $/whr = $1.92 million). Some amount of this energy consumption could be limited by an applicable energy conservation standard in the future. This energy saving potential would be part of the analysis in support of such a standard. Accordingly, for these reasons, DOE cannot eliminate the integration of standby mode and off mode into the residential furnaces and boilers test procedures on the basis of insignificant energy savings potential.
Crown Boiler also argued that the overall burden of conducting the additional tests for standby mode and off mode is significant for small businesses. The commenter specifically stated that the purchase cost of equipment needed to run the IEC Standard 62301 test is significant for small boiler manufacturers. On this matter, DOE certified in the October 2010 final rule that the added provisions to address standby mode and off mode energy consumption will not a have a significant economic impact on a significant number of small entities. 75 FR 64621, 64628–29 (Oct. 20, 2010). Furthermore, in the September 2011 NOPR, DOE tentatively certified that the possible additional burden represented by the adoption of the second edition of IEC Standard 62301 also would not have a significant economic impact on a substantial number of small entities. 76 FR 56339, 56343–44 (Sept. 13, 2011). In today's final rule, DOE affirms its certification, because it has concluded that the possible additional equipment cost for affected manufacturers is a small investment compared to manufacturers' overall financial investment needed to undertake the business enterprise of testing consumer products, including residential boilers.
Crown Boiler also commented on the additional testing time that IEC Standard 62301 (Second Edition) may require on units with unstable readings. DOE analyzed this issue in the September 2011 NOPR and tentatively concluded that in the worst case, the labor costs associated with wait time during testing would result in a small additional cost of $30 per test unit.
In its comments, Crown Boiler argued that a second testing burden would arise from the need to separately test different controls systems on various boiler models for standby mode and off mode energy consumption. If, in fact, the energy consumption is different for each type of control system and there are numerous control system options applied to a given basic model, additional testing may be required for those basic models. However, this situation is not unlike any other design feature of a covered product that affects energy consumption. DOE believes this possible difference between control systems, and its potential additional testing costs, could be mitigated by the existing rules regarding conservative ratings, while still satisfying the requirement in EISA 2007 for incorporation into the DOE test procedures. In a recent rulemaking on certification, compliance, and enforcement, DOE clarified the conservative ratings concept within that final rule's discussion of the concept of “basic model.” 76 FR 12422, 12428–29 (March 7, 2011). Specifically, that discussion elaborated on the permitted flexibility in determining how manufacturers choose to group individual models into a basic model with essentially identical energy consumption characteristics. Generally, characteristics, such as different control systems, that have a small effect on overall energy consumption or efficiency need not constitute different basic models and, therefore, would not require additional separate testing. Rather, at the manufacturer's discretion, a basic model could include a variety of control systems, provided that the resulting rated energy consumption would be sufficiently conservative to account for the least-efficient model within the basic model. DOE believes it is reasonable to assume that the manufacturer can determine which control system would be likely to have the highest energy consumption, thereby allowing the manufacturer to avail itself of the conservative ratings in lieu of additional testing, if it so chooses.
Finally, Crown Boiler mentioned as a burden the differences in ambient air specifications between IEC Standard 62301 and the existing DOE test procedure. This is not a valid point, because the October 2010 final rule specifies, expressly to eliminate unnecessary burden, that the existing test procedure specification for ambient air is to be used for all testing. 75 FR 64621, 64623–25 (Oct. 20, 2010). Today's final rule does nothing to alter DOE's existing specifications for ambient temperature.
In sum, the concerns raised by Crown Boiler have not demonstrated an undue burden associated with DOE's proposed standby mode and off mode measurement provisions, which have been adopted pursuant to DOE's mandate in EISA 2007.
Although Crown Boiler would prefer the elimination of standby mode and off mode measurements for residential boilers, in the alternative, it requested consideration of some simplification of the measurement procedures. Specifically, Crown Boiler asked that in lieu of requiring the IEC Standard 62301 measurements, that manufacturers could be allowed, as an option, to assess the standby mode and off mode wattage with a preliminary and less sophisticated measurement procedure. More specifically, Crown Boiler suggested that if that value is below some threshold, the manufacturer would be allowed to report a conservative default value (
In addition to proposing the use of the second edition of IEC Standard 62301, the September 2011 NOPR provided rounding guidance applicable to the new measures of energy consumption for furnaces and boilers (
DOE believes that the IEC rounding provisions for wattage measurements are appropriate and within the capabilities of the instrumentation specified in the IEC standard. Specifically, DOE's review of IEC Standard 62301-compliant instrumentation has determined that one can easily support this level of reporting. Moreover, the test procedures for other DOE covered products already utilize IEC Standard 62301 for the wattage measurements, and DOE believes there is benefit in measuring the standby mode and off mode energy consumption of various covered products in a consistent manner for the various DOE requirements (
The effective date for these amendments is January 30, 2013. At that time, representations may be made using the new metrics P
However, DOE is clarifying here that use of these test procedure amendments related to standby mode and off mode energy consumption are not required for purposes of energy conservation standards compliance until May 1, 2013 (for non-weatherized gas and oil furnaces including mobile home furnaces, and all electric furnaces); this is the compliance date of the recently amended energy conservation standards for residential furnaces, which include standards for standby mode and off mode energy consumption. 76 FR 37408 (June 27, 2011); 76 FR 67037 (Oct. 31, 2011). Again, DOE makes this statement with the caveat that the amended standards only apply to furnaces and not boilers. Amended energy conservation standards addressing standby mode and off mode for boilers will be addressed and apply on the compliance date for the next energy conservation standards rulemaking for those products.
EPCA requires that any test procedures prescribed or amended must
Today's amendments to the DOE test procedure for residential furnaces and boilers incorporates the most current version of IEC Standard 62301 in lieu of the previous version. DOE has concluded that these new provisions will continue to produce valid test results, while reducing testing burden. Accordingly, this final rule meets the requirements of 42 U.S.C. 6293(b)(3).
In addition, DOE has determined that these amendments will not alter the measured efficiency or energy use when determining compliance with the current energy conservation standards for these products or with future standards related to standby mode and off mode for furnaces. Accordingly, no modifications to the currently applicable energy conservation standards are required. This is because the currently applicable energy conservation standard is based on the annual fuel utilization efficiency (AFUE) metric which does not include or depend on the new measures of energy consumption regarding standby mode and off mode. In addition, consistent with its mandate pursuant to EISA 2007, DOE is further clarifying here that use of these test procedure amendments related to standby mode and off mode energy consumption are not required for purposes of energy conservation standards compliance,
Lastly, DOE does not believe that these test procedure amendments, which adopt a revised version of the IEC test procedure, would significantly alter the energy consumption as measured by the existing DOE test procedure provisions related to standby mode and off mode for residential furnaces and boilers, because the test procedure provisions of IEC Standard 62301 (Second Edition) are limited to providing additional accuracy for the measurements and clarification on the test method. Consequently, DOE does not believe that potential adoption of amendments pertaining to these clarifications and additions would alter any estimates of energy consumption under either DOE's current energy conservation standards or the recently promulgated amended standards.
The Office of Management and Budget has determined that test procedure rulemakings do not constitute “significant regulatory actions” under section 3(f) of Executive Order 12866, “Regulatory Planning and Review.” 58 FR 51735 (Oct. 4, 1993). Accordingly, this regulatory action was not subject to review under the Executive Order by the Office of Information and Regulatory Affairs (OIRA) in the Office of Management and Budget (OMB).
The Regulatory Flexibility Act (5 U.S.C. 601
Today's final rule adopts test procedure provisions to measure standby mode and off mode energy consumption of residential furnaces and boilers, generally through the incorporation by reference of IEC Standard 62301 (Second Edition). DOE reviewed today's final rule under the provisions of the Regulatory Flexibility Act and the policies and procedures published on February 19, 2003. For the reasons explained below, DOE certifies that the final rule will not have a significant impact on a substantial number of small entities.
As noted above, the test procedure incorporates by reference provisions from IEC Standard 62301 for the measurement of standby mode and off mode energy consumption. IEC Standard 62301 is widely accepted and used internationally to measure electric power in standby mode and off mode.
Based on its analysis of IEC Standard 62301 (Second Edition), DOE has determined that the only possible additional burden represented by the adoption of IEC Standard 62301 (Second Edition) is associated with the testing time. For measurements of power consumption that are determined to be stable, test time would not change. Test time would increase under IEC Standard 62301 (Second Edition), as compared to IEC Standard 62301 (First Edition), should the stability test indicate that the power is being used in a variable manner. For these cases, the revised procedure would increase the time of measurement from the current 15 minutes to up to 60 minutes. No additional setup time would be required for these tests. This possible increase in test time does not necessarily require active labor, because no additional set up is required, and the additional time essentially amounts to a waiting period to determine stability. Nonetheless, assuming the 45 minutes additional test time does incur additional labor cost, the worst-case estimate of an additional $30 per test unit is a small incremental change compared to the overall financial investment needed to undertake the business enterprise of testing consumer products. For these reasons, DOE does not believe that this final rule adds significant costs nor requires any significant investment in test facilities or new equipment.
The Small Business Administration (SBA) considers an entity to be a small business if, together with its affiliates, it employs fewer than a threshold number of workers specified in 13 CFR part 121, which relies on size standards and codes established by the North American Industry Classification System (NAICS). The threshold number for NAICS classification 333415, which applies to Air-Conditioning and Warm
Accordingly, DOE has not prepared a regulatory flexibility analysis for this rulemaking. DOE's certification and supporting statement of factual basis were provided to the Chief Counsel for Advocacy of the SBA for review under 5 U.S.C. 605(b). DOE did not receive any comments demonstrating a significant economic impact on any small entities. Thus, DOE reaffirms and certifies that this rule will not have a significant economic impact on a substantial number of small entities.
Today's final rule would impose no new information or recordkeeping requirements. Accordingly, OMB clearance is not required under the Paperwork Reduction Act. (44 U.S.C. 3501
In this rule, DOE is amending the test procedure for residential furnaces and boilers to address measurement of the standby mode and off mode energy consumption of these products. DOE has determined that this final rule falls into a class of actions that are categorically excluded from review under the National Environmental Policy Act of 1969 (Pub. L. 91–190, codified at 42 U.S.C. 4321
Executive Order 13132, “Federalism,” imposes certain requirements on agencies formulating and implementing policies or regulations that preempt State law or that have Federalism implications. 64 FR 43255 (August 10, 1999). The Executive Order requires agencies to examine the constitutional and statutory authority supporting any action that would limit the policymaking discretion of the States, and to carefully assess the necessity for such actions. The Executive Order also requires agencies to have an accountable process to ensure meaningful and timely input by State and local officials in the development of regulatory policies that have Federalism implications. On March 14, 2000, DOE published a statement of policy describing the intergovernmental consultation process that it will follow in developing such regulations. 65 FR 13735. DOE has examined this final rule and has determined that it does 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. EPCA governs and prescribes Federal preemption of State regulations as to energy conservation for the products that are the subject of today's final rule. States can petition DOE for exemption from such preemption to the extent, and based on criteria, set forth in EPCA. (42 U.S.C. 6297(d)) Therefore, Executive Order 13132 requires no further action.
Regarding the review of existing regulations and the promulgation of new regulations, section 3(a) of Executive Order 12988, “Civil Justice Reform,” 61 FR 4729 (Feb. 7, 1996), imposes on Federal agencies the general duty to adhere to the following requirements: (1) eliminate drafting errors and ambiguity; (2) write regulations to minimize litigation; (3) provide a clear legal standard for affected conduct rather than a general standard; and (4) promote simplification and burden reduction. Regarding the review required by section 3(a), section 3(b) of Executive Order 12988 specifically requires that Executive agencies make every reasonable effort to ensure that the regulation: (1) Clearly specifies the preemptive effect, if any; (2) clearly specifies any effect on existing Federal law or regulation; (3) provides a clear legal standard for affected conduct while promoting simplification and burden reduction; (4) specifies the retroactive effect, if any; (5) adequately defines key terms; and (6) addresses other important issues affecting clarity and general draftsmanship under any guidelines issued by the Attorney General. Section 3(c) of Executive Order 12988 requires Executive agencies to review regulations in light of applicable standards in sections 3(a) and 3(b) to determine whether they are met or it is unreasonable to meet one or more of them. DOE has completed the required review and determined that, to the extent permitted by law, this rule meets the relevant standards of Executive Order 12988.
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) (Pub. L. 104–4, codified at 2 U.S.C. 1501
Section 654 of the Treasury and General Government Appropriations Act, 1999 (Pub. L. 105–277) requires Federal agencies to issue a Family Policymaking Assessment for any rule that may affect family well-being. Today's final rule amending DOE test procedures would not have any impact on the autonomy or integrity of the family as an institution. Accordingly, DOE has concluded that it is not necessary to prepare a Family Policymaking Assessment.
Pursuant to Executive Order 12630, “Governmental Actions and Interference with Constitutionally Protected Property Rights,” 53 FR 8859 (March 15, 1988), DOE has determined that this final rule will not result in any takings that might require compensation under the Fifth Amendment to the United States Constitution.
The Treasury and General Government Appropriations Act, 2001 (Pub. L. 106–554, codified at 44 U.S.C. 3516 note) provides for agencies to review most disseminations of information to the public under information quality guidelines established by each agency pursuant to general guidelines issued by OMB. OMB's guidelines were published at 67 FR 8452 (Feb. 22, 2002), and DOE's guidelines were published at 67 FR 62446 (Oct. 7, 2002). DOE has reviewed today's final rule under the OMB and DOE guidelines and has concluded that it is consistent with applicable policies in those guidelines.
Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use,” 66 FR 28355 (May 22, 2001), requires Federal agencies to prepare and submit to OMB a Statement of Energy Effects for any proposed significant energy action. A “significant energy action” is defined as any action by an agency that promulgated or is expected to lead to promulgation of a final rule, and that: (1) is a significant regulatory action under Executive Order 12866, or any successor order; and (2) is likely to have a significant adverse effect on the supply, distribution, or use of energy; or (3) is designated by the Administrator of OIRA as a significant energy action. For any proposed significant energy action, the agency must give a detailed statement of any adverse effects on energy supply, distribution, or use should the proposal be implemented, and of reasonable alternatives to the action and their expected benefits on energy supply, distribution, and use. Today's final rule is not a significant regulatory action under Executive Order 12866 or any successor order; will not have a significant adverse effect on the supply, distribution, or use of energy; and has not been designated by the Administrator of OIRA as a significant energy action. Therefore, DOE has determined that this rule is not a significant energy action. Accordingly, DOE has not prepared a Statement of Energy Effects for this rulemaking.
Under section 301 of the Department of Energy Organization Act (Pub. L. 95–91; 42 U.S.C. 7101
Certain of the amendments and revisions in this final rule incorporate testing methods contained in the following commercial standard, the International Electrotechnical Commission (IEC) Standard 62301, “Household electrical appliances—Measurement of standby power” (Second Edition 2011). DOE has evaluated this standard and is unable to conclude whether it fully complies with the requirements of section 32(b) of the Federal Energy Administration Act (
As required by 5 U.S.C. 801, DOE will report to Congress on the promulgation of today's final rule before its effective date. The report will state that it has been determined that the rule is not a “major rule” as defined by 5 U.S.C. 804(2).
The Secretary of Energy has approved publication of this final rule.
Administrative practice and procedure, Confidential business information, Energy conservation, Household appliances, Imports, Incorporation by reference, Intergovernmental relations, Small businesses.
For the reasons stated in the preamble, DOE is amending part 430 of Chapter II, Subchapter D of Title 10 of the Code of Federal Regulations, as set forth below:
42 U.S.C. 6291–6309; 28 U.S.C. 2461 note.
The additions and revisions read as follows:
* * * However, any representation related to standby mode and off mode energy consumption of these products made after July 1, 2013 must be based upon results generated under this test procedure, consistent with the requirements of 42 U.S.C. 6293(c)(2). * * *
Bureau of Consumer Financial Protection.
Final rule; official commentary.
The Bureau of Consumer Financial Protection (Bureau) is publishing a final rule amending the official commentary that interprets the requirements of the Bureau's Regulation C (Home Mortgage Disclosure) to reflect a change in the asset-size exemption threshold for banks, savings associations, and credit unions based on the annual percentage change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI–W). The exemption threshold is adjusted to increase to $42 million from $41 million. The adjustment is based on the 2.23 percent increase in the average of the CPI–W for the 12-month period ending in November 2012. Therefore, banks, savings associations, and credit unions with assets of $42 million or less as of December 31, 2012, are exempt from collecting data in 2013.
This final rule is effective December 31, 2012.
Joan Kayagil, Senior Counsel, Office of Regulations, at (202) 435–7700.
The Home Mortgage Disclosure Act of 1975 (HMDA) (12 U.S.C. 2801–2810) requires most mortgage lenders located in metropolitan areas to collect data about their housing-related lending activity. Annually, lenders must report those data to the appropriate Federal agencies and make the data available to the public. The Bureau's Regulation C (12 CFR part 1003) implements HMDA.
Prior to 1997, HMDA exempted certain depository institutions as defined in HMDA (
The definition of “financial institution” in Regulation C provides that the Bureau will adjust the asset threshold based on the year-to-year change in the average of the CPI–W, not seasonally adjusted, for each 12-month period ending in November, rounded to the nearest million. 12 CFR 1003.2. For 2012, the threshold was $41 million. During the 12-month period ending in November 2012, the CPI–W increased by 2.23 percent. As a result, the exemption threshold is increased to $42 million. Thus, banks, savings associations, and credit unions with assets of $42 million or less as of December 31, 2012, are exempt from collecting data in 2013. An institution's exemption from collecting data in 2013 does not affect its responsibility to report data it was required to collect in 2012.
Under the Administrative Procedure Act (APA), notice and opportunity for public comment are not required if the Bureau finds that notice and public comment are impracticable, unnecessary, or contrary to the public interest. 5 U.S.C. 553(b)(B). Pursuant to this final rule, comment 1003.2 (Financial institution)–2 in Regulation C, supplement I, is amended to update the exemption threshold. The amendment in this final rule is technical and nondiscretionary, and it merely applies the formula established by Regulation C for determining any adjustments to the exemption threshold. For these reasons, the Bureau has determined that publishing a notice of proposed rulemaking and providing opportunity for public comment are unnecessary and the amendment is adopted in final form.
Under section 553(d) of the APA, the required publication or service of a substantive rule shall be made not less than 30 days before its effective date except for certain instances, including when a substantive rule grants or recognizes an exemption or relieves a restriction. 5 U.S.C. 553(d). As this rule increases the exemption threshold, and is therefore a substantive rule that grants or recognizes an exemption or relieves a restriction, the Bureau is publishing this final rule less than 30 days before its effective date. Additionally, as it is in the public interest to make the
The Regulatory Flexibility Act (RFA) does not apply to a rulemaking where general notice of proposed rulemaking is not required. 5 U.S.C. 603 and 604. As noted previously, the Bureau has determined that it is unnecessary to publish a general notice of proposed rulemaking for this final rule. Accordingly the RFA's requirements relating to an initial and final regulatory flexibility analysis do not apply.
Banks, Banking, Credit unions, Mortgages, National banks, Savings associations, Reporting and recordkeeping requirements.
For the reasons set forth in the preamble, the Bureau of Consumer Financial Protection amends 12 CFR part 1003 as follows:
12 U.S.C. 2803, 2804, 2805, 5512, 5581.
Financial institution.
2.
In Title 12 of the Code of Federal Regulations, Parts 1 to 199, revised as of January 1, 2012, on page 52, in appendix C to Part 3, Part I, Section 1 is revised to read as follows:
(a)
(1) Minimum qualifying criteria for banks using bank-specific internal risk measurement and management processes for calculating risk-based capital requirements;
(2) Methodologies for such banks to calculate their risk-based capital requirements; and
(3) Public disclosure requirements for such banks.
(b)
(i) Has consolidated assets, as reported on the most recent year-end Consolidated Report of Condition and Income (Call Report) equal to $250 billion or more;
(ii) Has consolidated total on-balance sheet foreign exposure at the most recent year-end equal to $10 billion or more (where total on-balance sheet foreign exposure equals total cross-border claims less claims with head office or guarantor located in another country plus redistributed guaranteed amounts to the country of head office or guarantor plus local country claims on local residents plus revaluation gains on foreign exchange and derivative products, calculated in accordance with the Federal Financial Institutions Examination Council (FFIEC) 009 Country Exposure Report);
(iii) Is a subsidiary of a depository institution that uses 12 CFR part 3, appendix C, 12 CFR part 208, appendix F, 12 CFR part 325, appendix D, or 12 CFR part 567, appendix C, to calculate its risk-based capital requirements; or
(iv) Is a subsidiary of a bank holding company that uses 12 CFR part 225, appendix G, to calculate its risk-based capital requirements.
(2) Any bank may elect to use this appendix to calculate its risk-based capital requirements.
(3) A bank that is subject to this appendix must use this appendix unless the OCC determines in writing that application of this appendix is not appropriate in light of the bank's asset size, level of complexity, risk profile, or scope of operations. In making a determination under this paragraph, the OCC will apply notice and response procedures in the same manner and to the same extent as the notice and response procedures in 12 CFR 3.12.
(c)
(2)
(ii) If the OCC determines that the risk-weighted asset amount for operational risk produced by the bank under this appendix is not commensurate with the operational risks of the bank, the OCC may require the bank to assign a different risk-weighted asset amount for operational risk, to change elements of its operational risk analytical framework, including distributional and dependence assumptions, or to make other changes to the bank's operational risk management processes, data and assessment systems, or quantification systems, all as specified by the OCC.
(3)
(4)
(d)
(1) The bank can demonstrate on an ongoing basis to the satisfaction of the OCC that not applying the provision would, in all circumstances, unambiguously generate a risk-based capital requirement for each such exposure greater than that which would otherwise be required under this appendix;
(2) The bank appropriately manages the risk of each such exposure;
(3) The bank notifies the OCC in writing prior to applying this principle to each such exposure; and
(4) The exposures to which the bank applies this principle are not, in the aggregate, material to the bank.
Office of the Comptroller of the Currency, Treasury.
Final rule.
The Office of the Comptroller of the Currency (OCC) is amending its lending limits rule to extend the rule's temporary exception for credit exposures arising from a derivative transaction or securities financing transaction from January 1, 2013 to July 1, 2013.
This final rule is effective December 31, 2012. The effective date of amendatory instruction 3a of the interim final rule published on June 21, 2012, 77 FR 37277, is delayed from January 1, 2013 to July 1, 2013.
Jonathan Fink, Assistant Director, Bank Activities and Structure Division, (202) 649–5593; Heidi M. Thomas, Special Counsel, Legislative and Regulatory Activities Division, (202) 649–5490; or Kurt Wilhelm, Director for Financial Markets, (202) 649–6437, Office of the Comptroller of the Currency, Washington, DC 20219.
Section 5200 of the Revised Statutes, 12 U.S.C. 84, provides that the total loans and extensions of credit by a national bank to a person outstanding at one time shall not exceed 15 percent of the unimpaired capital and unimpaired surplus of the bank if the loan or extension of credit is not fully secured, plus an additional 10 percent of unimpaired capital and unimpaired surplus if the loan is fully secured. Section 5(u)(1) of the Home Owners' Loan Act (HOLA), 12 U.S.C. 1464(u)(1), provides that section 5200 of the Revised Statutes “shall apply to savings associations in the same manner and to the same extent as it applies to national banks.” In addition, section 5(u)(2) of HOLA, 12 U.S.C. 1464(u)(2), includes exceptions to the lending limits for certain loans made by savings associations. These HOLA provisions apply to both Federal and state-chartered savings associations.
Section 610 of the Dodd-Frank Wall Street Reform and Consumer Protection Act
On June 21, 2012, the OCC published in the
Based on the public comments received on the interim final rule, the OCC concludes that institutions that wish to use an internal model method to determine credit exposure for derivative transactions and securities financing transactions may not have sufficient time to develop a model, receive approval for its use, and implement the model before the January 1, 2013 expiration of the temporary exception. Moreover, for many institutions with large portfolios, the other non-model methods to measure credit exposure provided by the rule often would not be optimal. For the foregoing reasons, the OCC is extending this exception to July 1, 2013,
This final rule is effective on December 31, 2012. Pursuant to the Administrative Procedure Act (APA), at 5 U.S.C. 553(b)(B), notice and comment are not required prior to the issuance of a final rule if an agency, for good cause, finds that “notice and public procedure thereon are impracticable, unnecessary, or contrary to the public interest.”
This final rule extends the temporary exception from the lending limits rules for extensions of credit arising from derivative transactions or securities financing transactions from January 1, 2013 to July 1, 2013 in order to provide national banks and savings associations with additional time to comply with these provisions. The rule makes no substantive changes to the lending limits rule. Furthermore, on November 16, 2012, the OCC announced its intention to extend this temporary exception,
This interim final rule is effective on December 31, 2012. A final rule may be effective without 30 days advance publication in the
Pursuant to the Regulatory Flexibility Act (RFA),
Section 202 of the Unfunded Mandates Reform Act of 1995, Public Law 104–4 (2 U.S.C. 1532) (Unfunded Mandates Act), requires that an agency prepare a budgetary impact statement before promulgating any rule likely to result in a Federal mandate that may result in the expenditure by state, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any one year. If a budgetary impact statement is required, § 205 of the Unfunded Mandates Act also requires an agency to identify and consider a reasonable number of regulatory alternatives before promulgating a rule. The OCC has determined that there is no Federal mandate imposed by this rulemaking that may result in the expenditure by state, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any one year. Accordingly, final rule is not subject to § 202 of the Unfunded Mandates Act.
In accordance with the requirements of the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501–3521), the OCC may not conduct or sponsor, and a respondent is not required to respond to, an information collection unless it displays a currently valid Office of Management and Budget (OMB) control number. This rule amends rules, which contain information collection requirements under the PRA, that have been previously approved by OMB under OMB Control No. 1557–0221. The amendments in this final rule do not introduce any new collections of information into the rules, nor do they amend the rules in a way that modifies the collection of information that OMB has previously approved for part 32. Therefore, no Paperwork Reduction Act submission to OMB is required.
National banks, Reporting and recordkeeping requirements.
For the reasons set forth in the preamble, 12 CFR part 32 is amended as follows:
12 U.S.C. 1
Federal Aviation Administration (FAA), DOT.
Final rule; request for comments.
This action amends the emission standards for turbine engine powered airplanes to incorporate the standards promulgated by the United States Environmental Protection Agency (EPA) on June 18, 2012. This amendment fulfills the FAA's requirements under the Clean Air Act Amendments of 1970 to issue regulations ensuring compliance with the EPA standards. This action revises the standards for oxides of nitrogen and test procedures for exhaust emissions based on International Civil Aviation Organization standards, and for the identification and marking requirements for engines.
Effective December 31, 2012. Affected parties, however, are not required to comply with the information collection requirement in § 45.11 until the Office of Management and Budget (OMB) approves the collection and assigns a control number under the Paperwork Reduction Act of 1995. The FAA will publish in the
The incorporation by reference of certain publications listed in the rule is approved by the Director of the Federal Register as of December 31, 2012.
Submit comments on or before March 1, 2013.
You may send comments identified by Docket Number FAA–
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For technical questions concerning this action, contact Aimee Fisher, Emissions Division (AEE–300), Office of Environment and Energy, Federal Aviation Administration, 800 Independence Avenue SW., Washington, DC 20591; telephone (202) 267–7705; email
For legal questions concerning this rule contact Karen Petronis, International Law, Legislation and Regulations Division (AGC–200), Office of the Chief Counsel, Federal Aviation Administration, 800 Independence Avenue SW., Washington, DC 20591; telephone (202) 267–3073, email
Section 553(b)(3)(B) of the Administrative Procedure Act (APA) (5 U.S.C. 551
In July 2011, the United States Environmental Protection Agency (EPA) proposed new aircraft engine emission standards for oxides of nitrogen (NO
Section 232 of the Clean Air Act Amendments of 1970 (CAA) (42 U.S.C. 7572) directs the FAA to prescribe regulations to ensure compliance with the EPA's aircraft emission standards. The FAA is amending 14 CFR parts 34 and 45 to incorporate the changes promulgated by the EPA in the emission standards and the associated engine marking requirements. The FAA is not adopting any standards or requirements different from those promulgated by the EPA. Accordingly, the FAA finds that further public comment on these standards prior to promulgation is unnecessary, and that further delay in making the regulations consistent would be contrary to the public interest.
Section 553(d)(3) of the Administrative Procedure Act requires that agencies publish a rule not less than 30 days before its effective date, except as otherwise provided by the agency for good cause found and published with the rule.
This rule, as previously adopted by the EPA, contains a production cutoff date of December 31, 2012. In addition, it contains a new production marking requirement that is effective on aircraft engines produced after December 31. In order to give manufacturers the maximum amount of time to adjust their processes to these requirements, the FAA finds that good cause exists to make this rule effective in less than 30 days.
The FAA's authority to issue rules on aviation safety is found in Title 49 of the United States Code. Subtitle I, Section 106, describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart III. Under Section 232 of the CAA (42 U.S.C. 7571), the FAA is directed to prescribe regulations to ensure compliance with the standards prescribed by the EPA under § 7571, including making such standards applicable in the issuance, amendment, modification, suspension, or revocation of any certificate authorized by part A of subtitle VII of title 49. These regulations are within the scope of that authority, as the FAA is adopting the standards promulgated by the EPA and making them applicable to aircraft engine type certificates issued under the FAA's Title 49 authority.
For the reasons noted above, the FAA is adopting this final rule without prior notice and public comment. The Regulatory Policies and Procedures of the Department of Transportation (DOT) (44 FR 1134; February 26, 1979) provide that, to the maximum extent possible, operating administrations for the DOT should provide an opportunity for public comment on regulations issued without prior notice.
The FAA invites interested persons to participate in this rulemaking by submitting written comments, data, or views. The agency also invites comments relating to the economic, environmental, energy, or federalism impacts that might result from adopting the changes. The most helpful comments reference a specific portion of this rule, explain the reason for any recommended change, and include supporting data. To ensure the docket does not contain duplicate comments, please send only one copy of written comments, or if you are filing comments electronically, please submit your comments only one time.
The FAA will file in the docket all comments we receive, as well as a report summarizing each substantive public contact with FAA personnel concerning this rulemaking. Once the comment period closes, the FAA will review and dispose of the comments filed in the rulemaking docket. Because this is a final rule, the FAA will publish a disposition of comments in the
Do not file in the docket information that you consider to be proprietary or confidential business information. Send or deliver this information directly to the person identified in the
Under § 11.35(b), when the FAA is aware of proprietary information filed with a comment, the agency does not place it in the docket. The FAA holds it in a separate file to which the public does not have access, and the agency places a note in the docket that it has received it. If the FAA receives a request to examine or copy this information, the FAA treats it as any other request under the Freedom of Information Act, 5 U.S.C. 552. The FAA processes such a request under the DOT procedures found in 49 CFR part 7.
You can get an electronic copy of rulemaking documents using the Internet by:
(1) Searching the Federal eRulemaking portal at
(2) Visiting the FAA's Regulations and Policies Web page at
(3) Accessing the Government Printing Office's Web page at
You can also get a copy by sending a request to the Federal Aviation Administration, Office of Rulemaking, ARM–1, 800 Independence Avenue SW., Washington, DC 20591, or by calling (202) 267–9680. Make sure to identify the docket and amendment numbers of this rulemaking.
Section 231(a)(2)(A) of the CAA (42 U.S.C. 7571) directs the Administrator of the EPA to propose aircraft emission standards applicable to the emission of any air pollutant from classes of aircraft engines which in the EPA Administrator's judgment causes or contributes to air pollution that may reasonably be anticipated to endanger public health or welfare. These emission standards have been promulgated by the EPA in 40 CFR part 87.
Section 232 of the CAA (42 U.S.C. 7572) then directs the FAA to prescribe regulations to ensure compliance with the EPA's standards. The FAA has promulgated these emission standards in 14 CFR part 34, and the engine marking requirements in part 45.
The EPA initially regulated gaseous exhaust emissions, smoke and fuel venting from aircraft in 1973, with occasional revision. Since the EPA's adoption of the initial regulations, the FAA has taken subsequent action to ensure that the regulations in 14 CFR are kept current with the EPA's standards. This final rule continues the revisions to the regulations in 14 CFR.
On July 27, 2011, the EPA proposed new aircraft engine emission standards for NO
Department of Transportation Order DOT 2100.5 prescribes policies and procedures for simplification, analysis, and review of regulations. If the expected cost impact is so minimal that a proposed or final rule does not warrant a full evaluation, this order permits that a statement to that effect and the basis for it to be included in the preamble if a full regulatory evaluation of the cost and benefits is not prepared. Such a determination has been made for this final rule.
The EPA has adopted a new naming convention, “tier,” in 40 CFR part 87. The tier numbers distinguish levels of increased stringency in the NO
The tier designation departs from the previous FAA practice that described aircraft engine emission standards as amendments. The new designation is a valuable tool that provides a consistent reference to individual standards. The FAA is adopting this naming convention in the emission standards contained in this final rule; the designations appear in §§ 34.21 and 34.23.
This final rule adopts the same emissions standards in part 34 as the EPA promulgated for 40 CFR part 87. Any differences between the appearance of the regulations is the result of different regulatory formats between the two titles. No difference in the standards or the meaning of any term is implied nor should any difference be presumed. In the event that a substantive difference is identified, the regulation in 40 CFR part 87 is considered controlling and will be enforced.
The FAA is not changing any of its procedures for exemption requests submitted under part 34. The FAA intends to continue to work together with the EPA to jointly consider all exemption requests as we have in the past.
In this document we are revising paragraph 34.7(b) to add an additional sentence limiting the applicability to the requirements of § 34.21 (maintaining the current scope after § 34.23 is added).
Table 2 below summarizes the NO
The first set of standards is equivalent to the NO
Overall, Tier 6 represents an approximate 12 percent reduction in NO
Under the EPA rule, the Tier 6 standard was effective for engines produced on and after July 18, 2012, unless otherwise covered by an exception or exemption. These exceptions include:
1. The production of Tier 4 engines introduced before July 18, 2012, (including their derivatives) through December 31, 2012 (§ 34.23(c) and 40 CFR § 87.23(d)(1)); and
2. Up to six engines per manufacturer produced on and after July 18, 2012 and before August 31, 2013 (§ 34.9(b) and 40 CFR § 87.23(d)(3)). This exception is described more fully in section 4 below.
Exemptions to the standards of part 34 must be filed under the regulatory exemption process discussed in § 34.7 and part 11.
The second set of new standards is equivalent to the CAEP/8 NO
This final rule applies to engines that are to be manufactured on and after July 18, 2012, the effective date for Tier 6 standards in the United States. However, Tier 4 engines introduced before July 18, 2012 (and their derivatives) may continue to be produced through December 31, 2012 without further action by the manufacturer. In addition, § 34.9(b) incorporates an exception that allows each engine manufacturer to produce up to six Tier 4 compliant engines with a date of manufacture on and after July 18, 2012 and before August 31, 2013 that do not meet the Tier 6 standards without further action by the manufacturer. Engines produced under this exception are required to meet Tier 4 standards.
The primary purpose of allowing limited continued production of Tier 4 engines is to provide for an orderly transition to Tier 6 standards as Tier 4 engines reach the end of their production cycles.
This final rule allows for the production of a “spare” engine that is newly produced but meets the Tier 4 emission standard under which it was certificated rather than a more stringent standard that may be in place at the time of production. A spare engine may be produced as a replacement for an engine in service, whether installed temporarily during a repair or for permanent use. A spare engine may not be installed on a new aircraft. A spare engine may have different emission levels for individual pollutants than the engine being replaced, as long as the spare remains in overall compliance with the levels required for the original engine's type certificate.
The standard is incorporated in § 34.9(a). Spare engines must be marked in accordance with § 45.13(a)(7)(v).
This final rule contains carbon monoxide (CO) and NO
The amended test procedures adopted in § 34.60 are based on ICAO Annex 16, Volume II. The amendments to Annex 16 Volume II include clarifications and add flexibilities for engine manufacturers. They are:
• Standardizing the terminology relating to engine thrust/power.
• Clarifying the need to correct measured results to standard reference day and reference engine conditions.
• Allowing a certificating authority to approve the use of test fuels other than those specified during certification testing.
• Allowing materials other than stainless steel in the sample collection equipment.
• Clarifying the appropriate value of fuel flow to be used at each LTO test point.
• Clarifying exhaust nozzle terminology for exhaust emissions sampling.
• Allowing an equivalent procedure for gaseous emission and smoke measurement if approved by the certificating authority.
Many manufacturers are already voluntarily complying with these changes. The U.S. adoption of these test procedure amendments is unlikely to require new action by manufacturers. To accomplish the above changes, we have revised § 34.60 and removed §§ 34.61 through 34.64, and 34.71. This action eliminates subpart H of part 34, and we have removed cross references to subpart H in the affected sections where they appear.
In promulgating the new standards, the EPA adopted several new definitions for terms in its regulations. The FAA is including seven of these definitions in § 34.1 to avoid any uncertainty about their meaning and application. These definitions are consistent with CAEP/8 usage, and the common understanding of these terms as used by industry. The terms and definitions have the same scope and meaning as they have in 40 CFR part 87. Since the regulation includes the terms and their definitions, they are not being repeated here.
Often manufacturers will make changes to a type certificated engine that is in production while keeping the same basic engine core and combustor design. In some cases, these modifications may affect emissions. We are adopting the term “derivative engine for emissions certification purposes” to distinguish an engine model for which the emission characteristics vary from the original type certificated engine design, but remain within the criteria specified in § 34.48.
The FAA has adopted the EPA's rule text in § 34.48 that uses the phrase “similar in design to a previously certificated (original) engine for purposes of compliance” with the emissions standards. The FAA understands the “original” to be a previously type certificated engine for which there is test data. That test data will be used in determining whether the new engine may be considered a derivative using the criteria in § 34.48.
To qualify as a derivative engine for emissions certification purposes, an engine must comply with the emission standards associated with the original type certificated engine. The derivative engine must have the same or similar emission characteristics as the original type certificated engine; the original engine must be listed on a U.S. type certificate issued under part 33. The FAA will make the following determinations regarding derivatives:
• Whether the emission characteristics of the modified design are significantly different from the original type certificated engine's emissions such that a demonstration of compliance with more recent emission standards is necessary;
• Whether the changes are minor relative to the original type certificated engine's emissions, such that it may be considered a derivative version of the original type certificated engine model with no emissions changes;
• Whether iterative changes made over time resulted in a cumulative change that reaches the point at which a new demonstration of compliance is warranted.
In the past, these determinations were made for turbofan engines by an engineering evaluation that was performed by the engine manufacturer and then reviewed by the FAA. The definition of “derivative engines for emissions certification purposes,” along with the criteria for making this determination, will provide engine manufacturers and the FAA with more certainty regarding emission standard requirements for future modifications made to certificated models. The FAA will continue its existing practices for determining derivatives for part 33 engine certification, expanding those practices to make “derivative engines for emissions certification” determinations under the criteria promulgated by the EPA and adopted here into § 34.48.
If a derivative engine is sufficiently similar to its original type certificated engine so as to meet the criteria established in § 34.48, the manufacturer may demonstrate certification compliance and continue production of the engine model to the same extent as allowed for the original engine model. However, if a derivative engine is determined to be significantly different than the original type certificated engine, the manufacturer would be required to demonstrate compliance with the most recent emission standards. This determination will be made using numerical criteria consistent with ICAO provisions. An engine model may be considered a derivative only if:
1. It is a modification of an engine that received a U.S. type certificate;
2. The engine was certificated under 14 CFR part 33; and
3. One of the following conditions is met:
• If the FAA determines that a safety issue exists that requires an engine modification; or
• If emissions from the derivative engines are equivalent to or lower than the original type certificated engine.
This final rule provides that an engine manufacturer may show emissions equivalency by demonstrating that the difference between emission rates of a derivative engine and the original type certificated engine are within the following allowable ranges (unless otherwise adjusted using good engineering judgment as determined by the FAA):
• ± 3.0 g/kN for NO
• ± 1.0 g/kN for HC,
• ± 5.0 g/kN for CO, and
• ± 2.0 SN for smoke.
This final rule also provides that an engine model whose characteristic level is at least 5 percent below all applicable standards would be allowed to demonstrate equivalency by engineering analysis. In all other cases, the manufacturer is required to test the new engine model to show emission equivalency.
Similar to the new terms being defined in § 34.1, certain abbreviations have been added or corrected in § 34.2. No separate discussion of them is included here. We are amending the text of §§ 34.10(a) and (b), 34.21(b) and (d), and 34.31(b) to include the correct notation of these abbreviations.
In § 34.21(b) of the current regulation, there is a printing error. The formula for smoke number should have included “−0.274” as a superscript notation. Instead, it was printed in regular size text, implying a very different mathematical calculation. Since all other instances of the notation in paragraphs (d) and (e) of that section are correct, we are not aware that there has been any misunderstanding from this printing error, but we are correcting it here.
The FAA is revising §§ 34.3(c) and (d), General requirements, to eliminate the use of the term Federal Aviation Regulation and its abbreviation, FAR. Neither term is correct. As regulations are amended, the FAA is removing these terms.
In addition, the FAA is revising § 34.3(d) to remove the reference to 40 CFR 87.1(c) and replacing it with a reference to 40 CFR 87.1 as the EPA regulation no longer uses subparagraph designations in that section.
The new emission standards require the addition of new designations to identify the status of engines at manufacture. Section 45.13(a)(7) is being added to include the new designations EXEMPT NEW and EXCEPTED SPARE. Engines are already required to carry certain production markings, and this amendment merely adds the two new designations adopted in this final rule. The use of these new terms is required under §§ 34.7(h) and 34.9(a)(6).
The Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)) requires that the FAA consider the impact of paperwork and other information collection burdens imposed on the public. According to the 1995 amendments to the Paperwork Reduction Act (5 CFR 1320.8(b)(2)(vi)), an agency may not collect or sponsor the collection of information, nor may it impose an information collection requirement unless it displays a currently valid Office of Management and Budget (OMB) control number.
This action contains an existing collection in use without an OMB control number. As required by the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)), the FAA has submitted these information collection amendments to OMB for its review.
The agency is soliciting comments to—
(1) Evaluate whether the proposed information requirement is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
(2) Evaluate the accuracy of the agency's estimate of the burden;
(3) Enhance the quality, utility, and clarity of the information to be collected; and
(4) Minimize the burden of collecting information on those who are to respond, including by using appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology.
Individuals and organizations may send comments on the information collection requirement to the address listed in the
Changes to Federal regulations must undergo several economic analyses. First, Executive Order 12866 and Executive Order 13563 direct that each Federal agency shall propose or adopt a regulation only upon a reasoned determination that the benefits of the intended regulation justify its costs. Second, the Regulatory Flexibility Act of 1980 (Pub. L. 96–354) requires agencies to analyze the economic impact of regulatory changes on small entities. Third, the Trade Agreements Act (Pub. L. 96–39) prohibits agencies from setting standards that create unnecessary obstacles to the foreign commerce of the United States. In developing U.S. standards, the Trade Act requires agencies to consider international standards and, where appropriate, that they be the basis of U.S. standards. Fourth, the Unfunded Mandates Reform Act of 1995 (Pub. L. 104–4) requires agencies to prepare a written assessment of the costs, benefits, and other effects of proposed or final rules that include a Federal mandate likely to result in the expenditure by State, local, or tribal governments, in the aggregate, or by the private sector, of $100 million or more annually (adjusted for inflation with base year of 1995). This portion of the preamble summarizes the FAA's analysis of the economic impacts of this final rule.
Department of Transportation Order DOT 2100.5 prescribes policies and procedures for simplification, analysis, and review of regulations. If the expected cost impact is so minimal that a proposed or final rule does not warrant a full evaluation, this order permits that a statement to that effect and the basis for it to be included in the preamble if a full regulatory evaluation of the cost and benefits is not prepared. Such a determination has been made for this final rule. The reasoning for this determination follows:
Rulemaking actions by the FAA usually trigger a full regulatory evaluation of the potential monetary costs that would be imposed and benefits generated (including separate analyses for regulatory flexibility, international trade impact, and unfunded mandates). However, this regulation brings the regulations in 14 CFR into conformity with the existing EPA regulations. A full regulatory evaluation is unwarranted because the FAA is not imposing any new standards on the aviation industry for engine emissions or test procedures. The EPA concluded (77 FR 36342, 36386, June 18, 2012) that its rule would impose minimal costs to manufacturers because the affected engines are designed for and marketed internationally, and thus are already being manufactured using the ICAO standards adopted in this rule.
The FAA has made one addition to the standards adopted by the EPA. Previously, each affected engine had to be marked pursuant to 14 CFR part 45 as falling under one of three engine categories. The rule now requires that each affected engine has to be marked as falling under one of five engine categories. As all affected engines had to be marked under the previous rule, increasing the number of categories from three to five will not change the number of engines that need to be marked. The EPA rule required these markings be effective, but the requirement that controls engine marking exists only in 14 CFR part 45. Accordingly, the FAA is simply implementing the EPA requirement. The FAA has, therefore, determined that this final rule is not a “significant regulatory action” as defined in section 3(f) of Executive Order 12866, and is not “significant” as defined in DOT's Regulatory Policies and Procedures.
The Regulatory Flexibility Act of 1980 (Pub. L. 96–354) (RFA) establishes “as a principle of regulatory issuance that agencies shall endeavor, consistent with the objectives of the rule and of applicable statutes, to fit regulatory and informational requirements to the scale of the businesses, organizations, and governmental jurisdictions subject to regulation.” To achieve this principle, agencies are required to solicit and consider flexible regulatory proposals and to explain the rationale for their actions to assure that such proposals are given serious consideration.” The RFA covers a wide-range of small entities, including small businesses, not-for-profit organizations, and small governmental jurisdictions.
Agencies must perform a review to determine whether a rule will have a significant economic impact on a substantial number of small entities. If the agency determines that it will, the agency must prepare a regulatory flexibility analysis as described in the RFA.
However, if an agency determines that a rule is not expected to have a significant economic impact on a substantial number of small entities, section 605(b) of the RFA provides that the head of the agency may so certify and a regulatory flexibility analysis is not required. The certification must include a statement providing the factual basis for this determination, and the reasoning should be clear.
This final rule revises the emission standards for turbine engine airplanes, the test procedures for gaseous emissions, and the different engine categories for marking purposes. Other than the FAA marking requirement that involves minimal cost changes to engine manufacturers, all of the costs associated with this rule have been addressed by the EPA in its rulemaking. The EPA determined that its rule would impose minimal costs to manufacturers because the affected engines are designed for and marketed internationally, and thus are already being manufactured using the ICAO standards adopted in the EPA rule. Thus, this rule has a minimal economic impact.
Therefore, as the FAA Acting Administrator, I certify that this rule will not have a significant economic impact on a substantial number of small entities.
The Trade Agreements Act of 1979 (Pub. L. 96–39), as amended by the Uruguay Round Agreements Act (Pub. L. 103–465), prohibits Federal agencies from establishing standards or engaging in related activities that create unnecessary obstacles to the foreign commerce of the United States. Pursuant to these Acts, the establishment of standards is not considered an unnecessary obstacle to the foreign commerce of the United States, so long as the standard has a legitimate domestic objective, such as the protection of safety, and does not operate in a manner that excludes imports that meet this objective. The statute also requires consideration of international standards and, where appropriate, that they be the basis for U.S. standards. The FAA has assessed the potential effect of this final rule and determined that it is in accord with the Trade Agreements Act, as the rule uses the ICAO international standards as the basis for the U.S. regulation.
Title II of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104–4) requires each Federal agency to prepare a written statement assessing the effects of any Federal mandate in a proposed or final agency rule that may result in an expenditure of $100 million or more (in 1995 dollars) in any one year by State, local, and tribal governments, in the aggregate, or by the private sector; such a mandate is deemed to be a “significant regulatory action.” The FAA currently uses an inflation-adjusted value of $143.1 million in lieu of $100 million. This final rule does not contain such a mandate; therefore, the requirements of Title II of the Act do not apply.
(1) In keeping with U.S. obligations under the Convention on International Civil Aviation, it is FAA policy to conform to International Civil Aviation Organization (ICAO) Standards and Recommended Practices to the maximum extent practicable. The FAA has reviewed the corresponding ICAO Standards and Recommended Practices and has identified no differences with these regulations.
(2) Executive Order 13609, Promoting International Regulatory Cooperation, promotes international regulatory cooperation to meet shared challenges involving health, safety, labor, security, environmental, and other issues and to reduce, eliminate, or prevent unnecessary differences in regulatory requirements. The FAA has analyzed this action under the policies and agency responsibilities of Executive Order 13609, and has determined that this action would have no effect on international regulatory cooperation.
In accordance with FAA Order 1050.1E, the FAA has determined that this action is categorically excluded from environmental review under section 103(2)(c) of the National Environmental Policy Act (NEPA). This action is categorically excluded under FAA Order 1050.1E, Chapter 3, paragraph 312a, which covers “all FAA actions to ensure compliance with EPA aircraft emission standards.” This rule amends the emission standards for turbine engine powered airplanes and certain marking requirements for engines, to incorporate the standards adopted by EPA based on the ICAO standards for gaseous emissions of NO
The FAA has analyzed this final rule under the principles and criteria of Executive Order 13132, Federalism. We determined that this action will not have a substantial direct effect on the States, or the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, we determined that this final rule does not have federalism implications.
The FAA has analyzed this final rule under Executive Order 13211, Actions Concerning Regulations that Significantly Affect Energy Supply, Distribution, or Use, 66 FR 28355 (May 18, 2001). We have determined that it is not a “significant energy action” under the executive order because it is not a “significant regulatory action” under Executive Order 12866, and it is not likely to have a significant adverse effect on the supply, distribution, or use of energy.
Air pollution control, Aircraft, Incorporation by reference.
Aircraft, marking, identification data.
In consideration of the foregoing, the Federal Aviation Administration amends Chapter I of Title 14 Code of Federal Regulations as follows:
42 U.S.C 4321
CO
g Gram(s)
kN Kilonewton(s)
kW Kilowatt(s)
lb Pound(s)
(c)
(d)
(b) * * * This exemption is limited to the requirements of § 34.21 only.
(d)
(a)
(1) This exception allows production of an engine for installation on an in-service aircraft. A spare engine may not be installed on a new aircraft.
(2) Each spare engine must be identical to a sub-model previously certificated to meet all applicable requirements.
(3) A spare engine may be used only when the emissions of the spare do not exceed the certification requirements of the original engine, for all regulated pollutants.
(4) No separate approval is required to produce spare engines.
(5) The record for each engine excepted under this paragraph (c) must indicate that the engine was produced as an excepted spare engine.
(6) Engines produced under this exception must be labeled “EXCEPTED SPARE” in accordance with § 45.13 of this chapter.
(b) On and after July 18, 2012, and before August 31, 2013, a manufacturer may produce up to six Tier 4 compliant engines that meet the NO
(a) The provisions of this subpart are applicable to all new aircraft gas turbine engines of classes T3, T8, TSS, and TF equal to or greater than 36 kN (8,090 lb) rated output, manufactured on or after January 1, 1974, and to all in-use aircraft gas turbine engines of classes T3, T8, TSS, and TF equal to or greater than 36 kN (8,090 lb) rated output manufactured after February 1, 1974.
(b) The provisions of this subpart are also applicable to all new aircraft gas turbine engines of class TF less than 36 kN (8,090 lb) rated output and class TP manufactured on or after January 1, 1975, and to all in-use aircraft gas turbine engines of class TF less than 36 kN (8,090 lb) rated output and class TP manufactured after January 1, 1975.
(b) Exhaust emissions of smoke from each new aircraft gas turbine engine of class TF and of rated output of 129 kN (29,000 lb) thrust or greater, manufactured on or after January 1, 1976, shall not exceed
(d) Gaseous exhaust emissions from each new aircraft gas turbine engine shall not exceed:
(1) For Classes TF, T3, T8 engines greater than 26.7 kN (6,000 lb) rated output:
(i) Engines manufactured on or after January 1, 1984:
(ii) Engines manufactured on or after July 7, 1997:
(iii) Engines of a type or model of which the date of manufacture of the first individual production model was on or before December 31, 1995, and for which the date of manufacture of the individual engine was on or before December 31, 1999 (Tier 2):
(iv) Engines of a type or model of which the date of manufacture of the first individual production model was after December 31, 1995, or for which the date of manufacture of the individual engine was after December 31, 1999 (Tier 2):
(v) The emission standards prescribed in paragraphs (d)(1)(iii) and (iv) of this section apply as prescribed beginning July 7, 1997.
(vi) The emission standards of this paragraph apply as prescribed after December 18, 2005. For engines of a type or model of which the first individual production model was manufactured after December 31, 2003 (Tier 4):
(A) That have a rated pressure ratio of 30 or less and a maximum rated output greater than 89 kN:
(B) That have a rated pressure ratio of 30 or less and a maximum rated output greater than 26.7 kN but not greater than 89 kN:
(C) That have a rated pressure ratio greater than 30 but less than 62.5, and a maximum rated output greater than 89 kN:
(D) That have a rated pressure ratio greater than 30 but less than 62.5, and a maximum rated output greater than 26.7 kN but not greater than 89 kN:
(E) That have a rated pressure ratio of 62.5 or more:
(2) For Class TSS Engines manufactured on or after January 1, 1984:
(e) Smoke exhaust emissions from each gas turbine engine of the classes specified below shall not exceed:
(1) For Class TF of rated output less than 26.7 kN (6,000 lb) manufactured on or after August 9, 1985:
(2) For Classes T3, T8, TSS, and TF of rated output equal to or greater than 26.7 kN (6,000 lb) manufactured on or after January 1, 1984:
(3) For Class TP of rated output equal to or greater than 1,000 kW manufactured on or after January 1, 1984:
(f) The standards set forth in paragraphs (a), (b), (c), (d), and (e) of this section refer to a composite gaseous emission sample representing the operation cycles and exhaust smoke emission emitted during operation of the engine as specified in the applicable sections of subpart G of this part, and measured and calculated in accordance with the procedures set forth in subpart G.
(g) Where a gaseous emission standard is specified by a formula, calculate and round the standard to three significant figures or to the nearest 0.1 g/kN (for standards at or above 100 g/kN). Where a smoke standard is specified by a formula, calculate and round the standard to the nearest 0.1 SN. Engines comply with an applicable standard if the testing results show that the engine type certificate family's characteristic level does not exceed the numerical level of that standard, as described in § 34.60.
The standards of this section apply to aircraft engines manufactured on and after July 18, 2012, unless otherwise exempted or excepted. Where a gaseous emission standard is specified by a formula, calculate and round the standard to three significant figures or to the nearest 0.1 g/kN (for standards at or above 100 g/kN). Where a smoke standard is specified by a formula, calculate and round the standard to the nearest 0.1 SN. Engines comply with an applicable standard if the testing results show that the engine type certificate family's characteristic level does not exceed the numerical level of that standard, as described in § 34.60.
(a) Gaseous exhaust emissions from each new aircraft gas turbine engine shall not exceed:
(1) For Classes TF, T3 and T8 of rated output less than 26.7 kN (6,000 lb) manufactured on and after July 18, 2012:
(2) Except as provided in §§ 34.9(b) and 34.21(c), for Classes TF, T3 and T8 engines manufactured on and after July 18, 2012, and for which the first individual production model was manufactured on or before December 31, 2013 (Tier 6):
(3) Engines exempted from paragraph (a)(2) of this section produced on or before December 31, 2016 must be labeled “EXEMPT NEW” in accordance with § 45.13 of this chapter. No exemptions to the requirements of paragraph (a)(2) of this section will be granted after December 31, 2016.
(4) For Class TSS Engines manufactured on and after July 18, 2012:
(b) Gaseous exhaust emissions from each new aircraft gas turbine engine shall not exceed:
(1) For Classes TF, T3 and T8 engines of a type or model of which the first individual production model was manufactured after December 31, 2013 (Tier 8):
(c) Engines (including engines that are determined to be derivative engines for the purposes of emission certification) type certificated with characteristic levels at or below the NO
(b) Exhaust emissions of smoke from each in-use aircraft gas turbine engine of Class TF and of rated output of 129 kN (29,000 lb) thrust or greater, beginning January l, 1976, shall not exceed
(c) The standards set forth in paragraphs (a) and (b) of this section refer to exhaust smoke emission emitted during operation of the engine as specified in the applicable sections of subpart G of this part, and measured and calculated in accordance with the procedures set forth in subpart G.
(a)
(1) The FAA has determined that a safety issue exists that requires an engine modification.
(2) Emissions from the derivative engines are determined to be similar. In general, this means the emissions must meet the criteria specified in paragraph (b) of this section. The FAA may amend the criteria of paragraph (b) in unusual circumstances, for individual cases, consistent with good engineering judgment.
(3) All of the regulated emissions from the derivative engine are lower than the original engine.
(b)
(i) ± 3.0 g/kN for NO
(ii) ± 1.0 g/kN for HC.
(iii) ± 5.0 g/kN for CO.
(iv) ± 2.0 SN for smoke.
(2) If the characteristic level of the original certificated engine model (or any other sub-models within the emission type certificate family tested for certification) before modification is at or above 95% of the applicable standard for any pollutant, an applicant must measure the proposed derivative engine model's emissions for all pollutants to demonstrate that the derivative engine's resulting characteristic levels will not exceed the applicable emission standards. If the characteristic levels of the originally certificated engine model (and all other sub-models within the emission type certificate family tested for certification) are below 95% of the applicable standard for each pollutant, the applicant may use engineering analysis consistent with good engineering judgment to demonstrate that the derivative engine will not exceed the applicable emission standards. The engineering analysis must address all modifications from the original engine, including those approved for previous derivative engines.
(c)
(d)
(a) Use the equipment and procedures specified in Appendix 3, Appendix 5, and Appendix 6 of ICAO Annex 16, as applicable, to demonstrate whether engines meet the applicable gaseous emission standards specified in subpart C of this part. Measure the emissions of all regulated gaseous pollutants. Use the equipment and procedures specified in Appendix 2 and Appendix 6 of ICAO Annex 16 to determine whether engines meet the applicable smoke standard specified in subpart C of this part. The compliance demonstration consists of establishing a mean value from testing the specified number of engines, then calculating a “characteristic level” by applying a set of statistical factors that take into account the number of engines tested. Round each characteristic level to the same number of decimal places as the corresponding emission standard. For turboprop engines, use the procedures specified for turbofan engines, consistent with good engineering judgment.
(b) Use a test fuel that meets the specifications described in Appendix 4 of ICAO Annex 16. The test fuel must not have additives whose purpose is to suppress smoke, such as organometallic compounds.
(c) Prepare test engines by including accessories that are available with production engines if they can reasonably be expected to influence emissions. The test engine may not extract shaft power or bleed service air to provide power to auxiliary gearbox-mounted components required to drive aircraft systems.
(d) Test engines must reach a steady operating temperature before the start of emission measurements.
(e) In consultation with the EPA, the FAA may approve alternative procedures for measuring emissions, including testing and sampling methods, analytical techniques, and equipment specifications that differ from those specified in this part. Manufacturers and operators may request approval of alternative procedures by written request with supporting justification to the FAA Aircraft Certification Office and to the Designated EPA Program Officer. To be approved, one of the following conditions must be met:
(1) The engine cannot be tested using the specified procedures; or
(2) The alternative procedure is shown to be equivalent to, or more accurate or precise than, the specified procedure.
(f) The following landing and takeoff (LTO) cycles apply for emissions testing and for calculating weighted LTO values:
(g) Engines comply with an applicable standard if the testing results show that the engine type certificate family's characteristic level does not exceed the numerical level of that standard, as described in the applicable appendix of Annex 16.
(h) The system and procedure for sampling and measurement of gaseous emissions shall be as specified by in Appendices 2, 3, 4, 5 and 6 to the International Civil Aviation Organization (ICAO) Annex 16, Environmental Protection, Volume II, Aircraft Engine Emissions, Third Edition, July 2008. This incorporation by reference was approved by the Director of the Federal Register in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. This document can be obtained from the ICAO, Document Sales Unit, 999 University Street, Montreal, Quebec H3C 5H7, Canada, phone +1 514–954–8022, or
49 U.S.C. 106(g), 40103, 40113–40114, 44101–44105, 44107–44111, 44504, 44701, 44708–44709, 44711–44713, 44725, 45302–45303, 46104, 46304, 46306, 47122.
(a) * * *
(7) On or after January 1, 1984, for aircraft engines specified in part 34 of this chapter, the date of manufacture as defined in § 34.1 of this chapter, and a designation, approved by the FAA, that indicates compliance with the applicable exhaust emission provisions of part 34 of this chapter and 40 CFR part 87. Approved designations include COMPLY, EXEMPT, and NON–US, as appropriate. After December 31, 2012, approved designations also include EXEMPT NEW, and EXCEPTED SPARE, as appropriate.
(iv) The designation EXEMPT NEW indicates that the engine has been granted an exemption pursuant to the applicable provision of § 34.7(h) of this chapter; the designation must be noted in the permanent powerplant record that accompanies the engine from the time of its manufacture.
(v) The designation EXCEPTED SPARE indicates that the engine has been excepted pursuant to the applicable provision of § 34.9(b) of this chapter; the designation must be noted in the permanent powerplant record that accompanies the engine from the time of its manufacture.
Securities and Exchange Commission.
Final rule.
The Securities and Exchange Commission is amending rule 206(3)–3T under the Investment Advisers Act of 1940, a temporary rule that establishes an alternative means for investment advisers who are registered with the Commission as broker-dealers to meet the requirements of section 206(3) of the Investment Advisers Act when they act in a principal capacity in transactions with certain of their advisory clients. The amendment extends the date on which rule 206(3)–3T will sunset from December 31, 2012 to December 31, 2014.
The amendments in this document are effective December 28, 2012 and the expiration date for 17 CFR 275.206(3)–3T is extended to December 31, 2014.
Melissa S. Gainor, Attorney-Adviser, Vanessa M. Meeks, Attorney-Adviser, Sarah A. Buescher, Branch Chief, or Daniel S. Kahl, Assistant Director, at (202) 551–6787 or
The Securities and Exchange Commission is adopting an amendment to temporary rule 206(3)–3T [17 CFR 275.206(3)–3T] under the Investment Advisers Act of 1940 [15 U.S.C. 80b] that extends the date on which the rule will sunset from December 31, 2012 to December 31, 2014. Note that previous related releases used RIN 3235–AJ96. (
On September 24, 2007, we adopted, on an interim final basis, rule 206(3)–3T, a temporary rule under the Investment Advisers Act of 1940 (the “Advisers Act”) that provides an alternative means for investment advisers that are registered with us as broker-dealers to meet the requirements of section 206(3) of the Advisers Act when they act in a principal capacity in transactions with certain of their advisory clients.
The study mandated by section 913 of the Dodd-Frank Act was prepared by the staff and delivered to Congress on January 21, 2011.
On October 9, 2012, we proposed to extend the date on which rule 206(3)–3T will sunset for a limited amount of time, from December 31, 2012 to December 31, 2014.
We are amending rule 206(3)–3T only to extend the rule's sunset date by two additional years.
Section 913 of the Dodd-Frank Act provides that we may commence a rulemaking concerning, among other things, the legal or regulatory standards of care for broker-dealers, investment advisers, and persons associated with these intermediaries when providing personalized investment advice about securities to retail customers. Since the completion of the 913 Study in 2011, we have been considering the findings, conclusions, and recommendations of the study and the comments we have received from interested parties.
If we permit rule 206(3)–3T to sunset on December 31, 2012, after that date investment advisers registered with us as broker-dealers that currently rely on rule 206(3)–3T would be required to comply with section 206(3)'s transaction-by-transaction written disclosure and consent requirements without the benefit of the alternative means of complying with these requirements currently provided by rule 206(3)–3T. This could limit the access of non-discretionary advisory clients of
As noted above, four commenters generally supported our proposal to amend rule 206(3)–3T to extend it,
One commenter opposed extending the rule for more than a limited period of time (no more than six months) and questioned maintaining investor choice as a rationale for extending rule 206(3)–3T.
On balance, and after careful consideration of these comments, we conclude that extending the rule for two years is the most appropriate course of action at this time. First, with respect to investors, we agree with commenters that permitting the rule to sunset before we complete our consideration of the regulatory requirements applicable to broker-dealers and investment advisers could produce substantial disruption for investors with advisory accounts serviced by firms relying on the rule.
Second, with respect to firms, the letters submitted by three commenters demonstrate that firms in fact do rely on the rule, and that those firms will be faced with uncertainty and disruption of operations should the rule expire just as the Commission is engaging in a comprehensive review process that may ultimately produce different regulatory requirements.
We believe that the requirements of rule 206(3)–3T, coupled with regulatory oversight, will adequately protect advisory clients for an additional limited period of time while we consider more broadly the regulatory requirements applicable to broker-dealers and investment advisers.
We received four comment letters specifically addressing the duration of our proposed extension of rule 206(3)–3T.
As we noted in the Proposing Release, we believe that the rule's sunset date should be extended only for a limited amount of time.
Three commenters addressed the question of whether we should consider changing the requirements for adviser disclosures to have registered advisers provide more information to us and their clients about whether they are relying on rule 206(3)–3T.
As noted above, one commenter suggested that there be a more detailed analysis of data, including spreads paid and investor returns.
The amendment to rule 206(3)–3T is effective on December 28, 2012. The Administrative Procedure Act generally requires that an agency publish a final rule in the
Rule 206(3)–3T contains “collection of information” requirements within the meaning of the Paperwork Reduction Act of 1995.
The amendment to the rule we are adopting today—to extend rule 206(3)–3T's sunset date for two years—does not affect the current annual aggregate estimated hour burden of 378,992 hours.
We are sensitive to the costs and benefits of our rules. The discussion below addresses the costs and benefits of extending rule 206(3)–3T's sunset date for two years, as well as the effect of the extension on the promotion of efficiency, competition, and capital formation as required by section 202(c) of the Advisers Act.
Rule 206(3)–3T provides an alternative means for investment advisers that are registered with the Commission as broker-dealers to meet the requirements of section 206(3) of the Advisers Act when they act in a principal capacity in transactions with their non-discretionary advisory clients. Other than extending the rule's sunset date for two additional years, we are not modifying the rule from its current form. We previously considered and discussed the economic analysis of rule 206(3)–3T in its current form in the 2007 Principal Trade Rule Release, the 2009 Extension Release, and the 2010 Extension Release.
The baseline for the following analysis of the benefits and costs of the amendment is the situation in existence today, in which investment advisers that are registered with us as broker-dealers can choose to use rule 206(3)–3T as an alternative means to comply with section 206(3) of the Advisers Act when engaging in principal transactions with their non-discretionary advisory clients. The amendment, which will extend rule 206(3)–3T's sunset date by
As stated in previous releases, we believe the principal benefit of rule 206(3)–3T is that it maintains investor choice among different types of accounts and protects the interests of investors. Rule 206(3)–3T also provides a lower cost and more efficient alternative for an adviser that is registered with us as a broker-dealer to comply with the requirements of section 206(3) of the Advisers Act. This, in turn, may provide non-discretionary advisory clients greater access to a wider range of securities. Non-discretionary advisory clients also benefit from the protections of the sales practice rules of the Securities Exchange Act of 1934 (the “Exchange Act”) and the relevant self-regulatory organization(s) and the fiduciary duties and other obligations imposed by the Advisers Act. Greater access to a wider range of securities may also allow non-discretionary advisory clients to better allocate capital. In the long term, the more efficient allocation of capital may lead to an increase in capital formation.
We received one comment on our economic analysis.
Also, in connection with the 2010 extension of the rule, one commenter had disagreed with a number of the benefits of rule 206(3)–3T described above, but did not provide any specific data, analysis, or other information in support of its comment.
We also received comments on the 2007 Principal Trade Rule Release from commenters who opposed the limitation of the temporary rule to investment advisers that are registered with us as broker-dealers, as well as to accounts that are subject to both the Advisers Act and Exchange Act as providing a competitive advantage to investment advisers that are registered with us as broker-dealers.
As we discussed in previous releases, there are also several costs associated with rule 206(3)–3T, including the operational costs associated with complying with the rule.
In addition to the benefits of rule 206(3)–3T described above and in previous releases, we believe there are benefits to extending the rule's sunset date for an additional two years. The temporary extension of rule 206(3)–3T will have the benefit of providing the Commission with additional time to consider principal trading as part of the broader consideration of the regulatory requirements applicable to broker-dealers and investment advisers without causing disruption to the firms and clients relying on the rule.
One alternative to the extension of the rule's sunset date would be to let the temporary rule sunset on its current sunset date, and so preclude investment advisers from engaging in principal transactions with their advisory clients unless in compliance with the requirements of section 206(3) of the Advisers Act. As explained in the 2010 Extension Release, if we did not extend rule 206(3)–3T's sunset date, firms currently relying on the rule would be required to restructure their operations and client relationships on or before the rule's current expiration date—potentially only to have to do so again later (first when the rule sunsets or is modified, and again if we adopt a new approach in connection with our broader consideration of the regulatory requirements applicable to broker-dealers and investment advisers).
Although we did not receive any comments on the rule's compliance costs, we recognize that, as a result of our amendment, firms relying on the rule will incur the costs associated with complying with the rule for two additional years. We also recognize that a temporary rule, by nature, creates long-term uncertainty, which in turn, may result in a reduced ability of firms to coordinate and plan future business activities.
The Commission has prepared the following Final Regulatory Flexibility Analysis (“FRFA”) regarding the amendment to rule 206(3)–3T in accordance with 5 U.S.C. 604. We prepared and included an Initial Regulatory Flexibility Analysis (“IRFA”) in the Proposing Release.
We are adopting an amendment to extend rule 206(3)–3T's sunset date for two years because we believe that it would be premature to require firms relying on the rule to restructure their operations and client relationships before we complete our broader consideration of the regulatory requirements applicable to broker-dealers and investment advisers. The objective of the amendment to rule 206(3)–3T, as discussed above, is to permit firms currently relying on rule 206(3)–3T to limit the need to modify their operations and relationships on multiple occasions before we complete our broader consideration of the regulatory requirements applicable to broker-dealers and investment advisers. Absent further action by the Commission, the rule will sunset on December 31, 2012.
We are amending rule 206(3)–3T pursuant to sections 206A and 211(a) of the Advisers Act [15 U.S.C. 80b–6a and 15 U.S.C. 80b-11(a)].
We did not receive any comment letters related to our IRFA.
Rule 206(3)–3T is an alternative method of complying with Advisers Act section 206(3) and is available to all investment advisers that: (i) Are registered as broker-dealers under the Exchange Act; and (ii) effect trades with clients directly or indirectly through a broker-dealer controlling, controlled by or under common control with the investment adviser, including small entities. Under Advisers Act rule 0–7, for purposes of the Regulatory Flexibility Act an investment adviser generally is a small entity if it: (i) Has assets under management of less than $25 million; (ii) did not have total assets of $5 million or more on the last day of its most recent fiscal year; and (iii) does not control, is not controlled by, and is not under common control with another investment adviser that has assets under management of $25 million or more, or any person (other than a natural person) that had total assets of $5 million or more on the last day of its most recent fiscal year.
As noted in the Proposing Release, we estimated that as of August 1, 2012, 547 SEC-registered investment advisers were
The provisions of rule 206(3)–3T impose certain reporting or recordkeeping requirements and our amendment will extend the imposition of these requirements for an additional two years. The two-year extension will not alter these requirements.
Rule 206(3)–3T is designed to provide an alternative means of compliance with the requirements of section 206(3) of the Advisers Act. Investment advisers taking advantage of the rule with respect to non-discretionary advisory accounts are required to make certain disclosures to clients on a prospective, transaction-by-transaction and annual basis.
Specifically, rule 206(3)–3T permits an adviser, with respect to a non-discretionary advisory account, to comply with section 206(3) of the Advisers Act by, among other things: (i) Making certain written disclosures; (ii) obtaining written, revocable consent from the client prospectively authorizing the adviser to enter into principal trades; (iii) making oral or written disclosure and obtaining the client's consent orally or in writing prior to the execution of each principal transaction; (iv) sending to the client a confirmation statement for each principal trade that discloses the capacity in which the adviser has acted and indicating that the client consented to the transaction; and (v) delivering to the client an annual report itemizing the principal transactions. Advisers are already required to communicate the content of many of the disclosures pursuant to their fiduciary obligations to clients. Other disclosures are already required by rules applicable to broker-dealers.
Our amendment will only extend the rule's sunset date for two years in its current form. Advisers currently relying on the rule already should be making the disclosures described above.
The Regulatory Flexibility Act directs us to consider significant alternatives that would accomplish our stated objective, while minimizing any significant adverse impact on small entities.
We believe that special compliance or reporting requirements or timetables for small entities, or an exemption from coverage for small entities, may create the risk that the investors who are advised by and effect securities transactions through such small entities would not receive adequate disclosure. Moreover, different disclosure requirements could create investor confusion if it creates the impression that small investment advisers have different conflicts of interest with their advisory clients in connection with principal trading than larger investment advisers. We believe, therefore, that it is important for the disclosure protections required by the rule to be provided to advisory clients by all advisers, not just those that are not considered small entities. Further consolidation or simplification of the proposals for investment advisers that are small entities would be inconsistent with our goal of fostering investor protection.
We have endeavored through rule 206(3)–3T to minimize the regulatory burden on all investment advisers eligible to rely on the rule, including small entities, while meeting our regulatory objectives. It was our goal to ensure that eligible small entities may benefit from our approach to the rule to the same degree as other eligible advisers. The condition that advisers seeking to rely on the rule must also be registered with us as broker-dealers and that each account with respect to which an adviser seeks to rely on the rule must be a brokerage account subject to the Exchange Act, and the rules thereunder, and the rules of the self-regulatory organization(s) of which the broker dealer is a member, reflect what we believe is an important element of our balancing between easing regulatory burdens (by affording advisers an alternative means of compliance with section 206(3) of the Act) and meeting our investor protection objectives.
The Commission is amending rule 206(3)–3T pursuant to sections 206A and 211(a) of the Advisers Act [15 U.S.C. 80b–6a and 80b–11(a)].
Investment advisers, Reporting and recordkeeping requirements.
For the reasons set out in the preamble, Title 17, Chapter II of the Code of Federal Regulations is amended as follows.
15 U.S.C. 80b–2(a)(11)(G), 80b–2(a)(11)(H), 80b–2(a)(17), 80b–3, 80b–4, 80b–4a, 80b–6(4), 80b–6a, and 80b–11, unless otherwise noted.
By the Commission.
Employment and Training Administration, Labor.
Direct final rule.
The Employment and Training Administration (ETA) of the Department of Labor (Department) is removing the regulations at 20 CFR parts 626, 627, 628, 631, 632, 633, 634, 636, 637, and 638, which implemented the Job Training Partnership Act (JTPA or the Act). These regulations were designed to improve the employment status of disadvantaged youth, adults, dislocated workers, and other individuals facing barriers to employment. In 1998, Congress passed the Workforce Investment Act (WIA), which required the Secretary of Labor to transition any authority under the JTPA to the system created by WIA. Therefore, the Department is taking this action to remove regulations for a program that is no longer operative.
This Direct Final Rule is effective April 1, 2013 without further action, unless significant adverse comment is received by January 30, 2013. If significant adverse comment is received, the Department of Labor will publish a timely withdrawal of the rule in the
You may submit comments, identified by RIN 1205–AB68, by one of the following methods:
Please submit your comments by only one method. Please be advised that the Department will post all comments on this Direct Final Rule on
Also, please note that due to security concerns, postal mail delivery in Washington, DC may be delayed. Therefore, the Department encourages the public to submit comments on
Michael S. Jones, Acting Administrator, Office of Policy Development and Research, Employment and Training Administration, U.S. Department of Labor, Room N–5641, 200 Constitution Avenue NW, Washington, DC 20210; telephone: (202) 693–3700 (this is not a toll-free number). This notice is available through the printed
Since removal of the Job Training Partnership Act implementing regulations is not controversial, and the authorizing legislation for these regulations has been repealed, these regulations govern a program that is no longer in operation. The Department therefore has determined that good cause exists to remove these regulations using a Direct Final Rule. No significant adverse comments are anticipated. All interested parties should comment at this time because we will not initiate an additional comment period.
If significant adverse comments are received, we will publish a timely notice in the
Through this Direct Final Rule, the Department is removing and reserving the JTPA regulations at 20 CFR parts 626, 627, 628, 631, 632, 633, 634, 636, 637, and 638, which were designed to improve the employment status of disadvantaged young adults, dislocated workers, and individuals facing barriers to employment. These regulations have been superseded by the regulations promulgated under the Workforce Investment Act of 1998 (WIA), 29 U.S.C. 2801
The statutory purpose of the JTPA was to establish programs that prepared disadvantaged youth and adults who faced serious barriers to employment for participation in the labor force by providing job training and other services that would result in increased employment and earnings, increased educational and occupational skills, and decreased welfare dependency.
On August 7, 1998, Congress passed WIA. Under WIA, which superseded the JTPA, Congress required the Secretary of Labor to develop and publish interim final regulations (IFR) to implement this transition no later than 180 days after WIA's enactment date.
Initially, although the JTPA authorizing legislation was repealed, the Department retained the JTPA regulations in the Code of Federal Regulations for grant closeout and auditing purposes. However, now that the JTPA programs have been transitioned to WIA for over a decade, the Department finds no reason to retain the JTPA regulations. Furthermore, the Department has previously removed several other JTPA regulatory provisions. Parts 629 and 630 were removed at 57 FR 62004 (Dec. 29, 1992). Part 635 was re-designated as 20 CFR part 1005 at 54 FR 39352 (Sept. 26, 1989), and the Department later removed part 1005 at 59 FR 26601 (May 23, 1994). Finally, the Department notes that it re-designated part 684 as part 638 at 55 FR 12992 (Apr. 6, 1990). Those JTPA regulatory provisions that remain are subject to this removal notice.
Accounting, Administrative practice and procedure, Disaster assistance, Grant programs—Labor, Manpower training programs, Reporting and recordkeeping requirements, Youth.
Administrative practice and procedure, Fraud, Grant programs—Indians, Grant programs—labor, Hawaiian Natives, Manpower training programs, Reporting and recordkeeping requirements Youth.
Grant programs—labor, Manpower training programs, Migrant labor, Recording and record keeping requirements.
Grant Programs—labor, Manpower training programs, Statistics.
Administrative practice and procedure, Grant programs—labor, Manpower training programs.
Grant programs—labor, Job Corps, Lobbying, Manpower training programs, Recording and record keeping requirements, Youth.
Accordingly, under the authority of the Workforce Investment Act of 1998 (WIA), 29 U.S.C. 9276(a), and for the reasons discussed in the preamble, the Department amends 20 CFR Chapter V by removing Parts 626, 627, 628, 631, 632, 633, 634, 636, 637, and 638 as follows:
Food and Drug Administration, HHS.
Final rule.
The Food and Drug Administration (FDA) is amending the animal drug regulations to reflect approval actions for new animal drug applications (NADAs) and abbreviated new animal drug applications (ANADAs) during November 2012. FDA is also informing the public of the availability of summaries the basis of approval and of environmental review documents, where applicable.
This rule is effective December 31, 2012.
George K. Haibel, Center for Veterinary Medicine (HFV–6), Food and Drug Administration, 7519 Standish Pl., Rockville, MD 20855, 240–276–9019, email:
FDA is amending the animal drug regulations to reflect original and supplemental approval actions during November 2012, as listed in table 1 of this document. In addition, FDA is informing the public of the availability, where applicable, of documentation of environmental review required under the National Environmental Policy Act (NEPA) and, for actions requiring
This rule does not meet the definition of “rule” in 5 U.S.C. 804(3)(A) because it is a rule of “particular applicability.” Therefore, it is not subject to the congressional review requirements in 5 U.S.C. 801–808.
Animal drugs.
Animal drugs, animal feeds.
Therefore, under the Federal Food, Drug, and Cosmetic Act and under authority delegated to the Commissioner of Food and Drugs and redelegated to the Center for Veterinary Medicine, 21 CFR parts 520, 522, 529, and 558 are amended as follows:
21 U.S.C. 360b.
(a)
(b)
(c)
(d)
(2)
21 U.S.C. 360b.
(e) * * *
(3) * * *
(ii)
21 U.S.C. 360b.
(a)
(b)
(c)
(2)
(3)
21 U.S.C. 360b, 371.
Department of State.
Final rule.
The Department of State is amending the International Traffic in Arms Regulations (ITAR) to list Afghanistan as a major non-NATO ally, and to make available the use of two additional defense export license exemptions for proscribed destinations.
Ms. Candace M. J. Goforth, Director, Office of Defense Trade Controls Policy, U.S. Department of State, telephone (202) 663–2792, or email
On July 6, 2012, President Obama exercised his authority under section 517 of the Foreign Assistance Act of 1961 (FAA) to designate the Islamic Republic of Afghanistan as a major non-NATO ally (MNNA) for purposes of the FAA and the Arms Export Control Act. This final rule amends ITAR § 120.32, which lists major non-NATO allies, to account for this designation. Section 126.1 is amended to except the exemptions at ITAR §§ 126.4 and 126.6 from the prohibitions therein and the text is further amended to clarify the requirements therein. Additionally, § 126.1(g) is amended to clarify references to United Nations Security Council resolutions.
The Department of State is of the opinion that controlling the import and export of defense articles and services is a foreign affairs function of the United States Government and that rules implementing this function are exempt from sections 553 (rulemaking) and 554 (adjudications) of the Administrative Procedure Act. Since the Department is of the opinion that this rule is exempt from 5 U.S.C. 553, it is the view of the Department that the provisions of section 553(d) do not apply to this rulemaking. Therefore, this rule is effective upon publication. The Department also finds that, given the national security issues surrounding U.S. policy towards Afghanistan, notice and public procedure on this rule would be impracticable, unnecessary, or contrary to the public interest; for the same reason, the rule will be effective immediately.
Since the Department is of the opinion that this rule is exempt from the rulemaking provisions of 5 U.S.C. 553, it does not require analysis under the Regulatory Flexibility Act.
This rulemaking does not involve a mandate that will result in the expenditure by state, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any year and it will not significantly or uniquely affect small governments. Therefore, no actions were deemed necessary under the provisions of the Unfunded Mandates Reform Act of 1995.
This rulemaking has been found not to be a major rule within the meaning of the Small Business Regulatory Enforcement Fairness Act of 1996.
This rulemaking 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. Therefore, in accordance with Executive Order 13132, it is determined that this rulemaking does not have sufficient federalism implications to require consultations or warrant the preparation of a federalism summary impact statement. The regulations implementing Executive Order 12372 regarding intergovernmental consultation on Federal programs and activities do not apply to this rulemaking.
Executive Orders 13563 and 12866 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributed impacts, and equity). These Executive Orders stress the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rule has been designated “significant regulatory actions,” although not economically significant, under section 3(f) of Executive Order 12866. Accordingly, this rule has been reviewed by the Office of Management and Budget (OMB).
The Department of State has reviewed this rulemaking in light of sections 3(a) and 3(b)(2) of Executive Order 12988 to eliminate ambiguity, minimize litigation, establish clear legal standards, and reduce burden.
The Department of State has determined that this rulemaking will not have tribal implications, will not impose substantial direct compliance costs on Indian tribal governments, and will not pre-empt tribal law. Accordingly, the requirement of Executive Order 13175 does not apply to this rulemaking.
This rule does not impose any new reporting or recordkeeping requirements
Arms and munitions, Exports.
Accordingly, for the reasons set forth above, Title 22, Chapter I, Subchapter M, parts 120 and 126 are amended as follows:
Secs. 2, 38, and 71, Pub. L. 90–629, 90 Stat. 744 (22 U.S.C. 2752, 2778, 2797); 22 U.S.C. 2794; E.O. 11958, 42 FR 4311; E.O. 13284, 68 FR 4075; 3 CFR, 1977 Comp. p. 79; 22 U.S.C. 2651a; Pub. L. 105–261, 112 Stat. 1920; Pub. L. 111–266.
Secs. 2, 38, 40, 42, and 71, Pub. L. 90–629, 90 Stat. 744 (22 U.S.C. 2752, 2778, 2780, 2791, and 2797); E.O. 11958, 42 FR 4311; 3 CFR, 1977 Comp., p. 79; 22 U.S.C. 2651a; 22 U.S.C. 287c; E.O. 12918, 59 FR 28205; 3 CFR, 1994 Comp., p. 899; Sec. 1225, Pub. L. 108–375; Sec. 7089, Pub. L. 111–117; Pub. L. 111–266; Section 7045, Pub. L. 112–74; Section 7046, Pub. L. 112–74.
(a)
(g)
Department of Veterans Affairs.
Interim final rule.
The Department of Veterans Affairs (VA) amends its medical regulations concerning the copayment required for certain medications. But for this rulemaking, beginning on January 1, 2013, the copayment amount would increase based on a formula set forth in regulation. The maximum annual copayment amount payable by veterans would also increase. For 2012, VA “froze” the copayment amount for veterans in VA's health care system enrollment priority categories 2 through 6, but allowed copayments to increase based on the regulatory formula for veterans in priority categories 7 and 8. However, that formula did not trigger an increase in the copayment amount for veterans in priority categories 7 and 8. This rulemaking freezes copayments at the current rate for veterans in priority categories 2 through 8 for 2013, and thereafter resumes increasing copayments in accordance with the regulatory formula.
Comments must be received on or before March 1, 2013.
Written comments may be submitted by email through
Kristin Cunningham, Director, Business Policy, Chief Business Office, 810 Vermont Avenue NW., Washington, DC 20420, (202) 461–1599. (This is not a toll-free number.)
Under 38 U.S.C. 1722A(a), VA must require veterans to pay a $2 copayment for each 30-day supply of medication furnished on an outpatient basis for the treatment of a non-service-connected disability or
Under 38 CFR 17.110(b)(1), veterans are obligated to pay VA a copayment for each 30-day or less supply of medication provided by VA on an outpatient basis (other than medication administered during treatment). Under the current regulation, for the period from July 1, 2010, through December 31, 2012, the copayment amount for veterans in priority categories 2 through 6 of VA's health care system is $8. 38 CFR 17.110(b)(1)(ii). Thereafter, the copayment amount for all affected veterans is to be established using a formula based on the prescription drug component of the Medical Consumer Price Index (CPI–P), set forth in 38 CFR 17.110(b)(1)(iv). For veterans in priority categories 7 and 8, the copayment amount from July 1, 2010, through December 31, 2011, was $9. 38 CFR 17.110(b)(1)(iii). After December 31, 2011, copayments for veterans in priority categories 7 and 8 were subject to the regulatory formula; however, that formula did not trigger an increase in the copayment amount, so it remains $9.
Current § 17.110(b)(2) also includes a “cap” on the total amount of copayments in a calendar year for a veteran enrolled in one of VA's health care enrollment system priority categories 2 through 6. Through December 31, 2012, the annual cap is set at $960. Thereafter, the cap is to increase “by $120 for each $1 increase in the copayment amount” applicable to veterans enrolled in one of VA's health care enrollment system priority categories 2 through 6.
On December 20, 2011, we published a final rulemaking that “froze” copayments for veterans in priority categories 2 through 6 at $8, through December 31, 2012. 76 FR 78824, Dec. 20, 2011. In that rulemaking, we stated that this freeze was appropriate because this group would be impacted more by the increase due to their likely greater need for medical care as a result of their service-connected disabilities or conditions. This continues to be true, and therefore we are continuing to freeze copayments for these veterans for the next 12 months.
We also believe that a freeze of the copayment rate is now appropriate for veterans enrolled in priority categories 7 and 8. Prior rulemakings justified freezing copayment rates on the basis that higher copayments reduced the utilization of VA pharmacy benefits. The ability to ensure that medications are taken as prescribed is essential to effective health care management. VA can monitor whether its patients are refilling prescriptions at regular intervals while also checking for medications that may conflict with each other when these prescriptions are filled by VA. When non-VA providers are also issuing prescriptions, there is a greater risk of adverse interactions and harm to the patient because it is more difficult for each provider to know if the patient is taking any other medications.
At the end of calendar year 2013, unless additional rulemaking is initiated, VA will once again utilize the CPI–P methodology in § 17.110(b)(1)(iv) to determine whether to increase copayments and calculate any mandated increase in the copayment amount for veterans in priority categories 2 through 8. At that time, the CPI–P as of September 30, 2013, will be divided by the index as of September 30, 2001, which was 304.8. The ratio will then be multiplied by the original copayment amount of $7. The copayment amount of the new calendar year will be rounded down to the whole dollar amount. As mandated by current § 17.110(b)(2), the annual cap will be calculated by increasing the cap by $120 for each $1 increase in the copayment amount. Any change in the copayment amount and cap, along with the associated calculations explaining the basis for the increase, will be published in a
In accordance with 5 U.S.C. 553(b)(B) and (d)(3), the Secretary of Veterans Affairs finds that there is good cause to dispense with the opportunity for advance notice and opportunity for public comment and good cause to publish this rule with an immediate effective date. As stated above, this rule freezes at current rates the prescription drug copayment that VA charges certain veterans. The Secretary finds that it is impracticable and contrary to the public interest to delay this rule for the purpose of soliciting advance public comment or to have a delayed effective date. Increasing the copayment amount on January 1, 2013, might cause a significant financial hardship for some veterans.
For the above reasons, the Secretary issues this rule as an interim final rule. VA will consider and address comments that are received within 60 days of the date this interim final rule is published in the
Title 38 of the Code of Federal Regulations, as revised by this interim final rulemaking, represents VA's implementation of its legal authority on this subject. Other than future amendments to this regulation or governing statutes, no contrary guidance or procedures are authorized. All existing or subsequent VA guidance must be read to conform with this rulemaking if possible or, if not possible, such guidance is superseded by this rulemaking.
This interim final rule contains no provisions constituting a collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501–3521).
Executive Orders 12866 and 13563 direct agencies to assess the 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 effects, and other advantages; distributive impacts; and equity). Executive Order 13563 (Improving Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 12866 (Regulatory Planning and Review) defines a “significant regulatory action,” which requires review by the Office of Management and Budget (OMB), as “any regulatory action that is likely to result in a rule that may: (1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the
The economic, interagency, budgetary, legal, and policy implications of this regulatory action have been examined, and it has been determined to be a significant regulatory action under Executive Order 12866.
The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in an expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any given year. This rule will have no such effect on State, local, and tribal governments, or on the private sector.
The Secretary hereby certifies that this interim final rule will not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601–612. This interim final rule will temporarily freeze the copayments that certain veterans are required to pay for prescription drugs furnished by VA. The interim final rule affects individuals and has no impact on any small entities. Therefore, pursuant to 5 U.S.C. 605(b), this rulemaking is exempt from the initial and final regulatory flexibility analysis requirements of sections 603 and 604.
The Catalog of Federal Domestic Assistance program number and title for this rule are as follows: 64.005, Grants to States for Construction of State Home Facilities; 64.007, Blind Rehabilitation Centers; 64.008, Veterans Domiciliary Care; 64.009, Veterans Medical Care Benefits; 64.010, Veterans Nursing Home Care; 64.011, Veterans Dental Care; 64.012, Veterans Prescription Service; 64.013, Veterans Prosthetic Appliances; 64.014, Veterans State Domiciliary Care; 64.015, Veterans State Nursing Home Care; 64.016, Veterans State Hospital Care; 64.018, Sharing Specialized Medical Resources; 64.019, Veterans Rehabilitation Alcohol and Drug Dependence; 64.022, Veterans Home Based Primary Care; and 64.024, VA Homeless Providers Grant and Per Diem Program.
The Secretary of Veterans Affairs, or designee, approved this document and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs. John R. Gingrich, Chief of Staff, Department of Veterans Affairs, approved this document on December 7, 2012, for publication.
Administrative practice and procedure, Alcohol abuse, Alcoholism, Claims, Day care, Dental health, Drug abuse, Foreign relations, Government contracts, Grant programs-health, Grant programs-veterans, Health care, Health facilities, Health professions, Health records, Homeless, Medical and dental schools, Medical devices, Medical research, Mental health programs, Nursing homes, Philippines, Reporting and recordkeeping requirements, Scholarships and fellowships, Travel and transportation expenses, Veterans.
For the reasons set forth in the preamble, VA amends 38 CFR part 17 as follows:
38 U.S.C. 501(a), and as noted in specific sections.
Environmental Protection Agency (EPA).
Final rule.
The Environmental Protection Agency (EPA) is determining that the New York-N. New Jersey-Long Island, NY–NJ–CT fine particle (PM
EPA has established a docket for this action under Docket ID Number EPA–R02–OAR–2012–0504. All documents in the docket are listed in the
Gavin Lau, (212) 637–3708, or by email at
Throughout this document whenever “we,” “us,” or “our” is used, we mean EPA.
The
EPA is determining that the New York-N. New Jersey-Long Island, NY-NJ-CT fine particle (PM
EPA's determination is being made in accordance with its longstanding interpretation under the Clean Data Policy, and with previously issued rules and determinations of attainment. A brief description of the Clean Data Policy with respect to the 2006 PM
In April 2007, EPA issued its PM
In 1995, based on the interpretation of Clean Air Act (CAA) sections 171 and 172, and section 182 in the General Preamble, EPA set forth what has become known as its “Clean Data Policy” for the 1-hour ozone NAAQS.
The Clean Data Policy represents EPA's interpretation that certain requirements of subpart 1 of part D of the Act are by their terms not applicable to areas that are currently attaining the NAAQS.
It is important to note that the obligation of a State with respect to an area which attains the 2006 PM
EPA received one adverse comment on the proposal, from a pseudonymous commenter. A summary of the comment submitted and EPA's response is provided below.
Table 1 shows the design values by county (i.e., the 3-year average of 98th percentile 24-hour PM
This final action, in accordance with the Clean Data Policy, which is reflected in 40 CFR 51.1004(c), suspends the requirements for the States of Connecticut, New Jersey, and New York, to submit an attainment demonstration, associated reasonably available control measures, RFP, contingency measures, and other planning SIPs related to attainment of the 2006 24-hour PM
This action does not constitute a redesignation to attainment under section 107(d)(3) of the CAA, because the area does not have an approved maintenance plan as required under section 175A of the CAA. Nor is it a determination that the area has met the other requirements for redesignation. The designation status of the area remains nonattainment for the 2006 24-hour PM
EPA is determining that the NY-NJ-CT PM
In accordance with 5 U.S.C. 553(d), EPA finds there is good cause for this action to become effective immediately upon publication. A delayed effective date is unnecessary due to the nature of a determination of attainment, which suspends the obligation to submit certain attainment-related CAA planning requirements that would otherwise apply. The immediate effective date for this action is authorized under both 5 U.S.C. 553(d)(1), which provides that rulemaking actions may become effective less than 30 days after publication if the rule “grants or recognizes an exemption or relieves a restriction,” and section 553(d)(3), which allows an effective date less than 30 days after publication “as otherwise provided by the agency for good cause found and published with the rule.” The purpose of the 30-day waiting period prescribed in section 553(d) is to give affected parties a reasonable time to adjust their behavior and prepare before the final rule takes effect. Today's rule, however, does not create any new regulatory requirements such that affected parties would need time to prepare before the rule takes effect. Rather, today's rule relieves the affected States of the obligation to submit certain attainment-related planning requirements for this PM
This action makes an attainment determination based on air quality and results in the suspension of certain Federal requirements, and it does not impose additional requirements beyond those imposed by state law.
For these reasons, this action:
• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Order 12866 (58 FR 51735, October 4, 1993);
• Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501
• Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601
• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104–4);
• Does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);
• Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);
• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);
• Is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and
• Does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).
In addition, this rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not approved to apply in Indian country located in the state, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law.
The Congressional Review Act, 5 U.S.C. 801
Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by March 1, 2013. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed,
This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)
Environmental protection, Air pollution control, Incorporation by reference, Particulate matter.
Part 52, chapter I, title 40 of the Code of Federal Regulations is amended as follows:
42 U.S.C. 7401 et seq.
(g)
(e)
Environmental Protection Agency.
Final rule.
EPA is approving a State Implementation Plan (SIP) revision submitted by the State of Colorado on May 25, 2011 that addresses regional haze. Colorado submitted this SIP revision to meet the requirements of the Clean Air Act (CAA or “the Act”) and our rules that require states to prevent any future and remedy any existing man-made impairment of visibility in mandatory Class I areas caused by emissions of air pollutants from numerous sources located over a wide geographic area (also referred to as the “regional haze program”). EPA is taking this action pursuant to section 110 of the CAA.
This final rule is effective January 30, 2013.
EPA has established a docket for this action under Docket ID No. EPA–R08–OAR–2011–0770. All documents in the docket are listed on the
Publicly available docket materials are available either electronically through
Laurel Dygowski, Air Program, Mailcode 8P–AR, Environmental Protection Agency, Region 8, 1595 Wynkoop Street, Denver, Colorado 80202–1129, (303) 312–6144,
For the purpose of this document, we are giving meaning to certain words or initials as follows:
i. The words or initials
ii. The initials
iii. The initials
iv. The initials
v. The initials
vi. The initials
vii. The words
viii. The initials
ix. The words
x. The initials
xi. The initials
xii. The initials
xiii. The initials
xiv. The initials
xv. The initials
xvi. The initials
xvii. The initials
xviii. The initials
xix. The initials
The CAA requires each state to develop plans, referred to as SIPs, to meet various air quality requirements. A state must submit its SIPs and SIP revisions to us for approval. Once approved, a SIP is enforceable by EPA and citizens under the CAA, also known as being federally enforceable. This action addresses the requirement that states have SIPs that address regional haze.
In 1990, Congress added section 169B to the CAA to address regional haze issues, and we promulgated regulations addressing regional haze in 1999 (64 FR 35714, July 1, 1999, codified at 40 CFR part 51, subpart P). The requirements for regional haze, found at 40 CFR 51.308 and 51.309, are included in our visibility protection regulations at 40 CFR 51.300–309. The requirement to submit a regional haze SIP applies to all 50 states, the District of Columbia and the Virgin Islands. States were required to submit a SIP addressing regional haze visibility impairment no later than December 17, 2007 (40 CFR 51.308(b)).
Few states submitted a regional haze SIP prior to the December 17, 2007, deadline, and on January 15, 2009, EPA found that 37 states, including Colorado, the District of Columbia, and the Virgin Islands, had failed to submit SIPs addressing the regional haze requirements (74 FR 2392). Once EPA has found that a state has failed to make a required submission, EPA is required to promulgate a Federal Implementation Plan (FIP) within 2 years unless the state submits a SIP and the Agency approves it within the 2-year period. CAA section 110(c)(1).
Colorado submitted a SIP addressing regional haze on May 25, 2011.
In a lawsuit in the U.S. District Court for the District of Colorado, environmental groups sued us for our failure to take timely action with respect to the regional haze requirements of the CAA and our regulations. In particular, the lawsuits alleged that we had failed to promulgate FIPs for these requirements within the 2-year period allowed by CAA section 110(c) or, in the alternative, fully approve SIPs addressing these requirements.
As a result of these lawsuits, we entered into a consent decree. The consent decree requires that we sign a notice of final rulemaking addressing the regional haze requirements for Colorado by September 10, 2012. We are meeting that requirement with the signing of this notice of final rulemaking.
We signed our notice of proposed rulemaking on March 15, 2012, and it was published in the
We requested comments on all aspects of our proposed action and provided a 60-day comment period, with the comment period closing on May 25, 2012. We received comments on our proposed rule that generally supported our proposed action and comments that were critical of certain aspects of our proposed action. In this action, we are responding to the comments we have received, taking final rulemaking action, and explaining the bases for our action.
With this action, EPA is approving a SIP revision submitted by the State of Colorado on May 25, 2011, that addresses regional haze. We are approving the State's regional haze SIP, including revisions submitted as part of the regional haze SIP to:
• Regulation No. 3, Part F, Section VI and Section VII.
• Regulation No. 3, Part D, Section XIV.F.
• Regulation No. 7, Section XVII.E.3.a.
We have fully considered all significant comments on our proposal and have concluded that no changes from our proposal are warranted. Our action is based on an evaluation of Colorado's regional haze SIP submittal against the regional haze requirements at 40 CFR 51.300–51.309 and CAA sections 169A and 169B. All general SIP requirements contained in CAA section 110, other provisions of the CAA, and our regulations applicable to this action were also evaluated. The purpose of this action is to ensure compliance with these requirements. Our authority for action on Colorado's SIP submittal is based on CAA section 110(k).
We are approving the State's regional haze SIP provisions because they meet the relevant regional haze requirements. Most of the adverse comments we received concerning our proposed approval of the regional haze SIP pertained to the State's best available retrofit technology (BART) and reasonable progress determinations. With respect to the BART determinations, we understand that there is room for disagreement about certain aspects of the State's analyses. Furthermore, we may have reached different conclusions had we been performing the determinations in the first instance. However, the comments have not convinced us that the State, conducting specific case-by-case analyses for the relevant units, acted unreasonably or that we should disapprove the State's BART determinations.
With respect to the State's reasonable progress determinations, the State
One commenter went on to say that if an emission rate of 0.05 lb/MMBtu had been used to assess the cost of SCR, the State would have found the cost to be $5,879 per ton of NO
As noted by the commenter, SNCR can typically achieve a 20–30% reduction after combustion controls. By contrast, Colorado assumed that at Craig SNCR could achieve a 15% reduction after combustion controls. This in turn was based on Tri-State's assertion that the Craig BART units can only meet this level of control since the effectiveness of SNCR is lower for wall-fired boilers similar to those at Craig. Under the circumstances, we do not find that the State's conclusion was unreasonable.
Colorado has stated that the Craig BART units fire sub-bituminous coal that is “bituminous-like” with respect to NO
We received numerous comments that the State, relying on Tri-State's cost analysis, significantly overestimated capital costs for SCR at Craig Unit 1 and Unit 2, and that EPA did not conduct a detailed review of Tri-State's cost analysis. Commenters cited numerous sources to show that the expected capital costs for SCR at Unit 1 and Unit 2 should be lower than what Tri-State assumed in its cost estimates. Commenters noted limited or missing information, such as lack of vendor quotes or detailed cost estimates. According to a commenter, this type of information is necessary for the public or other agencies to be able to thoroughly review and comment on the proposed determinations. According to commenters, the absence of this underlying information renders EPA's proposed approval of the BART determinations for these sources arbitrary. Commenters said that, to the extent that the State or EPA relied on such information, failure to include it in the docket further illegally impaired and deprived the public of its notice and comment rights, by concealing important grounds for the proposed action and preventing the public from examining and offering meaningful comment thereon.
Commenters noted several items in Tri-State's and the State's cost analyses that are not allowed by or are inconsistent with EPA's Control Cost Manual (CCM). According to commenters, Tri-State and the State: (1) Disregarded EPA's cost method, often referred to as the “overnight cost method;”
Commenters provided revised cost analyses for SCR at Craig Units 1 and 2. One commenter calculated that a more accurate cost effectiveness value would be no higher than $3,460/ton and $3,370/ton at Unit 1 and Unit 2, respectively. Another commenter calculated that average costs would be $2,209/ton for Unit 1 and $1,962/ton for Unit 2. Commenters pointed out that these costs were below the threshold established by the State for choosing SCR.
Commenters point out that EPA only provides the impacts to the most impacted Class I area, Mt. Zirkel, and that the cumulative impact of a source's emissions on visibility, as well as the cumulative benefit of emission reductions, is a necessary consideration as part of the fifth step in the BART analysis. Commenters provided examples where other EPA regions (Region 6 and Region 9) have considered cumulative visibility benefits. The NPS performed modeling and submitted the results as part of its comments. NPS modeling shows that the cumulative visibility impact from Craig Units 1 and 2 is 17.61 deciviews, while SCR at both units would provide a cumulative visibility improvement of 8.99 deciviews. The modeling also shows that SCR at both units would achieve at least a 0.5 deciview improvement at each of five Class I areas.
Commenters identified numerous issues with the State's determination of BART and consideration of the five factors. First, commenters pointed out that the State relied on a predetermined set of thresholds applicable only to post-combustion NO
Commenters asserted that EPA, in its October 26, 2010, comment letter to Colorado, anticipated some of the reasons the State's threshold is untenable. One commenter went on to say that in the unlikely scenario that the appropriate cost of SCR at Craig Units 1 and 2 is in fact above $5,000/ton, the State's criteria “preclude a reasonable weighing of the five factors,” as EPA had foretold. Commenters indicated that EPA relied on the State's vague and unsubstantiated criteria without resolving or even discussing its prior concerns.
Commenters noted that the Craig analysis presented data for each of the five BART factors, but pointed out that when it came to the crux of the BART determination, the actual weighing of the factors, EPA's proposed rulemaking failed to explain how EPA determined
One commenter stated that it was concerned that, although the State found SCR to be reasonable as BART for Craig Unit 2, it found the control technology to be unreasonable for Unit 1, even though according to the five factors, it would meet the same reasonability threshold as for Unit 2. Notably, the State found the cost of SCR for Unit 2, $5,728 per ton of NO
Commenters pointed out that the Craig BART alternative fails to provide for greater reasonable progress than would be achieved if an adequate source-specific BART limit were required of both subject-to-BART Craig units. Commenters went on to say that BART should have been SCR on both Craig units and thus, the BART alternative of SNCR on Unit 1 and SCR on Unit 2 is not better than BART. According to commenters, given that 40 CFR 51.308(e)(2)(C) requires states to make a BART determination for any source subject to an alternative to BART, the State's flawed BART analysis fails to support an alternative to BART pursuant to EPA regulations.
EPA acknowledges that Colorado's approach appears to be a novel and comprehensive strategy for addressing regional haze requirements and other air quality goals. In 2010, the Colorado General Assembly adopted legislation authorizing the Air Quality Control Commission and the Public Utilities Commission to develop a comprehensive plan for coal-fired electric generating units in the state that would address not only regional haze but also potential new ozone standards and mercury standards, as well as other requirements that, in the State's view, could apply to coal-fired electric generation units in the foreseeable future. The State desired to address these issues in a coordinated way in order to achieve the most cost-effective strategy that accounted for not only current, but other imminent regulatory requirements. This approach appears to be unique and, as noted below, will yield significant emissions reductions not only of pollutants that affect visibility in Class I areas, but also significant reductions in pollutants that contribute to ozone formation, nitrogen deposition, and mercury emissions and deposition. The State spent considerable time and conducted sequential and extended hearings to develop a plan which seeks to balance a number of variables beyond those that would be involved in a simpler and narrower regional haze determination.
Colorado's BART requirements for the Craig units reflect a balance struck by Tri-State Generation & Transmission Association, Inc. and several environmental groups before the Colorado Air Quality Control Commission during an extensive and formal proceeding; at the conclusion of the proceeding, the Commission adopted the agreement reached by Tri-State and those environmental groups as part of Colorado's regional haze plan. As a result, the plan requires installation of SCR at one of the two Craig BART-eligible units even though the Commission previously had concluded that installation of SCR was not warranted at either unit. In addition, we note that Colorado has imposed SCR as BART on two other EGUs in western Colorado—Hayden Units 1 and 2—and at the Pawnee plant in eastern Colorado. Moreover, Colorado has exceeded the minimum requirements for BART and reasonable progress for sources included in the PSCO BART Alternative (as described in our notice of proposed rulemaking, 77 FR 18073–18075), and has imposed substantial and meaningful controls, that go beyond what EPA's regulations otherwise might have required, to address reasonable progress sources for the initial planning period.
Under the unique circumstances discussed above, EPA concludes that Colorado's plan achieves a reasonable result overall. Based on this, we are approving the entirety of the Colorado regional haze SIP, even though the State's BART analysis for Craig 1 only analyzed visibility impacts at the most impacted Class I area and appears to overestimate the costs of SCR controls. We expect Colorado to revisit the appropriateness of SCR controls on Craig Unit 1 in the next reasonable progress planning period.
Finally, we note that the State's plan will result in NO
This example proves EPA's point. By this logic, if the evaluated technology in this instance were SNCR instead of SCR, it would be BART for at least Units 6 and 7, and possibly Unit 5. We concur with EPA's previous critique: this distinction has no basis and is untenable.
Despite this, the State did not assess whether alternative fueling scenarios, such as a full or partial shift from coal to natural gas or fuel oil at Units 4 and 5 would represent BART. This is a concern because according to the CAA Title V Operating Permit for the facility, both Units 4 and 5 could meet stronger SO
Here, alternative fueling scenarios, such as a full or partial shift away from
The failure to analyze alternative fueling scenarios is especially confusing because the State did, apparently, identify in its TSD for the CENC facility a fuel switch to natural gas as an available technology and in analyzing “SO
The failure to analyze alternative fueling scenarios is further confusing because the EPA's BART guidelines indicate that alternative fueling scenarios should be analyzed by states when determining BART. The guidelines specifically state that “potentially applicable retrofit control alternatives” can include the “use of inherently lower-emitting processes/practices” or “combinations of inherently lower-emitting processes and add-on controls.” Appendix Y at Section IV.D.3. Above all, states should “identify potentially applicable retrofit technologies that represent the full range of demonstrated alternatives.”
Given the State's failure to take into consideration an available technology, the EPA must disapprove the BART determinations for CENC Units 4 and 5 and in accordance with the CAA promulgate a FIP that establishes BART limits based on a full consideration of alternative fueling scenarios.
The State determined residual oil would not result in pollutant reductions, and that distillate oil, ethanol, and biodiesel are high cost fuels for boilers of this size, with prices about two to three times the cost of natural gas, and six to seven times the cost of coal (at the time of analysis—December 2009) and highly volatile. Thus, the State eliminated these fuels from further consideration.
Furthermore, the State determined the cost effectiveness of fuel-switching to natural gas for SO
Based on the above statement from our BART guidelines, and based on the State's analysis, we agree with the State's conclusion that fuel switching to natural gas is not BART at CENC Units 4 and 5.
SCR has been an available emission control technology for NO
EPA cannot come to conclusions on the cost effectiveness of SCR without analytical support, and there is no support for approving the State BART determination for the Cemex Lyons cement kiln. We request the EPA promulgate a FIP that objectively and thoroughly analyzes SCR as an available technology for purposes of establishing BART limits for the Cemex Lyons cement kiln.
The State's own BART analysis notes that currently Unit 1 is emitting at an average annual rate of 0.124 lb/MMBtu and Unit 2 is emitting at an average annual rate of 0.165 lb/MMBtu. This means that both on a 30-day rolling average basis and on an annual average basis, both units are capable of emitting, and indeed do emit, at rates below the proposed BART limits of 0.20 lb/MMBtu on a 30-day rolling average and 0.15 lb/MMBtu on an annual basis. In essence, Colorado's BART proposal actually allows Comanche Units 1 and 2 to emit more pollution than what they currently emit.
Under the State's proposed BART, emissions will be allowed to increase on an annual basis. Using annual heat input totals from the baseline year of 2009 obtained from the EPA's Air Markets Program Data Web site (24,247,113.27 MMBtu for unit 1 and 27,423,612.26 MMBtu for unit 2) and using the proposed annual combined average BART limits, it appears that under the annual BART limits, NO
Concerning the 30-day rolling average limits, there will definitely be allowed emission increases. During the baseline year of 2009, both Comanche Unit 1 and Unit 2 emitted far lower than the proposed BART limit of 0.20 lb/MMBtu. During the baseline year of 2009, 30-day rolling average NO
Clearly, Comanche Units 1 and 2 could easily meet lower emission limits as BART. We do not suggest that the State was required to set the emission limits exactly at the levels emitted, but clearly when the data demonstrates that Unit 1 could meet a 30-day rolling average NO
Although the State and the EPA may claim the proposed limits are necessary to provide a margin or cushion of compliance, nothing in the CAA or the EPA's regulations suggests that it is appropriate to build in such margins or cushions into BART limits, especially given that BART must represent that “best system of continuous emission reduction.” If Comanche Units 1 and 2 can do better, than clearly, the proposed BART limits are not the best. Nothing in the CAA or the EPA's regulations implementing the regional haze program suggest or remotely imply that a state could allow emission increases as BART.
Accordingly, EPA must disapprove of Colorado's NO
In addition, Comanche's actual emissions following the installation of low NO
In this case, the State did not assess the cost effectiveness of SCR based on a rate of 0.05 lb/MMBtu. Thus, it did not reasonably take into account the cost of compliance with SCR in accordance with the CAA. Without an adequate case-specific cost analysis, there is simply no support for concluding SCR, particularly for Unit 2, is unreasonable.
Based on visibility modeling from the NPS, commenters pointed out that the visibility benefits of adding SCR to Unit 3 are similar to those at Units 1 and 2—over 0.5 deciview at five Class I areas, and additional benefits at several more. The commenters asserted that, cumulatively, Unit 3 has an 8.39 deciview impact, with SCR providing a cumulative visibility improvement of 4.56 deciviews. Commenters went on to say that SCR at a limit of 0.05 lb/MMBtu should be required as reasonable progress for Craig Unit 3.
Indeed, data from the EPA demonstrates that between January 1, 2009, and December 31, 2011, Nucla has been meeting an average monthly NO
More importantly though, these rates indicate that the State's proposed reasonable progress limits actually allow more air pollution to be emitted from Nucla than is currently emitted. An increase in emissions would not appear to ensure reasonable progress in restoring visibility in Colorado's Class I areas. Thus, the State's proposed SIP is not approvable by EPA because it fails to ensure reasonable progress in accordance with 42 U.S.C. 7491(g)(1) and 40 CFR 51.308(d)(1)(i). At the least, the proposed reasonable progress emission limits for Nucla demonstrate that the State failed to appropriately assess the costs of compliance in accordance with the CAA. Indeed, if the State had appropriately assessed the costs of compliance, it would have found that lower emission rates would be equally cost-effective and more protective of visibility. Such a flawed analysis of reasonable progress in relation to the Nucla plant cannot be approved by EPA.
The EPA must promulgate a FIP that establishes reasonable progress limits at the Nucla plant that actually achieve cost-effective emissions reductions. To this end, we request EPA adopt reasonable progress limits that limit NO
It is essential that any regulatory program try to maintain a “level playing field.” There are two other cement plants in Colorado, and additional NO
GCC has installed SNCR but the current permit does not require these controls to be operated. We believe that, because the GCC permit allows emissions that exceed the State's threshold for determining which sources are subject to a reasonable progress analysis, GCC should have been included as a reasonable progress source. It is likely, based on the State's actions regarding the other two cement plants that the State would have required continuous operation of SNCR.
In 2006, Rio Grande Cement reported zero emissions because it did not operate. In 2007, Rio Grande Cement did report APEN emissions (based on permitted limits) resulting in a Q/d>20, but those emissions were not actual emissions because the source did not actually begin producing cement until April 2008. Because the State based its reasonable progress evaluation on 2006 actual emissions, we find it reasonable that the State did not further evaluate GCC for purposes of reasonable progress. We expect the State to do so for the next reasonable progress planning period.
As a result of the AQCC's egregious failures in Phase III of the SIP Rulemaking, the PSCO BART Alternative should not be included in the Colorado regional haze SIP. Until the Court has completed its review, EPA should not act to include the PSCO BART Alternative in the State's regional haze SIP.
Additionally, the CAA is clear that in mandating “expeditious” compliance, SIPs must ensure that subject-to-BART sources comply as soon as possible. In this case, Colorado's SIP simply fails to ensure compliance with BART as soon as possible. It lacks any concrete dates by which subject-to-BART sources must comply, other than to state that sources must comply within the statutory maximum compliance date of 5 years. However, the CAA is clear that if a source can comply with BART before 5 years, it must comply by that earlier date. See 42 U.S.C. 7491(g)(4). Simply deferring to the 5-year deadline undermines the Congressional intent behind the “as expeditiously as practicable” provision.
It is notable that in other situations, the EPA has proposed to require concrete compliance dates to satisfy the CAA's “as expeditiously as practicable” provisions under the regional haze program. For example, in proposing a FIP for BART for the San Juan Generating Station in New Mexico, the EPA proposed a 3-year compliance date, finding it to be “as expeditiously as practicable” (76 FR 504). Although EPA ultimately concluded that a 5-year schedule of compliance was appropriate, the Agency's proposed action clearly signaled that a concrete date is needed to satisfy the CAA.
The EPA must therefore disapprove of Colorado's blanket schedule of BART compliance. In its place, the Agency must promulgate a FIP that sets forth concrete dates by which all subject-to-BART sources must “procure, install, and operate” BART that represent the most expeditious dates practicable.
In this case, we are concerned that in proposing to approve Colorado's regional haze plan that the EPA has not demonstrated that the proposal
We are particularly concerned that the EPA overlooked its 110(l) obligations under the CAA given that, although the proposed rule may lead to emission reductions, no analysis or assessment has been prepared to demonstrate that even after these emission reductions, the recently promulgated NAAQS will be met. In this case, we are particularly concerned that the recently promulgated 1-hour NO
We are further concerned over the fact that several BART limits allow for increased emissions. For example, the proposed NO
In this case, the EPA must either disapprove of the Colorado SIP over the State's failure to perform a 110(l) analysis or prepare its own 110(l) analysis to demonstrate that the SIP will effectively protect public health and not interfere with attainment or maintenance of the NAAQS.
Although the Colorado regional haze SIP will lead to emission reductions, the commenter asserts that that even so EPA must determine that the SIP revision will ensure the NAAQS are met. We disagree with this interpretation of CAA section 110(l). The Act and EPA's regulations require the regional haze SIP to address visibility impairment in mandatory Class I areas—attainment of the NAAQS is provided for through a separate SIP process. It is EPA's consistent interpretation of section 110(l) that a SIP revision does not interfere with attainment and maintenance of the NAAQS if the revision at least preserves the status quo air quality by not relaxing or removing any existing emissions limitation or other SIP requirement. EPA does not interpret section 110(l) to require a full attainment or maintenance demonstration for each NAAQS for every SIP revision.
Thus, in this action, we need not determine whether a 30-day limit is adequate to protect a shorter-term NAAQS because the regional haze SIP is not required to ensure attainment of the NAAQS. The fact that the regional haze SIP specifies 30-day limits will not preclude Colorado from adopting limits with a shorter averaging time, if at some future date such limits are found to be necessary and required by the CAA to protect the NAAQS.
The commenter also alleges that “several BART limits allow for increased emissions” over current actual source emissions and cites as an example the NO
Under the Clean Air Act, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. Accordingly, this action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:
• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Order 12866 (58 FR 51735, October 4, 1993);
• Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501
• Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601
• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104–4);
• Does not have Federalism implications as specified in Executive
• Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);
• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);
• Is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the Clean Air Act; and
• Does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).
In addition, this rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not approved to apply in Indian country located in the state, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law.
The Congressional Review Act, 5 U.S.C. 801
Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by March 1, 2013. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See CAA section 307(b)(2).)
Environmental protection, Air pollution control, Incorporation by reference, Nitrogen dioxide, Ozone, Particulate matter, Sulfur oxides.
For the reasons discussed in the preamble, 40 CFR chapter I is amended as follows:
42 U.S.C. 7401
(c) * * *
(108) * * *
(i) * * *
(C) Colorado Air Quality Control Commission, Regulation Number 3, 5 CCR 1001–5,
(124) On May 25, 2011 the State of Colorado submitted revisions to its State Implementation Plan to address the requirements of EPA's regional haze rule.
(i) Incorporation by reference.
(A) Colorado Air Quality Control Commission, Regulation Number 3, 5 CCR 1001–5,
(B) Colorado Air Quality Control Commission, Regulation Number 7, 5 CCR 1001–9,
Environmental Protection Agency (EPA).
Final rule.
EPA is approving, under the Clean Air Act (CAA), the state of Ohio's request to redesignate the Ohio portion of the Huntington-Ashland (OH–WV–KY) nonattainment area (Lawrence, Scioto, and portions of Adams and Gallia Counties) to attainment for the 1997 annual National Ambient Air Quality Standard (NAAQS or standard) for fine particulate matter (PM
EPA has established a docket for this action under Docket Identification EPA–R05–OAR–2011–0468. All documents in these dockets are listed on the
Carolyn Persoon, Environmental Engineer, Control Strategies Section, Air Programs Branch (AR–18J), Environmental Protection Agency, Region 5, 77 West Jackson Boulevard, Chicago, Illinois 60604, (312) 353–8290, persoon.carolyn@epa.gov.
Throughout this document whenever “we,” “us,” or “our” is used, we mean EPA. This supplementary information section is arranged as follows:
On May 4, 2011 the Ohio EPA submitted its request to redesignate the Ohio portion of the Huntington-Ashland nonattainment area to attainment for the 1997 annual PM
In the proposed redesignation of the Huntington-Ashland area, EPA proposed to determine that the emission reduction requirements that contributed to attainment of the 1997 annual PM
On August 21, 2012, the D.C. Circuit issued a decision in
EPA has determined that the entire Huntington-Ashland area has attained and continues to attain the 1997 annual PM
Because the area continues to attain and meets all other requirements for redesignation under CAA section 107(d)(3)(E), EPA is approving the request from the state of Ohio to change the legal designation of the Ohio portion of the Huntington-Ashland area from nonattainment to attainment for the 1997 annual PM
EPA is taking several actions related to Ohio's PM
EPA is approving, pursuant to CAA section 175A, Ohio's 1997 annual PM
EPA is approving, pursuant to CAA section 172(c)(3), both the 2005 and 2008 emission inventories for primary PM
Finally, for transportation conformity purposes EPA is approving Ohio's determination that on-road emissions of PM
EPA received two sets of comments on its proposed rulemaking. The Ohio Utilities Group submitted comments in support of the redesignation of the Ohio portion of the Huntington-Ashland area, and on behalf of Sierra Club, Robert Ukeiley submitted adverse comments. A summary of Sierra Club's comments and EPA's responses are provided below.
Specifically, the Commenter argues that CAIR reductions are not permanent and enforceable because EPA stated in the proposal that CAIR emission reductions only run through 2011. The Commenter also cites statements by EPA made in the context of other rules indicating that CAIR is legally deficient, remanded, and therefore temporary, in both the regional haze proposed rulemakings (76 FR 78194, 78200, December 16, 2011), as well as a redesignation proposal for Cincinnati (76 FR 65458, 65460, October 21, 2011). The Commenter argues that EPA cannot rely on CAIR because it is a cap-and-trade program. The Commenter cites to
As an initial matter, EPA notes that the modeling EPA conducted during the rulemaking for the CSAPR rulemaking demonstrates that the Huntington-Ashland area would attain and maintain the 1997 PM
The Commenter points out that EPA made statements that CAIR reductions were expiring in 2011 (76 FR 79593, December 22, 2011) and were temporary (76 FR 78194, 78200, December 16, 2011; 76 FR 65458, 65460, October 21, 2011). However, these statements should be viewed in light of changes in the legal context of CAIR and CSAPR, which occurred subsequent to those statements and had a significant effect on the status of CAIR.
On May 12, 2005, EPA published CAIR, which requires significant reductions in emissions of SO
The agency's statements cited by the Commenter must be viewed in context: They were made after CSAPR had been promulgated to sunset and replace CAIR, and before the D.C. Circuit stayed CSAPR and issued its decision in
In addition, CAIR remains in place and enforceable until substituted by a “valid” replacement rule. Ohio's CAIR provisions can be found in Ohio Administrative Code Chapter 3745–109. On February 1, 2008, at 73 FR 6034, EPA approved an “abbreviated SIP” covering several of Ohio's CAIR provisions, including CAIR NO
Further, in vacating CSAPR and requiring EPA to continue administering CAIR, the D.C. Circuit emphasized that the consequences of vacating CAIR “might be more severe now in light of the reliance interests accumulated over the intervening four years.”
EPA also disagrees with the Commenter that emission reductions occurring within the relevant nonattainment area cannot be relied upon for the purpose of redesignations if they are associated with the emissions trading programs established in CAIR. The case cited by the Commenter,
There is simply no support for the Commenter's argument that, in determining whether to redesignate an area, EPA must ignore all emission reductions achieved by CAIR simply because the mechanism used to achieve the reductions is an emissions trading program. As a general matter, trading programs require total mass emission reductions by establishing mandatory caps on total emissions to permanently reduce the total mass emissions allowed by sources subject to the programs, validated through rigorous continuous emission monitoring and reporting regimens. The emission caps and associated controls are enforced through the associated SIP rules or FIPs. Any purchase of allowances and increase in emissions by one source necessitates a corresponding sale of allowances and reduction in emissions by another covered source. Given the regional nature of PM
There is no support for the Commenter's contention that the presence of allowance banking in a program somehow renders those programs' emission reduction requirements impermanent or unenforceable, such that EPA must ignore reductions associated with any trading program that allows banking. In general, banking provides economic incentives for early reductions in emissions and encourages sources to install controls earlier than required for compliance with future caps on emissions. As Commenter points out, Ohio's submittal states that “companies installed more controls” during the time period that CAIR was being developed and promulgated. The flexibility under a cap and trade system is not about whether to reduce emissions. Rather, it is about how to reduce them at the lowest possible cost. The fact that companies anticipate the economic benefits of installing controls earlier, and reductions thus may occur more quickly than required (freeing up allowances that may then be banked and providing earlier health and environmental benefits to the public) does not, in any way, undermine the permanence or enforceability of the requirements in the underlying rule. The bank itself was factored into the CAIR cap levels that were chosen. The bank allows for a “glide path” to final cap levels (70 FR 25194, May 12, 2005). Further, evaluations have been made to see whether banking and trading have created emissions “hot spots.” For example, since the beginning of the Acid Rain Program, there have been no emissions hot spots identified or created as a result of the program (see “The Acid Rain Program Experience: Should We Be Concerned About SO
Additionally, states and localities may impose stricter limits on sources to address specific local air quality concerns. These limits must be met regardless of a source's accumulated allowances.
In sum, contrary to Commenter's contention, the decision of the D.C. Circuit in
EPA also notes that CAIR is not the only permanent and enforceable measure affecting EGU emission reductions in the Huntington-Ashland area. There have been several consent decrees in the area affecting EGUs. First, in the Kentucky portion of the Huntington-Ashland Area, the Big Sandy Power Station was required by a federally enforceable consent decree
EPA disagrees with the Commenter's contention that using a single attainment year is arbitrary due to year to year variations in emission levels resulting from cap-and-trade programs, and that 2008 was a “problematic” year to select for analysis. As noted above, data for 2008–2010 and 2009–2011 as well as preliminary data for 2012 show continued attainment of the standard. Although the Commenter points out one monitor's reading that approached the threshold in 2010, the fact remains that Huntington-Ashland is in attainment and has been in attainment.
With respect to the Commenter's assertion that EPA has conducted no analyses to prove that emission reductions between 2005 and 2008 led to reduced PM
In contrast, in EPA's proposed redesignation of the Kentucky portion of the Huntington-Ashland area 77 FR 69409 (November 19,2012), EPA provided a technical analysis showing that emission reductions from EGUs in the Huntington-Ashland area exceed average emission reductions seen in EGUs subject to decreased electrical demand, i.e., the economic recession. A summary of the emission changes from 2005 to 2011 for the entire Huntington-Ashland Area is provided in Table 2 below. Table 3 summarizes EPA's analysis showing reductions of SO
This memorandum explained that 40 CFR 51.1004(c) provides that a determination that an area has attained the PM
40 CFR 51.1010 provides in part: “For each PM
Thus the regulatory text itself defines RACT as included in RACM, and provides that it is required only insofar as it is necessary to advance attainment. See also section 51.1010(b). Thus, EPA is correct in its conclusion here that the RACT requirement has been satisfied, and it does not result in interference with attainment or with other applicable requirements. The mere fact that EPA has correctly determined that the area meets the RACT requirements for the 1997 PM
The Commenter claims that
Also, on December 14, 2012, EPA finalized a rule revising the PM
However, the E15 partial waivers do not require that E15 be made or sold and it is unclear if and to what extent E15 may even be used in Ohio. Even if E15 is introduced into commerce in Ohio, considering the likely small and offsetting direction of the emission impacts, the limited set of motor vehicles approved for its use, and the measures required to mitigate misfueling, EPA believes that any potential emission impacts of E15 will be less than the maintenance plan safety margin by which Ohio shows maintenance.
EPA also has modeling, included in the docket for this rulemaking, which projects that the Huntington-Ashland area will maintain the 1997 annual PM
Further, Ohio's maintenance plan provides for verification of continued attainment by performing future reviews of triennial emissions inventories. It also includes contingency measures to ensure that the NAAQS is maintained into the future if monitored increases in ambient PM
The CAA sets forth the general criteria for redesignation of an area from nonattainment to attainment in section 107(d)(3)(E). These criteria include that the Administrator has fully approved the implementation plan for area for applicable requirements, 42 U.S.C. 7407(d)(3)(E)(ii)and (v). EPA must also determine that the improvement in air quality is due to reductions that are “permanent and enforceable” (iii), and that the area has an approved maintenance plan under section 175A. EPA has fully addressed all these criteria in its proposed and final rulemakings on the redesignation of the Ohio portion of the Huntington-Ashland Area. The SSM-related SIP provisions identified in the Commenter's letter are already approved, portions of the Ohio SIP, and EPA is not required to re-evaluate or revise them as part of this redesignation. EPA's review here is limited to whether the already approved SSM provisions impact any redesignation requirement in section 107(d)(3)(E), so as to preclude EPA from approving the redesignation request. There is no basis for EPA to conclude that these provisions have such effect. First, it has long been established that in approving a redesignation request EPA may rely on prior SIP approvals plus any additional measures it may approve in conjunction with a redesignation action. See John Calcagni Memorandum (September 4, 1992 at 3);
While the Commenter takes the position that specific SSM provisions in the Ohio rules result in a “regulatory structure that is inconsistent with the fundamental requirement that all excess emissions be considered violations,” the Commenter does not link this concern with any specific deficiencies in Ohio's redesignation submittal for the Huntington-Ashland Area.
The Commenter expressed concerns that some specific existing SIP provisions contain exemptions for excess emissions such that the emission limits are not “permanent and enforceable” for purposes of section 107(d)(3)(E)(iii). EPA disagrees with this conclusion because the provisions are contained within the existing approved SIP and thus, in the context of 107(d)(3), are both “permanent and enforceable”. The Commenter may take issue with some features of those provisions, which contain automatic and discretionary exemptions for excess emissions, but these provisions, in the form in which they exist, are currently approved in the SIP and thus considered “permanent and enforceable”.
EPA is in the process of evaluating SSM provisions in a separate context. While EPA understands that the Commenter wishes to raise concerns that about Ohio's existing SIP provisions with SSM exemptions, in the context of a redesignation action, EPA is not required to re-evaluate the validity of previously approved SIP provisions. In the context of a redesignation action, that generally a state has met the requirements of section 107(d)(3)(E)(ii) and (v), because the provisions have been previously approved into the SIP by EPA. If these provisions are later or separately determined to be deficient, such as compliance with other relevant requirements of the CAA, then EPA will be able to evaluate those concerns in the appropriate context. EPA notes that, in another, separate proceeding, EPA is in the process of evaluating similar comments relating to other SSM provisions.
On June 30, 2011, Sierra Club filed a “Petition to Find Inadequate and Correct Several State Implementation Plans under section 110 of the Clean Air Act Due to Startup, Shutdown, Malfunction, and/or Maintenance Provisions”. As part of settlement of a lawsuit, EPA has agreed to take action in response to this petition. See
At this time, with regard to the redesignation of the Ohio portion of the Huntington-Ashland area, Ohio has a fully approved SIP. The provisions to which the Commenter objects are permanent and enforceable, as those terms are meant in section 107(d)(3). In addition, the area has attained the annual PM
Moreover, prior to the promulgation of 40 CFR 51.1004(c) the General Preamble for Implementation of Title I (57 FR 13498, April 16, 1992) addressed the role of attainment-related planning requirements in the specific context of EPA's consideration of a redesignation request. The General Preamble sets forth EPA's view of applicable requirements for purposes of evaluating redesignation requests when an area is attaining a standard (General Preamble for Implementation of Title I (57 FR 13498, April 16, 1992)).
In the context of redesignations, EPA has interpreted requirements related to attainment as not applicable for purposes of redesignation.
The General Preamble explains that, in the context of a redesignation to attainment, when EPA determines that attainment has been reached, no additional measures are needed to provide for attainment. Thus section 172(c)(1) requirements for an attainment demonstration and RACM are no longer considered to be applicable for purposes of redesignation as long as the area continues to attain the standard until redesignation. The RFP requirement under section 172(c)(2) and contingency measures requirement under section 172(c)(9) are similarly not relevant for purposes of redesignation. The General Preamble stated:
[t]he section 172(c)(9) requirements are directed at ensuring RFP and attainment by the applicable date. These requirements no longer apply when an area has attained the standard and is eligible for redesignation. Furthermore, section 175A for maintenance plans * * * provides specific requirements for contingency measures that effectively supersede the requirements of section 172(c)(9) for these areas. “General Preamble for the Interpretation of Title I of the Clean Air Act Amendments of 1990,” (General Preamble) 57 FR 13498, 13564 (April 16, 1992).
See also Calcagni memorandum at 6 (“The requirements for reasonable further progress and other measures needed for attainment will not apply for redesignations because they only have meaning for areas not attaining the standard.”). With respect to nonattainment NSR requirements, see EPA's response to Comment 6c, below.
Ohio has committed to remedy a future violation that may occur after redesignation, and has included measures to address potential violations from a range of sources, as well as a timeline for promptly completing adoption and implementation. The state has identified measures that are sufficiently specific but which allow for latitude in potential scope. EPA believes that the contingency measures set forth in the submittal, combined with the state's commitment to an expeditious timeline and process for implementation, provide assurance that the State will promptly correct a future potential violation. The contingency measures, as part of the maintenance plan, are codified into the state's SIP at the time the area is redesignated to attainment effective upon publication.
Congress used the undefined term “measure” differently in various provisions of the CAA, which indicates that the term is susceptible to more than one interpretation and that EPA has the discretion to interpret it in a reasonable manner in the context of section 175A. See
Ohio also has an EPA approved PSD program that includes PM
Therefore, any increase in direct PM
In addition, the fact that Ohio's approved PSD SIPs lack PM
The requirements applicable for purposes of redesignation are those which at a minimum are linked to the attainment status of the area being redesignated. As noted in the proposal (76 FR 23757, April 28, 2011), all areas, regardless of their designation as attainment or nonattainment, are subject to section 110(a)(2)(D). The applicability of this provision is not connected with nonattainment plan submissions or with the attainment status of an area. A nonattainment area remains subject to the requirements of section 110(a)(2)(D) after it has been redesignated to attainment. Therefore EPA has long interpreted the 110(a)(2)(D) requirements as a not applicable requirement for purposes of redesignation. EPA has leeway to determine what constitutes an “applicable” requirement under section 107(d)(3)(E), and EPA's interpretation is entitled to deference.
The Commenter observes that portions of the emissions inventory were estimated. This method is entirely consistent with accepted EPA procedures for emissions inventory development procedures. It is common practice, and consistent with EPA emissions inventory guidance, for states to estimate emissions for any given year using related activity factors or to project emissions based on information from prior years and associated activity growth factors. See “Emissions Inventory Guidance for Implementation of Ozone and Particulate Matter National Ambient Air Quality Standards (NAAQS) and Regional Haze Regulations,” dated August 2005. For mobile sources, it is standard and accepted practice for states to estimate emissions using an EPA- approved emissions model coupled with the output of a transportation model, which provides traffic levels by roadway and activity type. The Commenter provided no information or specific details that show that the 2005 inventory was inaccurate.
While we believe the 2005 inventory submitted by the state meets the inventory requirements section 172(c)(3) of the CAA, EPA notes that Ohio also submitted a comprehensive 2008 emissions inventory to serve as the attainment year inventory as part of the maintenance plan. EPA's longstanding view, as set forth in the September 4, 1992, Calcagni memorandum is that the “requirements for an emission inventory [under section 172(c)] will be satisfied by the inventory requirements of the maintenance plan.” See Calcagni memorandum at 6.
When preparing the comprehensive 2008 emissions inventory, Ohio compiled point source information from the 2008 annual emissions reports submitted to Ohio EPA by sources and EPA's Clean Air Markets Division database for electric utilities. Area source emissions were calculated using the most recently available methodologies and emissions factors from EPA along with activity data (population, employment, fuel use, etc.) specific to 2008. Nonroad mobile source emissions were calculated using EPA's NONROAD emissions model. In addition, emissions estimates were calculated for commercial marine vessels, aircraft, and railroads, three non-road categories not included in the NONROAD model. On-road mobile source emissions were calculated using EPA's MOVES emissions model with 2008 Vehicle Miles Traveled data provided by the Tri-state planning agency KYOVA.
Therefore, the state has satisfied the CAA inventory requirements by its submittal of two inventories that meet the applicable emissions inventory requirement.
The docket associated with the proposal contained Ohio's submittal including appendix B, which contains the state's method and analysis of sources for the 2005 inventory year. The Clean Air Fine Particle Implementation Rule (72 FR 20586) states that the 3-year emissions inventory that fulfills the SIP requirement under 172(c)(3) must provide documentation on the development of the SIP inventory (appendix B of the proposal docket). The rule also states that all source types must be reported, but does not specify the resolution of the data reporting as a source by source report. Ohio has interpreted the source type reporting requirement as reported by county, which they have provided in their submittal. EPA also believes that its summary provided in the notice of proposed rulemaking, along with appendix B description of development, provides an adequate basis for the public to identify pertinent issues and evaluate EPA's analysis and conclusions regarding satisfaction of section 172(c)(3). Much of the information in Ohio's inventory also was used in EPA's National Emissions Inventory, which can be examined in considerable detail at
EPA has determined that the Huntington-Ashland area has continued to attain the 1997 annual PM
EPA has previously made the determination that the Huntington-Ashland area has attained the 1997 annual PM
In accordance with 5 U.S.C. 553(d), EPA finds there is good cause for this action to become effective immediately upon publication. This is because a delayed effective date is unnecessary due to the nature of a redesignation to attainment, which relieves the area from certain CAA requirements that would otherwise apply to it. The immediate effective date for this action is authorized under both 5 U.S.C. 553(d)(1), which provides that rulemaking actions may become effective less than 30 days after publication if the rule—grants or recognizes an exemption or relieves a restriction, and section 553(d)(3), which allows an effective date less than 30 days after publication—as otherwise provided by the agency for good cause found and published with the rule. The purpose of the 30-day waiting period prescribed in section 553(d) is to give affected parties a reasonable time to adjust their behavior and prepare before
Under the CAA, redesignation of an area to attainment and the accompanying approval of the maintenance plan under CAA section 107(d)(3)(E) are actions that affect the status of geographical area and do not impose any additional regulatory requirements on sources beyond those required by state law. A redesignation to attainment does not in and of itself impose any new requirements, but rather results in the application of requirements contained in the CAA for areas that have been redesignated to attainment. Moreover, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For these reasons, these actions:
• Are not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Order 12866 (58 FR 51735, October 4, 1993);
• Do not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501
• Are certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601
• Do not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104–4);
• Do not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);
• Are not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);
• Are not significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);
• Are not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and,
• Do not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).
In addition, this final rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not approved to apply in Indian country located in the Commonwealth, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law.
The Congressional Review Act, 5 U.S.C. 801
Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by March 1, 2013. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (
Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Particulate matter.
Environmental protection, Air pollution control, National parks.
40 CFR parts 52 and 81 are amended as follows:
42 U.S.C. 7401
(p) * * *
(2) The Ohio portion of the Huntington-Ashland nonattainment area (Lawrence and Scioto Counties and portions of Adams and Gallia Counties). The maintenance plan establishes a determination of insignificance for both NO
(q) * * *
(2) Ohio's 2005 and 2008 NO
42 U.S.C. 7401
Environmental Protection Agency (EPA).
Final rule.
EPA is removing significant new use rules (SNURs) promulgated under the Toxic Substances Control Act (TSCA) for four chemical substances which were the subject of premanufacture notices (PMNs). EPA published these SNURs using direct final rulemaking procedures. EPA received notice of intent to submit adverse comments on these rules. Therefore, the Agency is removing these SNURs, as required under the expedited SNUR rulemaking process. EPA intends to publish in the near future proposed SNURs for these four chemical substances under separate notice and comment procedures.
This final rule is effective December 31, 2012.
A list of potentially affected entities is provided in the
In the
For further information regarding EPA's expedited process for issuing SNURs, interested parties are directed to 40 CFR part 721, subpart D, and the
To access the electronic docket, please go to
This final rule removes existing regulatory requirement and does not contain any new or amended requirements. As such, the Agency has determined that this removal will not have any adverse impacts, economic or otherwise. The statutory and executive order review requirements applicable to the direct final rule were discussed in the
The Congressional Review Act, 5 U.S.C. 801
Environmental protection, Reporting and recordkeeping requirements.
Environmental protection, Chemicals, Hazardous substances, Reporting and recordkeeping requirements.
Therefore, 40 CFR parts 9 and 721 are amended as follows:
7 U.S.C. 135
15 U.S.C. 2604, 2607, and 2625(c).
Office of the Secretary, Interior.
Final rule.
This rule revises the regulations that the Department of the Interior (the “Department”) follows in processing records under the Freedom of Information Act (“FOIA”). The revisions clarify and update procedures for requesting information from the Department and procedures that the Department follows in responding to requests from the public. The revisions also incorporate clarifications and updates resulting from changes to the FOIA and case law. Finally, the revisions include current cost figures to be used in calculating and charging fees and increase the amount of information that members of the public may receive from the Department without being charged processing fees.
Effective January 30, 2013.
The regulations are being revised to update, clarify, and streamline the language of procedural provisions, and to incorporate certain changes brought about by the amendments to the FOIA under the OPEN Government Act of 2007, Public Law 110–175, 121 Stat. 2524. Additionally, the regulations are being updated to reflect developments in the case law and to include current cost figures to be used in calculating and charging fees.
The revisions also incorporate changes to the language and structure of the FOIA regulations in order to improve the Department's FOIA performance. More nuanced multitrack processing can be found at § 2.15. Partial fee waivers are expressly permitted under § 2.45. Revisions of the Department's fee schedule can be found at §§ 2.42, 2.49(a)(1), and Appendix A. The duplication charge for physical records or scanning records increased from thirteen to fifteen cents a page. The amount at or below which the Department will not charge a fee increased from $30.00 to $50.00.
On September 13, 2012, the Department published a proposed rule in the
Six commenters responded to the invitation for comments, including one commenter from a subcomponent of a Federal agency and five commenters from non-Federal sources. While most of the commenters generally supported the proposed changes, they identified thirty specific issues or recommendations, which the Department addressed as follows:
One commenter suggested that § 2.1 discuss how to submit a FOIA request (and also expressed concern that the regulations might only allow FOIA requests to be submitted to the Department electronically). Because § 2.3 directly addresses where to send a FOIA request (and specifically discusses where to find the physical and email addresses of each bureau's FOIA Officer), the Department has not adopted this suggestion.
One commenter suggested that requiring requesters to “write directly to the bureau that you believe maintains those records” in § 2.3(b) was overly burdensome and creates barriers to access, because requesters may not know where the records are maintained. However, § 2.3(d) specifically notes that “[q]uestions about where to send a FOIA request should be directed to the bureau that manages the underlying program or to the appropriate FOIA Public Liaison, as discussed in § 2.66.” Therefore, the Department does not believe § 2.3 is unduly burdensome and has not amended it.
One commenter suggested that examples of how requesters can reasonably describe the records they seek be added to § 2.5(b), and the Department has adopted this suggestion.
One commenter suggested, in the context of § 2.5, that the use of “does not hear from you” was ambiguous. The Department has adopted this suggestion
One commenter suggested that the time for requesters to respond to the Department in §§ 2.5(c), 2.6(c), and 2.50(e) be expanded from 20 workdays (the time period in the draft version of the final rule, as well as in the Department's previous version of the final rule) to 30 workdays. As the commenter notes, the Department does “expend[] numerous resources to produce documents pursuant to the FOIA, and the agency has an interest in resolving FOIA matters in an organized and timely fashion.” Although the commenter believes the 20 workday deadline is “unreasonable and arbitrary,” it has been the standard for the Department for over a decade and the Department believes that it is reasonable and comports with the statutory FOIA processing deadlines. The Department therefore declines to adopt this suggestion.
One commenter suggested § 2.8(b) be revised to require a bureau to inform requesters in advance if it intends to charge the requester any direct costs for converting the requested records into a requested format. The Department has adopted this suggestion by adding a cross reference to § 2.44 and adding this scenario to the examples given in § 2.44(b).
One commenter suggested that the juxtaposition of §§ 2.10 and 2.11 could lead to confusion about what kinds of “requests” were being referenced in these sections. The Department agrees and has adopted this suggestion by amending § 2.10.
One commenter suggested that, in § 2.13(c) and (e), the Department notify requesters of whether part of the request or entire request has been referred, and the Department has adopted this suggestion. The same commenter also suggested that the Department provide the requester with the contact information (in addition to the name) of the person the request had been referred to, and the Department has adopted this suggestion. Another commenter expressed concerns about § 2.13, stating that portions of it were “ambiguous and have no legal basis.” This commenter specified that § 2.13(e) permitted the Department to withhold the identity of outside agencies to which the Department refers FOIA requests, under limited circumstances, and §§ 2.13(f)(2) and 2.13(f)(4) did not have concrete examples. The Department has carefully reviewed § 2.13(e) and finds it to be unambiguous and consistent with law and policy. The Department has also concluded that adding examples to §§ 2.13(f)(2) and 2.13(f)(4) would not be beneficial, as the situations that will arise under these sections are highly fact specific and general examples would be bulky and would not be illuminating. However, the Department agrees that the previous versions of §§ 2.13(a) and 2.13(h) were unintentionally confusing. The Department therefore has adopted this suggestion in part and revised these sections for clarity.
One commenter suggested that the multiple tracks for processing FOIA requests outlined in § 2.15 violated FOIA's requirement that agencies “determine within 20 days [or longer in unusual circumstances] * * * after the receipt of any [FOIA] request whether to comply with such request * * * ” 5 U.S.C. 552(a)(6)(A). However, § 2.15 does not alter the statutory requirement for a bureau to determine whether it will comply with a request. To the contrary, it implements 5 U.S.C. 552(a)(6)(D)(i), which specifically permits agencies to promulgate regulations “providing for multitrack processing of requests for records based on the amount of work or time (or both) involved in processing requests.” This provision of the FOIA recognizes that a bureau exercising due diligence can determine whether it will comply with a request within the statutory timeframe, but may need additional time to search for and process the records in question. It also recognizes that simple requests should not have to wait for long periods of time while more complex requests are processed. To clarify this point, the Department has added paragraph (f) to this section. (The Department has also corrected a typographical error in § 2.15(c)(3) that may have created confusion about processing times.) The same commenter also suggested the definition of “review” in § 2.70 would violate FOIA's mandated time limits. However, the definition addresses when fees will be charged to a requester, not how long a bureau has to respond to a FOIA request. Neither § 2.15 nor § 2.70 expands the time period for determining whether to comply with a request and therefore neither have been amended.
One commenter suggested a clause and a sentence be added to § 2.16(a) referring to the potential of a 10-day extension, to help set the requester's expectations of when to expect a response. The Department has adopted the suggestion to refer to the potential extension, but consolidated the suggested language. The final rule already has a provision discussing when the bureau may extend the basic time limit (§ 2.19) and a cross reference to it has been added to § 2.16(a). The Department has also amended § 2.16(a) to more exactly track the language of 5 U.S.C. 552(a)(6)(A)(i).
One commenter expressed concern that the provisions in § 2.18(b) exceeded the FOIA's provisions for temporarily suspending the statutory response period because a temporary suspension was allowed to occur more than once if the bureau needed to clarify issues regarding fee assessments. However, 5 U.S.C. 552(a)(6)(A) makes it clear that, although a temporary suspension can occur only once when a bureau is reasonably asking for clarifying information unrelated to fee assessments (and the temporary suspension ends with a requester's response), temporary suspensions of the statutory response period can occur as many times as is necessary when a bureau needs clarifying information regarding a fee assessment. This section therefore does not exceed FOIA's temporary suspension authority and has not been amended.
One commenter suggested that the Department add a clause to § 2.21(b) requiring bureaus to provide a brief description of the subject of the request in its acknowledgment letter. The
A commenter suggested modifying § 2.23 to clarify when a request is being denied as opposed to the denial of procedural benefits under FOIA. The Department agrees this would be helpful and has made the suggested modifications, along with a few minor clarifications. The Department also made a minor change to paragraph (a)(3) of this section because a some material that had previously been included in § 2.13(h), amendments to which were discussed above, made more sense in this context.
One commenter suggested § 2.24 be amended to state that, where possible, the requester will be provided with the precise volume of denied material, rather than an estimated volume. Although the Department has declined to adopt this exact suggestion (because it believes the change would have a significant negative impact on the Department's processing and response times while providing the requester with very little, if any, additional, meaningful information), it has amended § 2.25 to more exactly track the language of 5 U.S.C. 552(b), which the commenter referenced. Another commenter suggested § 2.24 be amended to require “a detailed justification for [a] denial,” citing case law requiring detailed justifications in a litigation context. The Department has considered this suggestion, but declined to adopt it because it is not required at an administrative level and would have a tremendous negative impact on the Department's processing and response times.
One commenter suggested that § 2.36 be amended to state that only trade secrets can be withheld under the Trade Secrets Act, 18 U.S.C. 1905. However, the Trade Secrets Act is a broadly worded criminal statute that prohibits the unauthorized disclosure of more than simply “trade secrets.”
One commenter suggested that §§ 2.38 and 2.70 be amended to reflect that the FOIA provides for three fee categories, not four. While the Department agrees that only three categories are referred to in the FOIA, it has found over many years that requesters appreciate and benefit from the additional clarity provided by having one of the broader categories split in two. The Department therefore has not adopted this suggestion.
One commenter suggested that § 2.41(b) be amended from “the fees will be the average hourly General Schedule (“GS”) base salary, plus the District of Columbia locality payment” to “the fees will be the average hourly General Schedule (“GS”) base salary, plus any applicable locality payment.” The Department utilized the District of Columbia (“DC”) locality payments as its standardized locality payment in its previous version of the final rule and found it to be both efficient and reasonable. It allows the Department to create a standard chart that all bureaus can use to calculate fees, rather than each bureau calculating different amounts for different employees (in the Department, it is not unusual for people who work on the same request to be in multiple geographic locations) and requesters being confused by widely varying charges for the same work. It makes sense to use the DC locality as the standard, given the large numbers of the Department's FOIA professionals and processors that are based in DC The Department therefore has not adopted this suggestion.
One commenter suggested that § 2.45(c) unduly limits bureau decisions on fee waivers and this would negatively impact appeal decisions under § 2.57. However, § 2.45(c) merely allows a bureau to make fee waiver decisions based on what is submitted to it by the requester, rather than being required to seek additional information (although it is free to do so, at its discretion). The Department therefore has not amended these sections.
One commenter suggested adding the following sentence to § 2.45(d) in order to further assist the Department in setting expectations for requesters regarding fee waivers: “A fee waiver is tied to the subject of the request in addition to the identity of the requester.” The Department is concerned that adopting this suggestion would give the mistaken impression that only these two criteria are at issue in fee waiver determinations. But, in response to this comment, § 2.45(d) now includes two cross references. These cross references, to the fee waiver criteria in §§ 2.45(a) and 2.48, will help set requesters' expectations regarding fee waivers.
One commenter suggested that § 2.46 discuss where and how to file a fee waiver request. Because § 2.6 directly addresses where and how to file fee waiver requests (and § 2.46 already cross references § 2.6), the Department believes adopting this suggestion is not necessary.
One commenter expressed concern that § 2.48(a)(4), which outlines one of the four criteria bureaus are asked to consider when evaluating a fee waiver request, was narrower than FOIA's fee waiver standards. However, this provision does not narrow the scope of 5 U.S.C. 552(a)(4)(A)(iii), it simply helps the Department analyze whether the disclosure of the information is likely to contribute significantly to public understanding of the operations or
One commenter suggested that § 2.50(e) be amended to require the Department to “collaborate with FOIA requesters to establish a payment schedule that would permit requesters to pay [advance payments] in installments instead of closing out requests.” As the commenter notes, this provision mirrors the applicable provision in the previous version of the final rule. Changing it would greatly add to the complexity, uncertainty, and time spent processing advance fee payments, impairing the Department's FOIA processing. The Department therefore declines to adopt this suggestion.
One commenter suggested the Department should articulate its rationale for combining or aggregating requests more clearly in § 2.54. The Department agrees the previous version of this section was unintentionally confusing. The lettering/numbering therefore has been amended. Additionally, a “will” in § 2.54(a)(2) has been amended to “may.”
One commenter suggested it may be helpful to include examples of the particular types of records that a bureau may charge fees for outside of the scope of the FOIA in § 2.55. The Department has carefully considered this suggestion and has concluded that examples in this area would be so specific and narrow that they would be more distracting than illuminating. The Department therefore has not adopted this suggestion.
One commenter suggested that § 2.56 be amended to allow for the discretionary reduction of fees (in addition to the discretionary waiver of fees) and the Department has adopted this suggestion. The same commenter also suggested that new language be added to give Department employees additional, broader discretion for waiving or reducing fees, for example, whenever “the interest of the United States Government would be served.” The Department has declined to adopt this suggestion, because it is concerned that it would create unrealistic expectations on the part of requesters, undercut FOIA's statutory fee requirements, and provide Department employees with an unacceptably vague standard.
One commenter suggested that the Department require all responses to FOIA requests be posted online (except those that implicate the Privacy Act) and that it adopt a policy to proactively disclose information to the greatest extent possible. The Department has carefully considered this suggestion, but declines to adopt it because it believes the final rule reflects the appropriate balance between providing useful information and an appropriate use of the Department's resources.
Two commenters suggested the final rule discuss the services offered by OGIS. The Department agrees that OGIS's role in the FOIA process should be noted in the final rule. Rather than waiting until after an appeal decision has been made to introduce this information (as one of the commenters suggested), the Department has adopted this suggestion by requiring bureaus to provide information on OGIS in letters taking final action on a request, which will ensure maximum dissemination of the information at the most appropriate stage of the process. The revised § 2.21(a) both clarifies the provision and requires the Department to provide notice of the services offered by OGIS to all of the Department's FOIA requesters, rather than just the ones that file appeals.
One commenter suggested the Department require submitters of older records to provide additional information to explain why the information is still confidential and its release would still be harmful after the passage of time. However, § 2.28(g) already requires this, so the Department believes adopting this suggestion is not necessary.
One commenter asserted, in addition to a number of specific comments, that the final rule directly contravenes transparency goals. The Department has carefully considered this assertion, but believes the final rule improves overall processing and increases transparency, so no changes have been made based on this comment.
One commenter's entire comment was: “NO.Do not change the freedom of info act.” As noted above, this rule consists of the regulations that the Department follows in processing records under the FOIA. It does not change the FOIA itself in any way. Another commenter asserted, in addition to a number of specific comments, that the final rule exceeded the scope of the Department's rulemaking authority and was “contrary to law.” The Department has carefully considered these assertions, but believes the final rule was fully within the scope of the Department's rulemaking authority and completely consistent with all applicable laws, so no changes have been made based on this comment.
A number of commenters made suggestions related to minor word choices, minor clarifications, and additional citations, many of which have been adopted without further comment. The Department has also fixed a few minor typographical errors. Additionally, the Department added cross references, and/or made very minor clarifications in the following sections: 2.7(a) and (b), 2.15(a), 2.17, 2.19(c), 2.20(c), 2.22(c), 2.33, 2.41(a) and (c), 2.42(a), 2.43(a), and 2.60(b). Finally, in the interests of clarity, the Department also added phrases to §§ 2.31(a) and 2.63(c) and a second paragraph to § 2.37(f).
Executive Order 12866 provides that the Office of Information and Regulatory Affairs will review all significant rules. The Office of Information and Regulatory Affairs has determined that this rule is not significant.
Executive Order 13563 reaffirms the principles of E.O. 12866 while calling for improvements in the nation's regulatory system to promote predictability, to reduce uncertainty, and to use the best, most innovative, and least burdensome tools for achieving regulatory ends. The executive order directs agencies to consider regulatory approaches that reduce burdens and maintain flexibility and freedom of choice for the public where these approaches are relevant, feasible, and consistent with regulatory objectives. E.O. 13563 emphasizes further that regulations must be based on the best available science and that the rulemaking process must allow for public participation and an open exchange of ideas. We have developed this rule in a manner consistent with these requirements.
The Department of the Interior certifies that this rule will not have a significant economic effect on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601
This is not a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Enforcement Fairness Act. This rule:
a. Does not have an annual effect on the economy of $100 million or more.
b. Will not cause a major increase in costs or prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions.
c. Does not have significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of U.S.-based enterprises to compete with foreign-based enterprises.
This rule does not impose an unfunded mandate on State, local, or tribal governments or the private sector of more than $100 million per year. This rule does not have a significant or unique effect on State, local or tribal governments or the private sector. A statement containing the information required by the Unfunded Mandates Reform Act (2 U.S.C. 1531
In accordance with Executive Order 12630, this rule does not have significant takings implications. A takings implication assessment is not required.
In accordance with Executive Order 13132, this rule does not have sufficient federalism implications to warrant the preparation of a Federalism Assessment. It would not substantially and directly affect the relationship between the Federal and state governments. A Federalism Assessment is not required.
In accordance with Executive Order 12988, the Office of the Solicitor has determined that this rule does not unduly burden the judicial system and meets the requirements of sections 3(a) and 3(b)(2) of the Order.
Under the criteria in Executive Order 13175, we have evaluated this rule and determined that it has no potential effects on federally recognized Indian tribes. This rule does not have tribal implications that impose substantial direct compliance costs on Indian Tribal governments.
This rule does not contain information collection requirements, and a submission to the Office of Management and Budget under the Paperwork Reduction Act is not required.
This rule does not constitute a major Federal action significantly affecting the quality of the human environment. A detailed statement under the National Environmental Policy Act of 1969 is not required. Pursuant to Department Manual 516 DM 2.3A(2), Section 1.10 of 516 DM 2, Appendix 1 excludes from documentation in an environmental assessment or impact statement “policies, directives, regulations and guidelines of an administrative, financial, legal, technical or procedural nature; or the environmental effects of which are too broad, speculative or conjectural to lend themselves to meaningful analysis and will be subject late to the NEPA process, either collectively or case-by-case.”
This rule is not a significant energy action under the definition in Executive Order 13211. A Statement of Energy Effects is not required. This rule will not have a significant effect on the nation's energy supply, distribution, or use.
Freedom of information.
For the reasons stated in the preamble, the Department of the Interior amends 43 CFR subtitle A as follows:
5 U.S.C. 301, 552, 552a, 553; 31 U.S.C. 3717; 43 U.S.C. 1460, 1461.
(a) Subparts A through I of this part contain the rules that the Department follows in processing records under the Freedom of Information Act (FOIA), 5 U.S.C. 552.
(b) Definitions of terms used in Subparts A through I of this part are found at § 2.70.
(c) Subparts A through I of this part should be read in conjunction with the text of the FOIA and the OMB Fee Guidelines.
(d) The Department's FOIA Handbook and its attachments contain detailed information about Department procedures for making FOIA requests and descriptions of the types of records maintained by different Department bureaus or offices. This resource is available at
(e) Requests made by individuals for records about themselves under the Privacy Act of 1974, 5 U.S.C. 552a, are processed under subparts A through I and subpart K of this part.
(f) Part 2 does not entitle any person to any service or to the disclosure of any record that is not required under the FOIA.
(g) Before you file a FOIA request, you are encouraged to review the Department's electronic FOIA libraries at
Subparts A through I of this part do not apply to records that fall under the law enforcement exclusions in 5 U.S.C. 552(c)(1)–(3). These exclusions may be used only in the limited circumstances delineated by the statute and require both prior approval from the Office of the Solicitor and the recording of their use and approval process.
(a) The Department does not have a central location for submitting FOIA requests and it does not maintain a central index or database of records in its possession. Instead, the Department's records are decentralized and maintained by various bureaus and offices throughout the country.
(b) To make a request for Department records, you must write directly to the bureau that you believe maintains those records.
(c) Address requests to the appropriate FOIA contact in the bureau that maintains the requested records. The Department's FOIA Web site,
(d) Questions about where to send a FOIA request should be directed to the bureau that manages the underlying program or to the appropriate FOIA Public Liaison, as discussed in § 2.66 of this part.
(a) A request to a particular bureau component (for example, a request addressed to a regional or field office) will be presumed to seek only records from that particular component.
(b) If you seek records from an entire bureau, submit your request to the bureau FOIA Officer. The bureau FOIA Officer will forward it to the bureau component(s) that he or she believes has or are likely to have responsive records.
(c) If a request to a bureau states that it seeks records located at another specific component of the same bureau, the appropriate FOIA contact will forward the request to the other component.
(d) If a request to a bureau states that it seeks records from other unspecified components within the same bureau, the appropriate FOIA contact will send the request to the Bureau FOIA Officer. He or she will forward it to the components that the bureau FOIA Officer believes have or are likely to have responsive records.
(e) If a request to a bureau states that it seeks records of another specified bureau, the bureau will route the misdirected request to the specified bureau for response.
(f) If a request to a bureau states that it seeks records from other unspecified bureaus, the bureau's FOIA Officer may forward the request to those bureaus which he or she believes have or are likely to have responsive records. If the bureau FOIA Officer forwards the request, they will notify you in writing and provide the name of a contact in the other bureau(s). If it does not forward the request, the bureau will return it to you, advise you to submit the request directly to the other bureaus, notify you that it cannot comply with the request, and close the request.
(a) You must reasonably describe the records sought. A reasonable description contains sufficient detail to enable bureau personnel familiar with the subject matter of the request to locate the records with a reasonable amount of effort.
(b) You should include as much detail as possible about the specific records or types of records that you are seeking. This will assist the bureau in identifying the requested records (for example, time frames involved or specific personnel who may have the requested records). For example, whenever possible, identify:
(1) The date, title or name, author, recipient, and subject of any particular records you seek;
(2) The office that created the records you seek;
(3) The timeframe for which you are seeking records; and
(4) Any other information that will assist the bureau in locating the records.
(c) The bureau's FOIA Public Liaison can assist you in formulating or reformulating a request in an effort to better identify the records you seek.
(d) If the request does not reasonably describe the records sought, the bureau will inform you what additional information is needed. It will also notify you that it will not be able to comply with your FOIA request unless you provide the additional information requested within 20 workdays. If you receive this sort of response, you may wish to discuss it with the bureau's designated FOIA contact or its FOIA Public Liaison (see § 2.66 of this part). If the bureau does not hear from you within 20 workdays after asking for
(a) Your request must explicitly state that you will pay all fees associated with processing the request, that you will pay fees up to a specified amount, and/or that you are seeking a fee waiver.
(b) If the bureau anticipates that the fees for processing the request will exceed the amount you have agreed to pay, or if you did not agree in writing to pay processing fees and the bureau anticipates the processing costs will exceed your entitlements, the bureau will notify you:
(1) Of the estimated processing fees;
(2) Of its need for either an advance payment (see § 2.50 of this part) or your written assurance that you will pay the anticipated fees (or fees up to a specified amount); and
(3) That it will not be able to fully comply with your FOIA request unless you provide the written assurance or advance payment requested.
(c) If the bureau does not receive a written response from you within 20 workdays after requesting the information in paragraph (b) of this section, it will presume that you are no longer interested in the records and will close the file on the request.
(d) If you are seeking a fee waiver, your request must include sufficient justification (see the criteria in §§ 2.45, 2.48, and 2.56 of this part). Failure to provide sufficient justification will result in a denial of the fee waiver request. If you are seeking a fee waiver, you may also indicate the amount you are willing to pay if the fee waiver is denied. This allows the bureau to process the request for records while it considers your fee waiver request.
(e) The bureau will begin processing the request only after the fee issues are resolved.
(f) If you are required to pay a fee and it is later determined on appeal that you were entitled to a full or partial fee waiver, you will receive an appropriate refund.
(a) A request should indicate your fee category (that is, whether you are a commercial-use requester, news media, educational or noncommercial scientific institution, or other requester as described in §§ 2.38 and 2.39 of this part).
(b) If you submit a FOIA request on behalf of another person or organization (for example, if you are an attorney submitting a request on behalf of a client), the bureau will determine the fee category by considering the underlying requester's identity and intended use of the information.
(c) If your fee category is unclear, the bureau may ask you for additional information (see § 2.51 of this part).
(a) Generally, you may choose the form or format of disclosure for records requested. The bureau must provide the records in the requested form or format if the bureau can readily reproduce the record in that form or format.
(b) The bureau may charge you the direct costs involved in converting records to the requested format if the bureau does not normally maintain the records in that format (see § 2.44 of this part).
(a) When a request seeks records about another person, you may receive greater access by submitting proof that the person either:
(1) Consents to the release of the records to you (for example, a notarized authorization signed by that person); or
(2) Is deceased (for example, a copy of a death certificate or an obituary).
(b) At its discretion, the bureau can require you to supply additional information if necessary to verify that a particular person has consented to disclosure or is deceased.
You may ask for the processing of your request to be expedited. The bureau will determine whether to expedite the processing of your request using the criteria outlined in § 2.20.
A request should include your name, mailing address, daytime telephone number (or the name and telephone number of an appropriate contact), email address, and fax number (if available) in case the bureau needs additional information or clarification of your request.
(a) Except as described in §§ 2.4 and 2.13 of this part, the bureau to which the request is addressed is responsible for responding to the request and for making a reasonable effort to search for responsive records.
(b) In determining which records are responsive to a request, the bureau will include only records in its possession and control on the date that it begins its search.
(c) The bureau will make reasonable efforts to search for the requested records in electronic form or format, except when these efforts would significantly interfere with the operation of the bureau's automated information system.
(d) If a bureau receives a request for records in its possession that it did not create or that another bureau or a Federal agency is substantially concerned with, it may undertake consultations and/or referrals as described in § 2.13.
(a) Consultations and referrals can occur within the Department or outside the Department.
(1) Paragraphs (b) and (c) of this section addresses consultations and referrals that occur within the Department when the bureau has responsive records.
(2) Paragraphs (d) through (g) of this section address consultations and referrals that occur outside the Department when the bureau has responsive records.
(3) Paragraph (h) of this section addresses what happens when the bureau has no responsive records but believes responsive records may be in the possession of a Federal agency outside the Department.
(b) If a bureau (other than the Office of Inspector General) receives a request for records in its possession that another bureau created or is substantially concerned with, it will either:
(1) Consult with the other bureau before deciding whether to release or withhold the records; or
(2) Refer the request, along with the records, to that other bureau for direct response.
(c) The bureau that originally received the request will notify you of the referral in writing. When the bureau notifies you of the referral, it will tell you whether the referral was for part or all of your request and provide the name and contact information for the other bureau.
(d) If, while responding to a request, the bureau locates records that originated with another Federal agency, it usually will refer the request and any responsive records to that other agency for a release determination and direct response.
(e) If the bureau refers records to another agency, it will document the
(f) If the bureau locates records that originated with another Federal agency while responding to a request, the bureau will make the release determination itself (after consulting with the originating agency) when:
(1) The record is of primary interest to the Department (for example, a record may be of primary interest to the Department if it was developed or prepared according to the Department's regulations or directives, or in response to a Departmental request);
(2) The Department is in a better position than the originating agency to assess whether the record is exempt from disclosure;
(3) The originating agency is not subject to the FOIA; or
(4) It is more efficient or practical depending on the circumstances.
(g) If the bureau receives a request for records that another Federal agency has classified under any applicable executive order concerning record classification, it must refer the request to that agency for response.
(h) If the bureau receives a request for records not in its possession, but that the bureau believes may be in the possession of a Federal agency outside the Department, the bureau will return the request to you, may advise you to submit it directly to the agency, will notify you that the bureau cannot comply with the request, and will close the request.
The bureau ordinarily will respond to requests according to their order of receipt within their processing track.
(a) Bureaus use processing tracks to distinguish simple requests from more complex ones on the basis of the estimated number of workdays needed to process the request.
(b) In determining the number of workdays needed to process the request, the bureau considers factors such as the number of pages involved in processing the request or the need for consultations.
(c) The basic processing tracks are designated as follows:
(1) Simple: requests in this track will take between one to five workdays to process;
(2) Normal: requests in this track will take between six to twenty workdays to process;
(3) Complex: requests in this track will take between twenty-one workdays and sixty workdays to process; or
(4) Exceptional/Voluminous: requests in this track involve very complex processing challenges, which may include a large number of potentially responsive records, and will take over sixty workdays to process.
(d) Bureaus also have a specific processing track for requests that are granted expedited processing under the standards in § 2.20 of this part. These requests will be processed as soon as practicable.
(e) Bureaus must advise you of the track into which your request falls and, when appropriate, will offer you an opportunity to narrow your request so that it can be placed in a different processing track.
(f) The use of multitrack processing does not alter the statutory deadline for a bureau to determine whether to comply with your FOIA request (see § 2.16 of this part).
(a) Ordinarily, the bureau has 20 workdays after the date of receipt to determine whether to comply with (for example, grant, partially grant, or deny) a FOIA request, but unusual circumstances may allow the bureau to take longer than 20 workdays (see § 2.19).
(b) A consultation or referral under § 2.13 of this part does not restart the statutory time limit for responding to a request.
The basic time limit for a misdirected FOIA request (see § 2.4(e) of this part) begins no later than ten workdays after the request is first received by any component of the Department that is designated to receive FOIA requests.
(a) The basic time limit in § 2.16 of this part may be temporarily suspended for the time it takes you to respond to one written communication from the bureau reasonably asking for clarifying information.
(b) The basic time limit in § 2.16 may also repeatedly be temporarily suspended for the time it takes you to respond to written communications from the bureau that are necessary to clarify issues regarding fee assessment (see § 2.51 of this part).
(a) The bureau may extend the basic time limit if unusual circumstances exist. Before the expiration of the basic 20 workday time limit to respond, the bureau will notify you in writing of:
(1) The unusual circumstances involved; and
(2) The date by which it expects to complete processing the request.
(b) If the processing time will extend beyond a total of 30 workdays, the bureau will:
(1) Give you an opportunity to limit the scope of the request or agree to an alternative time period for processing; and
(2) Make available its FOIA Public Liaison (see § 2.66 of this part) to assist in resolving any disputes between you and the bureau.
(c) If the bureau extends the time limit under this section and you do not receive a response in accordance with § 2.16(a) in that time period, you may consider the request denied and file an appeal in accordance with the procedures in § 2.59.
(d) Your refusal to reasonably modify the scope of a request or arrange an alternative time frame for processing a request after being given the opportunity to do so may be considered for litigation purposes as a factor when determining whether exceptional circumstances exist.
(a) The bureau will provide expedited processing upon request if you demonstrate to the satisfaction of the bureau that there is a compelling need for the records. The following circumstances demonstrate a compelling need:
(1) Where failure to expedite the request could reasonably be expected to pose an imminent threat to the life or physical safety of an individual; or
(2) Where there is an urgency to inform the public about an actual or alleged Federal Government activity and the request is made by a person primarily engaged in disseminating information.
(i) In most situations, a person primarily engaged in disseminating
(ii) If you are not a full time member of the news media, to qualify for expedited processing here, you must establish that your main professional activity or occupation is information dissemination, although it need not be your sole occupation.
(iii) The requested information must be the type of information which has particular value that will be lost if not disseminated quickly; this ordinarily refers to a breaking news story of general public interest.
(iv) Information of historical interest only or information sought for litigation or commercial activities would not qualify, nor would a news media deadline unrelated to breaking news.
(b) If you seek expedited processing, you must submit a statement that:
(1) Explains in detail how your request meets one or both of the criteria in paragraph (a) of this section; and
(2) Certifies that your explanation is true and correct to the best of your knowledge and belief.
(c) You may ask for expedited processing at any time by writing to the appropriate FOIA contact in the bureau that maintains the records requested. When making a request for expedited processing of an administrative appeal, submit the request to the FOIA Appeals Officer.
(d) The bureau must notify you of its decision to grant or deny expedited processing within 10 calendar days of receiving an expedited processing request.
(e) If expedited processing is granted, the request will be given priority, placed in the processing track for expedited requests, and be processed as soon as practicable.
(f) If expedited processing is denied, the bureau will notify you of the right to appeal the decision on expedited processing in accordance with the procedures in subpart H of this part.
(g) If you appeal the decision on expedited processing, your appeal (if it is properly formatted under § 2.59 of this part) will be processed ahead of other appeals.
(h) If the bureau has not responded to the request for expedited processing within 10 calendar days, you may file an appeal (for nonresponse in accordance with § 2.57(a)(8) of this part).
(a) When the bureau informs you of its decision to comply with a request by granting, partially granting, or denying the request, it will do so in writing and in accordance with the deadlines in subpart D of this part. The bureau's written response will include a statement about the services offered by the Office of Government Information Services (OGIS), using standard language that can be found at:
(b) If the bureau determines that your request will take longer than 10 workdays to process, the bureau immediately will send you a written acknowledgment that includes the request's individualized tracking number and processing track (see § 2.15(e)). The acknowledgement may also include a brief description of the subject of your request.
(a) Once the bureau makes a determination to grant a request in full or in part, it must notify you in writing.
(b) The notification will inform you of any fees charged under subpart G of this part.
(c) The bureau will release records (or portions of records) to you promptly upon payment of any applicable fees (or before then, in accordance with § 2.37(c) of this part).
(d) If the records (or portions of records) are not included with the bureau's notification, the bureau will advise you how, when, and where the records will be made available.
(a) A bureau denies a request when it makes a decision that:
(1) A requested record is exempt, in full or in part;
(2) The request does not reasonably describe the records sought;
(3) A requested record does not exist, cannot be located, or is not in the bureau's possession; or
(4) A requested record is not readily reproducible in the form or format you seek.
(b) A bureau denies a procedural benefit only, and not access to the underlying records, when it makes a decision that:
(1) A fee waiver, or another fee-related issue, will not be granted; or
(2) Expedited processing will not be provided.
(c) The bureau must consult with the Office of the Solicitor before it denies a fee waiver request or withholds all or part of a requested record.
(a)The bureau must notify you in writing of any denial of your request.
(b) The denial notification must include:
(1) The name and title or position of the person responsible for the denial;
(2) A brief statement of the reasons for the denial, including a reference to any FOIA exemption(s) applied by the bureau to withhold records in full or in part;
(3) An estimate of the volume of any records or information withheld, for example, by providing the number of pages or some other reasonable form of estimation, unless such an estimate would harm an interest protected by the exemption(s) used to withhold the records or information;
(4) The name and title of the Office of the Solicitor attorney consulted (if the bureau is denying a fee waiver request or withholding all or part of a requested record); and
(5) A statement that the denial may be appealed under subpart H of this part and a description of the requirements set forth therein.
If responsive records contain both exempt and nonexempt material, the bureau will consult with the Office of the Solicitor, as discussed in § 2.23(c). After consultation, the bureau will partially grant and partially deny the request by:
(a) Segregating and releasing the nonexempt information, unless the nonexempt material is so intertwined with the exempt material that disclosure of it would leave only meaningless words and phrases;
(b) Indicating on the released portion of the record the amount of information deleted and the FOIA exemption under which the deletion was made, unless doing so would harm an interest protected by the FOIA exemption used to withhold the information; and
(c) If technically feasible, placing the information required by paragraph (b) of this section at the place in the record where the deletion was made.
(a) The Department encourages, but does not require, submitters to designate confidential information in good faith at the time of submission. Such designations assist the bureau in determining whether information obtained from the submitter is confidential information, but will not always be determinative.
(b) If, in the course of responding to a FOIA request, a bureau cannot readily determine whether information is confidential information, the bureau will:
(1) Consult with the submitter under §§ 2.27 and 2.28; and
(2) Provide the submitter an opportunity to object to a decision to disclose the information under §§ 2.30 and 2.31 of this subpart.
(a) Except as outlined in § 2.29 of this subpart, a bureau must promptly notify a submitter in writing when it receives a FOIA request if either:
(1) The requested information has been designated in good faith by the submitter as information considered protected from disclosure under Exemption 4 of the FOIA, found at 5 U.S.C. 552(b)(4); or
(2) The bureau believes that requested information may be protected from disclosure under Exemption 4.
(b) If a large number of submitters are involved, the bureau may publish a notice in a manner reasonably calculated to reach the attention of the submitters (for example, in newspapers or newsletters, the bureau's Web site, or the
A notice to a submitter must include:
(a) Either a copy of the FOIA request or the exact language of the request;
(b) Either a description of the possibly confidential information located in response to the request or a copy of the responsive records, or portions of records, containing the information;
(c) A description of the procedures for objecting to the release of the possibly confidential information under §§ 2.30 and 2.31 of this subpart;
(d) A time limit for responding to the bureau—no less than 10 workdays from receipt or publication of the notice (as set forth in § 2.27(b) of this subpart)—to object to the release and to explain the basis for the objection;
(e) Notice that information contained in the submitter's objections may itself be subject to disclosure under the FOIA;
(f) Notice that the bureau, not the submitter, is responsible for deciding whether the information will be released or withheld;
(g) A request for the submitter's views on whether they still consider the information to be confidential if the submitter designated the material as confidential commercial or financial information 10 or more years before the request; and
(h) Notice that failing to respond within the time frame specified under § 2.28(d) of this subpart will create a presumption that the submitter has no objection to the disclosure of the information in question.
The notice requirements of § 2.28 of this subpart will not apply if:
(a) The information has been lawfully published or officially made available to the public; or
(b) Disclosure of the information is required by a statute other than the FOIA or by a regulation (other than this part) issued in accordance with the requirements of Executive Order 12600.
(a) If a submitter has any objections to the disclosure of confidential information, the submitter should provide a detailed written statement to the bureau that specifies all grounds for withholding the particular information under any FOIA exemption (see § 2.31 of this subpart for further discussion of Exemption 4 objection statements).
(b) A submitter who does not respond within the time period specified under § 2.28(d) of this subpart will be considered to have no objection to disclosure of the information. Responses received by the bureau after this time period will not be considered by the bureau unless the appropriate bureau FOIA contact determines, in his or her sole discretion, that good cause exists to accept the late response.
(a) To rely on Exemption 4 as basis for nondisclosure, the submitter must explain why the information is confidential information. To do this, the submitter must give the bureau a detailed written statement. This statement must include a specific and detailed discussion of why the information is a trade secret or, if the information is not a trade secret, the following three categories must be addressed (unless the bureau informs the submitter that a response to one of the first two categories will not be necessary):
(1) Whether the Government required the information to be submitted, and if so, how substantial competitive or other business harm would likely result from release;
(2) Whether the submitter provided the information voluntarily and, if so, how the information fits into a category of information that the submitter does not customarily release to the public; and
(3) A certification that the information is confidential, has not been disclosed to the public by the submitter, and is not routinely available to the public from other sources.
(b) If not already provided, the submitter must include a daytime telephone number, an email and mailing address, and a fax number (if available).
(a) The bureau must carefully consider a submitter's objections and specific grounds for nondisclosure in deciding whether to disclose the requested information.
(b) The bureau, not the submitter, is responsible for deciding whether the information will be released or withheld.
If the bureau decides to disclose information over the objection of a submitter, the bureau must notify the submitter by certified mail or other traceable mail, return receipt requested. The notification must be sent to the submitter's last known address and must include:
(a) The specific reasons why the bureau determined that the submitter's disclosure objections do not support withholding the information;
(b) Copies of the records or information the bureau intends to release; and
(c) Notice that the bureau intends to release the records or information no less than 10 workdays after receipt of the notice by the submitter.
If you file a lawsuit seeking to compel the disclosure of confidential information, the bureau must promptly notify the submitter.
If any of the following occur, the bureau will notify you:
(a) The bureau provides the submitter with notice and an opportunity to object to disclosure;
(b) The bureau notifies the submitter of its intent to disclose the requested information; or
(c) A submitter files a lawsuit to prevent the disclosure of the information.
If a bureau determines that the requested information is protected from release by Exemption 4 of the FOIA, the bureau has no discretion to release the information. Release of information protected from release by Exemption 4 is prohibited by the Trade Secrets Act, a criminal provision found at 18 U.S.C. 1905.
(a) The bureau will charge for processing requests under the FOIA in accordance with this subpart and with the OMB Fee Guidelines.
(b) The bureau may contact you for additional information to resolve fee issues.
(c) The bureau ordinarily will collect all applicable fees before sending copies of records to you.
(d) You may usually pay fees by check, certified check, or money order made payable to the “Department of the Interior” or the bureau.
(1) Where appropriate, the bureau may require that your payment be made in the form of a certified check.
(2) You may also be able to pay your fees by credit card. You may contact the bureau to determine what forms of payment it accepts.
(e) The bureau should ensure that it conducts searches, review, and duplication in the most efficient and the least expensive manner so as to minimize costs for both you and the bureau.
(f) If the Department does not comply with any of the FOIA's statutory time limits:
(1) The bureau cannot assess search fees for your FOIA request, unless unusual or exceptional circumstances apply; and
(2) Depending on your fee category, the bureau may not be able to assess duplication fees for your FOIA request, as discussed in § 2.39(b) of this subpart.
(a) There are four categories of requesters for the purposes of determining fees—commercial-use, educational and noncommercial scientific institutions, representatives of news media, and all others.
(b) The bureau's decision to place you in a particular fee category will be made on a case-by-case basis based on your intended use of the information and, in most cases, your identity. If you do not submit sufficient information in your FOIA request for the bureau to determine your proper fee category, the bureau may ask you to provide additional information (see § 2.51 of this subpart).
(c) See § 2.70 of this part for the definitions of each of these fee categories.
(a) You will be charged as shown in the following table:
(b) If you are in the fee category of a representative of the news media or an educational and noncommercial scientific institution and the Department does not comply with any of the FOIA's statutory time limits, the Department cannot assess duplication fees for the FOIA request in question, unless unusual or exceptional circumstances apply to the processing of the request.
(a) The bureau will charge the types of fees discussed below unless a waiver of fees is required under § 2.39 of this subpart or has been granted under § 2.45 or § 2.56.
(b) Because the types of fees discussed below already account for the overhead costs associated with a given fee type, the bureau should not add any additional costs to those charges.
(a) The bureau will charge search fees for all requests, subject to the restrictions of §§ 2.37(f), 2.39, and 2.40(a) of this subpart. The bureau may charge you for time spent searching even if it does not locate any responsive records or if it determines that the records are entirely exempt from disclosure.
(b) For each quarter hour spent by personnel searching for requested records, including electronic searches that do not require new programming, the fees will be the average hourly General Schedule (GS) base salary, plus the District of Columbia locality payment, plus 16 percent for benefits, of employees in the following three categories, as applicable:
(1) Clerical—Based on GS–6, Step 5, pay (all employees at GS–7 and below are classified as clerical for this purpose);
(2) Professional—Based on GS–11, Step 7, pay (all employees at GS–8 through GS–12 are classified as professional for this purpose); and
(3) Managerial—Based on GS–14, Step 2, pay (all employees at GS–13 and above are classified as managerial for this purpose).
(c) You can review the current fee schedule for the categories discussed above in paragraph (b) of this section at
(d) Some requests may require retrieval of records stored at a Federal records center operated by the National Archives and Records Administration. For these requests, bureaus will charge additional costs in accordance with the Transactional Billing Rate Schedule established by the National Archives and Records Administration.
(a) The bureau will charge duplication fees, subject to the restrictions of §§ 2.37(f), 2.39, and 2.40(a) of this subpart.
(b) If photocopies or scans are supplied, the bureau will provide one copy per request at the cost determined by the table in appendix A to this part.
(c) For other forms of duplication, the bureau will charge the actual costs of producing the copy, including the time spent by personnel duplicating the requested records. For each quarter hour spent by personnel duplicating the requested records, the fees will be the same as those charged for a search under § 2.41(b) of this subpart.
(d) If the bureau must scan paper records to accommodate your preference to receive records in an electronic format, you will pay both the per page amount noted in Appendix A to this part and the time spent by personnel scanning the requested records. For each quarter hour spent by personnel scanning the requested records, the fees will be the same as those charged for a search under § 2.41(b) of this subpart.
(a) The bureau will charge review fees if you make a commercial-use request, subject to the restrictions of §§ 2.37(f), 2.39, and 2.40(a) of this subpart.
(b) The bureau will assess review fees in connection with the initial review of the record (the review conducted by the bureau to determine whether an exemption applies to a particular record or portion of a record).
(c) The Department will not charge for reviews at the administrative appeal stage of exemptions applied at the initial review stage. However, if the appellate authority determines that an exemption no longer applies, any costs associated with the bureau's re-review of the records to consider the use of other exemptions may be assessed as review fees.
(d) The bureau will charge review fees at the same rates as those charged for a search under § 2.41(b) of this subpart.
(e) The bureau can charge review fees even if the record(s) reviewed ultimately is not disclosed.
(a) Although not required to provide special services, if the bureau chooses to do so as a matter of administrative discretion, it will charge you the direct costs of providing the service.
(b) Examples of these services include certifying that records are true copies under subpart L of this part, providing multiple copies of the same record, converting records to a requested format, obtaining research data under § 2.69 of this part, or sending records by means other than first class mail.
(c) The bureau will notify you of these fees before they accrue and will obtain your written assurance of payment or an advance payment before proceeding. See §§ 2.49 and 2.50 of this subpart.
(a) The bureau will release records responsive to a request without charge (in other words, it will give you a full fee waiver) or at a reduced charge (in other words, it will give you a partial fee waiver, as discussed further in paragraph (b) of this section) if the bureau determines, based on all available information, that you have demonstrated (under the factors listed in § 2.48 of this subpart) that disclosing the information is:
(1) In the public interest because it is likely to contribute significantly to public understanding of government operations or activities, and
(2) Not primarily in your commercial interest.
(b) A partial fee waiver may be appropriate if some but not all of the requested records are likely to contribute significantly to public understanding of the operations and activities of the government.
(c) When deciding whether to waive or reduce fees, the bureau will rely on the fee waiver justification submitted in your request letter. If the letter does not include sufficient justification, the bureau will deny the fee waiver request. The bureau may, at its discretion, request additional information from you (see § 2.51 of this subpart).
(d) The burden is on you to justify entitlement to a fee waiver. Requests for fee waivers are decided on a case-by-case basis under the criteria discussed above in paragraph (a) of this section and § 2.48 of this subpart. If you have received a fee waiver in the past, that does not mean you are automatically entitled to a fee waiver for every request submitted.
(e) Discretionary fee waivers are addressed in § 2.56 of this subpart.
(f) The bureau must not make value judgments about whether the information at issue is “important” enough to be made public; it is not the bureau's role to attempt to determine the level of public interest in requested information.
(a) You should request a fee waiver when your request is first submitted to the bureau (see § 2.6 of this part).
(b) You may submit a fee waiver request at a later time if the underlying record request is still either pending or on administrative appeal.
If the bureau denies your request for a fee waiver, it will notify you, in writing, of the following:
(a) The basis for the denial, including a full explanation of why the fee waiver request does not meet the Department's fee waiver criteria in § 2.48 of this subpart.
(b) The name and title or position of each person responsible for the denial;
(c) The name and title of the Office of the Solicitor attorney consulted; and
(d) Your right to appeal the denial to the FOIA Appeals Officer, under the procedures in § 2.57 of this part, within 30 workdays after the date of the fee waiver denial letter.
(a) In deciding whether your fee waiver request meets the requirements of § 2.45(a)(1) of this subpart, the bureau will consider the criteria listed in paragraphs one through four below. You must address each of these criteria.
(1) How the records concern the operations or activities of the Federal government.
(2) How disclosure is likely to contribute to public understanding of those operations or activities, including:
(i) How the contents of the records are meaningfully informative;
(ii) The logical connection between the content of the records and the operations or activities;
(iii) How disclosure will contribute to the understanding of a reasonably broad audience of persons interested in the subject, as opposed to your individual understanding;
(iv) Your identity, vocation, qualifications, and expertise regarding the requested information and information that explains how you plan to disclose the information in a manner that will be informative to the understanding of a reasonably broad audience of persons interested in the subject, as opposed to your individual understanding
(v) Your ability and intent to disseminate the information to a reasonably broad audience of persons interested in the subject (for example, how and to whom do you intend to disseminate the information).
(3) How disclosure is likely to significantly contribute to the understanding of a reasonably broad audience of persons interested in the subject, as opposed to your individual understanding, including:
(i) Whether the information being requested is new;
(ii) Whether the information would confirm or clarify data that has been released previously;
(iii) How disclosure will increase the level of public understanding of the operations or activities of the Department or a bureau that existed prior to disclosure; and
(iv) Whether the information is already publicly available. If the Government previously has published the information you are seeking or it is routinely available to the public in a library, reading room, through the Internet, or as part of the administrative record for a particular issue, it is less likely that there will be a significant contribution from release.
(4) How the public's understanding of the subject in question will be enhanced to a significant extent by the disclosure.
(b) In deciding whether the fee waiver meets the requirements in § 2.45(a)(2) of this subpart, the bureau will consider any commercial interest of yours that would be furthered by the requested disclosure.
(1) You are encouraged to provide explanatory information regarding this consideration.
(2) The bureau will not find that disclosing the requested information will be primarily in your commercial interest where the public interest is greater than any identified commercial interest in disclosure.
(3) If you do have a commercial interest that would be furthered by disclosure, explain how the public interest in disclosure would be greater than any commercial interest you or your organization may have in the documents.
(i) Your identity, vocation, and intended use of the requested records are all factors to be considered in determining whether disclosure would be primarily in your commercial interest.
(ii) If you are a representative of a news media organization seeking information as part of the news gathering process, we will presume that the public interest outweighs your commercial interest.
(iii) If you represent a business/corporation/association or you are an attorney representing such an organization, we will presume that your commercial interest outweighs the public interest unless you demonstrate otherwise.
(a) The bureau will notify you under this section unless:
(1) The anticipated fee is less than $50 (you will not be charged if the fee for processing your request is less than $50, unless multiple requests are aggregated under § 2.54 of this subpart).
(2) You have been granted a full fee waiver; or
(3) You have previously agreed to pay all the fees associated with the request.
(b) If none of the above exceptions apply, the bureau will:
(1) Promptly notify you of the estimated costs for search, review, and/or duplication;
(2) Ask you to provide written assurance within 20 workdays that you will pay all fees or fees up to a designated amount;
(3) Notify you that it will not be able to comply with your FOIA request unless you provide the written assurance requested; and
(4) Give you an opportunity to reduce the fee by modifying the request.
(c) If the bureau does not receive your written assurance of payment under paragraph (b)(2) of this section within 20 workdays, the request will be closed.
(d) After the bureau begins processing a request, if it finds that the actual cost will exceed the amount you previously agreed to pay, the bureau will:
(1) Stop processing the request;
(2) Promptly notify you of the higher amount and ask you to provide written assurance of payment; and
(3) Notify you that it will not be able to fully comply with your FOIA request unless you provide the written assurance requested; and
(4) Give you an opportunity to reduce the fee by modifying the request.
(e) If you wish to modify your request in an effort to reduce fees, the bureau's FOIA Public Liaison can assist you.
(a) The bureau will require advance payment before starting further work when it finds the estimated fee is over $250 and:
(1) You have never made a FOIA request to the Department requiring the payment of fees; or
(2) You did not pay a previous FOIA fee within 30 calendar days of the date of billing.
(b) If the bureau believes that you did not pay a previous FOIA fee within 30 calendar days of the date of billing, the bureau will require you to either:
(1) Demonstrate you paid prior fee within 30 calendar days of the date of billing; or
(2) Pay any unpaid amount of the previous fee, plus any applicable interest penalties (see § 2.53 of this subpart), and pay in advance the estimated fee for the new request.
(c) When the bureau notifies you that an advance payment is due, it will give you an opportunity to reduce the fee by modifying the request.
(d) The bureau may require payment before records are sent to you; such a payment is not considered an “advance payment” under § 2.50(a) of this subpart.
(e) If the bureau requires advance payment, it will start further work only after receiving the advance payment. It will also notify you that it will not be able to comply with your FOIA request unless you provide the advance payment. Unless you pay the advance payment within 20 workdays after the date of the bureau's fee letter, the bureau will presume that you are no longer interested and will close the file on the request.
(a) If your FOIA request does not contain sufficient information for the bureau to determine your proper fee category or leaves another fee issue unclear, the bureau may ask you to provide additional clarification. If it does so, the bureau will notify you that it will not be able to comply with your FOIA request unless you provide the clarification requested.
(b) If the bureau asks you to provide clarification, the 20-workday statutory time limit for the bureau to respond to the request is temporarily suspended.
(1) If the bureau hears from you within 20 workdays, the 20-workday statutory time limit for processing the request will resume (see § 2.16 of this part).
(2) If you still have not provided sufficient information to resolve the fee issue, the bureau may ask you again to provide additional clarification and notify you that it will not be able to comply with your FOIA request unless you provide the additional information requested within 20 workdays.
(3) If the bureau asks you again for additional clarification, the statutory time limit for response will be temporarily suspended again and will resume again if the bureau hears from you within 20 workdays.
(c) If the bureau asks for clarification about a fee issue and does not receive a written response from you within 20 workdays, it will presume that you are no longer interested and will close the file on the request.
If you are required to pay a fee associated with a FOIA request, the bureau processing the request will send a bill for collection.
(a) The bureau may charge interest on any unpaid bill starting on the 31st day following the billing date.
(b) The bureau will assess interest charges at the rate provided in 31 U.S.C. 3717 and implementing regulations and interest will accrue from the billing date until the bureau receives payment.
(c) The bureau will follow the provisions of the Debt Collection Act of 1982 (Public Law 97–365, 96 Stat. 1749), as amended, and its administrative procedures, including the use of consumer reporting agencies, collection agencies, and offset to collect overdue amounts and interest.
(d) This section does not apply if you are a state, local, or tribal government.
(a) The bureau may aggregate requests and charge accordingly when it reasonably believes that you, or a group of requesters acting in concert with you, are attempting to avoid fees by dividing a single request into a series of requests on a single subject or related subjects.
(1) The bureau may presume that multiple requests of this type made within a 30-day period have been made to avoid fees.
(2) The bureau may aggregate requests separated by a longer period only where there is a reasonable basis for determining that aggregation is warranted in view of all the circumstances involved.
(b) The bureau will not aggregate multiple requests involving unrelated matters.
(a) The fee schedule in appendix A to this part does not apply to fees charged under any statute that specifically requires the bureau to set and collect fees for particular types of records.
(b) If records otherwise responsive to a request are subject to a statutorily-based fee schedule, the bureau will inform you whom to contact to obtain the records.
(a) The bureau may waive or reduce fees at its discretion if a request involves furnishing:
(1) A copy of a record that the bureau has reproduced for free distribution;
(2) One copy of a personal document (for example, a birth certificate) to a person who has been required to furnish it for retention by the Department;
(3) One copy of the transcript of a hearing before a hearing officer in a grievance or similar proceeding to the employee for whom the hearing was held;
(4) Records to donors with respect to their gifts;
(5) Records to individuals or private nonprofit organizations having an official, voluntary, or cooperative relationship with the Department if it will assist their work with the Department;
(6) A reasonable number of records to members of the U.S. Congress; state, local, and foreign governments; public international organizations; or Indian tribes, when to do so is an appropriate courtesy, or when the recipient is carrying on a function related to a Departmental function and the waiver will help accomplish the Department's work;
(7) Records in conformance with generally established business custom (for example, furnishing personal reference data to prospective employers of current or former Department employees); or
(8) One copy of a single record to assist you in obtaining financial benefits to which you may be entitled (for example, veterans or their dependents, employees with Government employee compensation claims).
(b) You cannot appeal the denial of a discretionary fee waiver or reduction.
(a) You may file an appeal when:
(1) The bureau withholds records, or parts of records;
(2) The bureau informs you that your request has not adequately described the records sought;
(3) The bureau informs you that it does not possess or cannot locate responsive records and you have reason to believe this is incorrect or that the search was inadequate;
(4) The bureau did not address all aspects of the request for records;
(5) You believe there is a procedural deficiency (for example, fees are improperly calculated);
(6) The bureau denied a fee waiver;
(7) The bureau did not make a decision within the time limits in § 2.16 or, if applicable, § 2.18; or
(8) The bureau denied, or was late in responding to, a request for expedited
(b) An appeal under paragraph (a)(8) of this section relates only to the request for expedited processing and does not constitute an appeal of the underlying request for records. Special procedures apply to requests for expedited processing of an appeal (see § 2.63 of this subpart).
(c) Before filing an appeal, you may wish to communicate with the contact person listed in the FOIA response, the bureau's FOIA Officer, and/or the FOIA Public Liaison to see if the issue can be resolved informally. However, appeals must be received by the FOIA Appeals Officer within the time limits in § 2.58 of this subpart or they will not be processed.
(a) Appeals covered by § 2.57(a)(1) through (5) of this subpart must be received by the FOIA Appeals Officer no later than 30 workdays from the date of the final response.
(b) Appeals covered by § 2.57(a)(6) of this subpart must be received by the FOIA Appeals Officer no later than 30 workdays from the date of the letter denying the fee waiver.
(c) Appeals covered by § 2.57(a)(7) of this subpart may be filed any time after the time limit for responding to the request has passed.
(d) Appeals covered by § 2.57(a)(8) of this subpart should be filed as soon as possible.
(e) Appeals arriving or delivered after 5 p.m. Eastern Time, Monday through Friday, will be deemed received on the next workday.
(a) You must submit the appeal in writing by mail, fax or email to the FOIA Appeals Officer (using the address available at
(b) The appeal must include:
(1) Copies of all correspondence between you and the bureau concerning the FOIA request, including the request and the bureau's response (if there is one); and
(2) An explanation of why you believe the bureau's response was in error.
(c) The appeal should include your name, mailing address, daytime telephone number (or the name and telephone number of an appropriate contact), email address, and fax number (if available) in case the Department needs additional information or clarification.
(d) An appeal concerning a denial of expedited processing or a fee waiver denial should also demonstrate fully how the criteria in § 2.20 or §§ 2.45 and 2.48 of this part are met.
(e) All communications concerning an appeal should be clearly marked with the words: “FREEDOM OF INFORMATION APPEAL.”
(f) The Department will reject an appeal that does not attach all correspondence required by paragraph (b)(1) of this section, unless the FOIA Appeals Officer determines, in his or her sole discretion, that good cause exists to accept the defective appeal. The time limits for responding to an appeal will not begin to run until the correspondence is received.
(a) The FOIA Appeals Officer is the deciding official for FOIA appeals.
(b) When necessary, the FOIA Appeals Officer will consult other appropriate offices, including the Office of the Solicitor for denials of records and fee waivers.
(c) The FOIA Appeals Officer normally will not make a decision on an appeal if the request becomes a matter of FOIA litigation.
(a) A decision on an appeal must be made in writing.
(b) A decision that upholds the bureau's determination will notify you of the decision and your statutory right to file a lawsuit.
(c) A decision that overturns, remands, or modifies the bureau's determination will notify you of the decision. The bureau then must further process the request in accordance with the appeal determination.
(a) The basic time limit for responding to an appeal is 20 workdays after receipt of an appeal meeting the requirements of § 2.59 of this subpart.
(b) The FOIA Appeals Officer may extend the basic time limit, if unusual circumstances exist. Before the expiration of the basic 20-workday time limit to respond, the FOIA Appeals Officer will notify you in writing of the unusual circumstances involved and of the date by which he or she expects to complete processing of the appeal.
(c) If the Department is unable to reach a decision on your appeal within the given time limit for response, the FOIA Appeals Officer will notify you of:
(1) The reason for the delay; and
(2) Your statutory right to seek review in a United States District Court.
(a) To receive expedited processing of an appeal, you must demonstrate to the Department's satisfaction that the appeal meets one of the criteria under § 2.20 of this part and include a statement that the need for expedited processing is true and correct to the best of your knowledge and belief.
(b) The FOIA Appeals Officer will advise you whether the Department will grant expedited processing within 10 calendar days of receiving the appeal.
(c) If the FOIA Appeals Officer decides to grant expedited processing, he or she will give the appeal priority over other pending appeals and process it as soon as practicable.
Before seeking review by a court of the bureau's adverse determination, you generally must first submit a timely administrative appeal.
Records that are required by the FOIA to be made proactively available for public inspection and copying are accessible on the Department's Web site,
(a) Each bureau has a FOIA Public Liaison that can assist individuals in locating bureau records.
(b) FOIA Public Liaisons report to the Department's Chief FOIA Officer and you can raise concerns to them about the service you have received.
(c) FOIA Public Liaisons are responsible for assisting in reducing delays, increasing transparency and understanding of the status of requests, and assisting in resolving disputes.
(d) A list of the Department's FOIA Public Liaisons is available at
(a) Each bureau must:
(1) Determine which of its records must be made publicly available under the FOIA (for example, certain frequently requested records);
(2) Identify additional records of interest to the public that are appropriate for public disclosure; and
(3) Post those records in FOIA libraries.
(b) Because of these proactive disclosures, you are encouraged to review the Department's FOIA libraries
(a) Each bureau must preserve all correspondence pertaining to the requests that it receives under subpart B of this part, as well as copies of all requested records, until disposition or destruction is authorized by the General Records Schedule 14 of the National Archives and Records Administration (NARA) or another NARA-approved records schedule.
(b) Materials that are identified as responsive to a FOIA request will not be disposed of or destroyed while the request or a related appeal or lawsuit is pending. This is true even if they would otherwise be authorized for disposition or destruction under the General Records Schedule 14 of NARA or another NARA-approved records schedule.
(a) If you request research data that were used by the Federal Government in developing certain kinds of agency actions, and the research data relate to published research findings produced under an award, in accordance with OMB Circular A–110:
(1) If the bureau was the awarding agency, it will request the research data from the recipient;
(2) The recipient must provide the research data within a reasonable time; and
(3) The bureau will review the research data to see if it can be released under the FOIA.
(b) If the bureau obtains the research data solely in response to your FOIA request, the bureau may charge you a reasonable fee equaling the full incremental cost of obtaining the research data.
(1) This fee should reflect costs incurred by the agency, the recipient, and applicable subrecipients.
(2) This fee is in addition to any fees the agency may assess under the FOIA.
(c) The bureau will forward a copy of the request to the recipient, who is responsible for searching for and reviewing the requested information in accordance with these FOIA regulations. The recipient will forward a copy of any responsive records that are located, along with any recommendations concerning the releasability of the data, and the total cost incurred in searching for, reviewing, and providing the data.
(d) The bureau will review and consider the recommendations of the recipient regarding the releasability of the requested research data. However, the bureau, not the recipient, is responsible for deciding whether the research data will be released or withheld.
For the purposes of subparts A through I of this part, the following definitions apply:
(1) Research findings are published in a peer-reviewed scientific or technical journal; or
(2) A Federal agency publicly and officially cites the research findings in support of an agency action that has the force and effect of law.
(1) Trade secrets, commercial information, materials necessary to be held confidential by a researcher until they are published, or similar information which is protected under law; and
(2) Personnel and medical information and similar information the disclosure of which would constitute a clearly unwarranted invasion of personal privacy, such as information that could be used to identify a particular person in a research study.
Federal Emergency Management Agency, DHS.
Final rule.
Modified Base (1% annual-chance) Flood Elevations (BFEs) are finalized for the communities listed below. These modified BFEs will be used to calculate flood insurance premium rates for new buildings and their contents.
The effective dates for these modified BFEs are indicated on the following table and revise the Flood Insurance Rate Maps (FIRMs) in effect for the listed communities prior to this date.
The modified BFEs for each community are available for inspection at the office of the Chief Executive Officer of each community. The respective addresses are listed in the table below.
Luis Rodriguez, Chief, Engineering Management Branch, Federal Insurance and Mitigation Administration, Federal Emergency Management Agency, 500 C Street SW., Washington, DC 20472, (202) 646–4064, or (email)
The Federal Emergency Management Agency (FEMA) makes the final determinations listed below of the modified BFEs for each community listed. These modified BFEs have been published in newspapers of local circulation and ninety (90) days have elapsed since that publication. The Deputy Associate Administrator for Mitigation has resolved any appeals resulting from this notification.
The modified BFEs are not listed for each community in this notice. However, this final rule includes the address of the Chief Executive Officer of the community where the modified BFE determinations are available for inspection.
The modified BFEs are made pursuant to section 206 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4105, and are in accordance with the National Flood Insurance Act of 1968, 42 U.S.C. 4001
For rating purposes, the currently effective community number is shown and must be used for all new policies and renewals.
The modified BFEs are the basis for the floodplain management measures that the community is required either to adopt or to show evidence of being already in effect in order to qualify or to remain qualified for participation in the National Flood Insurance Program (NFIP).
These modified BFEs, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities.
These modified BFEs are used to meet the floodplain management requirements of the NFIP and also are used to calculate the appropriate flood insurance premium rates for new buildings built after these elevations are made final, and for the contents in those buildings. The changes in BFEs are in accordance with 44 CFR 65.4.
Flood insurance, Floodplains, Reporting and recordkeeping requirements.
Accordingly, 44 CFR part 65 is amended to read as follows:
42 U.S.C. 4001
Federal Emergency Management Agency, DHS.
Final rule.
Base (1% annual-chance) Flood Elevations (BFEs) and modified BFEs are made final for the communities listed below. The BFEs and modified BFEs are the basis for the floodplain management measures that each community is required either to adopt or to show evidence of being already in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP).
The date of issuance of the Flood Insurance Rate Map (FIRM) showing BFEs and modified BFEs for each community. This date may be obtained by contacting the office where the maps are available for inspection as indicated in the table below.
The final BFEs for each community are available for inspection at the office of the Chief Executive Officer of each community. The respective addresses are listed in the table below.
Luis Rodriguez, Chief, Engineering Management Branch, Federal Insurance and Mitigation Administration, Federal Emergency Management Agency, 500 C Street SW., Washington, DC 20472, (202) 646–4064, or (email)
The Federal Emergency Management Agency (FEMA) makes the final determinations listed below for the modified BFEs for each community listed. These modified elevations have been published in newspapers of local circulation and ninety (90) days have elapsed since that publication. The Deputy Associate Administrator for Mitigation has resolved any appeals resulting from this notification.
This final rule is issued in accordance with section 110 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and 44 CFR part 67. FEMA has developed criteria for floodplain management in floodprone areas in accordance with 44 CFR part 60.
Interested lessees and owners of real property are encouraged to review the proof Flood Insurance Study and FIRM available at the address cited below for each community. The BFEs and modified BFEs are made final in the communities listed below. Elevations at selected locations in each community are shown.
Administrative practice and procedure, Flood insurance, Reporting and recordkeeping requirements.
Accordingly, 44 CFR part 67 is amended as follows:
42 U.S.C. 4001
Federal Emergency Management Agency, DHS.
Final rule.
Base (1% annual-chance) Flood Elevations (BFEs) and modified BFEs are made final for the communities listed below. The BFEs and modified BFEs are the basis for the floodplain management measures that each community is required either to adopt or to show evidence of being already in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP).
The date of issuance of the Flood Insurance Rate Map (FIRM) showing BFEs and modified BFEs for each community. This date may be obtained by contacting the office where the maps are available for inspection as indicated in the table below.
The final BFEs for each community are available for inspection at the office of the Chief Executive Officer of each community. The respective addresses are listed in the table below.
Luis Rodriguez, Chief, Engineering Management Branch, Federal Insurance and Mitigation Administration, Federal Emergency Management Agency, 500 C Street SW., Washington, DC 20472, (202) 646–4064, or (email)
The Federal Emergency Management Agency (FEMA) makes the final determinations listed below for the modified BFEs for each community listed. These modified elevations have been published in newspapers of local circulation and ninety (90) days have elapsed since that publication. The Deputy Associate Administrator for Mitigation has resolved any appeals resulting from this notification.
This final rule is issued in accordance with section 110 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and 44 CFR part 67. FEMA has developed criteria for floodplain management in floodprone areas in accordance with 44 CFR part 60.
Interested lessees and owners of real property are encouraged to review the proof Flood Insurance Study and FIRM available at the address cited below for each community.
The BFEs and modified BFEs are made final in the communities listed below. Elevations at selected locations in each community are shown.
Administrative practice and procedure, Flood insurance, Reporting and recordkeeping requirements.
Accordingly, 44 CFR part 67 is amended as follows:
42 U.S.C. 4001
Federal Communications Commission.
Final rule.
The Audio Division, at the request of Georgia-Carolina Radiocasting Company, LLC, allots FM Channel 287A and deletes FM Channel 244A at Tignall, Georgia. The allotment change is part of a hybrid rule making and FM application proposal. Channel 287A can be allotted at Tignall, consistent with the minimum distance separation requirements of the Commission's rules, at coordinates 33–45–22 NL and 82–42–56 WL.
Effective January 30, 2013.
Deborah Dupont, Media Bureau, (202) 418–2180.
This is a synopsis of the Commission's
Radio, Radio broadcasting.
For the reasons discussed in the preamble, the Federal Communications Commission amends 47 CFR part 73 as follows:
47 U.S.C. 154, 303, 334, 336 and 339.
Defense Acquisition Regulations System, Department of Defense (DoD).
Final rule.
DoD is making technical amendments to the Defense Federal Acquisition Regulation Supplement (DFARS) to provide needed editorial changes.
Mr. Manuel Quinones, Defense Acquisition Regulations System, OUSD(AT&L)DPAP(DARS), Room 3B855, 3060 Defense Pentagon, Washington, DC 20301–3060. Telephone 571–372–6088; facsimile 571–372–6094.
1. Corrects fax number at 201.201–1(d)(i).
2. Corrects DODOIG address at 203.1003.
3. Corrects typographical error at 204.1104. Redesignates 204.1104 as 204.1105 to correctly align with FAR 4.1105;
4. Clarifies terminology at 204.7102 and 204.7106 relating to contract line items.
5. Updates DPAP directorate office symbol at 215.403–1(c)(4)(B).
6. Corrects cross-reference to PGI at 219.202–1.
7. Redesignates 245.103(1) as 245.103–70, redesignates 245.103(2) as 245.103–71, adds new 245.103–72 and 103–73 to direct contracting officers to additional DFARS procedures, guidance, and information at PGI 245.103–72 and PGI 245.103–73 respectively.
8. Removes 245.201–71 and 245.201.72, and redesignates 245.201–73 as 245.201–71 Security Classification.
9. Corrects address of the DoD Office of Inspector General (DODOIG) at 252.203–7003;
10. Removes DODOIG address at 252.203.7004 and adds a hyperlink to obtain Hotline posters; and
11. Corrects title of statute and clause date at 252.227–7037 and 252.227–7038.
12. Corrects typographical error at 252.247–7023;
Government procurement.
Therefore, 48 CFR parts 201, 203, 204, 215, 219, 245, and 252 are amended as follows:
41 U.S.C. 1303 and 48 CFR chapter 1.
(b) Notification of possible contractor violation. Upon notification of a possible contractor violation of the type described in FAR 3.1003(b), coordinate the matter with the following office:
Department of Defense Office of Inspector General, Investigative Policy and Oversight Contractor Disclosure Program, 4800 Mark Center Drive, Suite 11H25, Arlington, VA 22350–1500.
Toll-Free Telephone: 866–429–8011.
When performance will require the use of Government-furnished property, contracting officers shall use the fillable electronic “Requisitioned Government Furnished Property” and/or “Scheduled Government Furnished Property” formats as attachments to solicitations and awards. See
See
As prescribed in 203.1004(a), use the following clause:
The agency office of the Inspector General referenced in paragraphs (c) and (d) of FAR clause 52.203–13, Contractor Code of Business Ethics and Conduct, is the DoD Office of Inspector General at the following address:
Department of Defense Office of Inspector General, Investigative Policy and Oversight, Contractor Disclosure Program, 4800 Mark Center Drive, Suite 11H25, Alexandria, VA 22350–1500.
Toll Free Telephone: 866–429–8011.
(End of clause)
(b) * * *
(1) The Contractor shall display prominently in common work areas within business segments performing work in the United States under Department of Defense (DoD) contracts DoD hotline posters prepared by the DoD Office of the Inspector General. DoD hotline posters may be obtained via the Internet at
Defense Acquisition Regulations System, Department of Defense (DoD).
Final rule.
DoD is issuing a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to revise the definitions of “contracting activity” and “departments and agencies” found at DFARS subpart 202.101.
Ms. Lesa Scott, telephone 571–372–6104.
This final rule updates the list of contracting activities and moves the list to the DFARS Procedures, Guidance, and Instruction (PGI) at 202.101. The reorganization of DFARS 202.101 will facilitate the rapid updating of contracting activities as organizational changes occur. This final rule—
• Revises the definition of “contracting activity” at DFARS 202.101 by removing the list of contracting activities;
• Inserts a pointer at DFARS 202.101 to direct readers to PGI 202.101 for the list of contracting activities that have been delegated broad authority regarding acquisition functions;
• Adds the updated list of contracting activities to the PGI at 202.101; and
• Updates the definition of “departments and agencies.”
“Publication of proposed regulations,” 41 U.S.C. 1707, is the statute which applies to the publication of the Federal Acquisition Regulation. Paragraph (a)(1) of the statute requires that a procurement policy, regulation, procedure or form (including an amendment or modification thereof) must be published for public comment if it relates to the expenditure of appropriated funds, and has either a significant effect beyond the internal operating procedures of the agency issuing the policy, regulation, procedure or form, or has a significant cost or administrative impact on contractors or offerors. This final rule is not required to be published for public comment, because it merely updates and moves the list of contracting activities from DFARS 202.101, Definitions, to a new DFARS PGI section at 202.101, Definitions. These requirements affect only the internal operating procedures of the Government.
Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is not a significant regulatory action and, therefore, was not subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.
The Regulatory Flexibility Act does not apply to this rule because this final rule does not constitute a significant DFARS revision within the meaning of FAR 1.501–1, and 41 U.S.C. 1707 does not require publication for public comment.
The rule does not contain any information collection requirements that require the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).
Government procurement.
Therefore, 48 CFR part 202 is amended as follows:
41 U.S.C. 1303 and 48 CFR chapter 1.
The revisions read as follows:
Defense Acquisition Regulations System, Department of Defense (DoD).
Final rule.
DoD is issuing a final rule to amend the Defense Federal Acquisition Regulation Supplement (DFARS) to update the text to reflect the distinction between “certified cost or pricing data” and “data other than certified cost or pricing data.” The DFARS changes are necessary to ensure consistency with the Federal Acquisition Regulation (FAR) which had been amended to clarify the distinction between those terms, as well as the requirements for the submission of cost or pricing data.
December 31, 2012.
Mr. Mark Gomersall, telephone 571–372–6099.
DoD published a proposed rule in the
Two respondents submitted comments. One respondent supported the rule without further comment, and the second respondent's comment was non-substantive. Therefore, the DFARS is revised as proposed.
Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is not a significant regulatory action and, therefore, was not subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.
DoD does not expect this rule to have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601,
The rule does not contain any information collection requirements that require the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C chapter 35).
Government procurement.
Therefore, DoD amends 48 CFR parts 204, 215, 217, 219, 225, 239, 241, 242, 244, and 252 as follows:
41 U.S.C. 1303 and 48 CFR chapter 1.
12. Section 217.7406 is amended in paragraph (b)(3) by removing “of cost or pricing data” and adding “of certified cost or pricing data” in its place and removing “and cost or pricing data” and adding “and certified cost or pricing data” in its place.
(a) Common carriers are not required to submit certified cost or pricing data before award of contracts for tariffed services. Rates or preliminary estimates quoted by a common carrier for tariffed telecommunications services are considered to be prices set by regulation within the provisions of 10 U.S.C. 2306a. This is true even if the tariff is set after execution of the contract.
(b) Rates or preliminary estimates quoted by a common carrier for nontariffed telecommunications services or by a noncommon carrier for any telecommunications service are not considered prices set by law or regulation.
(c) Contracting officers shall obtain sufficient data to determine that the prices are reasonable in accordance with FAR 15.403–3 or 15.403–4. See
Defense Acquisition Regulations System, Department of Defense (DoD).
Final rule.
DoD is issuing a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to add Poland as a qualifying country.
Ms. Amy G. Williams, telephone 571–372–6106.
DoD is amending the DFARS to add the Republic of Poland as a qualifying country. On August 27, 2011, the U.S. Secretary of Defense signed a new reciprocal defense procurement agreement with the Polish Minister of National Defense. This agreement was placed into force on July 19, 2012. The agreement removes discriminatory barriers to procurements of supplies and services produced by industrial enterprises of the other country to the extent mutually beneficial and consistent with national laws, regulations, policies, and international obligations. The agreement does not cover construction or construction material. Poland is already a designated country under the World Trade Organization Government Procurement Agreement.
“Publication of proposed regulations”, 41 U.S.C. 1707, is the statute which applies to the publication of the Federal Acquisition Regulation. Paragraph (a)(1) of the statute requires that a procurement policy, regulation, procedure or form (including an amendment or modification thereof) must be published for public comment if it relates to the expenditure of appropriated funds, and has either a significant effect beyond the internal operating procedures of the agency issuing the policy, regulation, procedure or form, or has a significant cost or administrative impact on contractors or offerors. This final rule is not required to be published for public comment, because it does not constitute a significant DFARS revision within the meaning of FAR 1.501–1, does not have a significant effect beyond the internal operating procedures of DoD, and will not have a significant cost or administrative impact on contractors or offerors. Poland is added to the list of 22 other countries that have similar reciprocal defense procurement agreements with DoD.
Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is not a significant regulatory action and, therefore, was not subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.
The Regulatory Flexibility Act does not apply to this rule because this final rule does not constitute a significant DFARS revision within the meaning of FAR 1.501–1 and 41 U.S.C. 1707 does not require publication for public comment.
This rule affects the certification and information collection requirements in the provisions at DFARS 252.225–7000 and 252.225–7035, currently approved under OMB Control Number 0704–0229, titled DFARS Part 225, Foreign Acquisition, and Associated Clauses, in accordance with the Paperwork Reduction Act (44 U.S.C. chapter 35). The impact, however, is negligible, because it merely shifts the category under which items from Poland must be listed.
Government procurement.
Therefore, 48 CFR parts 225 and 252 are amended as follows:
41 U.S.C. 1303 and 48 CFR chapter 1.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Final rule.
NMFS issues final specifications for the 2013 summer flounder, scup, and black sea bass fisheries, as well as the 2014 summer flounder and scup fisheries. This final rule specifies allowed harvest limits for both commercial and recreational fisheries. This action prohibits federally permitted commercial fishing vessels from landing summer flounder in Delaware in 2013 due to continued quota repayment from previous years' overages.
These actions are necessary to comply with regulations implementing the Summer Flounder, Scup, and Black Sea Bass Fishery Management Plan, as well as to ensure compliance with the Magnuson-Stevens Fishery Conservation and Management Act.
The intent of this action is to establish harvest levels and other management measures to ensure that these species are not overfished or subject to overfishing in 2013 and 2014.
Effective January 1, 2013, through December 31, 2014.
Copies of the specifications document, consisting of an Environmental Assessment (EA), Initial Regulatory Flexibility Analysis (IRFA), and other supporting documents used by the Summer Flounder, Scup, and Black Sea Bass Monitoring Committees and Scientific and Statistical Committee (SSC), are available from Dr. Christopher Moore, Executive Director, Mid-Atlantic Fishery Management Council, Suite 201, 800 North State Street, Dover, DE 19901. The specifications document is also accessible via the Internet at
Carly Bari, Fishery Management Specialist, (978) 281–9224.
The Mid-Atlantic Fishery Management Council (Council) and the Atlantic States Marine Fisheries Commission (Commission) cooperatively manage the summer flounder, scup, and black sea bass fisheries under the Summer Flounder, Scup, and Black Sea Bass Fishery Management Plan (FMP). Fishery specifications in these fisheries include various catch and landing subdivisions, such as the commercial and recreational sector annual catch limits (ACLs), annual catch targets (ACTs), sector-specific landing limits (i.e., the commercial fishery quota and recreational harvest limit (RHL)), and research set-aside (RSA) established for the upcoming fishing year. Details of each subdivision appear later in this rule.
The FMP and its implementing regulations establish the Council's process for establishing specifications. All requirements of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act), including the 10 national standards, also apply to specifications.
The management units specified in the FMP include summer flounder (
NMFS will establish the 2013 recreational management measures (i.e., minimum fish size, possession limits, and fishing seasons) for summer flounder, scup, and black sea bass by publishing proposed and final rules in the
This final rule implements TAL, RSA, and RHL for each management unit for 2013 and 2014, consistent with the recommendations of the Council:
Summer Flounder: For 2013, a TAL of 19.07 million lb (8,650 mt), including RSA of 589,800 lb (267 mt); a commercial quota of 11.44 million lb (5,189 mt); and an RHL of 7.63 million lb (3,459 mt). For 2014, a TAL of 19.98 million lb (8,609 mt), including proposed RSA of 587,100 lb (266 mt); a commercial quota of 11.39 million lb (5,166 mt); and an RHL of 7.59 million lb (3,444 mt).
Scup: For 2013, a TAL of 31.08 million lb (14,098 mt), including RSA of 958,950 lb (435 mt); a commercial quota of 23.53 million lb (10,671 mt); and an RHL of 7.55 million lb (3,425 mt). For 2014, a TAL of 28.98 million lb (13,145 mt), including proposed RSA of 896,100 lb (406 mt); a commercial quota of 21.95 million lb (9,955 mt); and an RHL of 7.03 million lb (3,188 mt).
Black Sea Bass: For 2013, a TAL of 3.63 million lb (1,646 mt), including RSA of 111,900 lb (50.8 mt); a commercial quota of 1.78 million lb (805 mt); and an RHL of 1.85 million lb (838 mt).
Additional detail for each species' specifications is provided, as follows.
The summer flounder stock was declared rebuilt in 2011. The stock assessment update utilized to derive specification recommendations determined that summer flounder are not overfished and that overfishing did not occur in 2011, the most recent year of available data. This stock assessment update did, however, indicate that biomass is currently lower than in recent years. As a result, the catch limits for 2013 and 2014 are slightly lower than in 2012.
The overfishing limit (OFL) for summer flounder for 2013 was estimated to be 29.81 million lb (13,523 mt). Based on this information, the 2013 ABC for summer flounder is 22.34 million lb (10,133 mt), and, using a strategy of a constant fishing mortality rate, that the 2014 ABC for summer flounder is 22.24 million lb (10,088 mt).
Consistent with the quota-setting procedures for the FMP, summer flounder overages are determined based upon landings for the period January–October 2012, plus any previously unaccounted for overages. Table 2 summarizes, for each state, the commercial summer flounder percent shares as outlined in § 600.100(d)(1)(I), the resultant 2013 commercial quotas (both initial and after deducting the RSA), the quota overages as described above, and the final adjusted 2013 commercial quotas, after deducting the RSA.
Table 3 presents the initial allocations of summer flounder for 2014, by state, with and without the commercial portion of the RSA deduction. These state quota allocations for 2014 are preliminary and are subject to change if
Table 2 shows that, for Delaware, the amount of overharvest from previous years is greater than the amount of commercial quota allocated to Delaware for 2013. As a result, there is no quota available for 2013 in Delaware. The regulations at § 648.4(b) provide that Federal permit holders, as a condition of their permit, must not land summer flounder in any state that the Administrator, Northeast Region, NMFS, has determined no longer has commercial quota available for harvest. Therefore, effective January 1, 2013, landings of summer flounder in Delaware by vessels holding commercial Federal summer flounder permits are prohibited for the 2013 calendar year, unless additional quota becomes available through a quota transfer and is announced in the
The OFL for scup is 47.80 million lb (21,680 mt). Using the appropriate control rule and applying the Council's risk policy, the ABC for scup is 38.71 million lb (17,557 mt) for 2013, and, using a constant fishing mortality rate of 0.142, the 2014 ABC is 35.99 million lb (16,325 mt). Similar to summer flounder, the stock assessment update upon which the specifications are based indicates that scup biomass is currently lower than in recent years. Therefore, the 2013 and 2014 catch limits are slightly lower than in 2012, but are still relatively high compared to recent landings.
The scup management measures specify that the ABC is equal to the sum of the commercial and recreational sector ACLs. The ACTs (both commercial and recreational) are equal to the respective ACL for 2013–2014. Therefore, commercial sector ACLs/ACTs are 30.19 million lb (13,694 mt) for 2013, and 28.07 million lb (12,734 mt) for 2014. The recreational sector ACLs/ACTs are 8.52 million lb (3,863 mt) and 7.92 million lb (3,592 mt) for 2013 and 2014, respectively.
After deducting 958,950 lb (435 mt) from the ACL for 2013 RSA, the scup commercial quota is reduced to 23.53 million lb (10,671 mt), with an RHL of 7.55 million lb (3,425 mt). Using the preliminary 2014 RSA amount of 3 percent, the scup commercial for 2014 is 21.95 million lb (9,955 mt), and the RHLs is 7.03 million lb (3,188 mt). The quota allocations for 2014 are preliminary and are subject to reductions if there are overages that occur in the 2013 fishing year, as well as any adjustments needed after the 2014 RSA projects are awarded. Any necessary quota adjustments will be included in a
The scup commercial quota is divided into three commercial fishery quota periods. Consistent with the quota setting procedures established for the FMP, scup overages are determined based upon landings for the Winter I
Per the quota accounting procedures in the FMP, after June 30, 2013, NMFS will compile all available landings data for the 2012 Winter II quota period and compare the landings to the 2012 Winter II quota period allocation, inclusive of any transfer from the 2012 Winter I quota period. Any overages will be determined, and deductions, if needed, will be made to the Winter II 2013 allocation and published in the
Table 6 presents the allocations for 2014, by period, with and without the commercial portion of the RSA deduction. These period allocations for 2014 are preliminary and are subject to change if there are overages in the 2013 fishing year, as well as any adjustments needed after the 2013 RSA projects are awarded. Any commercial quota adjustments from 2013 will be announced in a
Consistent with the unused Winter I commercial scup quota rollover provisions at § 648.120(a)(3), this final rule maintains the Winter II possession limit-to-rollover amount ratios that have been in place since the 2007 fishing year, as shown in Table 7. The Winter II possession limit will increase by 1,500 lb (680 kg) for each 500,000 lb (227 mt) of unused Winter I period quota transferred, up to a maximum possession limit of 8,000 lb (3,629 kg).
The SSC rejected the OFL estimate provided from the most recent black sea bass stock assessment, stating that it was highly uncertain and not sufficiently reliable to use as the basis for management advice. Therefore, the 2013 ABC for black sea bass is the status quo ABC of 4.50 million lb (2,041 mt), and the 2013 ACTs (both commercial and recreational) are equal to the respective ACLs.
The 2013 black sea bass commercial ACL and ACT is 2.13 million lb (966 mt), and the recreational ACL and ACT is 2.37 million lb (1,075 mt). After removing discards and RSA of 111,900 lb (50.8 mt), the commercial quota is 1.78 million lb (805 mt) and the RHL is 1.85 million lb (838 mt). While the ABC is the same as 2012, the ACLs/ACTs and quotas are different from 2012 because the updated discard estimate is higher than the previous year. Recent data indicate that the 2012 recreational black sea bass ACL has been exceeded by a significant amount. The regulations require that we deduct the amount of landings that exceeded the RHL from a single subsequent year's ACT as soon as possible. However, NMFS has determined that because the data are preliminary and will not be finalized until April 2013, any deduction necessary to account for the overage will be applied to the fishing year 2014 RHL.
Consistent with the quota-setting procedures for the FMP, commercial black sea bass overages are determined based upon landings for the period January-October 2012, plus any previously unaccounted for landings. Table 8 details the specifications for the black sea bass fishery.
NMFS received three comments during the 15-day comment period for the November 16, 2012, proposed rule (77 FR 68723).
Other than to specify the final summer flounder state allocations after accounting for prior overages and the RSA allocation, no other changes were made from the proposed rule.
The Administrator, Northeast Region, NMFS, determined that this final rule is necessary for the conservation and management of the summer flounder, scup, and black sea bass fisheries and that it is consistent with the Magnuson-Stevens Act and other applicable laws.
The Assistant Administrator for Fisheries, NOAA, finds good cause under 5 U.S.C. 553(d)(3) to waive the 30-day delay of effectiveness period for this rule, to ensure that the final specifications are in place on January 1, 2013. This action establishes specifications (i.e., annual quotas) for the summer flounder, scup, and black sea bass fisheries.
This rule is being issued at the earliest possible date. Preparation of the proposed rule was dependent on the submission of the EA/IRFA in support of the specifications that is developed by the Council. This document was received by NMFS in early October 2012. Documentation in support of the Council's recommended specifications is required for NMFS to provide the public with information from the environmental and economic analyses as required in rulemaking. The proposed rule published on November 16, 2012, with a comment period ending December 3, 2012. Publication of the adjusted summer flounder quota at the start of the fishing year that begins January 1, 2013, is required by the order of Judge Robert Doumar in
However, if the 30-day delay in effectiveness is not waived, there will be no quota specifications for the affected
For these reasons, the 30-day delay in effectiveness is contrary to the public interest, and NMFS is waiving the requirement.
These specifications are exempt from the procedures of E.O. 12866 because this action contains no implementing regulations.
This final rule does not duplicate, conflict, or overlap with any existing Federal rules.
A FRFA was prepared pursuant to 5 U.S.C. 604(a), and incorporates the IRFA, a summary of the significant issues raised by the public comments in response to the IRFA, NMFS's responses to those comments, and a summary of the analyses completed to support the action. A copy of the EA//IRFA is available from the Council (see
The preamble to the proposed rule included a detailed summary of the analyses contained in the IRFA, and that discussion is not repeated here.
A description of the reasons why this action is being taken, and the objectives of and legal basis for this final rule, is contained in the preambles to the proposed rule and this final rule and is not repeated here.
No changes to the proposed rule were required to be made as a result of public comments. None of the comments received raised specific issues regarding the economic analyses summarized in the IRFA or the economic impacts of the rule more generally. For a summary of the comments received, and the responses thereto, refer to the “Comments and Responses” section of this preamble.
The categories of small entities likely to be affected by this action include commercial and charter/party vessel owners holding an active Federal commercial or charter/party permit for summer flounder, scup, or black sea bass, as well as owners of vessels that fish for any of these species in state waters. Under the Small Business Administration's regulations implementing the Regulatory Flexibility Act, these vessels are considered “small entities” if their revenues are less than $4 million per year. The Council estimates that the proposed 2013–2014 specifications could affect 2,039 vessels that held a Federal summer flounder, scup, and/or black sea bass permit in 2011 (the most recent year of complete permit data). However, the more immediate impact of this rule will likely be realized by the 870 vessels that actively participated in these fisheries (i.e., landed these species) in 2011.
No additional reporting, recordkeeping, or other compliance requirements are included in this final rule.
Specification of commercial quotas and possession limits is constrained by the conservation objectives set forth in the FMP and implemented at 50 CFR part 648 under the authority of the Magnuson-Stevens Act. Economic impacts of changes in year-to-year quota specifications may be offset by adjustments to such measures as commercial fish sizes, changes to mesh sizes, gear restrictions, or possession and trip limits that may increase efficiency or value of the fishery. For 2013 and 2014, no such adjustments were recommended by the Council; therefore, this final rule contains no such measures. Therefore, the economic impact analysis of the action is evaluated solely on the different levels of quota specified in the alternatives. The ability of NMFS to minimize economic impacts for this action is constrained to approving quota levels that provide the maximum availability of fish while still ensuring that the required objectives and directives of the FMP, its implementing regulations, and the Magnuson-Stevens Act are met. In particular, the Council's SSC has made recommendations for the 2013–2014 ABC level for all three stocks. NMFS considers these recommendations to be consistent with National Standard 2. Establishing catch levels higher than the SSC ABC recommendations is not permitted under the Magnuson-Stevens Act.
The economic analysis for the 2013–2014 specification assessed the impacts for quota alternatives that achieve the aforementioned objectives. The no action alternative, wherein no quotas are established for 2013 or 2014, was excluded from analysis because it is not consistent with the goals and objectives of the FMP and the Magnuson-Stevens Act. Implementation of the no action alternative in 2013 or 2014 would substantially complicate the approved management programs for these three species. NMFS is required under the FMP's implementing regulations to implement specifications for these fisheries on an annual basis, and for up to 3 years. The no action alternative would result in no fishing limits for 2013 or 2014, and could result in overfishing of the resources and substantially compromise the mortality and/or stock rebuilding objectives for each species, contrary to laws and regulations.
The Council analyzed three sets of combined catch limit alternatives for the 2013–2014 summer flounder, scup, and
Through this final rule, NMFS implements the Council's preferred ABCs in 2013 for summer flounder (22.34 million lb (10,133 mt)), scup (38.71 million lb (17,577 mt)), and black sea bass (4.5 million lb (2,041 mt)). This final rule also implements the following ABCs for 2014: Summer flounder, 22.24 million lb (10,088 mt); and scup, 35.99 million lb (16,325 mt). This alternative consists of the quota levels that pair the lowest economic impacts to small entities and meet the required objectives of the FMP and the Magnuson-Stevens Act. The respective specifications contained in this final rule for all three species were selected because they satisfy NMFS' obligation to implement specifications that are consistent with the goals, objectives, and requirements of the FMP, its implementing regulations, and the Magnuson-Stevens Act. The F rates associated with the catch limits for all three species all have very low likelihoods of causing overfishing to occur in 2013.
The revenue decreases associated with allocating a portion of available catch to the RSA program are expected to be minimal (approximately between $300 and $1,000 per vessel), and are expected to yield important benefits associated with improved fisheries data. It should also be noted that fish harvested under the RSA program can be sold, and the profits used to offset the costs of research. As such, total gross revenues to the industry are not expected to decrease substantially, if at all, as a result of this final rule authorizing RSA for 2013 and 2014.
Section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996 states that, for each rule or group of related rules for which an agency is required to prepare a FRFA, the agency shall publish one or more guides to assist small entities in complying with the rule, and shall designate such publications as “small entity compliance guides.” The agency shall explain the actions a small entity is required to take to comply with a rule or group of rules. As part of this rulemaking process, a small entity compliance guide will be sent to all holders of Federal permits issued for the summer flounder, scup, and black sea bass fisheries. In addition, copies of this final rule and guide (i.e., permit holder letter) are available from NMFS (see
16 U.S.C. 1801
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Final rule, correction.
On April 23, 2012, NMFS published in the
Effective December 26, 2012, through December 31, 2012.
Carly Bari, Fisheries Management Specialist, (978) 281–9224,
NMFS publishes this rule to correct an error in the commercial summer flounder quota and recreational harvest limit, which was implemented in the April 23, 2012 final rule on the 2012 summer flounder, scup, and black sea bass specifications. Regulations for the summer flounder fishery are found at 50 CFR part 648. The regulations require annual specification of a commercial quota that is apportioned among the coastal states from North Carolina through Maine and a coastwide recreational harvest limit. The process to set the annual commercial quota and the percent allocated to each state are described in § 648.102.
The final rule implementing 2012 summer flounder, scup, and black sea bass specifications published on April 23, 2012 (77 FR 24151). An error was found in the summer flounder commercial quota and recreational harvest limit. The 3-percent research set-aside (RSA) was mistakenly deducted twice from the quotas. The revised 2012 summer flounder commercial quota, less RSA, is 13,136,000 lb (5,958,490 kg), and the revised 2012 summer flounder recreational harvest limit, less RSA, is 8,758,000 lb (3,972,629 kg). Table 1 presents the allocations of summer flounder by state with the corrected commercial quota including RSA, overages, and transfers through December 11, 2012.
Pursuant to 5 U.S.C. 553(b)(B), the Assistant Administrator for Fisheries, NOAA, finds good cause to waive prior notice and opportunity for additional public comment for this action because this would be impracticable and contrary to the public interest. The interim final rule for the 2012 summer flounder, scup, and black sea bass specification already took comment on the initial summer flounder quota with the understanding that overage adjustments would be made. This action is correcting an error found in the specifications regarding the summer flounder commercial quota and recreational harvest limit. In the April 23, 2012 rule, the 3-percent research set-aside (RSA) was mistakenly deducted twice from the quotas. Thus, this rule corrects this error by increasing the summer flounder commercial and recreational quotas by 3-percent. Delaying the implementation of this action to allow for prior notice and
Moreover, pursuant to 5 U.S.C. 553(d), the Assistant Administrator finds good cause to waive the 30-day delay in effective date. This action is correcting an error found in the specifications regarding the summer flounder commercial quota and recreational harvest limit. Delaying the effective date of this correction to allow for the 30-day delay could result in premature closures of the summer flounder fishery in states that have the potential to fully harvest their quotas. Given that states have surpassed their summer flounder quota in the past, if the revised quota is not implemented immediately, there is the potential that the fishery would reach the erroneous harvest quota amount, and could produce unnecessary adverse economic consequences for fishermen that participate in this fishery.
Because prior notice and opportunity for public comment are not required for this rule by 5 U.S.C. 553, or any other law, the analytical requirements of the Regulatory Flexibility Act, 5 U.S.C. 601
This final rule is exempt from review under Executive Order 12866.
In the
16 U.S.C. 1801
Nuclear Regulatory Commission.
Petition for rulemaking; notice of receipt; supplemental information.
The U.S. Nuclear Regulatory Commission (NRC) is providing supplemental information to a notice of receipt that appeared in the
Please refer to Docket ID NRC–2012–0215 when contacting the NRC about the availability of information for this petition. You may access information related to this petition, which the NRC possesses and is publicly available, by any of the following methods:
•
•
•
Cindy Bladey, Chief, Rules, Announcements, and Directives Branch, Division of Administrative Services, Office of Administration, U.S. Nuclear Regulatory Commission, Washington, DC 20555–0001; telephone: 301–492–3667, email:
The U.S. Nuclear Regulatory Commission (NRC) is providing supplemental information to a notice of receipt that appeared in the
For the Nuclear Regulatory Commission.
Office of Energy Efficiency and Renewable Energy, Department of Energy.
Petition for Reconsideration; Request for Comments.
The Department of Energy (DOE) received a petition from the Association of Home Appliance Manufacturers (AHAM) requesting reconsideration of the U.S. Department of Energy's (DOE) final rule to amend the test procedures for residential dishwashers, dehumidifiers, and conventional cooking products, published on October 31, 2012, and DOE's direct final rule to amend energy conservation standards for dishwashers, published on May 30, 2012. Specifically, AHAM requested that DOE stay the effectiveness of the test procedure final rule and final standards rule until DOE either: Revises the standards in the final standards rule to account for the impact on measured energy resulting from test procedure amendments to measure fan-only mode and standby and off mode energy use; or delays requirements regarding measurement of fan-only mode and standby and off mode energy use until promulgation of a revised standard for dishwashers. DOE seeks comment on whether to grant the petition and proceed with a rulemaking on this matter.
Any comments must be received by DOE not later than January 30, 2013.
Comments must be submitted, identified by docket number EERE–BT–PET–0053, by one of the following methods:
1.
2.
3.
4.
5.
The Administrative Procedure Act (APA), 5 U.S.C. 551
Set forth below is the full text of the AHAM petition.
In the Matter of: Docket No. EERE–2010–BT–TP–0039, RIN: 1904–AC01, Energy Conservation Program: Test Procedures for Residential Dishwashers, Dehumidifiers, and Conventional Cooking Products and Docket No. EERE–2011–BT–STD–0060, RIN No. 1904–AC64, Energy Conservation Program: Energy Conservation Standards For Residential Dishwashers
The Association of Home Appliance Manufacturers (AHAM) respectfully petitions the Department of Energy (DOE) for reconsideration of its final rule on Test Procedures for Residential Dishwashers, Dehumidifiers, and Conventional Cooking Products, Docket No. EERE–2010–BT–TP–0039, RIN 1904–AC01, 77 FR 65942 (Oct. 31, 2012) (Test Procedure Final Rule) and its direct final rule on Energy Conservation Standards for Dishwashers, Docket No. EERE–2011–BT–STD–0060, RIN No. 1904–AC64, 77 FR 31918 (May 30, 2012) (Direct Final Rule).
AHAM believes that, overall, the amendments made to the residential dishwasher test procedure are critical amendments, many of which will enhance the repeatability and reproducibility of the test procedure. AHAM requested many of the amendments, and we thank DOE for acting quickly to address the issues we raised. But, despite DOE's conclusions that amendments to the residential dishwasher test procedure regarding fan-only mode and standby and off mode would impact measured energy and AHAM's comments to the same effect, DOE has ignored and violated its statutory obligations under 42 U.S.C. 6293(e) and 42 U.S.C. 6295(gg)(2). These provisions require analysis of test procedure revisions to determine whether they affect the stringency of the underlying standard, and, if so, DOE must adjust the standards accordingly. This is to prevent “back-door” rulemakings that effectively decrease or increase the appliance standards. DOE's action is incompatible with and undermines the consensus agreement which underlies the amended residential dishwasher standard.
AHAM thus requests an immediate stay of the effectiveness of both the Direct Final Rule and the Test Procedure Final Rule until DOE either (1) revises the standards in the Direct Final Rule to account for the impact on measured energy resulting from test procedure amendments regarding fan-only mode and standby and off mode energy; or (2) delays requirements regarding measurement of fan-only mode and the revised standby and off mode procedures until such time as a revised standard is promulgated for residential dishwashers.
On July 30, 2010, AHAM and energy efficiency advocates submitted energy conservation standards proposals for residential dishwashers and other products that had been the subject of intensive negotiations (Joint Stakeholder Agreement). DOE encouraged these negotiations, supplied technical support to the parties, and considered the standards under the fast track consensus standards provision in 42 U.S.C. 6295(p)(4). That agreement included agreed-to energy conservation standards levels and a compliance date for dishwashers which the parties to the agreement jointly submitted to DOE via petition dated September 25, 2010. Notably, the Joint Stakeholder Agreement expressly states that “[t]he Joint Stakeholders have made no agreement concerning the appropriate levels for standby or off mode energy consumption and agree that stakeholders will comment to DOE as they view appropriate during DOE's rulemaking process for each of the affected products, as applicable.” Joint Stakeholder Agreement, at ¶ 4. And the Joint Stakeholders “agree[d] that pending amendments to test procedures for the affected products should be completed by DOE, subject to input from all stakeholders and agree[d] to recommend that DOE translate the standards contained in this agreement to equivalent levels specified under revised test procedures.”
In a separate rulemaking, on December 2, 2010, DOE published a notice of proposed rulemaking in which it proposed amendments to the residential dishwasher test procedure, Appendix C to Subpart B of Part 430 (Appendix C), to address standby and off mode, including incorporation by reference of IEC Standard 62301, First Edition.
In its comments on the May 2012 SNOPR, AHAM commented that it was “somewhat unclear when compliance with the proposed revisions to the dishwasher test procedure would be required. Some of the proposals would impact measured energy (e.g., fan-only mode, water softener regeneration). Accordingly, if those amendments would be effective under the existing standards and/or the pending direct final rule, DOE would need to do a crosswalk to ensure that the stringency of those standards does not change. * * * Alternatively, DOE would need to address the changes in measured energy in a future standards rulemaking.” AHAM Comments on the SNOPR for Test Procedures for Residential Dishwashers, Dehumidifiers, and Conventional Cooking Products 2 (June 25, 2012) [hereinafter AHAM June 2012 Comments] (emphasis in original). AHAM also proposed that DOE incorporate by reference ANSI/AHAM DW–1–2009 in Appendix C.
In response to comments it received from AHAM and others on the May 2012 SNOPR, DOE published a third supplemental notice of proposed rulemaking on August 15, 2012.
In response to the August 2012 SNOPR, AHAM commented “that it is still somewhat unclear when compliance with some of the proposed revisions to the dishwasher test procedure would be required” and requested “that DOE clarify which amendments are to be effective at which time.” AHAM Comments on the SNOPR for Test Procedures for Residential Dishwashers, Dehumidifiers, and Conventional Cooking Products 2 (Aug. 30, 2012) [hereinafter AHAM August 2012 Comments]. In addition, AHAM commented that, because some of the proposals would or could impact measured energy, DOE would need to ensure that the stringency of the standards does not change if it intended to require the amendments be used for compliance with existing or 2013 standards.
• Added provisions for measuring standby mode and off mode energy consumption, including incorporating specific sections of IEC Standard 62301, Second Edition by reference;
• Added a provision for measuring energy use in fan-only mode; and
• Updated the referenced industry test method to ANSI/AHAM DW–1–2010;
DOE determined that “the date upon which the use of new appendix C1 will be required will be May 30, 2013, the compliance date of the direct final rule published on May 30, 2012 * * *” Test Procedure Final Rule, at 65947.
DOE did not revise the standards promulgated in the Direct Final Rule to account for changes in measured energy as a result of amendments requiring measurement of fan-only mode. DOE reasoned that “energy use in [fan-only mode] is estimated to be less than 5 percent of the total energy use of standard dishwashers. Given that 65 percent of all standard dishwashers currently on the market meet or exceed the minimum energy conservation standards established in the direct final rule, inclusion of this small amount of energy use would not impact compliance with the revised standard. Therefore, DOE has determined that the energy use in fan-only mode is
Nor did DOE adjust the standards in the Direct Final Rule to account for the standby and off-mode test procedure amendments.
When DOE amends a test procedure, it must determine “to what extent, if any, the proposed test procedure would alter the measured energy efficiency, measured energy use, or measured water use of any covered product as determined under the existing test procedure.” 42 U.S.C. 6293(e)(1). And, if DOE determines that the amended test procedure will alter measured energy or water use, DOE “shall amend the applicable energy conservation standard during the rulemaking carried out with respect to such test procedure.” 42 U.S.C. 6293(e)(2). There is a specific procedure, involving evaluating minimally compliant products, set forth in the law for making that adjustment.
DOE determined, and, as discussed below, AHAM data confirms, that the fan-only mode amendments to the residential dishwasher test procedure impact measured energy. DOE stated that the impact would be “
In the May 2012 SNOPR, when DOE first proposed amendments to the residential test procedure to measure fan-only mode, DOE found that the proposed measurement would increase measured energy. DOE calculated the range of annual energy consumption associated with an air circulation fan operating after the end of the active cycle, according to the proposed test procedure, to be from 0.4 to 17 kilowatt hours (kWh) per year.
AHAM, though it did not oppose measurement of fan-only mode, agreed that it would increase measured energy, and, thus, requested clarification as to when the measurement would be required for compliance with the energy conservation standards for dishwashers:
DOE should also clarify when this measurement would be required for compliance with energy conservation standards for dishwashers. DOE stated that this would be “required in the annual energy metric upon the compliance date of any updated dishwasher energy conservation standards addressing standby mode and off mode energy use.” Especially because this measurement would impact measured energy, AHAM assumes that statement is referencing a future standard that has not yet been proposed and that the fan-only measurement would not be required for compliance with the standards in the current direct final rule for dishwashers, 77 FR 31918 (May 30, 2012). An express statement to that effect would provide clarity to regulated parties.
AHAM June 2012 Comments, at 3. Importantly, AHAM specifically stated its assumption that DOE's statement regarding the compliance date did not
In the subsequent August 2012 SNOPR, in response to AHAM's comments, DOE proposed an alternative approach for measurement of fan-only mode, but DOE did not alter its analysis regarding the impact of the amendments on measured energy or respond to AHAM's request for clarity regarding the compliance date for the proposed fan-only mode amendments. Thus, AHAM again requested clarity and argued that, because the proposed amendments to measure fan-only mode would impact measured energy, DOE would need to either amend the standards in the Direct Final Rule to ensure that the stringency of those standards did not change or not require measurement of fan-only mode for compliance with the current or May 2013 standards:
AHAM notes that it is still somewhat unclear when compliance with some of the proposed revisions to the dishwasher test procedure would be required. Some of the proposals would or could impact measured energy. Accordingly, if those amendments would be effective under the existing standards and/or the pending direct final rule, DOE would need to do a crosswalk to ensure that the stringency of those standards does not change.
Then, in the Test Procedure Final Rule, DOE adopted amendments to measure fan-only mode and confirmed its estimates of the upper end of the range of annual energy consumption associated with fan-only mode.
Based on data AHAM collected, the fan-only mode amendments to the residential dishwasher test procedure will add a shipment weighted average of 0.29 kWh per year in measured energy. That energy takes into account the market penetration of fan-only mode—it does not assume that all basic models have fan-only mode. In addition, the shipment weighted average number includes a wide range of impacts on manufacturers and individual models, some much greater than 0.29 kWh per year. AHAM thus encourages DOE to interview individual manufacturers about the impact based on different technologies. AHAM's data show that, the fan-only mode amendments could add up to two percent of the 2013 standard in measured energy for some models. For models with fan-only mode, this is a significant impact on measured energy, particularly for minimally compliant products, and could not only require manufacturers to re-certify some or all of their models, but could also impact compliance with the standards. DOE should adjust the May 2013 standard to account for this impact on measured energy or, alternatively delay the requirement to measure fan-only mode until the compliance date of a future standard (i.e., after the May 2013 standards). AHAM's preference would be that DOE revise the standards with which compliance is required on May 30, 2013, to account for the impact on measured energy.
In making its determination not to adjust the May 2013 standards to account for the impact on measured energy resulting from the fan-only mode amendments, DOE seems to have relied upon (1) its estimation that energy use in fan-only mode is less than five percent of the total energy use of standard dishwashers; and (2) the fact that 65% of dishwashers currently on the market meet or exceed the energy conservation standards in the Direct Final Rule.
DOE determined that its amendments to require measurement of fan-only mode would impact measured energy. It must, therefore, amend the May 2013 standard to ensure that the stringency of those standards does not change.
Furthermore, DOE's statement that 65% of dishwashers currently on the market meet or exceed the May 2013 standards misses the point. First, even if it is true that most dishwashers already meet or exceed the upcoming standards, because fan-only mode impacts measured energy, manufacturers may need to re-certify and re-label models with fan-only mode, depending on the magnitude of the impact on each model and whether the manufacturer conservatively rated the product originally. The resources required to re-certify and re-label models is significant. And the result will be confusion to consumers. Second, DOE's own analysis itself is contradictory and belies its conclusions. That most products, but hardly all, already meet the new standards levels, leads to the conclusion that some do not
Nor is the fact that DOE is requiring measurement of fan-only mode for compliance with future standards sufficient to relieve DOE of its obligation to ensure that the stringency of those standards does not change. The standards in the Direct Final Rule did not contemplate measurement of fan-only mode, as evidenced by the facts that (1) the Joint Stakeholder Agreement on which the standards in the Direct Final Rule were based was finalized on July 30, 2010, over two years before the fan-only mode amendments were adopted; (2) the Direct Final Rule was published on May 30, 2012, only five days after DOE first proposed to require measurement of fan-only mode, and specifically stated that it was consistent with the proposed standards levels in the Joint Stakeholder Agreement; and (3) the Direct Final Rule became effective on September 27, 2012, a little over one month before publication of the Final Test Procedure Rule in the
The Joint Stakeholder Agreement specifically contemplated just this situation by providing, in proposed statutory language, that, should the residential test procedure be amended prior to the compliance date of the agreed-to amended standards, the procedures of 42 U.S.C. 6293(e)(2) must be followed.
DOE authorized the Test Procedure Final Rule on September 17, 2012, which was the same date comments on the Direct Final Rule and accompanying Notice of Proposed Rulemaking were due to DOE. Notice of that authorization was not sent to stakeholders until 6:06 p.m. on September 17, 2012, thus not affording stakeholders sufficient time to be able to review and develop comments prior to the end of the comment period on the Direct Final Rule.
Accordingly, AHAM requests that DOE either: (1) Revise the May 2013 standards to account for the impact on measured energy resulting from the fan-only mode amendments; or (2) not require measurement of fan-only mode until such time as a future revised standard is promulgated for residential dishwashers. AHAM's preference would be that DOE revise the standards with which compliance is required on May 30, 2013, to account for the impact on measured energy.
DOE determined, and AHAM data confirms, that the standby and off mode amendments to the residential dishwasher test procedure impact measured energy. DOE determined that because the amendments would not be required to determine compliance with the current standards, it did not need to adjust the standards to account for the increase in measured energy. AHAM disagrees—DOE's decision not to adjust the standards violates DOE's statutory obligations under 42 U.S.C. 6295(gg)(2) and 42 U.S.C. 6293(e). AHAM thus requests that DOE adjust the May 2013 standards to account for the impact of the standby and off mode amendments on measured energy or not require those amendments to determine compliance with the May 2013 standard.
DOE determined that the amendments to the dishwasher test procedure regarding standby and off mode would impact measured energy and, thus, proposed that those amendments not be required until the compliance date of amended dishwasher standards that address standby mode and off mode energy use.
Throughout the rulemaking, it seemed that DOE would, appropriately, use the standards-setting process to account for the increase in measured energy due to the standby and off mode test procedure amendments. For example, DOE stated “that the standby mode and off mode energy use is of a magnitude that it would materially affect that standard-setting process without overwhelming the effects of differing levels of active mode energy use.”
In the September 2011 SNOPR, DOE continued to conclude that no amendments to the existing energy conservation standards would be required because the “proposed amendments would not measurably alter the existing energy efficiency and energy use metrics for residential dishwashers . * * * [and because] those proposed amendments would clarify that manufacturers would not be required to use the provisions relating to standby mode and off mode energy use until the compliance of new energy conservation standards addressing such energy use.” September 2011 SNOPR, at 58355. AHAM commented that it did not agree with DOE's conclusion that there would be no change in measured energy resulting from the standby and off mode test procedure changes:
AHAM does not agree, however, that there would be no change in measured energy resulting from the changes to the dishwasher test procedure. Although the dishwasher test procedure currently
AHAM October 2011 Comments, at 3. Yet DOE did not change its position in the Test Procedure Final Rule.
Based on data AHAM collected, the standby and off mode amendments to the residential dishwasher test procedure will add a shipment weighted average of 1.10 kWh per year. This amount could be enough, especially combined with the increase in measured energy due to the fan-only mode amendments, to require a manufacturer to re-certify and re-label some or all of its dishwasher models. In addition, the shipment weighted average number includes a wide range of impacts on manufacturers and individual models, some much greater than 1.10 kWh per year. AHAM thus encourages DOE to interview individual manufacturers about the impact based on different technologies.
DOE did not address the impact of the standby or off mode as measured per Appendix C1 in the Direct Final Rule. Nor could it have because DOE adopted Appendix C1 on October 31, 2012, over a month after the Direct Final Rule became effective. Furthermore, the Joint Stakeholder Agreement did not contemplate the standby and off mode amendments to the test procedure and the Joint Stakeholders made no agreement regarding the proper standards for standby and off mode energy consumption.
Thus, in order to require use of the amendments for compliance with the May 2013 standards, DOE must account for the increase in measured energy due to the standby and off mode amendments. DOE followed this approach in its implementation of the Joint Stakeholder Agreement's recommendations for clothes dryers, room air conditioners, and clothes washer standards.
In the Test Procedure Final Rule, DOE concluded, based only on a lack of data to the contrary, that the incorporation by reference of AHAM DW–1–2010 would not impact measured energy.
In the Test Procedure Final Rule, DOE responded to the lack of data by identifying the differences between AHAM DW–1–1992 and AHAM DW–1–2010 and stating that it had “not been presented with any data or information that would show that these differences would impact the results from the DOE dishwasher test procedure for specific dishwasher models. DOE also notes the uniform support from commenters to reference the most recent version of industry standards in its test procedures and observes that some test laboratories are already conducting dishwasher testing according to ANSI/AHAM DW–1–2010. Further, these amendments will not be required until the compliance date of new standards, which will be May 30, 2013. * * * If manufacturers determine that the new DOE test procedure does not measure energy and water use that is representative for their products, they may submit to DOE a petition for waiver from the DOE test procedure to determine an appropriate method.” Test Procedure Final Rule, at 65966.
AHAM fully supports incorporation of AHAM DW–1–2010 by reference in Appendix C1 and thanks DOE for incorporating by reference the most recent industry test procedure. Like DOE, AHAM does not believe that the differences between AHAM DW–1–1992 and AHAM DW–1–2010 would noticeably impact measured energy. Accordingly, we are not asking DOE to reconsider its decision to incorporate AHAM DW–1–2010 by reference. Nevertheless, DOE should ensure in future rulemakings that it fulfills its duty under the law to investigate the impact on measured energy and should not act on its own non-empirical belief about the impact of a test procedure change on measured energy. If DOE does not get the data it requests, it must gather the data itself, continue seeking it from sources likely to have it, or accept that there is no available data on the point and thus, no rational, empirically based action can be taken.
DOE concluded during the rulemaking process that amendments to the residential dishwasher test procedure regarding fan-only mode and standby and off mode impact measured energy. And, as discussed above, AHAM's data further quantifies that impact. Furthermore, the shipment weighted average of the impact of both the fan-only mode and standby and off mode amendments is 1.38 kWh per year. That energy takes into account the market penetration of fan-only mode—it does not assume that all basic models
AHAM believes that, overall, the amendments made to the test procedure, which reside in Appendix C1, are critical amendments, many of which will enhance the repeatability and reproducibility of the test procedure. And we thank DOE for making those amendments, many of which AHAM requested. Thus, AHAM's preference would be that DOE revise the standards with which compliance is required on May 30, 2013, to account for the impact on measured energy. AHAM would be glad to assist DOE in determining the appropriate amended energy conservation standard under 42 U.S.C. 6293(e)(2). Pending resolution of the instant petition, AHAM requests that DOE stay compliance with the May 30, 2013, standards and Appendix C1.
Office of Energy Efficiency and Renewable Energy, Department of Energy.
Notice of proposed rulemaking (NOPR).
The Energy Policy and Conservation Act of 1975 (EPCA), as amended, prescribes energy conservation standards for various consumer products and certain commercial and industrial equipment, including incandescent reflector lamps (IRLs). The U.S. Department of Energy (DOE) received a petition from the National Electrical Manufacturers Association requesting the initiation of a rulemaking to exclude from coverage under EPCA standards a certain type of IRL marketed for use in pool and spa applications. Specifically, the lamp at issue is a 100-watt R20 short (having a maximum overall length of 3 and
DOE will accept comments, data, and information regarding this NOPR no later than March 1, 2013. See section 0 Public Participation for details.
Any comments submitted must identify the NOPR for Energy Conservation Standards for R20 Short Lamps, and provide docket number EERE–2010–BT–PET–0047 and/or regulatory information number (RIN) number 1904–AC57. Comments may be submitted using any of the following methods:
1.
2.
3.
4.
Written comments regarding the burden-hour estimates or other aspects of collection-of-information requirements may be submitted to Office of Energy Efficiency and Renewable Energy through the methods listed above and by email to
For detailed instructions on submitting comments and additional information on the rulemaking process, see section 0 of this document (Public Participation).
Docket: The docket is available for review at
The regulations.gov Web page will contain simple instructions on how to access all documents, including public comments, in the docket. See section 0 for more information on how to submit comments through
For further information on how to submit a comment or review other public comments and the docket, contact Ms. Brenda Edwards at (202) 586–2945 or by email:
Ms. Lucy deButts, U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Program, EE–2J, 1000 Independence Avenue SW., Washington, DC 20585–0121. Telephone: (202) 287–1604. Email:
Ms. Celia Sher, U.S. Department of Energy, Office of the General Counsel, GC–71, 1000 Independence Avenue SW., Washington, DC 20585–0121. Telephone: (202) 287–6122. Email:
The Energy Policy and Conservation Act of 1975 (EPCA; 42 U.S.C. 6291
Accordingly, DOE has assessed the impact of the application of R20 short lamps on the potential energy savings from energy conservation standards for these lamps. The characteristics of R20 short lamps, as well as their distribution channels and marketing, indicate that they are designed for pool and spa applications. DOE determined that because the R20 short lamps serve a very small market, they will result in insignificant energy savings from the applicable conservation standards.
Additionally, DOE analyzed the characteristics of R20 short lamps to determine if they were available in reasonably substitutable lamp types. Because the most likely substitute lamp required a modification to the fixture lens in order to maintain the same light distribution, DOE has tentatively concluded that no currently commercially available lamp can serve as a reasonable substitute for the R20 short lamp.
Therefore, under 42 U.S.C. 6291(30)(E), DOE proposes to exclude R20 short lamps from coverage of energy conservation standards by modifying the definition of “Incandescent reflector lamp” and proposing a new definition for “R20 short lamp” in 10 CFR 430.2. Based on consideration of the public comments DOE receives in response to this notice and related information collected and analyzed during the course of this rulemaking effort, DOE may revise the proposal in this document.
Title III, Part B of EPCA (42 U.S.C. 6291–6309, as codified) established the Energy Conservation Program for Consumer Products Other Than Automobiles,
In particular, amendments to EPCA in the Energy Policy Act of 1992 (EPAct 1992), Public Law 102–486, established energy conservation standards for certain classes of IRLs and authorized DOE to conduct two rulemaking cycles to determine whether those standards should be amended. (42 U.S.C. 6291(1), 6295(i)(1) and (3)–(4)) DOE completed the first cycle of amendments by publishing a final rule in July 2009 (hereafter “2009 Lamps Rule”). 74 FR 34080 (July 14, 2009).
The EPAct 1992 amendments to EPCA also added as covered products certain IRLs with wattages of 40W or higher and established energy conservation standards for these IRLs. Section 322(a)(1) of the Energy Independence and Security Act of 2007 (EISA 2007), Public Law 110–140, subsequently expanded EPCA's definition of “incandescent reflector lamp” to include lamps with a diameter between 2.25 and 2.75 inches.
Although these lamps are covered products, 42 U.S.C. 6291(30)(E) gives DOE the authority to exclude these lamps upon a determination that standards “would not result in significant energy savings because such lamp is designed for special applications or has special characteristics not available in reasonably substitutable lamp types.”
The Administrative Procedure Act (APA; 5 U.S.C. 551
As stated in the previous section 0, amendments to EPCA in EISA 2007 expanded EPCA's definition of IRLs to include smaller diameter lamps, such as the R20 lamps that are the subject of this rulemaking. (42 U.S.C. 6291(30)(C)(ii)) The related statutory standards went into effect on June 15, 2008—180 days after the date of enactment of EISA 2007. (42 U.S.C. 6295(i)(1)(D)(ii)) Although R20 short lamps were required to comply with these standards, noncompliant R20 short lamps remained on the market until September 2010 because the manufacturers of these lamps mistakenly believed the lamps were excluded from coverage. 75 FR at 80732 (Dec. 23, 2010). The manufacturers had relied upon the Federal Trade
In the petition, NEMA asked both for a rulemaking to exclude R20 short lamps from coverage of energy conservation standards, and for a stay of enforcement pending that rulemaking. As grounds for the petition, NEMA stated that R20 short lamps qualify for exclusion under 42 U.S.C. 6291(30)(E), which allows the Secretary to exclude a fluorescent or incandescent lamp “as a result of a determination that standards for such lamp would not result in significant energy savings because such lamp is designed for special applications or has special characteristics not available in reasonably substitutable lamp types.” In its petition, NEMA contended that a rulemaking would find that energy conservation standards for R20 short lamps would not result in significant energy savings and that the lamp was designed for special applications or has special characteristics not available in substitute lamp types. Specifically, as the lamp has a particular MOL and is specially designed to meet underwater illumination requirements of pool and spa manufacturers (including designated beam spread and lumen output), there are no substitute products on the market for this application. 75 FR at 80732 (Dec. 23, 2010).
Additionally, NEMA asserted that having energy conservation standards for this lamp type would lead to its unavailability in the United States. To the best of NEMA's and manufacturers' knowledge, the decision of the two manufacturers of R20 short lamps to withdraw the product from the market has already resulted in its current unavailability. 75 FR at 80732–33 (Dec. 23, 2010).
DOE received several comments on the petition from manufacturers, utilities, and environmental and energy efficiency organizations.
DOE received comments in response to the RFI from utilities and environmental and energy efficiency organizations.
In response to the RFI, DOE received comments from interested parties regarding DOE's authority to exclude R20 short lamps under 42 U.S.C. 6291(30)(E). Earthjustice and National Resources Defense Council (hereafter “Earthjustice and NRDC”) reiterated their previous comment made in response to NEMA's petition that section 6291(30)(E) can only apply to lamps for which significant energy savings would not be captured under future standards; the language of the provision (i.e., “would not result”) does not permit DOE to apply it retroactively to lamps with existing standards. (Earthjustice and NRDC, No. 8 at p. 1)
As stated in the RFI, DOE does not believe the plain language of section 6291(30)(E) compels an interpretation that the section only applies to standards before their compliance date. DOE finds this reading would prevent application of section 6291(30)(E). Under 42 U.S.C. 6295(o)(3), DOE is already barred from adopting standards for any product for which the standards would not result in significant conservation of energy. Therefore, if interpreted to apply to products for which standards are not yet in effect, section 6291(30)(E) would be rendered redundant and superfluous, as both it and section 6295(o)(3) would evaluate potential energy savings from future standards. Instead, DOE concluded in the RFI that section 6291(30)(E) contains no time bar for undertaking a rulemaking action to address a lamp for which standards would not result in significant energy savings because it is designed for special applications or has special characteristics not available in substitutable lamp types. Given the broad and growing coverage of DOE's energy conservation standards for lamps, DOE believes that Congress intended section 6291(30)(E) to provide a mechanism to address both those lamps inadvertently covered by existing standards, as well as new lamps subsequently developed to which standards would otherwise apply. 76 FR at 55611 (Sept. 8, 2011).
Earthjustice and NRDC disagreed that section 6291(30)(E) would be redundant if not applicable to standards that already require compliance. Earthjustice
The language in section 6291(30)(E) does not explicitly condition exclusions from coverage of standards based on the authority under which the standards were developed. Interpreting section 6291(30)(E) as applying to only statutory standards in order to distinguish it from section 6295(o)(3) would limit the scope of section 6291(30)(E). The language in section 6291(30)(E) does not indicate that it was Congress's intent to limit the Secretary's authority of exemption. Therefore, DOE preliminarily concludes it has the authority under section 6291(30)(E) to consider excluding R20 short lamps from energy conservation standards. DOE assessed whether the lamps qualify for exclusion under each criteria set forth in that section.
NEMA's original petition stated that the R20 short lamp was specifically designed to meet the underwater illumination requirements of pool and spa part manufacturers. NEMA stated that the R20 short lamp's MOL, heat shield, filament, lumen output, and beam spread indicate the lamp was specifically designed for its application. 75 FR at 80733 (Dec. 23, 2010) Through interviews with lamp manufacturers and pool and spa part manufacturers, DOE was able to confirm that the R20 short lamp's MOL of 3 and
In addition to design features, DOE also analyzed distribution channels and marketing literature for R20 short lamps. NEMA commented that along with R20 short lamps' design characteristics, their application-specific marketing and specialty distribution methods deter any use in other applications. (NEMA, No. 7 at p. 1) DOE found R20 short lamps are marketed and clearly packaged in a way that indicates the lamps are specifically for pool and spa use. Through lamp manufacturer interviews and research conducted by DOE using publicly available information, DOE found that R20 short lamp manufacturers do not sell lamps directly to consumers. The commercial market is supplied through catalog warehouses, maintenance supply, maintenance, repair, operations (MRO) distributors, and pool and spa distributors. The residential market is primarily supplied through pool and spa distributors, which include large retail pool outlets and online retailers. Additionally, a small portion of products are sold to online retailers for pool and spa replacement parts, electrical distributors for direct installation in new pool construction, and hospitality and specialty lighting suppliers (e.g., medical equipment retail) for use with pools and spas.
Given the preceding information, DOE tentatively concludes that the non-traditional distribution channels and application-specific packaging indicates R20 short lamps are designed for pool and spa applications. Combined with the application-specific characteristics described in the previous section, DOE preliminary concludes that R20 short lamps are designed for a special application and therefore fulfill the special application condition in section 6291(30)(E).
As mentioned in the previous sections, under 42 U.S.C. 6291(30)(E), DOE may determine to exclude a fluorescent or incandescent lamp provided standards for the lamp would not result in significant energy savings because the lamp is designed for special applications. As stated in section 0, DOE preliminarily concluded that certain features of R20 short lamps and manufacturers' use of specialty distribution channels and application-specific marketing indicate that R20 short lamps are designed for a special application. Given that R20 short lamps met this criterion, DOE then considered the impact on energy savings from regulation of R20 short lamps.
NEMA commented that R20 short lamps have a minimal potential for energy savings because of low sales and operating hours due to their use in specialty task lighting rather than in general applications. (NEMA, No. 7 at p. 2) As part of its analysis, DOE evaluated the market share of R20 short lamps put forth by NEMA. In its petition, NEMA stated there are only two known manufacturers of the 100W R20 short lamp in the United States. Both manufacturers submitted their confidential R20 short lamps 2009 shipment data to NEMA. In interviews, these lamp manufacturers commented that the shipment data from 2009 is representative of the R20 short lamp market before they stopped making the lamp available to consumers in 2010. For comparison, NEMA used an adjusted estimate of covered IRL shipments from the 2009 Lamps Rule. In the 2009 Lamps Rule, DOE estimated the shipments of covered IRLs to be 181 million units in the year 2005. Based on a decline in shipments of all IRLs in 2009, NEMA assumed covered IRLs would also decline, but estimated the shipments to still remain above 100 million. Based on a minimum of 100 million and a maximum of 181 million shipments of covered IRLs, NEMA calculated that the shipments of R20 short lamps represented significantly less than 0.1 percent of 2009 shipments of covered IRLs. 75 FR at 80733 (Dec. 23, 2010).
DOE independently obtained shipment information from lamp manufacturers that confirmed NEMA's estimate of R20 short lamps being significantly less than 0.1 percent of 2009 shipments of covered IRLs. Therefore, DOE determined this to be an accurate assessment of the R20 short lamp market share and concluded that less than 0.1 percent of covered IRLs indicated a small market share for R20 short lamps. (More information on R20 short lamp energy use can be found in appendix B.
DOE also analyzed the potential for market migration of R20 short lamps. Pacific Gas and Electric Company, Southern California Gas Company, San Diego Gas and Electric, and Southern California Edison (hereafter “CA
DOE received information from lamp manufacturers stating that the end-user price varies, but typically ranges from $12 to $25. DOE research confirmed this large variation, finding prices ranging from as low as $2 to as high as $25. DOE acknowledges that the price of R20 short lamps can be competitive with other IRLs. Even with low prices, however, substitution of R20 short lamps in general applications is unlikely as consumers are unable to purchase R20 short lamps at typical retail outlets such as large home improvement stores. In interviews, lamp manufacturers stated that the R20 short lamp market is primarily for replacement lamps and, therefore, historically had shown very little growth or decay. Further, despite lamp manufacturers never previously considering the lamps as regulated, the market share has remained extremely low and there has been no indication of market migration. Therefore, DOE has preliminarily concluded that the R20 short lamp market has limited potential for growth and it is unlikely the lamps will migrate to general lighting applications.
CA Utilities also cited the R20 short lamp MOL as a reason for potential market migration, stating that there are commercially available lamps that have the same shortened 3 and
Because the specialty application of the R20 short lamps results in a small market share and limited potential for growth for these lamps, DOE determined that the regulation of R20 short lamps would not result in significant energy savings. For these same reasons, DOE has also tentatively concluded that the exclusion of R20 short lamps would not significantly impact the energy savings resulting from energy conservation standards. DOE requests comment on its assessment of the potential energy savings from standards for R20 short lamps.
DOE may also exclude a lamp type because its special characteristics are not available in reasonably substitutable lamp types. 42 U.S.C. 6291(30)(E) To determine whether an exclusion was also acceptable based on this second condition, DOE ascertained whether special characteristics of R20 short lamps are available in reasonable substitutes. The following sections detail DOE's analysis, which consisted of identifying the special characteristics of R20 short lamps and determining whether these characteristics existed in other lamp types that would qualify as reasonable substitutes.
As discussed in section 0, DOE received comments that the R20 short lamps' shortened MOL, heat shield, specially engineered filament, and lamp performance (including a wide beam spread and high lumen output) indicate that the lamp was designed specifically for pool and spa applications. Therefore, DOE evaluated these lamp characteristics to determine if they should be considered as necessary in potential substitute lamps. DOE considered a lamp characteristic special if, without it, the R20 short lamp would not be able to provide the special application for which it was designed (i.e. use in pools and spas). Therefore, even if the lamp characteristic was not unique to the R20 short lamp, it was deemed special if it was required for the lamp to function in pools and spas. DOE identified a set of features that in combination allow the lamp to be used in a specialty application.
Beyond the characteristics mentioned above, DOE did not find any other R20 short lamp feature that should be considered a necessary special characteristic. DOE requests comments on any additional characteristics, other than those identified, that should be considered special characteristics.
The R20 short lamp has a MOL of 3 and
DOE notes that there are currently several lamps in the marketplace that are labeled as short lamps, but are not designed for specific applications. These commercially available lamps have the same shortened MOL of 3 and
DOE received comments that the heat shield in the R20 short lamp was a special characteristic that is required to prevent high heat from damaging the cement that joins the glass envelope and base. 75 FR at 80732 (Dec. 23, 2010). Heat shields are metal rings constructed of either aluminum or steel and located in the narrow portion of the reflector below the filament. In lamp manufacturer interviews, DOE learned that heat shields are used to reflect radiant energy away from the lamp base. DOE further confirmed with lamp manufacturers that because of the high operating temperatures of pools and
NEMA stated that the R20 short lamp's filament was specially engineered to provide a required beam spread. 75 FR at 80732 (Dec. 23, 2010). DOE attempted to identify how the filament was specially engineered and if the design change was necessary for the lamp's use in pools and spas.
Through teardowns and interviews with lamp manufacturers, DOE verified that R20 short lamps use a C–9 filament. This filament type is a single-coil filament that is commonly used in indoor IRLs. DOE received feedback from lamp manufacturers that although the filament type is not unique, the filament has been specifically placed within the lamp in order to achieve the same beam spread as a standard R20 lamp. Therefore, it is the placement of the filament, rather than the filament itself, that is distinct. Because the filament is placed to produce a specific beam spread, DOE does not consider filament placement to be a special characteristic, but a method of achieving a specific beam spread. The beam spread characteristic is discussed further in the following section.
In its petition NEMA stated that R20 short lamps are required to meet a specific beam spread and lumen output identified by pool and spa part manufacturers. 75 FR at 80733 (Dec. 23, 2010). In interviews with lamp manufacturers DOE learned that R20 short lamps have a lumen output between 900 and 1,000 lumens and a beam angle between 70 and 80 degrees. Additionally, DOE received comments that public pools and spas are often required to achieve minimum illumination levels. (NEMA, No. 2 at p. 1) DOE conducted independent testing on each of the two known lamp manufacturer's R20 short lamp models to confirm the lumen output and beam angle specifications, and also further researched illumination requirements.
The measured lumen output of the two R20 short lamp models indicated a lumen output range of 637 lumens to 1,022 lumens. The average lumen output of the first model was 967 lumens and within lamp manufacturer specified range. The second model's average lumen output was 720 lumens, which was considerably lower. DOE did not find any information indicating that these lower lumen output R20 short lamp models produced an inadequate lumen output or had any issues in their use in pool and spa applications. DOE considered both the measured and the rated lumen output to determine a broad lumen output range. DOE therefore concluded that a potential substitute lamp would need to achieve a measured lumen output between 637 and 1,022 lumens.
The measured beam angle of the R20 short lamp models indicated a range of 111 to 123 degrees and was relatively consistent between the two models. The average beam angle of the first model was 117 degrees and the average beam angle of the second was 116 degrees. The measured beam angle range did not correspond to the 70- to 80-degree beam angle range identified by lamp manufacturers. However, because lamp manufacturer feedback indicated R20 short lamps can have a 70-degree beam angle, DOE decided to establish a range encompassing both measured and manufacturer-provided beam angles. DOE therefore concluded that a potential substitute lamp would need to achieve a measured beam angle between 70 and 123 degrees.
Additionally, as previously stated, DOE further researched illumination requirements based on wattage. Pool and spa part manufacturers confirmed during interviews that R20 short lamps are designed to provide 0.5W of input power per square foot of water surface area, or equivalent level of illumination, to account for commercial building code requirements pertaining to products for pool and spa lighting. In researching building codes, DOE found that while commercial building codes exist on both state and local levels, and vary by jurisdiction, there is no evidence of pools and spas in the residential sector being subject to building code requirements for lighting.
CA Utilities commented that minimum power density requirements prescribed in some local safety ordinances are often waived when replacement light sources are proven to provide adequate illumination comparable to incandescent lighting. For example, CA Utilities stated that California State regulations only specify that underwater lighting be adequate to see a person at the bottom of the pool and assure water quality. Therefore, CA Utilities concluded that low-wattage replacement lamps can be used as substitutes provided they have been demonstrated to provide acceptable levels of light. (CA Utilities, No. 9 at pp. 2–3)
DOE agrees with CA Utilities that building code requirements vary by jurisdiction and some waive requirements when replacement light sources are proven to provide adequate lighting. However, it appears that not all jurisdictions have explicitly included this caveat in their building codes and some seem to maintain minimum requirements based on input power alone. DOE requests further comment on whether reduced wattage lamps can be used in all jurisdictions, provided that adequate illumination is proven.
In order to account for the variation in commercial building code requirements, DOE used the design specification of 0.5W per square foot of water surface area, or the equivalent illumination for reduced wattage lamps, to determine if potential substitutes were in compliance. DOE requests comment on whether this specification for underwater illumination is accurate for commercial building code compliance.
Given the criteria discussed in the previous section, DOE evaluated lamps that could serve as potential substitutes by determining whether they contained all of the following special characteristics of R20 short lamps:
• Shortened MOL: An MOL of 3 and
• Heat Shield: A shield reflecting radiant energy from lamp base;
• Beam Spread: A beam angle between 70 and 123 degrees;
• Lumen Output: A lumen output between 637 and 1,022 lumens; and
• Illumination: 0.5W per square foot of water surface area or the equivalent.
With regards to potential substitutes, in its petition NEMA stated that Pentair, a pool and spa part manufacturer, had noted only an R20 short lamp can be used with the existing fixtures because the lamp is listed on the fixture's Underwriters Laboratory (UL) listing. (NEMA, No. 2 at p. 3) All underwater pool and spa lighting must adhere to the applicable UL standards in the United
NEMA commented that underwater lamp fixtures are tightly sealed to prevent water intrusion and therefore experience elevated temperatures that typically exceed the recommended operating temperature of any electronically self-ballasted lamps. NEMA added that current compact fluorescent lamp (CFL) and light-emitting diode (LED) PAR lamp
DOE surveyed the market and identified several commercially available lamps that were marketed or evaluated by manufacturers as potential substitutes for an R20 short lamp. These lamps included more efficacious R20 short lamps, smaller diameter IRLs, and LED lamps. When analyzing each of the likely replacements, DOE focused on whether they possessed the special characteristics of the R20 short lamp. DOE's initial findings are outlined below.
Currently available R20 short lamps do not meet existing energy conservation standards. When examining substitute lamps, DOE explored the possibility of a halogen-based R20 short lamp with an improved efficacy that would meet standards. Specifically, DOE examined the addition of halogen capsules to existing R20 short lamps. Tungsten-halogen lamps are a specific type of IRL that contain a small diameter, fused quartz envelope, referred to as a capsule, filled with a halogen molecule that surrounds the filament. The use of halogen capsules is known to improve the efficacy of IRLs.
In the RFI, DOE requested additional information on the feasibility of improving the efficacy of R20 short lamps while maintaining the necessary characteristics required for pool and spa applications. 76 FR at 55614 (Sept. 8, 2011). DOE received several comments in response to this request, mainly regarding halogen-based technology. NEMA commented that incorporating halogen capsules currently used in PAR lamps in R20 short lamps will not allow R20 short lamps to meet energy conservation standards established by the 2009 Lamps Rule that require compliance on July 14, 2012. NEMA stated that lamp manufacturers attempted to improve the efficacy of R20 short lamps through the use of an incandescent halogen capsule, but found it technically infeasible either due to MOL constraints, internal dimensional compatibility of the halogen capsule, or meeting light output or beam spread requirements. (NEMA, No. 7 at p. 1)
CA Utilities and Earthjustice and NRDC disagreed with NEMA's comment and stated that the efficacy of existing lamps can be improved while still maintaining the necessary requirements for pool and spa applications. CA Utilities commented that single-ended and double-ended halogen burners are frequently used in small diameter reflector lamps to improve efficacy. CA Utilities suggested that because PAR20 lamps, which typically do not have MOLs exceeding 3 and
In order to determine if an improved R20 short lamp could be a substitute, DOE modeled the performance of an R20 short lamp with a halogen capsule. DOE then determined if the halogen-based R20 short lamp would meet energy conservation standards and the special characteristic requirements.
First, DOE determined the dimensional compatibility of incorporating halogen technology in R20 short lamps. DOE performed teardowns of a 60W PAR16 lamp containing a single-ended halogen burner, a 60W PAR30 lamp containing a double-ended halogen burner, and a 100W R20 short lamp to determine the dimensional compatibility of the halogen capsules within an R20 short lamp. Based on the dimensions of the burners and the R20 short lamp, DOE has tentatively concluded that it is possible to fit both the single-ended and double-ended halogen burners in an R20 short lamp. DOE notes that single-ended halogen burners are already present in commercially available R20 lamps that have a listed MOL of 3.54 inches and are intended for use in general lighting applications. Given this availability and the results of the teardown analysis, DOE agrees with CA Utilities and Earthjustice and NRDC that single-ended and double-ended halogen burners are the appropriate size for R20 short lamps. For more information on the teardowns, see appendix A.
DOE next performed testing to determine the potential improvement in efficacy for R20 short lamps through the use of single-ended and double-ended halogen burners. DOE performed independent testing and analysis to determine what the theoretical increase in efficacy would be, given the successful incorporation of each burner type.
To determine the efficacy of a theoretical R20 short lamp with a single-ended halogen burner, DOE tested a 120V, 45W halogen R20 lamp with a MOL of 3.92 inches that contained a single-ended burner. Using equations relating lumens and wattage from the Illuminating Engineering Society of North America (IESNA) Lighting Handbook (see appendix A), DOE scaled the lumen output of the 45W lamp such that it was within the desired range. Based on the calculations, DOE expects that when designing a more efficient version of an R20 short lamp, lamp manufacturers will be able to reduce the
To determine the efficacy of a theoretical R20 short lamp with a double-ended burner, DOE tested a 120V, 60W PAR30 short lamp that contained a double-ended burner dimensionally compatible with an R20 short lamp. DOE then applied a reflector efficiency factor (see appendix A) to scale the lumen output of the PAR lamp to that of an R lamp. Again using IESNA equations relating lumen output and wattage, DOE scaled the 60W lamp to a 75W lamp. The efficacy of the 100W R20 lamp was measured to be 8.5 lm/W, while the efficacy of the 75W halogen R20 lamp was calculated to be 13.8 lm/W. DOE determined that the use of a double-ended halogen burner would likely enable the 75W R20 halogen short lamp to meet the EISA 2007 standard of 12.5 lm/W; however, the efficacy would not increase enough to meet the 2009 Lamps Rule standard of 16.0 lm/W. Therefore, DOE has tentatively concluded that while a double-ended burner is dimensionally compatible with an R20 short lamp, this improved halogen R20 short lamp is not a viable substitute because the lamp would not meet July 2012 standards. For more information on the improved efficacy calculation, see appendix A.
DOE confirmed during interviews that lamp manufacturers had attempted to improve the efficacy of R20 short lamps through the use of halogen capsules. The information shared by lamp manufacturers supports DOE's findings that while some halogen capsules are dimensionally compatible with the R20 short lamp envelope, the use of halogen capsules does not improve the efficacy enough to meet the July 2012 standards.
Although the two model lamps do not comply with upcoming standards, DOE evaluated whether they could include the R20 short lamp special characteristics as listed in the beginning of section 0. As incorporating the halogen capsule does not affect the lamp length, the shortened MOL is retained. The heat shield could also be included in the improved R20 short lamp. The addition of a halogen capsule would, however, affect the lumen output and beam spread. Based on its theoretical modeling, DOE determined that the halogen-based R20 short lamp with single-ended burner would likely have a lumen output within the established range of 637 to 1,022 lumens, and the R20 short lamp with double-ended burner would have a slightly higher, but comparable lumen output. Additionally, because the position of the filament impacts the beam angle, DOE anticipates that the beam angle could be affected by the use of a halogen capsule; however, prototypes would need to be constructed and tested in order to confirm. Because DOE determined that the halogen-based R20 short lamp was not a viable option due to insufficient efficacy improvement, DOE did not conduct prototype testing to verify the effect on beam angle.
Further, DOE preliminarily concluded that the halogen-based R20 short lamp would meet the 0.5 watts per square foot of water surface area or equivalent illumination requirements because the theoretical lamp would deliver a higher lumen output with a reduced input wattage compared to the R20 short lamp. However, additional testing would be required to confirm this conclusion. DOE notes an improved R20 short lamp would need to be separately listed on the UL certification for a fixture because the lamp would have different specifications than current R20 short lamps.
DOE has tentatively concluded that because the improved efficacy of a halogen-based R20 short lamp would not meet or exceed the July 2012 standards, it is not a reasonable substitute.
Through market research and manufacturer interviews, DOE determined that 60W PAR16 lamps are currently being distributed and sold for use in pool and spa applications as a replacement for R20 short lamps. Existing energy conservation standards cover PAR lamps that have diameters exceeding 2.25 inches. Therefore, PAR16 lamps, which have a diameter of 2 inches, are not covered under standards. Through research DOE identified two 60W PAR16 models marketed for use in pool and spa applications. DOE tested these two models to determine if this lamp type contained the R20 short lamp special characteristics identified and could serve as a reasonable substitute. In manufacturer interviews, DOE was able to identify an additional 60W PAR16 model that can be used in pool and spa applications. This model was not tested as DOE determined it had adequate information to make a conclusion regarding the substitutability of this lamp type.
The 60W PAR16 lamp is a small diameter halogen lamp with a parabolic aluminized reflector. DOE found some variation in MOL of the 60W PAR16 lamps, ranging from a minimum MOL of 2.86 inches to a maximum of 3.31 inches. However, all models had a MOL less than the R20 short lamp MOL of 3.625 inches. In addition, the 60W PAR16 lamps tested contained heat shields.
After DOE confirmed that the physical specifications of the 60W PAR16 were equivalent to those of the R20 short lamp, DOE considered the performance specifications. DOE received feedback from lamp manufacturers that the lumen output of 60W PAR16 lamps was between 600 and 700 lumens and the beam angle was 30 degrees. DOE conducted independent testing and determined that the average lumen output of the models tested was 733 lumens.
DOE also measured beam angles and determined that the average beam angle was 34 degrees.
Additionally, DOE interviewed lamp manufacturers to determine if they considered the 60W PAR16 as a suitable replacement for the R20 short lamp. Lamp manufacturers commented that while the 60W PAR16 is being used in pools and spas, the lamp was not designed for such applications. The lamp was not utilized in pools and spas until September 2010, when an alternate lamp was needed until the R20 short lamp exclusion rulemaking was
During interviews, some lamp manufacturers commented that the lumen output and beam angle of the 60W PAR16 were not sufficient for use in pool and spa applications. However, DOE also received comments that the performance of the 60W PAR16 was comparable to the R20 short lamp when installed in a fixture with optimized components. Pool and spa part manufacturers develop underwater lighting based on the performance of a lamp and fixture together and optimize the fixture's components in order to achieve suitable illumination. A manufacturer of pool and spa parts commented that by adding an optimized lens to the R20 short lamp fixture, the measured light output and beam angle of the 60W PAR16 lamp within the fixture was comparable to the R20 short lamp within the fixture with a standard lens. The lens added to the R20 short lamp fixture was an existing component, developed for use with underwater LED lighting in order to provide a more diffuse beam spread. The pool and spa part manufacturer provided test results of the 60W PAR16 within the R20 short lamp fixture both with and without the optimized LED lens. When the LED lens was used, the beam angle was substantially increased and fell within the required beam angle range. However, because the subject of this rulemaking is specific to the lamp, DOE must evaluate the performance of the lamp alone when determining the availability of reasonable substitutes.
The 60W PAR16 is currently being marketed and sold for use in pool and spa applications and therefore likely to be compliant with building code requirements for appropriate illumination of pool/spas. DOE also notes that the 60W PAR16 lamp is UL listed for use in R20 short lamp fixtures.
The 60W PAR16 lamp is physically compatible with an underwater light fixture due to its short MOL and also contains a heat shield. However, in order for the 60W PAR16 to serve as a replacement for the R20 short lamp, modifications must be made to achieve the acceptable beam spread. Specifically, the 60W PAR16 must be partnered with a fixture with an optimized LED lens to achieve the appropriate beam angle. Because the 60W PAR16 lamp alone does not contain all of the special characteristics of a R20 short lamp, DOE has tentatively concluded that this is not a reasonable substitute.
CA Utilities commented that several commercially available LED lamps could serve as replacements for R20 short lamps. CA Utilities added that while the products are currently more expensive, they offer longer lifetimes with lower maintenance costs. In addition, LED prices are expected to decrease as the technology matures. (CA Utilities, No. 9 at p. 2) DOE did confirm that LED replacement lamps are currently being sold for use in pool and spa fixtures. DOE researched three LED models that were determined to be compatible with the R20 short lamp fixture in order to determine if the lamps offered the special characteristics of the R20 short lamp and could therefore be considered a substitutable lamp type.
One of the LED models that can be used as a replacement for R20 short lamps has a rated wattage of 8 W, a diameter of 2.5 inches, and has a listed MOL of 3.5 inches, which is less than that of a R20 short lamp MOL of 3.625 inches. The lamp has a lumen output of 500 lumens and a 40 degree beam angle. Additionally, the lamp has a rated lifetime of 40,000 hours. While the use of a heat shield is not applicable to LED lamps, the lamp manufacturer indicated that the lamp was adapted for use in underwater pool and spa applications and certain components were changed in order to withstand the high heat environment.
This LED lamp has the required MOL for pool and spa applications, however, the lamp does not achieve the required lumen output and beam angle. The LED lamp's rated lumen output of 500 lumens is notably less than the established acceptable range of 637 and 1,022 lumens. Additionally, the LED lamp's beam angle of 40 degrees is also considerably less than specified beam angle range of 70 to 123 degrees. DOE has tentatively concluded based on the lamp manufacturer-provided specifications, that this LED model is not a reasonable substitute because the lamp does not have the required special characteristics of the R20 short lamp.
The remaining two LED models for use in the R20 short lamp fixture did not have published performance specifications. DOE contacted the lamp manufacturers, but was able to obtain only limited information on the models. DOE was able to determine that one model has a rated wattage of 20 W, an MOL of 3.3 inches, and a diameter of 3.0 inches. DOE was unable to find information on the lamp shape, lumen output, beam angle, and rated lifetime of the model. For the other model, DOE was able to determine that it has a rated wattage of 12 W, an MOL of 2.41 inches, and a diameter of 3.07 inches. Similarly, DOE was unable to find information on the lamp shape, lumen output, beam angle, and rated lifetime of the model. Because of the limited information on these two LED models, DOE cannot conclude that the lamps have the required special characteristics of R20 short lamps. DOE welcomes further information on potential LED replacement models.
DOE assumed that because the LED lamps are currently being marketed and sold for use in pool and spa applications, these lamps provide the equivalent illumination of 0.5 watts per square foot of water surface area. DOE notes that the LED lamps are not UL listed for use in R20 short lamp fixtures.
DOE also identified an LED lamp that is being sold for use in pool and spa applications, but cannot be installed in an R20 short lamp fixture and, therefore, requires a compatible LED fixture. The LED lamp and fixture are intended to be a direct replacement for the R20 short lamp and fixture. Because the replacement option requires a completely new fixture and this rulemaking is evaluating the lamp alone, DOE has determined that this LED lamp is not a reasonable substitute.
Based on the foregoing, DOE has tentatively concluded that commercially available LED lamps are not reasonable substitutes because they do not have the required special characteristics of R20 short lamps. DOE also tentatively concluded that the LED lamp and fixture replacement identified is not a reasonable substitute because it requires more than the lamp to be replaced.
DOE requests comment on the analysis of potential R20 short lamp substitutes and its initial conclusion that there are no reasonable substitutes for this lamp type.
In interviews with manufacturers, DOE established that R20 short lamps were designed for pool and spa applications based on industry need and consumer preference. The design requirements included a wide beam spread, high lumen output and adequate illumination; a heat shield to withstand the high operating temperatures of spas; and a shortened MOL, allowing the lamp to fit in underwater pool or spa fixtures. Further, DOE determined that the majority of R20 short lamps are purchased from pool and spa distributors and specialty retail stores, and are not available where IRLs are typically sold for general lighting applications. R20 short lamps are also marketed and clearly packaged in a way that indicates the lamps are specifically for pools and spas. Therefore, DOE has preliminarily concluded that R20 short lamps are designed for pool and spa applications. Due to the special application of R20 short lamps, DOE assessed the impact on energy savings from the exclusion of these lamps from energy conservation standards. As R20 short lamps have a small market share and limited potential for growth, DOE tentatively determined that the regulation of R20 short lamps would not result in significant energy savings.
DOE also evaluated lamps that could serve as potential substitutes by analyzing their ability to replicate the specialized characteristics of the R20 short lamp, specifically a shortened MOL, heat shield, high lumen output, wide beam spread, and adequate illumination. DOE considered a halogen-based R20 short lamp with improved efficacy, a commercially available 60W PAR16 lamp, and LED lamps as potential substitutes. DOE has tentatively disqualified these lamps as reasonable substitutes for the following reasons: (1) The halogen-based R20 short lamp would not comply with standards; (2) the 60W PAR16 can only achieve the required beam spread when partnered with a fixture with an optimized LED lens; and (3) the LED replacement does not have the necessary lumen output.
Based on the previous assessments, DOE proposes to exclude R20 short lamps from energy conservation standards. DOE's analysis has initially found that energy conservation standards for R20 short lamps would not result in significant energy savings because the lamps are designed for special applications, and also that the lamps have special characteristics that are not available in reasonably substitutable lamp types. Therefore, under section 6291(30)(E), DOE proposes to exclude R20 short lamps from energy conservation standards by modifying the definition of “Incandescent reflector lamp” and proposing a new definition for “R20 Short Lamp” in 10 CFR 430.2. DOE requests comment on its proposed determination that R20 short lamps should be excluded from energy conservation standards.
Stakeholders provided additional suggestions on how to exclude R20 short lamps from energy conservation standards. Earthjustice and NRDC commented that if DOE excludes R20 short lamps from coverage under EPCA energy conservation standards, measures must be taken to ensure that the blanket exclusion does not become a loophole. Earthjustice and NRDC provided four recommendations for conditional exclusions. In one recommendation, Earthjustice and NRDC suggested that DOE could provide exclusion only for R20 short lamps installed in states where 120V electricity supplies pools and spas. This would prevent R20 short lamps from migrating to states where the only use would be as a substitute for an IRL that meets standards. Earthjustice and NRDC suggested in another recommendation that DOE limit the exclusion to a specified number of R20 short lamps. They stated DOE has the authority to do this because section 6291(30)(E) authorizes DOE to grant exclusion from standards at the individual lamp level. Another recommendation was to exclude the first 100,000 R20 short lamps produced after the final rule effective date on the basis that subsequent production would abate findings that standards would not result in significant energy savings. In addition, Earthjustice and NRDC suggested DOE could establish an annual sales limit, restricting the market share and thereby ensuring that standards for R20 short lamps would not result in significant energy savings. They stated that this could be accomplished by requiring manufacturers to report sales quarterly and terminating the exclusion when reported sales exceed an established percentage of historic annual sales. (Earthjustice and NRDC, No. 8 at pp. 2–4)
Finally, Earthjustice and NRDC also suggested that any exclusion expire after five years, regardless of lamp sales. This would allow R20 short lamp manufacturers enough time to perform necessary redesign for incorporating more energy-efficient lighting technologies at the lowest possible cost, while not greatly reducing energy savings achieved through standards.
As mentioned previously, DOE does not anticipate market growth or market migration of R20 short lamps due to their application-specific marketing and unique distribution channels. DOE's proposed definition for R20 short lamps requires them to be designed, labeled, and marketed for pool and spa applications. However, DOE would consider reevaluating the exclusion of R20 short lamps from energy conservation standards, if it was found that lamp sales were increasing due to market migration after an exclusion of R20 short lamps was granted. DOE invites the submission of shipment information that supports increased lamp sales following an exclusion of R20 short lamps.
Earthjustice and NRDC also suggested that DOE require a technical specification for R20 short lamps, such as a specific correlated color temperature value, that would not significantly affect quality or efficiency but would ensure the lamp would not be used in other applications. (Earthjustice and NRDC, No. 8 at p. 4) EPCA authorizes DOE to consider and adopt only performance-based energy conservation standards for this product. (42 U.S.C. 6291(6)) DOE cannot, therefore, specify R20 short lamps to have certain technical characteristics. Further, as stated previously, DOE does not anticipate that R20 short lamps would be used in other applications and therefore, does not see a need for such a requirement.
Today's regulatory action has been determined to not be a “significant regulatory action” under section 3(f) of Executive Order 12866, “Regulatory Planning and Review,” 58 FR 51735 (Oct. 4, 1993). Accordingly, the Office of Information and Regulatory Affairs (OIRA) in the Office of Management and Budget (OMB) is not required to review this action.
DOE has also reviewed this proposed regulation pursuant to Executive Order 13563, issued on January 18, 2011 (76
DOE emphasizes as well that Executive Order 13563 requires agencies to use the best available techniques to quantify anticipated present and future benefits and costs as accurately as possible. In its guidance, OIRA has emphasized that such techniques may include identifying changing future compliance costs that might result from technological innovation or anticipated behavioral changes. For the reasons stated in the preamble, DOE believes that today's NOPR is consistent with these principles, including the requirement that, to the extent permitted by law, benefits justify costs and that net benefits are maximized.
The Regulatory Flexibility Act (5 U.S.C. 601
DOE reviewed today's proposed rulemaking under the provisions of the Regulatory Flexibility Act and the policies and procedures published on February 19, 2003. This proposed rulemaking would set no standards; it would only determine whether exclusion from standards is warranted for R20 short lamps. DOE certifies that this proposed rulemaking will not have a significant impact on a substantial number of small entities. The factual basis for this certification is as follows.
For manufacturers of 100W R20 IRLs with an MOL of 3 and
Amendments to EPCA in the Energy Policy Act of 1992 (EPAct 1992), Public Law 102–486, established the current energy conservation standards for certain classes of IRLs. On July 14, 2009, DOE published a final rule in the
This rulemaking, which proposes an exclusion from energy conservation standards for R20 short lamps, would impose no new information or record keeping requirements. Accordingly, the OMB clearance is not required under the Paperwork Reduction Act. (44 U.S.C. 3501
Pursuant to the National Environmental Policy Act (NEPA) of 1969, DOE has determined that this proposed rulemaking fits within the category of actions that are categorically excluded from review under the National Environmental Policy Act of 1969 (Pub. L. 91–190, codified at 42 U.S.C. 4321
Executive Order 13132, “Federalism,” 64 FR 43255 (Aug. 10, 1999) imposes certain requirements on federal agencies formulating and implementing policies or regulations that preempt state laws or that have federalism implications. The Executive Order requires agencies to examine the constitutional and statutory authority supporting any action that would limit the policymaking discretion of the states and to carefully assess the necessity for such actions. The Executive Order also requires agencies to have an accountable process to ensure meaningful and timely input by state and local officials in the development of regulatory policies that have federalism implications. On March 14, 2000, DOE published a statement of policy describing the intergovernmental consultation process it will follow in the
With respect to the review of existing regulations and the promulgation of new regulations, section 3(a) of Executive Order 12988, “Civil Justice Reform,” imposes on federal agencies the general duty to adhere to the following requirements: (1) Eliminate drafting errors and ambiguity; (2) write regulations to minimize litigation; and (3) provide a clear legal standard for affected conduct rather than a general standard and promote simplification and burden reduction. 61 FR 4729 (Feb. 7, 1996). Section 3(b) of Executive Order 12988 specifically requires that Executive agencies make every reasonable effort to ensure that the regulation: (1) Clearly specifies the preemptive effect, if any; (2) clearly specifies any effect on existing federal law or regulation; (3) provides a clear legal standard for affected conduct while promoting simplification and burden reduction; (4) specifies the retroactive effect, if any; (5) adequately defines key terms; and (6) addresses other important issues affecting clarity and general draftsmanship under any guidelines issued by the Attorney General. Section 3(c) of Executive Order 12988 requires Executive agencies to review regulations in light of applicable standards in section 3(a) and section 3(b) to determine whether they are met or it is unreasonable to meet one or more of them. DOE has completed the required review and determined that, to the extent permitted by law, this proposed rulemaking meets the relevant standards of Executive Order 12988.
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) requires each federal agency to assess the effects of federal regulatory actions on state, local, and Tribal governments and the private sector. Public Law 104–4, sec. 201 (codified at 2 U.S.C. 1531). For a proposed regulatory action likely to result in a rule that may cause the expenditure by state, local, and Tribal governments, in the aggregate, or by the private sector of $100 million or more in any one year (adjusted annually for inflation), section 202 of UMRA requires a federal agency to publish a written statement that estimates the resulting costs, benefits, and other effects on the national economy. (2 U.S.C. 1532(a), (b)). The UMRA also requires a federal agency to develop an effective process to permit timely input by elected officers of state, local, and Tribal governments on a proposed “significant intergovernmental mandate,” and requires an agency plan for giving notice and opportunity for timely input to potentially affected small governments before establishing any requirements that might significantly or uniquely affect small governments. On March 18, 1997, DOE published a statement of policy on its process for intergovernmental consultation under UMRA. 62 FR 12820. DOE's policy statement is also available at
DOE examined today's proposed rulemaking according to UMRA and its statement of policy and determined that the rule contains neither an intergovernmental mandate, nor a mandate that may result in the expenditure of $100 million or more in any year. Instead, if adopted in a final rulemaking, the rule would exclude R20 IRLs with an MOL of 3 and
Section 654 of the Treasury and General Government Appropriations Act, 1999 (Pub. L. 105–277) requires federal agencies to issue a Family Policymaking Assessment for any rule that may affect family well-being. This proposed rulemaking would not have any impact on the autonomy or integrity of the family as an institution. Accordingly, DOE has concluded that it is not necessary to prepare a Family Policymaking Assessment.
DOE has determined, under Executive Order 12630, “Governmental Actions and Interference with Constitutionally Protected Property Rights” 53 FR 8859 (Mar. 18, 1988), that this regulation would not result in any takings that might require compensation under the Fifth Amendment to the U.S. Constitution.
Section 515 of the Treasury and General Government Appropriations Act, 2001 (44 U.S.C. 3516, note) provides for federal agencies to review most disseminations of information to the public under guidelines established by each agency pursuant to general guidelines issued by OMB. OMB's guidelines were published at 67 FR 8452 (Feb. 22, 2002), and DOE's guidelines were published at 67 FR 62446 (Oct. 7, 2002). DOE has reviewed today's proposed rulemaking under the OMB and DOE guidelines and has concluded that it is consistent with applicable policies in those guidelines.
Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” 66 FR 28355 (May 22, 2001), requires federal agencies to prepare and submit to OIRA at OMB, a Statement of Energy Effects for any proposed significant energy action. A “significant energy action” is defined as any action by an agency that promulgates or is expected to lead to promulgation of a final rule, and that: (1) Is a significant regulatory action under Executive Order 12866, or any successor order; and (2) is likely to have a significant adverse effect on the supply, distribution, or use of energy, or (3) is designated by the Administrator of OIRA as a significant energy action. For any proposed significant energy action, the agency must give a detailed statement of any adverse effects on energy supply, distribution, or use should the proposal be implemented, and of reasonable alternatives to the action and their expected benefits on energy supply, distribution, and use.
DOE has tentatively concluded that today's proposed regulatory action, which excludes R20 short lamps from coverage under energy conservation standards, is not a significant energy action because the proposed exclusion from standards is not a significant regulatory action under Executive Order 12866, is not likely to have a significant adverse effect on the supply, distribution, or use of energy, nor has it been designated as such by the Administrator at OIRA. Accordingly, DOE has not prepared a Statement of Energy Effects on the proposed rulemaking.
On December 16, 2004, OMB, in consultation with the Office of Science and Technology Policy (OSTP), issued its Final Information Quality Bulletin for Peer Review (the Bulletin). 70 FR 2664 (Jan. 14, 2005). The Bulletin establishes that certain scientific information shall be peer reviewed by qualified specialists before it is disseminated by the Federal Government, including influential scientific information related to agency regulatory actions. The purpose of the Bulletin is to enhance the quality and credibility of the Government's scientific information. Under the Bulletin, the energy conservation standards rulemaking analyses are “influential scientific information,” which the Bulletin defines as scientific information the agency reasonably can determine will have, or does have, a clear and substantial impact on important public policies or private sector decisions. 70 FR at 2667 (Jan. 14, 2005).
In response to OMB's Bulletin, DOE conducted formal in-progress peer reviews of the energy conservation standards development process and analyses and has prepared a Peer Review Report pertaining to the energy conservation standards rulemaking analyses. Generation of this report involved a rigorous, formal, and documented evaluation using objective criteria and qualified and independent reviewers to make a judgment as to the technical/scientific/business merit, the actual or anticipated results, and the productivity and management effectiveness of programs and/or projects. The “Energy Conservation Standards Rulemaking Peer Review Report” dated February 2007 has been disseminated and is available at the following Web site:
DOE will accept comments, data, and information regarding this NOPR no later than the date provided in the
Submitting comments via regulations.gov. The regulations.gov Web page will require you to provide your name and contact information. Your contact information will be viewable to DOE Building Technologies staff only. Your contact information will not be publicly viewable except for your first and last names, organization name (if any), and submitter representative name (if any). If your comment is not processed properly because of technical difficulties, DOE will use this information to contact you. If DOE cannot read your comment due to technical difficulties and cannot contact you for clarification, DOE may not be able to consider your comment.
However, your contact information will be publicly viewable if you include it in the comment itself or in any documents attached to your comment. Any information that you do not want to be publicly viewable should not be included in your comment, nor in any document attached to your comment. Otherwise, persons viewing comments will see only first and last names, organization names, correspondence containing comments, and any documents submitted with the comments.
Do not submit to regulations.gov information for which disclosure is restricted by statute, such as trade secrets and commercial or financial information (hereinafter referred to as Confidential Business Information (CBI)). Comments submitted through regulations.gov cannot be claimed as CBI. Comments received through the Web site will waive any CBI claims for the information submitted. For information on submitting CBI, see the Confidential Business Information section below.
DOE processes submissions made through regulations.gov before posting. Normally, comments will be posted within a few days of being submitted. However, if large volumes of comments are being processed simultaneously, your comment may not be viewable for up to several weeks. Please keep the comment tracking number that regulations.gov provides after you have successfully uploaded your comment.
Include contact information each time you submit comments, data, documents, and other information to DOE. If you submit via mail or hand delivery/courier, please provide all items on a CD, if feasible. It is not necessary to submit printed copies. No facsimiles (faxes) will be accepted.
Comments, data, and other information submitted to DOE electronically should be provided in PDF (preferred), Microsoft Word or Excel, WordPerfect, or text (ASCII) file format. Provide documents that are not secured, that are written in English, and that are free of any defects or viruses. Documents should not contain special characters or any form of encryption and, if possible, they should carry the electronic signature of the author.
Factors of interest to DOE when evaluating requests to treat submitted information as confidential include: (1) A description of the items; (2) whether and why such items are customarily treated as confidential within the industry; (3) whether the information is generally known by or available from other sources; (4) whether the information has previously been made available to others without obligation concerning its confidentiality; (5) an explanation of the competitive injury to the submitting person which would result from public disclosure; (6) when such information might lose its confidential character due to the passage of time; and (7) why disclosure of the information would be contrary to the public interest.
It is DOE's policy that all comments may be included in the public docket, without change and as received,
Although DOE welcomes comments on any aspect of this proposal, DOE is particularly interested in receiving comments and views of interested parties concerning the following issues:
1. DOE's assessment of the identified special characteristics of R20 short lamps and any other features that should be considered special characteristics;
2. The proposal that R20 short lamps qualify for an exclusion from energy conservation standards because of insignificant energy savings attributable to their design for specialty applications;
3. Whether reduced wattage lamps can be used as reasonable substitutes in pool and spa applications in all jurisdictions provided that they meet the 0.5W of input power per square foot of water surface area, or equivalent level of illumination;
4. The identified specifications for underwater illumination (0.5W of input power per square foot of water surface area, or equivalent level of illumination) for building code compliance and whether this requirement is appropriate when qualifying a lamp as a reasonable substitute; and
5. DOE's analysis of potential R20 short lamp substitutes and the conclusion that there are no reasonably substitutable lamps for this lamp type.
The Secretary of Energy has approved publication of today's proposed rulemaking.
Administrative practice and procedure, Confidential Business Information, Energy conservation, Household appliances, Imports, Intergovernmental relations, Small businesses.
For the reasons set forth in the preamble, DOE proposes to amend part 430 of chapter II, subchapter D, of title 10 of the Code of Federal Regulations, as set forth below:
1. The authority citation for part 430 continues to read as follows:
42 U.S.C. 6291–6309; 28 U.S.C. 2461 note.
2. In § 430.2, revise the definition for “Incandescent reflector lamp” and add the definition for “R20 short lamp,” in alphabetical order, to read as follows:
Office of Energy Efficiency and Renewable Energy, Department of Energy.
Proposed determination of coverage.
The U.S. Department of Energy (DOE) proposes to determine that commercial and industrial compressors meet the criteria for covered equipment under Part A–1 of Title III of the Energy Policy and Conservation Act (EPCA), as amended. DOE proposes that classifying equipment of such type as covered equipment is necessary to carry out the purpose of Part A–1 of EPCA, which is to improve the efficiency of electric motors and pumps and certain other industrial equipment to conserve the energy resources of the nation.
DOE will accept written comments, data, and information on this notice, but no later than January 30, 2013.
Interested persons may submit comments, identified by docket number EERE–2012–BT–DET–0033 or RIN 1904–AC83, by any of the following methods:
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•
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A link to the docket web page can be found at:
Mr. James Raba, U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies, EE–2J, 1000 Independence Avenue SW., Washington, DC 20585–0121, Telephone: (202) 586–8654. Email:
In the Office of General Counsel, contact Ms. Elizabeth Kohl, U.S. Department of Energy, Office of the General Counsel, GC–71, 1000 Independence Avenue SW., Washington, DC 20585. Telephone: (202) 586–7796. Email:
Title III of the Energy Policy and Conservation Act of 1975 (EPCA), as amended (42 U.S.C. 6291
EPCA specifies a list of equipment that constitutes covered commercial and industrial equipment. (42 U.S.C. 6311(1)(A)−(L). The list identifies 11 types of equipment and sets forth a twelfth provision for any other type of industrial equipment which the Secretary of Energy (Secretary) classifies as covered equipment. EPCA also specifies the types of industrial equipment that can be classified as covered in addition to the equipment enumerated in 42 U.S.C. 6311(1). This equipment includes compressors. (42 U.S.C. 6311(2)(B)(i)). Industrial equipment must also, without regard to whether such equipment is in fact distributed in commerce for industrial or commercial use, be of a type that:
(1) In operation consumes, or is designed to consume, energy in operation;
(2) to any significant extent, is distributed in commerce for industrial or commercial use; and
(3) is not a covered product as defined in 42 U.S.C. 6291(a)(2) of EPCA, other than a component of a covered product with respect to which there is in effect a determination under 42 U.S.C. 6312(c). (42 U.S.C. 6311 (2)(A)).
To classify equipment as covered commercial or industrial equipment, the Secretary must determine that classifying the equipment as covered equipment is necessary for the purposes of Part A–1 of EPCA. The purpose of Part A–1 is to improve the efficiency of electric motors, pumps and certain other industrial equipment to conserve the energy resources of the nation. (42 U.S.C. 6312 (a), (b))
DOE has not previously conducted an energy conservation standard rulemaking for compressors. If after public comment, DOE issues a final determination of coverage for this equipment, DOE would consider both test procedures and energy conservation standards for this equipment.
With respect to test procedures, DOE would consider proposed test procedures for measuring the energy efficiency, energy use, or estimated annual operating cost of compressors during a representative average use cycle or period of use that are not unduly burdensome to conduct. (42 U.S.C. 6314(a)(2)) In a test procedure rulemaking, DOE initially prepares a test procedure notice of proposed rulemaking (NOPR) and allows interested parties to present oral and written data, views, and arguments with respect to such procedures. In prescribing new test procedures, DOE takes into account relevant information including technological developments relating to energy use or energy efficiency of compressors.
With respect to energy conservation standards, DOE typically prepares initially an energy conservation standards rulemaking framework document (the framework document). The framework document explains the issues, analyses, and process that it is considering for the development of energy conservation standards for compressors. After DOE receives comments on the framework document, DOE typically prepares an energy conservation standards rulemaking preliminary analysis and technical support document (the preliminary analysis). The preliminary analysis typically provides initial draft analyses of potential energy conservation standards on consumers, manufacturers, and the nation. Neither of these steps is legally required.
DOE is required to publish a NOPR setting forth DOE's proposed energy conservations standards and a summary of the results of DOE's supporting technical analysis. The details of DOE's analysis are provided in a technical support document (TSD) that describes the details of DOE's analysis of both the burdens and benefits of potential standards, pursuant to 42 U.S.C. 6295(o). DOE affords interested persons an opportunity during a period of not less than 60 days after the publication of the NOPR to provide oral and written comment. (42 U.S.C. 6295(p)(2)) After receiving and considering the comments on the NOPR and not less than 90 days after the publication of the NOPR, DOE would issue the final rule prescribing any new energy conservation standards for compressors. (42 U.S.C. 6295(p)(3))
DOE is considering a definition for “Commercial and Industrial Compressors” to clarify coverage of any potential test procedure or energy conservation standard that may arise from today's proposed determination. There is currently no statutory definition of compressors, and DOE is considering the following definition of compressors to provide clarity for interested parties as it continues its analyses:
Compressor: A compressor is an electric-powered device that takes in air or gas at atmospheric pressure and delivers the air or gas at a higher
A compressor may have some or all of the following components: piston, roller, rotor(s), impeller wheel, spiral disks, cylinder(s), lubricant, motor and transmission, controls, treatment equipment (after cooler and lubricant cooler), filter(s), and/or a lubricant/air separator.
DOE seeks feedback from interested parties on this definition for compressors.
The following sections describe DOE's evaluation of whether compressors fulfill the criteria for being added as covered equipment pursuant to 42 U.S.C. 6311(2) and 42 U.S.C. 6312.
Compressors are listed as a type of industrial equipment at 42 U.S.C. 6311(2)(B)(i). The following discussion addresses DOE's consideration of the three requirements of 42 U.S.C. 6311(2)(A) and 42 U.S.C. 6312.
Data from the 2002 United States Industrial Electric Motor Systems Market Opportunities Assessment estimate total annual industrial compressor energy use (from Manufacturing SIC codes 20–39) at 91,050 million kWh per year.
Compressors are distributed in commerce for both the industrial and commercial sectors. Based on the 2011 International Energy Agency (IEA) Survey, DOE estimated that 1.3 million motors are shipped annually to drive compressors in the U.S. commercial and industrial sectors.
Compressors are not currently included as covered products under Title 10 of the Code of Federal Regulations, part 430 (10 CFR part 430).
The purpose of part A–1 of EPCA is to improve the energy efficiency of electric motors, pumps and certain other industrial equipment to conserve the energy resources of the nation. Coverage of compressors is necessary to carry out the purposes of part A–1 of EPCA because coverage will promote the conservation of energy supplies. Efficiency standards that may result from coverage would help to capture some portion of the potential for improving the efficiency of compressors.
Based on the information in section IV of this notice, DOE proposes to determine that commercial and industrial compressors qualify as covered equipment under part A–1 of Title III of EPCA, as amended (42 U.S.C. 6311
DOE has reviewed its proposed determination of compressors under the following executive orders and acts.
The Office of Management and Budget has determined that coverage determination rulemakings do not constitute “significant regulatory actions” under section 3(f) of Executive Order 12866, Regulatory Planning and Review, 58 FR 51735 (Oct. 4, 1993). Accordingly, this proposed action was not subject to review under the Executive Order by the Office of Information and Regulatory Affairs (OIRA) in the Office of Management and Budget (OMB).
The Regulatory Flexibility Act (5 U.S.C. 601
DOE reviewed today's proposed determination under the provisions of the Regulatory Flexibility Act and the policies and procedures published on February 19, 2003. If adopted, today's proposed determination would set no standards and would only positively determine that future standards may be warranted and should be explored in an energy conservation standards rulemaking. The proposed determination also does not establish any test procedures. If a positive determination is made, DOE would consider test procedures in a subsequent rulemaking. Economic impacts on small entities would be considered in the context of such rulemakings. On the basis of the foregoing, DOE certifies that the proposed determination, if adopted, would have no significant economic impact on a substantial number of small entities. Accordingly, DOE has not prepared a regulatory flexibility analysis for this proposed determination. DOE will transmit this certification and supporting statement of factual basis to the Chief Counsel for Advocacy of the Small Business Administration for review under 5 U.S.C. 605(b).
This proposed determination, which proposes to determine that compressors meet the criteria for classification as covered equipment, will impose no new information or recordkeeping
In this notice, DOE proposes to positively determine that compressors meet the criteria for classification as covered equipment. Environmental impacts would be explored in any future energy conservation standards rulemaking for compressors. DOE has determined that review under the National Environmental Policy Act of 1969 (NEPA), Public Law 91–190, codified at 42 U.S.C. 4321
Executive Order (E.O.) 13132, “Federalism” 64 FR 43255 (August 10, 1999), imposes certain requirements on agencies formulating and implementing policies or regulations that preempt State law or that have Federalism implications. The Executive Order requires agencies to examine the constitutional and statutory authority supporting any action that would limit the policymaking discretion of the States and to assess carefully the necessity for such actions. The Executive Order also requires agencies to have an accountable process to ensure meaningful and timely input by State and local officials in developing regulatory policies that have Federalism implications. On March 14, 2000, DOE published a statement of policy describing the intergovernmental consultation process that it will follow in developing such regulations. 65 FR 13735 (March 14, 2000). DOE has examined today's proposed determination and concludes that it would not preempt State law or have substantial direct effects on the States, on the relationship between the Federal government and the States, or on the distribution of power and responsibilities among the various levels of government. EPCA governs and prescribes Federal preemption of State regulations as to energy conservation for the equipment that is the subject of today's proposed determination. States can petition DOE for exemption from such preemption to the extent permitted, and based on criteria, set forth in EPCA. (42 U.S.C. 6297) No further action is required by E.O. 13132.
With respect to the review of existing regulations and the promulgation of new regulations, section 3(a) of E.O. 12988, “Civil Justice Reform” 61 FR 4729 (February 7, 1996), imposes on Federal agencies the duty to: (1) Eliminate drafting errors and ambiguity; (2) write regulations to minimize litigation; (3) provide a clear legal standard for affected conduct rather than a general standard; and (4) promote simplification and burden reduction. Section 3(b) of E.O. 12988 specifically requires that Executive agencies make every reasonable effort to ensure that the regulation specifies the following: (1) The preemptive effect, if any; (2) any effect on existing Federal law or regulation; (3) a clear legal standard for affected conduct while promoting simplification and burden reduction; (4) the retroactive effect, if any; (5) definitions of key terms; and (6) other important issues affecting clarity and general draftsmanship under any guidelines issued by the Attorney General. Section 3(c) of E.O. 12988 requires Executive agencies to review regulations in light of applicable standards in sections 3(a) and 3(b) to determine whether these standards are met, or whether it is unreasonable to meet one or more of them. DOE completed the required review and determined that, to the extent permitted by law, this proposed determination meets the relevant standards of E.O. 12988.
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) (Pub. L. 104–4, codified at 2 U.S.C. 1501
Section 654 of the Treasury and General Government Appropriations Act of 1999 (Pub. L. 105–277) requires Federal agencies to issue a Family Policymaking Assessment for any rule that may affect family well-being. This proposed determination would not have any impact on the autonomy or integrity of the family as an institution. Accordingly, DOE has concluded that it is not necessary to prepare a Family Policymaking Assessment.
Pursuant to E.O. 12630, “Governmental Actions and Interference with Constitutionally Protected Property Rights” 53 FR 8859 (March 15, 1988), DOE determined that this proposed determination would not result in any takings that might require compensation under the Fifth Amendment to the U.S. Constitution.
The Treasury and General Government Appropriations Act of 2001 (44 U.S.C. 3516, note) requires agencies to review most disseminations of information they make to the public under guidelines established by each agency pursuant to general guidelines issued by the Office of Management and Budget (OMB). The OMB's guidelines
E.O. 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use,” 66 FR 28355 (May 22, 2001), requires Federal agencies to prepare and submit to OMB a Statement of Energy Effects for any proposed significant energy action. A “significant energy action” is defined as any action by an agency that promulgates a final rule or is expected to lead to promulgation of a final rule, and that: (1) Is a significant regulatory action under E.O. 12866, or any successor order; and (2) is likely to have a significant adverse effect on the supply, distribution, or use of energy; or (3) is designated by the Administrator of the Office of Information and Regulatory Affairs (OIRA) as a significant energy action. For any proposed significant energy action, the agency must give a detailed statement of any adverse effects on energy supply, distribution, or use if the proposal is implemented, and of reasonable alternatives to the proposed action and their expected benefits on energy supply, distribution, and use.
DOE has concluded that today's regulatory action proposing to determine that compressors meet the criteria for classification as covered equipment would not have a significant adverse effect on the supply, distribution, or use of energy. This action is also not a significant regulatory action for purposes of E.O. 12866, and the OIRA Administrator has not designated this proposed determination as a significant energy action under E.O. 12866 or any successor order. Therefore, this proposed determination is not a significant energy action. Accordingly, DOE has not prepared a Statement of Energy Effects for this proposed determination.
On December 16, 2004, OMB, in consultation with the Office of Science and Technology Policy (OSTP), issued its Final Information Quality Bulletin for Peer Review (the Bulletin). 70 FR 2664 (January 14, 2005). The Bulletin establishes that certain scientific information shall be peer reviewed by qualified specialists before it is disseminated by the Federal government, including influential scientific information related to agency regulatory actions. The purpose of the Bulletin is to enhance the quality and credibility of the Government's scientific information. DOE has determined that the analyses conducted for this rulemaking do not constitute “influential scientific information,” which the Bulletin defines as “scientific information the agency reasonably can determine will have or does have a clear and substantial impact on important public policies or private sector decisions.” 70 FR 2667 (January 14, 2005). The analyses were subject to pre-dissemination review prior to issuance of this rulemaking.
DOE will determine the appropriate level of review that would be applicable to any future rulemaking to establish energy conservation standards for compressors.
DOE will accept comments, data, and information regarding this notice of proposed determination no later than the date provided at the beginning of this notice. After the close of the comment period, DOE will review the comments received and determine whether compressors are covered equipment under EPCA.
Comments, data, and information submitted to DOE's email address for this proposed determination should be provided in WordPerfect, Microsoft Word, PDF, or text (ASCII) file format. Submissions should avoid the use of special characters or any form of encryption, and wherever possible comments should include the electronic signature of the author. No telefacsimiles (faxes) will be accepted.
According to 10 CFR Part 1004.11, any person submitting information that he or she believes to be confidential and exempt by law from public disclosure should submit two copies: One copy of the document should have all the information believed to be confidential deleted. DOE will make its own determination as to the confidential status of the information and treat it according to its determination.
Factors of interest to DOE when evaluating requests to treat submitted information as confidential include (1) a description of the items; (2) whether and why such items are customarily treated as confidential within the industry; (3) whether the information is generally known or available from public sources; (4) whether the information has previously been made available to others without obligations concerning its confidentiality; (5) an explanation of the competitive injury to the submitting persons which would result from public disclosure; (6) a date after which such information might no longer be considered confidential; and (7) why disclosure of the information would be contrary to the public interest.
DOE welcomes comments on all aspects of this proposed determination. DOE is particularly interested in receiving comments from interested parties on the following issues related to the proposed determination for compressors:
• Definition of compressors;
• Whether classifying compressors as covered equipment is necessary to carry out the purposes of Part A–1 of EPCA;
• Availability or lack of availability of technologies for improving the energy efficiency of compressors.
DOE invites all interested parties to submit, in writing and by January 30, 2013, comments and information on matters addressed in this notice and on other matters relevant to a determination for compressors. DOE is also interested in receiving views concerning other issues relevant to establishing a test procedure and energy conservation standard for compressors.
After the expiration of the period for submitting written statements, DOE will consider all comments and additional information that is obtained from interested parties or through further analyses, and it will prepare a final determination. If DOE determines that compressors qualify as covered equipment, DOE will consider a test procedure and energy conservation standards for compressors. Members of the public will be given an opportunity to submit written and oral comments on any proposed test procedure and standards.
Administrative practice and procedure, Confidential business information, Energy conservation, Reporting and recordkeeping requirements.
Federal Aviation Administration (FAA), DOT.
Supplemental notice of proposed rulemaking (NPRM); reopening of comment period.
We are revising an earlier proposed airworthiness directive (AD) for certain General Electric Company (GE) CF6–80C2 series turbofan engines. That NPRM proposed to supersede an AD that required replacement of fuel tubes connected to the fuel flowmeter. That NPRM was prompted by several reports of fuel leaks, and two reports of engine fire, due to mis-assembled supporting brackets on the fuel tube connecting the flowmeter to the Integrated Drive Generator (IDG) fuel-oil cooler. That NPRM required installation of a new simplified one-piece supporting bracket to eliminate mis-assembly. This supplemental action adds an engine model, alters the list of affected part numbers (P/Ns), changes the replacement schedule, and revises our estimated cost of compliance. We are reopening the comment period to allow the public the opportunity to comment on these proposed changes. We are proposing this AD to prevent high-pressure fuel leaks caused by improper seating of fuel tube flanges, which could result in an engine fire and damage to the airplane.
We must receive comments on this supplemental NPRM by March 1, 2013.
You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:
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For service information identified in this AD, contact General Electric Company, GE Aviation, Room 285, 1 Neumann Way, Cincinnati, OH 45215, phone: (513) 552–3272; email:
You may examine the AD docket on the Internet at
Kasra Sharifi, Aerospace Engineer, Engine Certification Office, FAA, Engine & Propeller Directorate, 12 New England Executive Park, Burlington, MA 01803; phone: 781–238–7773; fax: 781–238–7199; email:
We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under the
We will post all comments we receive, without change, to
We issued an NPRM to amend 14 CFR part 39 to include an AD that would apply to certain GE CF6–80C2 series turbofan engines. That NPRM published in the
Since we issued the previous NPRM (77 FR 48110, August 13, 2012), we received and evaluated comments from the public. The nature of the comments caused us to issue this supplemental NRPM to reopen the comment period and allow the public the opportunity to comment on the changes we have made.
The following presents the comments received on the previous NPRM (77 FR 48110, August 13, 2012) and the FAA's response to each comment.
Seven air carriers requested that we exclude bolt P/N MS9557–12 from the final rule because this is a common part used in other components of the engine besides the main engine control to flowmeter fuel tube.
We agree. We changed the proposed AD by removing reference to P/N MS9557–12 from the compliance and prohibition paragraphs.
The Boeing Company (Boeing) and FEDEX Express requested that we remove the idle leak check requirement, which they contend is not necessary to address the unsafe condition and which is included in normal maintenance, and so does not need to be mandated.
We disagree. We are issuing this AD to prevent fuel leak and fire due to mis-assembled connections, and idle leak check is necessary to ensure no fuel leaks occur after tube or bracket replacement. We did not change the proposed AD.
Boeing, General Electric Company, and American Airlines requested that we change the AD to mandate replacement of only the disconnected hardware during on-wing maintenance, and then the remaining balance of affected hardware during the next shop visit.
We agree. We changed the proposed AD to require that for on-wing maintenance, only those tubes and
GE and Boeing requested that we add the GE CF6–80C2B5F engine model to the list of applicable engines. Even though the production model of this engine used a one-piece design (2021M83G01), some engines may have subsequently received bracket P/N 1321M88P001A, allowed by GE Alert Service Bulletin (SB) 73–A0401 for the purpose of hardware interchangeability.
We agree. We changed the proposed AD by adding the GE CF6–80C2BF5 engine to the list of applicable engines specified in paragraph (c).
Four air carriers requested that applicable GE SBs be incorporated by reference in the AD to provide more specific and detailed instructions to aid operators in part replacement.
We partially agree. We agree that GE SBs provide additional guidance. We disagree with incorporating the SBs by reference because multiple acceptable methods exist for performing the actions required by the AD. We did not change the proposed AD.
Onur Air requested clarification as to why the proposed AD would mandate fuel tube changes when the GE SB only applies to engines with a certain bracket.
We disagree. The proposed AD supersedes AD 2000–04–14, Amendment 39–11597 (65 FR 10698, February 29, 2000). That AD requires replacement of certain fuel tube P/Ns. The proposed AD retains that requirement and also mandates replacement of certain supporting brackets and spray shields. We did not change the proposed AD.
American Airlines requested that the proposed AD provide a method to identify the affected fuel tube configuration without disassembling the tubes, because P/N 1321M42G04 is located under a loop clamp, making it difficult to read the P/N.
We disagree. Detailed maintenance instructions can be found in the Instructions for Continued Airworthiness for the engine. We did not change the proposed AD.
The National Transportation Safety Board requested that we issue a new AD, instead of proposing to supersede AD 2000–04–14, Amendment 39–11597 (65 FR 10698, February 29, 2000), for actions regarding the removal of the bracket. Operators might presume that if they have already complied with AD–2000–04–14 that they might also comply with the additional requirements (replacement of brackets and spray shield) of the proposed supersedure AD.
We disagree. The proposed supersedure AD addresses the same unsafe condition as the original AD, but expands its scope. The proposed supersedure AD will receive its own amendment number and AD number, and the original AD will be deleted. We did not change the proposed AD.
American Airlines requested that we revise the cost estimate to more accurately capture the cost of the spray shield and also to include the cost of the idle leak check.
We agree. In the “Cost of Compliance” section of the proposed AD, we have changed the cost estimate for each spray shield from $180 to $370, and we have included an estimated cost of $1000 per engine for the idle leak check.
Delta Airlines requested that we change the conjunction “and” between the two P/Ns listed in paragraph (f)(4) to “or” since each engine only has one spray shield to be replaced, and that we add spray shield P/N 1606M57G03 to the list, resulting in three specified P/Ns. The added part number is an alternative spray shield to P/N 1775M61G01, and so is also affected by the AD.
We partially agree. We agree that P/N 1606M57G03 should be added to the list of P/Ns to be removed. We disagree that the conjunction “and” should be changed to “or” because all three spray shield P/Ns are subject to replacement. We changed the AD to require the replacement of P/N 1606M57G03.
GE requested that we add more historical information to the “Action Since Existing AD was Issued” paragraph in the AD preamble.
We disagree. The cited preamble paragraph will not appear in the final rule, and so additional historical information will not add value to that proposed rule. We did not change the proposed AD.
UPS requested that we provide P/Ns of eligible replacement parts.
We disagree. The purpose of the AD is to identify and mandate removal of parts causing the unsafe condition. Operators are required to only use parts that are eligible for installation. We did not change the proposed AD.
Four air carriers requested that the AD state that no further action is required if the applicable GE SBs have already been accomplished.
We disagree. The “Compliance” and “Replacement” paragraphs sufficiently state that compliance actions do not have to be repeated if accomplished before the effective date of the AD. We did not change the proposed AD.
American Airlines requested that we withdraw the requirement to incorporate the spray shield on-wing any time the fuel tubes are disconnected because disconnecting them is an unnecessary hardship on air carriers.
We disagree. On-wing maintenance to the spray shield and affected tubes without removing and replacing them may lead to the unsafe condition. We did not change the proposed AD.
We are proposing this supplemental NPRM 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. Certain changes described above expand the scope of the original NPRM. As a result, we have determined that it is necessary to reopen the comment period to provide additional opportunity for the public to comment on this supplemental NPRM.
This supplemental NPRM would require installation of a new simplified one-piece bracket to eliminate mis-assembly of supporting brackets on the fuel tube connecting the flowmeter to the IDG fuel-oil cooler.
We estimate that this proposed AD would affect 926 GE CF6–80C2 engines
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.
(1) Is not a “significant regulatory action” under Executive Order 12866,
(2) Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979),
(3) Will not affect intrastate aviation in Alaska, and
(4) Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.
Air transportation, Aircraft, Aviation safety, Safety.
Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows:
1. The authority citation for part 39 continues to read as follows:
49 U.S.C. 106(g), 40113, 44701.
2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD):
We must receive comments by March 1, 2013.
This AD supersedes AD 2000–04–14, Amendment 39–11597 (65 FR 10698, February 29, 2000).
This AD applies to all General Electric Company (GE) CF6–80C2 A1/A2/A3/A5/A8/A5F/B1/B2/B4/B5F/B6/B1F/B2F/B4F/B6F/B7F/D1F turbofan engines with fuel tubes, part number (P/N) 1321M42G01, 1334M88G01, 1374M30G01, 1383M12G01, 1606M57G03, 1606M57G01, or 1775M61G01, or supporting bracket, P/N 1321M88P001A, installed.
This AD was prompted by several reports of fuel leaks, and two reports of engine fire, due to mis-assembled supporting brackets on the fuel tube connecting the flowmeter to the Integrated Drive Generator (IDG) fuel-oil cooler. We are proposing this AD to prevent high-pressure fuel leaks caused by improper seating of fuel tube flanges, which could result in an engine fire and damage to the airplane.
Comply with this AD within the compliance times specified, unless already done.
After the effective date of this AD, if the fuel tubes are disconnected for any reason, or at the next engine shop visit, whichever occurs first, replace the fuel tubes and brackets with improved tubes and brackets eligible for installation. For on-wing maintenance, replace only tubes and brackets that have been disconnected. Do the following:
(1) Replace the fuel flowmeter to IDG fuel-oil cooler fuel tube, P/N 1321M42G01, with a part eligible for installation.
(2) For engines with Power Management Controls, replace the Main Engine Control to fuel flowmeter fuel tube, P/N 1334M88G01, with a part eligible for installation.
(3) For engines with Full Authority Digital Electronic Controls, replace the Hydromechanical Unit to fuel flowmeter fuel tubes, P/Ns 1383M12G01 and 1374M30G01, with a part eligible for installation.
(4) Replace supporting bracket, P/N 1321M88P001A, and spray shields, P/Ns 1606M57G01, 1606M57G03, and 1775M61G01 with one-piece supporting bracket, P/N 2021M83G01.
(5) Perform an idle leak check after accomplishing paragraphs (f)(1), (f)(2), (f)(3), or (f)(4), or any combination thereof.
After the effective date of this AD, do not install any of the following parts into any GE CF6–80C2 series turbofan engines: P/Ns 1321M42G01, 1321M88P001A, 1334M88G01, 1374M30G01, 1383M12G01, 1606M57G01, 1606M57G03, and 1775M61G01.
The Manager, Engine Certification Office, FAA, may approve AMOCs for this AD. Use the procedures found in 14 CFR 39.19 to make your request.
(1) For more information about this AD, contact Kasra Sharifi, Aerospace Engineer, Engine Certification Office, FAA, Engine & Propeller Directorate, 12 New England Executive Park, Burlington, MA 01803; phone: 781–238–7773; fax: 781–238–7199; email:
(2) For guidance on the replacements, refer to GE Alert Service Bulletins CF6–80C2 SB 73–A0224, CF6–80C2 SB 73–A0231, CF6–80C2 SB 73–A0401, and CF6–80C2 SB 73–0242.
(3) For service information identified in this AD, contact General Electric Company, GE-Aviation, Room 285, 1 Neumann Way, Cincinnati, OH 45215, phone: (513) 552–3272; email:
Environmental Protection Agency (EPA).
Proposed rule.
EPA is proposing to more clearly describe the active and inert ingredients permitted in products eligible for the exemption from regulation for minimum risk pesticides. EPA is proposing to reorganize these lists with a focus on clarity and transparency by adding specific chemical identifiers. The identifiers would make it clearer to manufacturers; the public; and Federal, state, and tribal inspectors which ingredients are permitted in minimum risk pesticide products. EPA is also proposing to modify the label requirements in the exemption to require the use of specific common chemical names in lists of ingredients on minimum risk pesticide product labels, and to require producer contact information on the label. Once final, these proposed changes would maintain the availability of minimum risk pesticide products while providing more consistent information for consumers, clearer regulations for producers, and easier identification by states, tribes and EPA as to whether a product is in compliance with the exemption.
Comments must be received on or before April 1, 2013.
Submit your comments, identified by docket identification (ID) number 12P–0200 EPA–HQ–OPP–2010–0305, by one of the following methods:
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Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at
Ryne Yarger, Field and External Affairs Division (7506P), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460–0001; telephone number: (703) 605–1193; fax number: (703) 305–5884; email address:
You may be potentially affected by this action if you manufacture, distribute, sell, or use minimum risk pesticide products. Minimum risk pesticide products are exempt from Federal regulation, and are described in 40 CFR 152.25(f). The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:
• Manufacturers of these products, which includes pesticide and other agricultural chemical manufacturers (NAICS codes 325320 and 325311), as well as other manufacturers in similar industries such as animal feed (NAICS code 311119), cosmetics (NAICS code 325620), and soap and detergents (NAICS code 325611).
• Manufacturers who may also be distributors of these products, which includes farm supplies merchant wholesalers (NAICS code 424910), drug and druggists' merchant wholesalers (NAICS code 424210), and motor vehicle supplies and new parts merchant wholesalers (NAICS code 423120).
• Retailers of minimum risk pesticide products (some of which may also be manufacturers), which includes nursery, garden center, and farm supply stores (NAICS code 44220); outdoor power equipment stores (NAICS code 444210); and supermarkets (NAICS code 445110).
• Users of minimum risk pesticides, including the public in general, as well as exterminating and pest control services (NAICS code 561710), landscaping services (NAICS code 561730), sports and recreation institutions (NAICS code 611620), and child day care services (NAICS code 624410). Many of these companies also manufacture minimum risk pesticide products.
This action is issued under the authority of the Federal Insecticide, Fungicide and Rodenticide Act (FIFRA), 7 U.S.C. 136 et seq., sections 3 and 25.
EPA is proposing to more clearly describe the active and inert ingredients permitted in products eligible for the exemption from regulation for minimum risk pesticides (40 CFR 152.25(f)). EPA is proposing to reorganize these lists by adding specific chemical identifiers. The identifiers would make it clearer to manufacturers; the public; and Federal, state, and tribal inspectors the specific ingredients that are permitted in minimum risk pesticide products. EPA is also proposing to modify the label requirements in the exemption to require the use of specific common chemical names in lists of ingredients on minimum risk pesticide product labels, and to require producer contact information on the label.
The primary goal of this proposal is to clarify the conditions of exemption for minimum risk pesticides by making clearer the specific ingredients that are permitted in minimum risk pesticide products. EPA has exempted from the requirement of registration certain pesticide products if they are composed of specified ingredients and labeled according to EPA's regulations in 40 CFR 152.25(f). EPA created the exemption for minimum risk pesticides to eliminate the need to expend significant resources to regulate products that were deemed to be of minimum risk to human health and the environment. In addition, exempting such products freed Agency resources to focus on evaluating formulations whose toxicity was less well characterized or of higher toxicity. The existing regulatory structure, however, leads to confusion as to which ingredients are exempt under 40 CFR 152.25(f), and how they should be labeled on products.
The proposed revisions to the exemption would clarify the specific ingredients that are permitted, specify how they should be presented on a label, and provide consumers with contact information for the manufacturer of the products. EPA's intention is to restructure the exemption with a focus on clarity and transparency for the ingredient lists. Once final, these proposed changes would provide more consistent information for consumers, clearer regulations for producers, and easier identification by states, tribes and EPA as to whether a product is in compliance with the exemption.
Under FIFRA section 25(b)(2), EPA may exempt from the requirements of FIFRA any pesticide that is “of a character unnecessary to be subject to [FIFRA].” Pursuant to this authority, in March 1996, EPA promulgated 40 CFR 152.25(g), which exempted from FIFRA any pesticide product consisting solely of specified ingredients that EPA judged to pose minimum risk to humans and the environment (61 FR 8876, March 6, 1996) (FRL–4984–8). This provision was later redesignated as 40 CFR 152.25(f) (66 FR 64759, December 14, 2001) (FRL–6752–1).
Unlike registered pesticides, sale and distribution of products exempted under 40 CFR 152.25(f) do not require that the products be registered with EPA, payment of registration fees, or reporting of production to EPA. To meet the criteria for the minimum risk exemption, a pesticide must:
• Contain only specified active and inert ingredients.
• List active ingredients on the label by name and percent weight in the formula.
• List inert ingredients on the label by name.
• Not bear claims either to control or mitigate microorganisms that pose a threat to human health, including but not limited to disease transmitting bacteria or viruses, or claims to control insects or rodents carrying specific diseases, including, but not limited to ticks that carry Lyme disease.
• Not include false or misleading labeling statements, specified in 40 CFR 156.10(a)(5)(i) through (viii). These include false or misleading statements about product composition, effectiveness, comparison to other products, endorsement by the Federal Government, or label disclaimers.
Restrictions on which ingredients may be used in minimum risk pesticide products are key aspects of the exemption, since the properties of these specific ingredients are the reason EPA exempted minimum risk pesticide products from FIFRA regulatory requirements. As stated in the notice of proposed rulemaking for the minimum risk exemption, “EPA believes regulation of these substances is not necessary to prevent unreasonable adverse effects on man or the environment, and these substances are not of a character necessary to be subject to FIFRA in order to carry out its purposes” (Ref. 1).
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Since 1994, EPA has updated the list of inert ingredients permitted in minimum risk pesticide products. In 2002, EPA proposed (in January) and finalized (in May) a consolidated set of tolerance exemptions for minimum risk chemicals under section 408 of the Federal Food, Drug and Cosmetic Act (FFDCA), 21 U.S.C. 346a. These changes primarily allowed a set of commonly consumed foods to be included in minimum risk pesticides with food uses (Ref. 4). Some commonly consumed foods (such as peanuts, tree nuts, milk, soybeans, eggs, fish, crustacean, and wheat) were excluded due to their known allergenic properties. EPA proposed and finalized these changes as part of the tolerance reassessment requirements of the Food Quality Protection Act of 1996, which amended FFDCA. In the 2002 proposal, EPA explained that commonly consumed foods could be considered minimum risk, since “it is unlikely that a commonly consumed food commodity could be used to control a pest via a toxic mode of action” and that foods are generally recognized as safe (Ref. 2). The 2002 final rule explained that, with some exceptions, all commonly consumed food items and all animal feed items would be considered minimum risk pesticide chemicals and would be located in the newly established 40 CFR 180.950. The 2002 final rule did not amend the FIFRA minimum risk exemption in 40 CFR 152.25(f). In 2004, EPA updated List 4A to specifically list the substances in the 2002 rulemaking (Ref. 5).
In 2006, EPA classified additional substances as minimum risk for purposes of tolerance exemptions under 40 CFR 180.950(e). The proposed rule also clarified that EPA was shifting existing tolerance exemptions for the inert ingredients that appear on List 4A from that list to 40 CFR 180.950(e) (Ref. 6).
Since 2006, EPA has been responding to stakeholder input and revising the Web page that lists inert ingredients eligible for use in minimum risk pesticide products. Among these updates, this Web page was revised on March 3, 2009, to include a common chemical name for many of the chemicals and to clearly delineate the food and non-food use status of the chemical substances.
The list was most recently re-formatted on December 20, 2010, to provide a more easily understood format for the chemicals listed. The list is available on the Agency's Web site at
3.
The regulations for displaying ingredients on minimum risk pesticide product labels differ from the regulations for registered products. Since exempt products are not registered with EPA and manufacturers submit no information to the Agency, listing product ingredients provides important information to the public, and to enforcement officials who must determine whether or not a product complies with the exemption.
EPA had several expectations regarding this exemption:
• Reduction of burden on the Agency and manufacturers of minimum risk pesticides.
• Facilitate the development of more low-risk methods of pest control.
• No significant environmental use of these substances as pesticides.
• Uncomplicated enforcement.
Though some of these expectations were met, the lack of clarity regarding ingredients has produced significant enforcement difficulties. For example, the way active ingredients are currently listed in the exemption is vague, and inspectors are confronted with the need to determine whether certain product ingredients as they are listed on product labels, such as cedar leaf oil or cedar wood oil, are exempt under the more
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However, a state's registration of a federally registered pesticide usually relies heavily on the previous Federal review of the product's toxicity, use patterns, and label. In contrast, given that minimum risk pesticides are largely exempt from Federal regulation under FIFRA, the numerous states that do regulate these products review and examine the products using criteria that vary from state to state. In some states, manufacturers of minimum risk pesticide products are only required to pay a registration fee; in others, there is a label review, which can include a review of the ingredients used in the product; and a few require Material Safety Data Sheets and data on product efficacy.
Though some states have more detailed registration processes for minimum risk pesticide products, and some states do not register these products at all, the exemption created significant enforcement concerns for all states since it created a category of legal but federally unregistered products. Instead of being able to rely on a Federal determination of whether a pesticide product was complying with relevant regulations, each state's enforcement authority had to make those decisions. To do this, each state had to become familiar with all active and inert ingredients permitted under the Federal exemption in order to determine whether a pesticide product lacking an EPA registration number was lawfully exempt from Federal regulation.
Inspectors have found it difficult to determine whether seemingly exempt products were complying with the exemption. One of the most common minimum risk pesticide product issues encountered by inspectors and enforcement case developers are products that claim the 40 CFR 152.25(f) exemption, but contain active or inert ingredients whose status as an ingredient that may be used in minimum risk pesticide products is not readily apparent from the name of the ingredient as listed on the label. Since ingredients may be listed on the label with one of numerous chemical, common, or Latin names, determining whether an ingredient on a pesticide product label is the same substance referred to by the active or inert ingredient lists is a time consuming task.
The lack of clarity in which ingredients are permitted in minimum risk pesticide products makes it difficult for companies to determine whether a specific formulation is within the exemption. The lack of consistency in how those ingredients are displayed on the product labels by the various manufacturers has led to inefficiencies in enforcement of the exemption. As discussed in Unit IV., by creating a situation in which enforcement officials cannot swiftly examine an unregistered pesticide product label and then determine if the ingredients listed on the label are eligible for use in minimum risk pesticide products creates slowdowns in developing enforcement cases.
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In 2006, in response to a petition from the Consumer Specialty Products Association, several states submitted comments that described their difficulties enforcing the terms of the exemption for minimum risk pesticide products. For example, the comment from Colorado stated:
In Colorado this results in numerous cases of enforcement actions requiring Colorado retailers to remove unregistered products from their shelves. We issue about 90 Cease and Desist Orders per year to retailers selling unregistered pesticides that claim to be 25(b) exempt. (Ref. 9)
A similar comment was received from California:
Although well intended, rather than relieving the States of ever increasing regulatory workload, the proliferation of minimum risk pesticides now available in
Many of these burdens and inefficiencies resulted from confusion created by ambiguities in the list of ingredients permitted for use in pesticide products exempt from Federal regulation. Several lists must be consulted to determine if a product's ingredients are permitted, and, often, ingredients on product labels may—legitimately—use chemical names different from those that appear on the ingredient lists. Chemicals often have multiple names. However, inspectors and consumers may be unfamiliar with alternative chemical names, resulting in confusion over whether the product complies with the exemption. For example, as Colorado stated in its comment on the 2006 petition:
There is also continuing confusion among applicants, extension educators, state regulators and even regional EPA staff on which ingredients are or are not allowed, and what statements can or cannot be on labels for 25(B) products. Even after 10 years, we frequently see applications for products with ingredients that are not allowed. (Ref. 9).
As currently written, it is difficult and time-consuming for state regulators and producers to determine which ingredients are allowed in products claiming the exemption. As a result, marketplace inspections are hobbled, and discovery of non-compliant products is delayed. As California stated in its comment on the 2006 petition:
The increased workload generated by unregulated 25(b) pesticides impacts other vital regulatory duties, such as worker protection inspections, and product registration (Ref. 10).
This encourages a proliferation of illegal products, or products that do not meet the Federal exemption criteria for ingredients, labeling, or other conditions.
The burden on the states is clear: Identifying which minimum risk pesticide products are compliant with the exemption requires significant state resources for inspection, yet when products are found to be violating the Federal exemption, states in many cases cannot precisely identify the problem or take action without significant guidance and assistance from EPA, which must interpret the ingredient lists and other criteria in the exemption to determine whether a product is compliant.
More than a decade of experience with 40 CFR 152.25(f) on the Federal and state levels has indicated that there is confusion over permitted ingredients. This lack of clarity has created a significant burden for enforcement of the exemption. Confusion over permitted ingredients may also result in public hazards due to the proliferation of unregistered pesticide products that do not comply with the ingredient restrictions in the exemption. As part of a survey of compliance with the exemption, EPA conducted an analysis of labels of products sold as minimum risk personal insect repellents (also referred to as skin-applied repellents), relying in part on information provided by the Nielsen Company. Personal insect repellent products are estimated to make up approximately 14% of products registered by states that make their registration databases publicly available. EPA found that nearly half (47%) of the minimum risk personal insect repellent products contained ingredients not permitted under 152.25(f) (Ref. 11). This finding is based on:
• Identification of 135 personal insect repellent products claiming to be exempt, or that were not registered with EPA. These products were identified through state registration lists, nationwide sales data compiled by the Nielsen Company, and Internet searches.
• Examination of publicly available labels of these personal insect repellent products. Labels were not available for 26 products (or 19% of all identified).
• Comparison of any stated ingredients with those on the active and inert ingredient lists specified in or referenced by the exemption. Forty-five products, or 33% of all identified, seemed to list only permitted ingredients; 64 products, or 47%, listed ingredients not permitted under the exemption.
The data are likely an underestimate of the non-compliance rate with the ingredient criteria of the exemption. These underestimations result from a lack of information available on these products, and the sources used to identify these products are not comprehensive of the entire universe of minimum risk personal insect repellents, which are not registered in all states and which may not be sold in the major retailers tracked by the Nielsen Company nor sold online. Furthermore, the compliance rate for skin-applied insect repellents may not be representative of all minimum risk pesticide products. EPA has not examined the other products with respect to compliance, since labels from other minimum risk pesticide products representative of the national marketplace could not be located.
Lack of compliance with the requirements of the exemption may result from producers' uncertainty about which ingredients are permitted, or inspectors' inability to develop enforcement cases to remove non-compliant products from the marketplace in a timely manner. Currently, it may not be clear to companies which specific ingredients are permitted for minimum risk pesticides exempt from regulation, since the terminology describing the ingredients is difficult to understand. Additionally, product labels often use unfamiliar terms for permitted ingredients, which creates confusion for state and Federal inspectors who are not familiar with all possible names for these chemicals. For example, some products use Latin names for some ingredients, such as a product that listed some of its inert ingredients as Glycine Soja Oil, Cymbopogon Nardus Oil, and Pimenta Acris Leaf Oil, which most inspectors and members of the public would not recognize as soybean oil, citronella oil, and bay leaf oil, respectively. Inspectors have reported the difficulty of determining the legality of some minimum risk pesticide products during field inspections.
The actions proposed today will provide greater specificity and clarity concerning the inert and active ingredients that can be used in exempted products, and specify the exact chemical terms that must be displayed on product labels. This will aid in resolving many of the issues surrounding non-compliance, as well as providing clearer information to consumers of these products without adversely affecting the availability of minimum risk pesticide products. Providing accurate and clear information to the public will assist users in making good choices regarding their use of pesticides. EPA believes that these beneficial label changes cannot be achieved through non-regulatory means.
EPA considered the following options for addressing the issues described previously related to the minimum risk exemption:
Items 1 and 2 would provide clarity regarding the ingredients and, to some extent, promote states' abilities to enforce the exemption while continuing the availability of minimum risk pesticide products.
Item 3 would not only significantly increase the clarity of the ingredients in a product claiming to be a minimum risk pesticide, but also augment visibility of that product's compliance with the exemption. Though companies would need to modify product labels to comply with the changes, the costs expended would be minimal and this would not impede the continued availability of minimum risk pesticides.
When considering Item 4, EPA believes that Item 4 is unlikely to provide any significant benefit to consumers from having a statement, a disclaimer, which signals exempt status on the product label. EPA's analysis of information from open literature and survey results indicates that in general most people do not read, understand, or believe a disclaimer. This means that a label disclaimer is unlikely to change consumer behavior or influence a purchasing decision. For a label statement to be effective, the purchaser must first read the label and notice the disclaimer, and then read the disclaimer, understand the disclaimer, believe the disclaimer, and choose to act on the disclaimer (Ref. 12). Potentially, there could be a slight benefit from such a statement for enforcement, as state inspectors could use this statement as part of their determination of a product's status under the exemption. However, as other pieces of label information may provide more useful information to consumers and enforcement, EPA chose to focus on making those modifications to the exemption.
Item 5 would assist manufacturers with complying with the minimum risk exemption. EPA plans to update its Web site on minimum risk pesticides (Ref. 13) to provide this guidance, including label formats, directions for use, and ways to display ingredient lists. Any clarifications communicated through this kind of guidance, however, would not be considered requirements for compliance with the exemption, and would not aid in efficient enforcement of the exemption. For this reason, merely providing guidance to manufacturers is not sufficient to address the exemption's issues related to enforcement difficulties and current lack of clarity. EPA intends to provide guidance by updating the sections of its Web site explaining the minimum risk exemption, but this would be independent of rulemaking.
Additional issues regarding the minimum risk exemption have been raised by states, with states expressing interest in:
Item 6 would provide consumers with directions for safe use of the product. Though many products already include directions on how to apply the product, some do not, and even for minimum risk pesticides there is a theoretical potential for injury or environmental hazard from improper use of the products. However, assessing the risk of certain uses of minimum risk pesticides already determined to be minimum risk is outside the scope of this rulemaking, which only proposes to clarify the terms of the original exemption. Additionally, EPA was not able to create a requirement for directions for use that would be both broad enough to apply to all potential categories of products, yet specific enough to be enforced fairly and effectively. For these reasons, EPA chose to focus on other aspects of minimum risk pesticide product labeling and on the ingredient lists. EPA will continue to seek ways to provide guidance on improving directions for use on minimum risk pesticide products.
Item 7 would provide a significant benefit to consumers, who may be unable to determine which company manufactured or distributed a minimum risk pesticide product. Although the labels of many products already provide this information, it does not appear on all minimum risk pesticide products. These changes would provide useful information without burdening manufacturers beyond the cost of changing their labels. Unlike directions for use, the requirements for company name and contact information (such as address and phone number) can be specified clearly in the proposed amendments to the exemption. Though this does not deal with ingredient clarity, EPA feels that in the interest of efficiency it is appropriate to propose this change at the same time, since it would provide a strong benefit to consumers with little added cost.
EPA determined that a combination of revisions and guidance would provide the best approach to the issues discussed previously. This combination is:
Items 1, 2, 3, and 6 are proposed in this rulemaking and are discussed in greater detail in Unit VII. Item 5 includes Web site changes that are in addition to the rulemaking proposed here, and is also outlined later in this document.
By clarifying the way ingredients are defined in the exemption and the way they should be displayed on product labels, EPA will be able to protect public health while relieving product manufacturers of the burdens associated with regulation. Similarly, requiring contact information on product labels would provide important consumer information and greater producer accountability with minimal cost.
EPA proposes to replace the text in 40 CFR 152.25(f) specifying the active ingredients and their variations with a table that would show, for each permitted active ingredient:
• Label Display Name. This is the common chemical name that would be required to be used on labels of products that contain these ingredients.
• Chemical Name, as determined by Chemical Abstract Services (CAS).
• Specifications. Though this column would generally be empty, some substances listed in the exemption had specifications associated with them in the text of the exemption as published in 1996.
• CAS Registry Number (CAS No.). The Agency listed the CAS No. for each of the chemical substances listed in 40 CFR 152.25(f) where a CAS No., was available. A CAS No. is a unique numerical identifier that provides one of the most distinct, readily available, and universally accepted means of identifying chemical substances. Identifying chemicals permitted in minimum risk pesticides by CAS No. would assure manufacturers that they
An example of this table is provided here, as Table 2.
In this document, EPA is not proposing to remove or add any active ingredients to the list. The current list is being clarified by using more precise chemical identifiers and nomenclature. For approximately 20 of the active ingredients in the proposed table, EPA is proposing to include the specification of USP (United States Pharmacopeia) standard in the Specifications column. USP standards are set for quality, purity, and identity, and usually provide information on chemical formula, chemical weight, CAS numbers, function, definition, packaging, storage, and labeling requirements. Information on the USP standards is included in the docket for this proposal.
State and Federal inspectors and interested members of the public would be able to easily match the name of the active ingredient on the label to the column in the table in 40 CFR 152.25(f)(1) that contains label display names. Linking the CAS No., the label display name, and the chemical name maintains the chemical identity specificity needed for enforcement, would provide the public and inspectors with understandable information, and would provide guidance for product manufacturers who may be unsure of the specific ingredients that their products can and cannot contain in order to comply with the minimum risk exemption.
As previously discussed, in Unit III.A.2., the minimum risk exemption in 40 CFR 152.25(f)(2) references a list of chemicals permitted to be used as inert ingredients that has been updated and currently is maintained on EPA's public Web site. To clarify which inert ingredients may be used in these products, EPA proposes to codify in the CFR a reference to sections detailing which chemicals may be used in addition to a reformatted version of the table that currently appears online.
The proposed changes to the section of the exemption dealing with inert ingredients would include references to 40 CFR 180.950(a), (b), and (c), which describe chemical substances exempt from the requirements of a tolerance and that may also be used as inert ingredients in minimum risk pesticides. The regulatory reference will provide the clarity needed for understanding which commonly consumed food commodities, animal feed items, and edible fats and oils can be used in exempted products. Additionally, EPA proposes to add a table that would contain the chemicals currently listed in 40 CFR 180.950(e) as well as those that appeared originally on List 4A. A version of this table currently appears online. Any duplicate listings would be removed.
EPA believes that adding these references and reformatting the table and placing it into the CFR will provide needed clarity, in as much as State inspectors, members of the public, or manufacturers of minimum risk pesticide products would be able to more quickly determine whether a given ingredient is a permitted inert ingredient for minimum risk pesticide products.
The columns of the table that would be codified would be:
• Label Display Name.
• Chemical Name, as determined by CAS.
• CAS No. (described previously).
An example of this table is listed, as Table 3.
Unlike the proposed table listing the active ingredients, the proposed table for the inert ingredients does not include a column outlining specifications, since none were outlined in the exemption. However, some of the substances have no tolerances or tolerance exemptions under FFDCA section 408 and thus have not been permitted for use in pesticides that may come in contact with foods, which are also known as food-use pesticides. For this reason, EPA is proposing that in addition to the proposed table listing inert ingredients, the text of the exemption be amended to indicate the address of an EPA Web site at which information can be found on which chemicals listed could be used in food-use pesticide products.
The FFDCA requires all active and inert ingredients that come into contact with food have an applicable tolerance or exemption from the tolerance requirement. EPA currently indicates on the minimum risk inert ingredient table that appears online (at
There are benefits to having all information about the minimum risk exemption consolidated in one location, and the CFR is a useful reference for many people interested in the exemption. Therefore, EPA proposes to add a reference to the address of the Web site that would contain the reformatted active and inert ingredient tables that include a “food use” and “non-food use” column. EPA would make clear that the information on the Web site is advisory and serves as guidance, and that the specific regulations should be consulted when seeking to learn about a chemical's exemption from the requirements of a tolerance. However, EPA believes that highlighting in the CFR where this guidance is available online would be helpful in explaining some of the more complicated aspects of the minimum risk exemption.
Currently, the chemical names on exempted labels are derived from a variety of sources, which include CAS nomenclature, informal or lay terminology, and Latin plant name derivatives. This causes confusion for inspectors and the public, who may not be aware of the multiple names a single chemical may have. All stakeholders would benefit from the use of a common chemical name for ingredients listed on the product label. EPA proposes to revise 40 CFR 152.25(f)(3) to include the requirement that labels of exempt products use the “label display name” in the ingredient listing, when a label display name is specified in the exemption.
An additional revision to the exemption would require that producers of minimum risk pesticide products include their company's name and contact information (address and telephone number) on the product label. In separate guidance, to be posted on EPA's Web site on minimum risk pesticides, companies would be encouraged to also provide a phone number, mailing address, Web site, or email address on their minimum risk pesticide product labels.
Requiring a company name and contact information would provide valuable information to consumers with minimal cost. It would also provide state and Federal inspectors with important information that currently can be difficult to find. To provide additional clarity, if a company name appears on the label and that company is not the producer, EPA proposes that the text indicate that the product was “packed for” “distributed by” or “sold by” to show that the company selling the product is not the producer.
The potential costs incurred by manufacturers of minimum risk pesticide products to comply with these proposed changes are estimated to be minimal. The analysis summarized in this unit estimates the cost of label changes required by the proposed rule, as separate and distinct from (i.e., incremental to) routine label changes that producers already undertake. For greater detail, including the assumptions used for the cost analysis, see the “Cost and Small Business Analysis of Proposed Revisions to Minimum Risk Exemption” (Ref. 14).
For Items 1 and 2 (Revising the exemption to redesign the format of the active ingredient list and revising the exemption to codify the inert ingredient list into the CFR), there are no costs to producers of exempt products. Since no ingredients are being added or removed from the list, manufacturers of currently exempted products should not need to change their product formulations.
For Items 3 and 7 (Revising the exemption to require the use of a common chemical name, and company name and contact information on the label), the cost is the cost of changing the label. To comply with the proposed changes for labeling requirements for minimum risk pesticide products, EPA expects that all products may need to be re-labeled in order to list ingredients by common chemical name. Some companies may also need to add their company name and contact information to product labels. The estimated costs associated with changing a label are summarized here.
Currently, EPA is aware of 216 companies producing 757 minimum risk pesticide products. EPA derived this information from publicly available lists of state registrations for minimum risk pesticides (Ref. 15), and AC Nielsen retail store scanner data (Ref. 16). As explained in the cost analysis, 192 parent companies were identified. Together, the 192 parent companies account for 541 minimum risk pesticide products, or about 79% percent of those identified by EPA.
Table 4 shows the distribution of firms by NAICS code. Most firms in the minimum risk pesticide industry belong to
The estimated cost of the proposed rule consists of a one-time change in the design of the label to comply with the proposed requirements. The estimated incremental cost of the proposed rule depends on the extent to which the
Many products have more than one size or type of package. Each is referred to as a stock keeping unit (SKU). Each SKU would have to be relabeled to comply with the new requirements. Using an estimate of 1.53 SKUs per product, there are 1,158 products to be relabeled.
In its analysis, EPA has assumed that firms will routinely re-label every 3 years, although some firms may re-label more or less frequently. EPA also assumed that if the changes occurred during a routine label update, then one-third of the label's artwork cost would be due to the new requirements. If the firm's routine relabeling cycle falls outside the rule compliance period (that is, if the rule requirements cannot be incorporated into the firm's routine labeling change), then the full cost of label change is due to the change in regulations.
The estimated costs of the rule under different rule compliance periods are shown in Table 5.
Using the average cost estimates from Table 5, EPA estimates the total potential industry cost in Table 6.
Under an implementation period of 2 years, the estimated industry cost is about $3 million.
The Agency invites the public to provide its views and suggestions for changes on all the various proposals in this document. Specifically included within the Agency's request for comments are the following:
• The format of the ingredient lists (active and inert ingredients).
• The information in the new format of the ingredient lists (active and inert ingredients).
• The proposed reference to a Web site that contains a table formatted to include more information on exemptions from the requirement of a tolerance (which would indicate whether or not a substance can be in a pesticide used on or near food). Would this Web site provide the clarity some stakeholders seek?
• EPA's methodology for estimating the costs associated with the proposed label changes.
• The proposed timeframe (2 years from the effective date of the final rule) for complying with label changes.
• How will these changes impact state and local agencies?
• What are effective methods and venues for communicating these proposed changes to affected entities, and receiving their feedback?
• Because EPA's analysis was conducted with a subset of products, EPA was unable to determine if most minimum risk pesticide products for sale today comply with the requirements of the exemption, and it is unclear how specifying active and inert ingredients would affect the composition of products on the market. EPA expects that the only costs to industry will be re-labeling; however, the Agency is especially interested in learning of any products that would need to be reformulated as a result of these proposed changes.
Commenters are encouraged to present any data or information that should be considered by EPA during the development of the final rule. Please describe any assumptions and provide any technical information used in preparing your comments. You should explain estimates in sufficient detail to allow for them to be reproduced for validation. EPA's underlying principle in developing the proposed revisions has been to strike an appropriate balance among:
• Clarifying the ingredients permitted for use in minimum risk pesticide products.
• Having revised labels with better information on the labels quickly.
• Minimizing the impacts on the affected industry.
The following is a listing of the documents that are specifically referenced in this proposed rule. The docket for this rulemaking, identified by docket ID number EPA–HQ-OPP–2010–0305, includes these documents and other information considered by EPA in developing this proposed rule. In some cases this may include documents that are referenced within the documents that are included in the docket, even if the referenced document is not physically located in the docket. For assistance in locating documents, please consult the person listed under
1. U.S. Environmental Protection Agency (EPA). Pesticides; Exemption of Certain Substances from Federal Insecticide, Fungicide, and Rodenticide Act Requirements; Proposed Rule.
2. EPA. Pesticides; Tolerance Exemptions for Minimal Risk Active and Inert Ingredients; Proposed Rule.
3. EPA. Inert Ingredients in Pesticide Products; List of Minimal Risk Inerts; Notice.
4. EPA. Pesticides; Tolerance Exemptions for Minimal Risk Active and Inert Ingredients; Final Rule.
5. EPA. Office of Pesticide Programs (OPP). List 4A—Minimal Risk Inert Ingredients—By CAS Number. (August
6. EPA. Pesticides: Minimal Risk Tolerance Exemptions; Proposed Rule.
7. EPA. OPP. Inert Ingredients Eligible for FIFRA 25(b) Pesticide Products. (December 20, 2010).
8. AAPCO. 25(b) Exempt Pesticides Survey. (1998). Accessible at:
9. Comment attachment by L. Quakenbush, Colorado Department of Agriculture. Docket ID No.: EPA–HQ–OPP–2006–0687. Document ID No.: EPA–HQ–OPP–2006 0687–0026.
10. Comment submitted by G. Farnsworth, Department of Pesticides Regulation (DPR). Docket ID No.: EPA–HQ–OPP–2006–0687. Document ID No.: EPA–HQ–OPP– 2006–0687–0064.
11. EPA. OPP. EPA Analysis of Labeled Ingredients on Minimum Risk Insect Repellent Products. (2009). Docket ID No.: EPA–HQ–OPP–2010–0305. Document ID No.: EPA–HQ–OPP–2010–0305–0010.
12. EPA. OPP. Review of Literature on Consumer Use of Label Statements and Findings Relevant to Planned Action on Minimum Risk Insect Repellents. (2009). Docket ID No.: EPA–HQ–OPP–2010–0305. Document ID No.: EPA–HQ–OPP–2010– 0305–0011.
13. EPA. OPP. Minimum Risk Pesticides.
14. EPA. OPP. Cost and Small Business Analysis of Proposed Revisions to Minimum Risk Exemption. (2012). Docket ID No.: EPA–HQ–OPP–2010–0305. Document ID No.: EPA–HQ–OPP–2010–0305–0012.
15. EPA. OPP. Minimum Risk Products Registered with States with Publicly Searchable Databases (AL, AK, AZ, CO, IA, LA, MS, NH, NC, OK, RI, SC, SD, and WA). (2010). Docket ID No.: EPA–HQ–OPP–2010–0305. Document ID No.: EPA–HQ–OPP–2010–0305–0013.
16. EPA. OPP. Products Located Through EPA Query of Nielson Company Scanner Data + Walmart Customer Panel Surveys. (2008). Docket ID No.: EPA–HQ–OPP–2010–0305. Document ID No.: EPA–HQ–OPP–2010–0305–0014.
17. EPA. OPP. Supporting Statement for an Information Collection Request (ICR): Labeling Change for Certain Minimum Risk Pesticides under FIFRA Section 25(b). (2012). Docket ID No.: EPA–HQ–OPP–2010–0305. Document ID No.: EPA–HQ–OPP–2010–0305–0015.
18. Small Entity Representative (SER) comments from 2009 SBREFA Panel, for minimum risk insect repellents proposed rule. Docket ID No.: EPA–HQ–OPP–2010–0305. Document ID No.: EPA–HQ–OPP–2010–0305–0016.
Under FIFRA section 25(a), EPA submitted a draft of the proposed rule to the Secretary of the Department of Agriculture (USDA) and the appropriate Congressional Committees. Additionally, under FIFRA section 21(b), EPA submitted a draft of the proposed rule to the Secretary of the Department of Health and Human Services (HHS). No comments were received regarding this proposed rule. USDA waived its review of the draft proposed rule on December 19, 2011, and HHS waived its review of the draft proposed rule on February 2, 2012. Both USDA and HHS have retained the right to review a draft of the final rule.
Under FIFRA section 25(d), EPA submitted a draft of the proposed rule to the Scientific Advisory Panel (SAP). The SAP waived its scientific review of the proposed rule on January 4, 2012, because the proposed rule does not contain scientific issues that warrant review by the Panel.
This action is not a “significant regulatory action”) under the terms of Executive Order 12866 (58 FR 51735, October 4, 1993) and was not therefore submitted to the Office of Management and Budget (OMB) for review under Executive Orders 12866 and 13563 (76 FR 3821, January 21, 2011).
The information collection requirements in this proposed rule have been submitted for approval to OMB under the PRA, 44 U.S.C. 3501
The information collection requirements in this proposed rule consist of proposed changes to existing requirements that would involve the relabeling of products currently exempt under 40 CFR 152.25(f) in order to list chemical names in the format EPA proposes to require. The proposed change would be a one-time burden increase for existing products. The estimated annual respondent burden for this rule-related collection is estimated to be 5.5 hours per response, for a total one-time burden of 6,369 hours. 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 in 40 CFR 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 asks that you use the public docket established for this rule, i.e., Docket ID No. EPA–HQ–OPP–2010–0305. Submit any comments related to the ICR to EPA and OMB. For EPA, follow the instructions in the
The RFA, 5 U.S.C. 601
For purposes of assessing the impacts of this proposed rule on small entities, small entity is defined as:
1. A small business as defined by the Small Business Administration's (SBA)
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. This proposed rule is not expected to impact any governmental jurisdictions.
3. A small organization that is any not-for-profit enterprise which is independently owned and operated and is not dominant in its field. This proposed rule is not expected to impact any not-for-profit entities.
After considering the economic impacts of this final rule on small entities, I certify that this action will not have a significant economic impact on a substantial number of small entities. The factual basis for the Agency's determination is presented in the small entity impact analysis prepared as part of the Cost Analysis for this proposed rule (Ref. 14) that is summarized in Unit V.E., and a copy of which is available in the docket at
EPA has determined that this rulemaking does not impact any small governmental jurisdictions or any small not-for-profit enterprise because these entities are rarely producers of pesticide products. As such, EPA assessed the impacts on small businesses.
EPA determined that for the minimum risk pesticide industry, there are 97 small firms (out of the total 192), accounting for approximately 51% of the industry. EPA estimated the impacts on small firms in two ways. The first analysis estimated the impacts of the proposed rule on small firms by measuring the cost of the rule as a percent of the average small business annual revenue. These average small business impacts are presented in Table 6.
However, this average revenues analysis may not account for the realities of very small firms. To account for the impacts on very small firms, i.e., those with sales of less than $500K, EPA performed a refined analysis that divided each individual firm's relabeling cost by that firm's sales revenue. Additionally, a lower labeling cost was assumed for very small firms. These impacts are presented in Table 7.
With a 2-year compliance period, 26 small firms (or 27% of all small firms) are likely to experience an economic impact of 1% or more of gross sales, and nine small firms (9% of all small firms) may incur impacts greater than or equal to 3% of gross sales. The selection of the 2-year compliance period was also based on information obtained in 2009, from a group of small manufacturers of minimum risk insect repellents. These small manufacturers, in comments submitted to EPA, indicated that they would need 2 years to re-label their products to avoid significant costs (Ref. 18). By providing a 2-year transition period (2 years from the effective date of the final rule), most companies would be able to incorporate the changes proposed in this document into their regularly planned label updates, and sell any products with older labels, thus reducing the cost and burden of the proposed changes to the exemption.
EPA is particularly interested in receiving comment from small businesses as to the benefits, costs and impacts of this proposed rule. Any comments should be submitted to the Agency in the manner specified under
Title II of UMRA, 2 U.S.C. 1531–1538, establishes requirements for Federal agencies, unless otherwise prohibited by law, to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. This proposed rule does not contain a Federal mandate that may result in expenditures of $100 million or more for state, local and tribal governments, in the aggregate, or for the private sector in any 1 year. This proposed rule is unlikely to affect state, local, and tribal governments at all, because no minimum risk pesticide products have been found to be produced by any state, local, or tribal governments. As summarized previously, under an implementation period of 2 years, the estimated industry total costs for the one-time relabeling proposed in this rule is about $3 million.
Thus, this proposed rule is not subject to the requirements of UMRA sections 202 or 205. This rule is also not subject to the requirements of UMRA section 203, because it contains no regulatory requirements that might significantly or uniquely affect small governments.
This rule does not have federalism implications because 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 (64 FR 43255, August 10, 1999). As indicated previously, there are no known instances where a state or local government is currently the producer of a minimum risk pesticide currently exempt from regulation. Thus, Executive Order 13132 does not apply to this action.
In the spirit of Executive Order 13132 and consistent with EPA policy to promote communication between EPA, and state and local governments, EPA did consult with representatives of state and local governments in developing
Although these proposed changes would not have substantial direct effects on the states, they may indirectly affect states in two ways. First, the states that register minimum risk pesticide products may determine that they need to re-evaluate those registrations, since companies selling products claiming to be exempt from EPA registration would have to adopt the new label requirements, and demonstrate that compliance to any states in which they register. However, since most states that register minimum risk products require a new registration every year, little or no extra burden on state pesticide registration services is anticipated as a result of the changes at the Federal level. Second, there may be an improvement in the efficiency of state pesticide inspections, since the proposed changes would make it easier and faster for inspectors to identify which unregistered pesticide products contain ingredients that comply with the minimum risk exemption. This would positively affect all states, including those that do not register minimum risk pesticide products.
EPA specifically solicits comment on this proposed rule from state and local officials.
This proposed rule does not have tribal implications because it will not have substantial direct effects on Indian Tribes, will not significantly or uniquely affect the communities of Indian Tribal governments, and does not involve or impose any requirements that affect Indian Tribes, as specified in Executive Order 13175 (65 FR 67249, November 9, 2000). As indicated previously, there are no known instances where a tribal government is currently the producer of a minimum risk pesticide currently exempt from regulation. Thus, Executive Order 13175 does not apply to this proposed rule. EPA specifically solicits comment on this proposed rule from tribal officials.
EPA interprets Executive Order 13045 (62 FR 19885, April 23, 1997), as applying only to those regulatory actions that concern health or safety risks, such that the analysis required under section 5–501 of the Executive Order has the potential to influence the regulation. This action is not subject to Executive Order 13045, because it is not an “economically significant regulatory action” as defined in Executive Order 12866, and because the Agency does not have reason to believe the environmental health or safety risks addressed by this action present a disproportionate risk to children. This proposed rule does not involve an environmental standard that is intended to have a negatively disproportionate effect on children. To the contrary, this proposed rule is intended to provide added protection to children by requiring clearer and more transparent information on the labels of exempted pesticide products.
This action is not subject to Executive Order 13211 (66 FR 28355, May 22, 2001), because it is not a significant regulatory action under Executive Order 12866.
Section 12(d) of NTTAA, 15 U.S.C. 272 note, directs EPA to use voluntary consensus standards in its regulatory activities unless to do so would be inconsistent with applicable law or otherwise 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 when the Agency decides not to use available and applicable voluntary consensus standards. This action does not involve any technical standards. Therefore, EPA did not consider the use of any voluntary consensus standards. EPA invites comment on its conclusion regarding the applicability of voluntary consensus standards to this rulemaking.
Executive Order 12898 (59 FR 7629, February 16, 1994) establishes the 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 will not have disproportionately high and adverse human health or environmental effects on minority or low-income populations, because it is expected to increase the level of environmental protection for all affected populations without having any disproportionately high and adverse human health or environmental effects on any population, including any minority or low-income population. This proposed rule only impacts minimum risk pesticide products, and, once final, may have positive impacts for all communities, since the rule provides increased information for consumers considering the use of pesticides. This proposed action, which would improve clarity on product labels, will enable all users, regardless of economic status, to become more informed about the substances they may be interested in using as pesticides.
Environmental protection, Administrative practice and procedure, Agricultural commodities, Pesticides and pests, Reporting and recordkeeping requirements.
Therefore, it is proposed that 40 CFR chapter I be amended as follows:
1. The authority citation for part 152 continues to read as follows:
7 U.S.C. 136–136y; subpart U is also issued under 31 U.S.C. 9701.
2. Section 152.25 is amended by revising paragraph (f) to read as follows:
(f)
(2)
(i)
(ii)
(iii)
(iv)
(3)
(i) Each product containing the substance must bear a label identifying the label display name and percentage (by weight) of each active ingredient. It must also list all inert ingredients by the label display name listed in the table in paragraph (f)(2)(iv) of this section.
(ii) The product must not bear claims either to control or mitigate microorganisms that pose a threat to
(iii) Company name and contact information.
(A) The name of the producer or the company for whom the product was produced must appear on the product label. If the company whose name appears on the label in accordance with this paragraph is not the producer, the company name must be qualified by appropriate wording such as “Packed for * * *,” “Distributed by * * *,” or “Sold by * * *” to show that the name is not that of the producer.
(B) Contact information for the company specified in accordance with paragraph (f)(3)(iii)(A) of this section must appear on the product label including the street address plus ZIP code and the telephone phone number of the location at which the company may be reached.
(C) The company name and contact information must be displayed prominently on the product label.
(iv) The product must not include any false and misleading labeling statements, including those listed in § 156.10(a)(5)(i) through (viii).
(v) Guidance on minimum risk pesticides is available at
Environmental Protection Agency (EPA).
Request for information and advance notice of public meeting.
In 2010, EPA issued an advance notice of proposed rulemaking (2010 ANPRM) concerning renovation, repair, and painting activities on and in public and commercial buildings. EPA is in the process of determining whether these activities create lead-based paint hazards, and, for those that do, developing certification, training, and work practice requirements as directed by the Toxic Substances Control Act (TSCA). This document opens a comment period to allow for additional data and other information to be submitted by the public and interested stakeholders. This document also provides advance notice of EPA's plan to hold a public meeting on June 26, 2013.
Comments must be received on or before April 1, 2013.
Submit your comments, identified by docket identification (ID) number EPA–HQ–OPPT–2010–0173, by one of the following methods:
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Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at
This document is directed to the public in general. However, you may be potentially affected by this action if you perform renovations, repairs, or painting activities on the exterior or interior of public buildings or commercial buildings. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Other types of entities not listed may also be affected. Potentially affected entities may include:
• Building construction (NAICS code 236),
• Specialty trade contractors (NAICS code 238),
• Real estate (NAICS code 531),
• Other general government support (NAICS code 921),
If you have any questions regarding the applicability of this action to a particular entity, consult the technical person listed under
1.
2.
i. Identify this document by docket ID number and other identifying information (subject heading,
ii. Follow directions. Follow the detailed instructions as provided under
iii. Explain why you agree or disagree; suggest alternatives.
iv. Describe any assumptions and provide any technical information and/or data that you used.
v. If you estimate potential costs or burdens, explain how you arrived at your estimate in sufficient detail to allow for it to be reproduced by the Agency and others.
vi. Provide specific examples to illustrate your concerns and suggest alternatives.
vii. Explain your views as clearly as possible, avoiding the use of profanity or personal threats.
viii. Make sure to submit your comments by the comment period deadline identified in this document.
Title IV of TSCA, 15 U.S.C. 2681
Shortly after the RRP Rule was published, several lawsuits were filed challenging the rule, asserting, among other things, that EPA violated TSCA section 402(c)(3) by failing to address renovation activities in public and commercial buildings. These lawsuits (brought by environmental and children's health advocacy groups as well as a homebuilders association) were consolidated in the Circuit Court of Appeals for the District of Columbia Circuit. EPA engaged in collective settlement negotiations with all the parties and on August 24, 2009, EPA entered into an agreement with environmental and children's health advocacy groups in settlement of their lawsuits (Ref. 3). Shortly thereafter, the homebuilders association voluntarily dismissed its challenge to the rule. As part of this settlement agreement, EPA agreed to commence rulemaking to address renovations in public and commercial buildings, other than child-occupied facilities, to the extent such renovations create lead-based paint hazards. As an initial step, EPA issued an ANPRM in the
The settlement agreement has been amended and modified several times primarily to extend deadlines, with the most recent amendment having been entered into by the parties on September 7, 2012. Under the terms of the amended settlement agreement, the date by which EPA has agreed to either sign a proposed rule covering renovation, repair, and painting activities in public and commercial buildings, or determine that these activities do not create lead-based paint hazards, is July 1, 2015. If EPA publishes a proposed rule in the
In addition, EPA agreed to hold a public meeting on or before July 31, 2013, and offer an opportunity for stakeholders and other interested members of the public to provide data and other information that EPA may use in making its regulatory determinations. With this document, EPA is providing advance notice that it plans to hold the public meeting on June 26, 2013, and will provide more information about the public meeting in a subsequent document it intends to publish in the
EPA also agreed to offer an opportunity for stakeholders and other interested members of the public to provide data and other information that EPA may use in making its regulatory determinations. This document, therefore, opens a comment period to allow the public to submit additional information and data pertaining to renovation, repair, and painting activities in and on public or commercial buildings. EPA plans to issue a discussion guide no later than 2 weeks before the public meeting. EPA expects the discussion guide to describe the information received during this comment period. Of particular interest to EPA for developing a proposed rule is information concerning:
1. The manufacture, sale, and uses of lead-based paint after 1978.
2. The use of lead-based paint in and on public and commercial buildings.
3. The frequency and extent of renovations on public and commercial buildings.
4. Work practices used in renovation of public and commercial buildings.
5. Dust generation and transportation from exterior and interior renovations of public and commercial buildings.
These topical descriptions offer only a short characterization of the information that EPA is interested in. The 2010 ANPRM contains a comprehensive history of this rulemaking and the lead program in general, a review of some of the relevant information EPA has already gathered and reviewed, and more detail on the information sought for the public meeting (Ref. 4).
EPA is seeking information from all sources and regarding all types of potentially affected businesses and other stakeholders, including small businesses. Information regarding work practices typically used by small businesses, as well as information on costs and other potential regulatory impacts on small businesses, particularly those that would uniquely affect small businesses, would be useful to EPA in developing any proposed rule for renovation, repair, and painting activities in and on public or commercial buildings.
As indicated under
Environmental protection, Buildings and facilities, Business and industry,
Federal Emergency Management Agency, DHS.
Proposed rule; withdrawal.
The Federal Emergency Management Agency (FEMA) is withdrawing its proposed rule concerning proposed flood elevation determinations for Nobles County, Minnesota, and Incorporated Areas.
This withdrawal is effective on December 31, 2012.
You may submit comments, identified by Docket No. FEMA–B–1184, to Luis Rodriguez, Chief, Engineering Management Branch, Federal Insurance and Mitigation Administration, Federal Emergency Management Agency, 500 C Street SW., Washington, DC 20472, (202) 646–4064, or (email)
Luis Rodriguez, Chief, Engineering Management Branch, Federal Insurance and Mitigation Administration, Federal Emergency Management Agency, 500 C Street SW., Washington, DC 20472, (202) 646–4064, or (email)
On April 27, 2011, FEMA published a proposed rulemaking at 76 FR 23528, proposing flood elevation determinations along one or more flooding sources in Nobles County, Minnesota and Incorporated Areas. Because FEMA has or will be issuing a Revised Preliminary Flood Insurance Rate Map, and if necessary a Flood Insurance Study report, featuring updated flood hazard information, the proposed rulemaking is being withdrawn. A Notice of Proposed Flood Hazard Determinations will be published in the
42 U.S.C. 4104; 44 CFR 67.4.
Federal Emergency Management Agency, DHS.
Proposed rule; correction.
On May 25, 2010, FEMA published in the
Comments are to be submitted on or before April 1, 2013.
You may submit comments, identified by Docket No. FEMA–B–1089, to Luis Rodriguez, Chief, Engineering Management Branch, Federal Insurance and Mitigation Administration, Federal Emergency Management Agency, 500 C Street SW., Washington, DC 20472, (202) 646–4064 or (email)
Luis Rodriguez, Chief, Engineering Management Branch, Federal Insurance and Mitigation Administration, Federal Emergency Management Agency, 500 C Street SW., Washington, DC 20472, (202) 646–4064 or (email)
The Federal Emergency Management Agency (FEMA) publishes proposed determinations of Base (1% annual-chance) Flood Elevations (BFEs) and modified BFEs for communities participating in the National Flood Insurance Program (NFIP), in accordance with section 110 of the
These proposed BFEs and modified BFEs, together with the floodplain management criteria required by 44 CFR 60.3, are minimum requirements. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities. These proposed elevations are used to meet the floodplain management requirements of the NFIP and also are used to calculate the appropriate flood insurance premium rates for new buildings built after these elevations are made final, and for the contents in those buildings.
In the proposed rule published at 75 FR 29219, in the May 25, 2010, issue of the
Federal Communications Commission.
Proposed rule; extension of comment and reply comment period.
In this document, the International Bureau granted a request for an extension of time to file comments in response to a Notice of Proposed Rulemaking that initiated a comprehensive review of the Commission's rules governing space stations and earth stations. The original deadline for filing comments was
Comments must be received on or before January 14, 2013. Reply comments must be received on or before February 13, 2013.
You may submit comments and reply comments, identified by IB Docket No. 12–267, by any of the following methods:
•
•
•
For detailed instructions for submitting comments and additional information on the rulemaking process, see the
William Bell (202) 418–0741, Satellite Division, International Bureau, Federal Communications Commission, Washington, DC 20554. For additional information concerning the information collection(s) contained in this document, contact Judith B. Herman at 202–418–0214, or via the Internet at
The original Notice of Proposed Rulemaking was published in the
Federal Communications Commission.
Animal and Plant Health Inspection Service, USDA.
Revision to and extension of approval of an information collection; comment request.
In accordance with the Paperwork Reduction Act of 1995, this notice announces the Animal and Plant Health Inspection Service's intention to request a revision to and extension of approval of an information collection that will help the Animal and Plant Health Inspection Service to strengthen its animal disease prevention and response capabilities.
We will consider all comments that we receive on or before March 1, 2013.
You may submit comments by either of the following methods:
•
•
Supporting documents and any comments we receive on this docket may be viewed at
For information on the animal disease traceability data systems, contact Mr. Neil Hammerschmidt, Program Manager, Animal Disease Traceability, VS, APHIS, 4700 River Road Unit 200, Riverdale, MD 20737; (301) 851–3539. For copies of more detailed information on the information collection, contact Mrs. Celeste Sickles, APHIS' Information Collection Coordinator, at (301) 851–2908.
The framework for ADT provides the basic tenets of an improved animal disease traceability capability in the United States and will only apply to animals moved in interstate commerce, be administered by the States and Tribal Nations to provide more flexibility, encourage the use of lower-cost technology, and be implemented transparently through Federal regulations. APHIS is adopting these tenets for animal disease traceability while using investments previously made on information systems, such as official animal identification devices and other areas where States and Tribes had achieved progress through cooperative agreements.
The ADT information systems involve a number of previously approved collection and recordkeeping activities, including animal identification; premises registration; nonproducer participant registration; updates submitted by animal identification number manufacturers and managers; cooperative agreements; cooperative agreement applications; cooperator (State/Tribe) quarterly accomplishment reports; and an identification number management system. These information collection activities were approved by the Office of Management and Budget (OMB) under control number 0579–0259. The ADT information systems require updates to information provided. In addition, producers and operators of feedlots, markets, buying stations, and slaughter plants will have to maintain records associated with their animal movement activities for 2 to 5 years, although these records are already routinely maintained by these entities.
Other activities are being discontinued. APHIS has discontinued the evaluation and listing of animal tracking databases since the activity is now managed by the States and Tribes. APHIS no longer requires reporting of animal movements to premises, so we no longer track individual and group/lot movement records, resulting in a 450,000-hour decrease in the overall burden. APHIS has removed the animal tracking database and movement record entries from the forms of burden. APHIS will no longer require producers to file quarterly progress reports. Finally, APHIS has consolidated its tracking methods for issuance of the various forms of identification. The overall result of discontinuing many of the previously approved activities has led to an overall decrease in estimated annual
We are asking OMB to approve our use of these information collection activities for an additional 3 years.
The purpose of this notice is to solicit comments from the public (as well as affected agencies) concerning our information collection. These comments will help us:
(1) Evaluate whether the collection of information is necessary for the proper performance of the functions of the Agency, including whether the information will have practical utility;
(2) Evaluate the accuracy of our estimate of the burden of the collection of information, including the validity of the methodology and assumptions used;
(3) Enhance the quality, utility, and clarity of the information to be collected; and
(4) Minimize the burden of the information collection on those who are to respond, through use, as appropriate, of automated, electronic, mechanical, and other collection technologies; e.g., permitting electronic submission of responses.
All responses to this notice will be summarized and included in the request for OMB approval. All comments will also become a matter of public record.
Animal and Plant Health Inspection Service, USDA.
Notice.
This notice announces the availability of new data standards required to generate an official interstate certificate of veterinary inspection (ICVI). The data standards would define the minimum data elements required to generate an ICVI using an electronic data system, outline the methods by which data can be shared between participating systems, and provide methods of approving data systems for data quality control. We are making these standards available for public review and comment.
We will consider all comments that we receive on or before January 30, 2013.
You may submit comments by either of the following methods:
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•
The data standards and any comments we receive may be viewed at
Dr. Joseph Vantiem, Information Technology Coordinator, National Animal Health Policy and Programs, VS, APHIS, 4700 River Road Unit 35, Riverdale, MD 20737–1231; (301) 851–3579.
The Animal and Plant Health Inspection Service (APHIS) has established a set of minimum data standards for any electronic system to be used to generate an official interstate certificate of veterinary inspection (ICVI). The standards were developed with the National Assembly of State Animal Health Officials.
ICVIs protect animal health in several important ways. States use ICVIs to monitor animal movements, address specific animal health concerns, and enforce regulations. Specifically, ICVI are used to document the health status of animals moving interstate and track the animals' movement. ICVIs are also used to record observations and test results that show freedom from specific diseases.
ICVIs have traditionally been paper documents; however, a paper-based system can result in lag time between animal movement and the distribution of documents as well as inefficiencies in document archiving and retrieval.
APHIS has attempted to address these deficiencies by developing an electronic module that lets States enter ICVI data into the Veterinary Services Process Streamlining (VSPS) system. Several States and private entities are also attempting to improve the usefulness of ICVIs by developing electronic versions for use by State animal health officials and accredited veterinarians.
Since ICVIs contain important data fields for both animal disease traceability and disease surveillance, the data elements used in ICVIs must be compatible with one another and with the current database standards being implemented in the Surveillance Collaborative Services (SCS) application. SCS is an animal health and surveillance system that is used to maintain test and vaccination data and other program information such as disease or certification status for flocks/herds subject to APHIS' animal disease or pest surveillance and control programs.
We have prepared a document entitled “Data Standards for Interstate Certificates of Veterinary Inspection” (July 2012) that establishes a common set of data for ICVIs so the data can be collected by a variety of methods and be shared seamlessly between all participating entities. We are making this document available to the public for review and comment before posting it on the APHIS Web site
The data standards document may be viewed on the Regulations.gov Web site or in our reading room (see
Forest Service, Agriculture; Fish and Wildlife Service, Interior.
Notice; request for comments.
Federal subsistence regulations require that the rural or nonrural status of communities or areas be reviewed every 10 years. In 2009, the Secretary of the Interior initiated a review of the Federal Subsistence Management Program. An ensuing directive was for the Federal Subsistence Board (Board) to review its process for determining the rural and nonrural status of communities. As a result, the Board has initiated a review of the rural determination process and is requesting comments from the public. These comments will be used by the Board, coordinating with the Secretaries of the Interior and Agriculture, to assist in making decisions regarding the scope and nature of possible changes to improve the rural determination process.
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•
Comments received will be available for public review during public meetings held by the Board on this issue. This generally means that any personal information you provide us will be available during public review.
Chair, Federal Subsistence Board, c/o U.S. Fish and Wildlife Service, Attention: Peter J. Probasco, Office of Subsistence Management; (907) 786–3888; or
Under Title VIII of the Alaska National Interest Lands Conservation Act (ANILCA) (16 U.S.C. 3111–3126), the Secretary of the Interior and the Secretary of Agriculture (Secretaries) jointly implement the Federal Subsistence Management Program. This Program provides a priority for taking of fish and wildlife resources for subsistence uses on Federal public lands and waters in Alaska. The Secretaries published temporary regulations to implement this Program in the
Consistent with subpart B of these regulations, the Secretaries established a Federal Subsistence Board to administer the Federal Subsistence Management Program. The Board comprises:
• A Chair, appointed by the Secretary of the Interior with concurrence of the Secretary of Agriculture;
• The Alaska Regional Director, U.S. Fish and Wildlife Service;
• The Alaska Regional Director, U.S. National Park Service;
• The Alaska State Director, U.S. Bureau of Land Management;
• The Alaska Regional Director, U.S. Bureau of Indian Affairs;
• The Alaska Regional Forester, U.S. Forest Service; and
• Two public members appointed by the Secretary of the Interior with concurrence of the Secretary of Agriculture.
Through the Board, these agencies and public members participate in the development of regulations for subparts C and D, which, among other things, set forth program eligibility and specific harvest seasons and limits.
In administering the program, the Secretaries divided Alaska into 10 subsistence resource regions, each of which is represented by a Federal Subsistence Regional Advisory Council. The Councils provide a forum for rural residents with personal knowledge of local conditions and resource requirements to have a meaningful role in the subsistence management of fish and wildlife on Federal public lands in Alaska. The Council members represent varied geographical, cultural, and user interests within each region.
The Federal Subsistence Regional Advisory Councils have a substantial role in reviewing subsistence issues and making recommendations to the Board. The Federal Subsistence Board, through the Councils, will hold public meetings to accept comments on this notice during the fall meeting cycle. You may present comments on this notice during those meetings at the following locations in Alaska, on the following dates:
A notice will be published of specific dates, times, and meeting locations in local and statewide newspapers, and on the Web at
As expressed in Executive Order 13175, “Consultation and Coordination with Indian Tribal Governments,” the Federal officials that have been delegated authority by the Secretaries are committed to honoring the unique government-to-government relationship that exists between the Federal Government and Federally Recognized Indian Tribes (Tribes) as listed in 75 FR 60810 (October 1, 2010). Consultation with Alaska Native corporations is based on Public Law 108–199, div. H, Sec. 161, Jan. 23, 2004, 118 Stat. 452, as amended by Public Law 108–447, div. H, title V, Sec. 518, Dec. 8, 2004, 118 Stat. 3267, which provides that: “The Director of the Office of Management and Budget and all Federal agencies shall hereafter consult with Alaska Native corporations on the same basis as Indian tribes under Executive Order No. 13175.”
The Alaska National Interest Lands Conservation Act, Title VIII (16 U.S.C. 3111–3126), does not provide specific rights to Tribes for the subsistence taking of wildlife, fish, and shellfish. However, because tribal members and Alaska Native corporations are affected by subsistence regulations, the Secretaries, through the Board, will provide Federally recognized Tribes and Alaska Native corporations an opportunity to consult. The Board provides a variety of opportunities for consultation: engaging in dialogue at the Council meetings; engaging in dialogue at the Board's meetings; and providing input in person, or by mail, email, or phone at any time during the comment period.
The Board will engage in outreach efforts for this notice, including a notification letter, to ensure that Tribes and Alaska Native corporations are advised of the mechanisms by which they can participate. The Board will commit to efficiently and adequately providing an opportunity to Tribes and Alaska Native corporations to prior to the adoption of any changes in policy or regulation concerning the rural determination process.
The Board will consider Tribes' and Alaska Native corporations' information, input, and recommendations, and endeavor to address their concerns.
In accordance with § _.10(d)(4)(ii), one of the responsibilities given to the Federal Subsistence Board is to determine which communities or areas of the State are rural or nonrural. Only residents of areas identified as rural are eligible to participate in the Federal Subsistence Management Program on Federal public lands in Alaska.
The Board determines if a community or area is rural in accordance with established guidelines set forth in § _.15(a). The Board reviews rural determinations on a 10-year cycle and may review determinations out-of-cycle in special circumstances. The Board conducts rulemaking to determine if the list at § _.23(a), which defines the rural/nonrural status of communities and/or areas, needs revision. Residents would have five years to comply with a rural to nonrural change. A change from nonrural to rural would be effective 30 days after publication of the rule.
On May 7, 2007, the Board published a final rule, “Subsistence Management Regulations for Public Lands in Alaska, Subpart C; Nonrural Determinations” (72 FR 25688). This rule revised the list of nonrural areas identified by the Board. The Board changed Adak's status to rural, added Prudhoe Bay to the list of nonrural areas, and adjusted the boundaries of the following nonrural areas: the Kenai Area; the Wasilla/Palmer Area, including Point McKenzie; the Homer Area, including Fritz Creek East (except Voznesenka) and the North Fork Road area; and the Ketchikan Area, including Saxman and portions of Gravina Island. The effective date was June 6, 2007, with a 5-year compliance date of May 7, 2012.
On October 23, 2009, Secretary of the Interior Salazar announced the initiation of a Departmental review of the Federal Subsistence Management Program in Alaska; Secretary of Agriculture Vilsack later concurred with this course of action. The review focused on how the Program is meeting the purposes and subsistence provisions of Title VIII of ANILCA, and how the Program is serving rural subsistence users as envisioned when it began in the early 1990s.
On August 31, 2010, the Secretaries announced the findings of the review, which included several proposed administrative and regulatory reviews and/or revisions to strengthen the Program and make it more responsive to those who rely on it for their subsistence uses. One proposal called for a review, with Council input, of the rural and nonrural determination process and, if needed, recommendations for regulatory changes.
On January 20, 2012, the Board met to consider the Secretarial directive, consider the Council's recommendations, and review all public, Tribal, and Native Corporation comments on the initial review of the rural determinations process. After discussion and careful review, the Board voted unanimously to initiate a review of the rural determination process and the 2010 decennial review. Consequently, based on that action, the Board found that it was in the public's best interest to extend the compliance date of its 2007 final rule (72 FR 25688; May 7, 2007) on rural and nonrural determinations until after the review of the rural determination process and decennial review are complete or in 5 years, whichever comes first. The Board has already published a final rule (77 FR 12477; March 1, 2012) extending the compliance date.
To comply with the Secretarial directives and the Federal subsistence regulations, the Federal Subsistence Board is proceeding with a review of the rural determination process. As part of the Secretaries' commitment to open
The Board has identified the following components in the process for review: Population thresholds, rural characteristics, aggregation of communities, timelines, and information sources. We describe these components below and include questions for public consideration and comment.
This notice announces to the public, including rural Alaska residents, Federally recognized Tribes of Alaska, and Alaska Native corporations, the request for comments on the Federal Subsistence Program's rural determination process. These comments will be used by the Board to assist in making decisions regarding the scope and nature of possible changes to improve the rural determination process, which may include, where the Board has authority, proposed regulatory action(s) or in areas where the Secretaries maintain purview, recommended courses of action.
Forest Service, USDA.
Notice of Land Transfer.
Approximately 353.63 acres of National Forest System lands are transferred to the jurisdiction of the Secretary of Interior pursuant to the Hoopa-Yurok Settlement Act (Pub. L. 100–580; 102 Stat. 2924 (1988)). Transfer of Jurisdiction of Certain National Forest System Lands in California to the Department of the Interior for the benefit of the Yurok Tribe.
This notice becomes effective December 31, 2012.
Louisa Herrera, National Title Program Manager, (202) 205–1255, Lands and Realty Management.
The Hoopa-Yurok Settlement Act (Pub. L. 100–580;102; Stat. 2924 (1988)), hereafter “Act”, provides at section 2(c) that, subject to valid existing rights, certain enumerated National Forest System lands shall be “held in trust by the United States for the benefit of the Yurok Tribe and shall be part of the Yurok Reservation” (102 Stat. 2926). A condition precedent to such lands being held in trust is adoption of a resolution of the Interim Council of the Yurok Tribe as provided in section 2(c)(4) of the Act (102 Stat. 2926).
On March 21, 2007, the Yurok Tribal Council enacted Resolution No. 07–037, waiving certain claims and consenting to uses of tribal funds pursuant to the Act. The Department of the Interior has determined that the resolution meets the requirements of section 2(c)(4) of the Act, and that determination has been accepted by the Department of Agriculture.
Therefore, the conditions of transfer having been met, subject to valid existing rights, administrative jurisdiction over the following Federally
National Institute of Food and Agriculture, USDA.
Notice and solicitation for nominations.
The National Institute of Food and Agriculture (NIFA) is soliciting nominations of veterinary service shortage situations for the Veterinary Medicine Loan Repayment Program (VMLRP) for fiscal year (FY) 2013, as authorized under the National Veterinary Medical Services Act (NVMSA), 7 U.S.C. 3151a. This notice initiates a 60-day nomination period and prescribes the procedures and criteria to be used by State, Insular Area, DC and Federal Lands to nominate veterinary shortage situations. Each year all eligible nominating entities may submit nominations, up to the maximum indicated for each entity in this notice. NIFA is conducting this solicitation of veterinary shortage situation nominations under a previously approved information collection (OMB Control Number 0524–0046).
Shortage situation nominations, both new and carry over, must be submitted on or before March 1, 2013.
Submissions must be made by email at
Gary Sherman; National Program Leader, Veterinary Science; National Institute of Food and Agriculture; U.S. Department of Agriculture; STOP 2220; 1400 Independence Avenue, SW.; Washington, DC 20250–2220; Voice: 202–401–4952; Fax: 202–401–6156; Email:
A landmark series of three peer-reviewed studies published in 2007 in
Among the most alarming findings of the Coalition-sponsored studies was objective confirmation that insufficient numbers of veterinary students are selecting food supply veterinary medical careers. This development has led both to current shortages and to projections for worsening shortages over the next 10 years. Burdensome educational debt was the leading concern students listed for opting not to choose a career in food animal practice or other food supply veterinary sectors. According to a survey of veterinary medical graduates conducted by the American Veterinary Medical Association (AVMA) in the spring of 2012, the average educational debt for students graduating from veterinary school is approximately $151,000. Such debt loads incentivize students to select other veterinary careers, such as companion animal medicine, which tend to be more financially lucrative and, therefore, enable students to more quickly repay their outstanding educational loans. Furthermore, when this issue was studied in the Coalition report from the perspective of identifying solutions to this workforce imbalance, panelists were asked to rate 18 different strategies for addressing shortages. Responses from the panelists overwhelmingly showed that student debt repayment and scholarship programs were the most important strategies in addressing future shortages (JAVMA 229:57–69).
In accordance with the Office of Management and Budget (OMB) regulations (5 CFR part 1320) that implement the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35), the information collection and recordkeeping requirements imposed by the implementation of these guidelines have been approved by OMB Control Number 0524–0046.
In January 2003, the National Veterinary Medical Service Act (NVMSA) was passed into law adding section 1415A to the National Agricultural Research, Extension, and Teaching Policy Act of 1997 (NARETPA). This law established a new Veterinary Medicine Loan Repayment Program (7 U.S.C. 3151a) authorizing the Secretary of Agriculture to carry out a program of entering into agreements with veterinarians under which they agree to provide veterinary services in veterinarian shortage situations.
In FY 2010, NIFA announced the first funding opportunity for the VMLRP and received 260 applications from which NIFA issued 53 awards totaling $5,186,000 to fill veterinary shortage areas in 31 states. In FY 2011, NIFA received 159 applications from which NIFA issued 75 awards totaling $7,251,000 to fill veterinary shortage areas in 35 states. There was a cumulative total of up to $4,500,000 available for awards heading into the FY 2012 funding opportunity. Funding for FY 2013 and future years will be based on annual appropriations and balances, if any, carried forward from prior years, and may vary from year to year.
Section 7105 of the Food, Conservation, and Energy Act of 2008, Public Law 110–246, (FCEA) amended section 1415A to revise the determination of veterinarian shortage situations to consider (1) geographical areas that the Secretary determines have a shortage of veterinarians; and (2) areas of veterinary practice that the Secretary determines have a shortage of veterinarians, such as food animal medicine, public health, epidemiology, and food safety. This section also added that priority should be given to agreements with veterinarians for the practice of food animal medicine in veterinarian shortage situations.
NARETPA section 1415A requires the Secretary, when determining the amount of repayment for a year of service by a veterinarian to consider the ability of USDA to maximize the number of agreements from the amounts appropriated and to provide an incentive to serve in veterinary service shortage areas with the greatest need.
The Secretary delegated the authority to carry out this program to NIFA pursuant to 7 CFR § 2.66(a)(141).
Pursuant to the requirements enacted in the NVMSA of 2004 (as revised), and the implementing regulation for this Act, Part 3431 Subpart A of the VMLRP Final Rule [75 FR 20239–20248], NIFA hereby implements guidelines for authorized State Animal Health Officials (SAHO) to nominate veterinary shortage situations for the FY 2013 program cycle:
Section 1415A of NARETPA, as amended and revised by Section 7105 of FCEA directs determination of veterinarian shortage situations to consider (1) geographical areas that the Secretary determines have a shortage of veterinarians; and (2) areas of veterinary practice that the Secretary determines have a shortage of veterinarians, such as food animal medicine, public health,
While the NVMSA (as amended) specifies priority be given to food animal medicine shortage situations, and that consideration also be given to specialty areas such as public health, epidemiology and food safety, the Act does not identify any areas of veterinary practice as ineligible. Accordingly, all nominated veterinary shortage situations will be considered eligible for submission. However, the competitiveness of submitted nominations, upon evaluation by the external review panel convened by NIFA, will reflect the intent of Congress that priority be given to certain types of veterinary service shortage situations. NIFA therefore anticipates that the most competitive nominations will be those directly addressing food supply veterinary medicine shortage situations.
NIFA has adopted definitions of the practice of veterinary medicine and the practice of food supply medicine that are broadly inclusive of the critical roles veterinarians serve in both public practice and private practice situations. Nominations describing either public or private practice veterinary shortage situations will therefore be eligible for submission. However, NIFA interprets that Congressional intent is to give priority to the private practice of food animal medicine. NIFA is grateful to the Association of American Veterinary Medical Colleges (AAVMC), the American Veterinary Medical Association (AVMA), and other stakeholders for their recommendations regarding the appropriate balance of program emphasis on public and private practice shortage situations. NIFA will seek to achieve a final distribution of approximately 90 percent of nominations (and eventual agreements) that are geographic, private practice, food animal veterinary medicine shortage situations, and approximately 10 percent of nominations that reflect public practice shortage situations.
Respondents on behalf of each State include the chief State Animal Health Official (SAHO), as duly authorized by the Governor or the Governor's designee in each State. The SAHOs are requested to submit nominations to
In its consideration of fair, transparent and objective approaches to solicitation of shortage area nominations, NIFA evaluated three alternative strategies before deciding on the appropriate strategy. The first option considered was to impose no limits on the number of nominations submitted. The second was to allow each state the same number of nominations. The third (eventually selected) was to differentially cap the number of nominations per state based on defensible and intuitive criteria.
The first option, providing no limits to the number of nominations per state, is fair to the extent that each state and insular area has equal opportunity to nominate as many situations as desired. However, funding for the VMLRP is limited (relative to anticipated demand), so allowing potentially high and disproportionate submission rates of nominations could both unnecessarily burden the nominators and the reviewers with a potential avalanche of nominations and dilute highest need situations with lower need situations. Moreover, NIFA believes that the distribution of opportunity under this program (i.e., distribution of mapped shortage situations resulting from the nomination solicitation and review process) should roughly reflect the national distribution of food supply veterinary service demand. By not capping nominations based on some objective criteria, it is likely there would be no correlation between the mapped pattern and density of certified shortage situations and the actual pattern and density of need. This in turn could undermine confidence in the program with Congress, the public, and other stakeholders.
The second option, limiting all states and insular areas to the same number of nominations suffers from some of the same disadvantages as option one. It has the benefit of limiting administrative burden on both the SAHO and the nomination review process. However, like option one, there would be no correlation between the mapped pattern of certified shortage situations and the actual pattern of need. For example, Guam and Rhode Island would be allowed to submit the same number of nominations as Texas and Nebraska, despite the large difference in the sizes of their respective animal agriculture industries and rural land areas requiring veterinary service coverage.
The third option, to cap the number of nominations in relation to major parameters correlating with veterinary service demand, achieves the goals both of practical control over the administrative burden to the states and NIFA, and of achieving a mapped pattern of certified nominations that approximates the theoretical actual shortage distribution. In addition, this method limits dilution of highest need areas with lower need areas. The disadvantage of this strategy is that there is no validated, unbiased, direct measure of veterinary shortage, and so it is necessary to employ parameters that correlate with the hypothetical cumulative relative need for each state in comparison to other states.
In the absence of a validated unbiased direct measure of relative veterinary service need or risk for each state and insular area, the National Agricultural Statistics Service (NASS) provided NIFA with reliable and public data that correlate with demand for food supply veterinary service. NIFA consulted with NASS and determined that the NASS variables most strongly correlated with state-level food supply veterinary service need are “Livestock and Livestock Products Total Sales ($)” and “Land Area” (acres). The “Livestock and Livestock Products Total Sales ($)” variable broadly predicts veterinary service need in a State because this is a normalized (to cash value) estimate of the extent of (live) animal agriculture in the state. The State “land area” variable predicts veterinary service need because there is positive correlation between state land area, percent of state area classified as rural and the percent of land devoted to actual or potential livestock production. Importantly, land area is also directly correlated with the number of veterinarians needed to provide veterinary services in a state because of the practical limitations relating to the maximum radius of a standard veterinary service area. Due to fuel and other cost factors, the maximum radius a veterinarian operating a mobile veterinary service can cover is approximately 60 miles, which roughly corresponds to two or three contiguous counties of average size.
Although these two NASS variables are not perfect predictors of veterinary service demand, NIFA believes they account for a significant proportion of several of the most relevant factors influencing veterinary service need and
Following this rationale, the Secretary is specifying the maximum number of nominations per state in order to (1) Assure distribution of designated shortage areas in a manner generally reflective of the differential overall demand for food supply veterinary services in different states, (2) assure the number of shortage situation nominations submitted fosters emphasis on selection by nominators and applicants of the highest priority need areas, and (3) provide practical and proportional limitations of the administrative burden borne by SAHOs preparing nominations, and by panelists serving on the NIFA nominations review panel.
Furthermore, instituting a limit on the number of nominations is consistent with language in the Final Rule stating, “The solicitation may specify the maximum number of nominations that may be submitted by each State animal health official.”
The number of designated shortage situations per state will be limited by NIFA, and this has an impact on the number of new nominations a state may submit each time NIFA solicits shortage nominations. In the 2013 cycle, NIFA is again accepting the number of nominations equivalent to the allowable number of designated shortage areas for each state. All eligible submitting entities will, for the 2013 cycle, have an opportunity to do the following: (1) Retain designated status for any shortage situation successfully designated in 2012 (if there is no change to any information, the nomination will be approved for 2013 without the need for re-review by the merit panel), (2) rescind any nomination officially designated in 2012, and (3) submit new nominations. The total of the number of new nominations plus designated nominations retained (carried over) may not exceed the maximum number of nominations each entity is permitted. Any amendment to an existing shortage nomination is presumed to constitute a significant change. Therefore, an amended nomination must be rescinded and resubmitted to NIFA as a new nomination and it will be evaluated by the 2013 review panel.
The maximum number of nominations (and potential designations) will remain the same in 2013 as they were for the previous three years. Thus, all states have the opportunity to re-establish the maximum number of designated shortage situations. Awards from previous years have no bearing on a state's maximum number of allowable shortage nomination submissions or number of designations for subsequent years. NIFA reserves the right in the future to proportionally adjust the maximum number of designated shortage situations per state to ensure a balance between available funds and the requirement to ensure priority is given to mitigating veterinary shortages corresponding to situations of greatest need. Nomination Allocation tables for FY 2013 are available under the State Animal Health Officials section of the VMLRP web site at www.nifa.usda.gov/vmlrp.
Table I lists “Special Consideration Areas” which include any State or Insular Area not reporting data, and/or reporting less than $1,000,000 in annual Livestock and Livestock Products Total Sales ($), and/or possessing less than 500,000 acres, as reported by NASS. One nomination is allocated to any State or Insular Area classified as a Special Consideration Area.
Table II shows how NIFA determined nomination allocation based on quartile ranks of States for two variables broadly correlated with demand for food supply veterinary services: “Livestock and Livestock Products Total Sales ($)” (LPTS) and “Land Area (acres)” (LA). The total number of NIFA- designated shortage situations per state in any given program year is based on the quartile ranking of each state in terms of LPTS and LA. States for which NASS has both LPTS and LA values, and which have at least $1,000,000 LPTS and at least 500,000 acres LA (typically all states plus Puerto Rico), were independently ranked from least to greatest value for each of these two composite variables. The two ranked lists were then divided into quartiles with quartile 1 containing the lowest variable values and quartile 4 containing the highest variable values. Each state then received the number of designated shortage situations corresponding to the number of the quartile in which the state falls. Thus a state that falls in the second quartile for LA and the third quartile for LPTS may submit a maximum of five shortage situation nominations (2 + 3). This transparent computation was made for each state thereby giving a range of 2 to 8 shortage situation nominations, contingent upon each state's quartile ranking for the two variables.
The maximum number of designated shortage situations for each State in 2013 is shown in Table III.
While Federal Lands are widely dispersed within States and Insular Areas across the country, they constitute a composite total land area over twice the size of Alaska. If the 200-mile limit U.S. coastal waters and associated fishery areas are included, Federal Land total acreage would exceed 1 billion. Both State and Federal Animal Health officials have responsibilities for matters relating to terrestrial and aquatic food animal health on Federal Lands. Interaction between wildlife and domestic livestock, such as sheep and cattle, is particularly common in the plains states where significant portions of Federal lands are leased for grazing. Therefore, both SAHOs and the Chief Federal Animal Health Officer (Deputy Administrator, Animal and Plant Health Inspection Service or designee) may submit nominations to address shortage situations on or related to Federal Lands.
NIFA emphasizes that shortage nomination allocation is set to broadly balance the number of designated shortage situations across states prior to the application and award phases of the VMLRP. Awards will be made based strictly on the peer review panels' assessment of the quality of the match between the knowledge, skills and abilities of the applicant and the attributes of the specific shortage situation applied for, thus no state will be given a preference for placement of awardees. Additionally, unless otherwise specified in the shortage nomination form, each designated shortage situation will be limited to one award.
As described in Section 4 above, all SAHOs will, for the FY 2013 cycle, have an opportunity to do the following: (1) Retain (carry over) designated status for any shortage situation successfully designated in 2012 and not revised, without need for reevaluation by merit review panel, (2) rescind any nomination officially designated in 2012, and (3) submit new nominations. The total number of new nominations and designated nominations retained (carried over) may not exceed the maximum number of shortages each state is allocated. An amendment to an existing shortage nomination constitutes a significant change and therefore must
The following process is the mechanism by which a SAHO should retain or rescind a designated nomination: NIFA will initiate the process by sending an email to each SAHO with a PDF copy of the nomination form of each designated area that went unfilled in FY 2012. If the SAHO wishes to retain (carry over) one or more designated nomination(s), the SAHO shall copy and paste the prior year information (unrevised) into the current year's nomination form. The SAHO will then email the carry over nomination(s), along with any new nominations, to vmlrp@nifa.usda.gov by the published deadline.
Both new and retained nominations must be submitted on the Veterinary Shortage Situation Nomination form provided in the State Animal Health Officials section at www.nifa.usda.gov/vmlrp.
Shortage situation nominations, both new and carry over, must be submitted on or before March 1, 2013, by email at vmlrp@nifa.usda.gov to the Veterinary Medicine Loan Repayment Program; National Institute of Food and Agriculture; U.S. Department of Agriculture.
Each designated shortage situation shall be certified and remain certified until it is filled with a VMLRP award or withdrawn by the SAHO. A SAHO may request that NIFA remove a previously certified and designated shortage situation by sending an email to vmlrp@nifa.usda.gov. The request should specifically identify the shortage situation the SAHO wishes to withdraw and the reason(s) for its withdrawal. The program manager will review the request, make a determination, and inform the requesting SAHO of the final action taken. When a request for withdrawal of a designated shortage situation leads to its removal from the list of NIFA-designated shortage situations, the withdrawn situation may not be replaced with a new shortage situation nomination until NIFA issues its next solicitation of shortage situation nominations for this program.
For the purpose of implementing the solicitation for veterinary shortage situations, the definitions provided in 7 CFR part 3431 are applicable.
The veterinary shortage situation nomination form is available in the State Animal Health Officials section at www.nifa.usda.gov/vmlrp. The completed form must be emailed to
Following conclusion of the nomination and designation process, NIFA will prepare lists and/or maps that include all designated shortage situations for the current program year. This effort requires a physical location that represents the center of the service area for a geographic shortage or the location of the main office or work address for a public practice and/or specialty practice shortage. For example, if the state seeks to certify a tri-county area as a food animal veterinary service (i.e., Type I) shortage situation, a road intersection approximating the center of the tri-county area would constitute a satisfactory physical location for NIFA's listing and mapping purposes. By contrast, if the state is identifying “veterinary diagnostician”, a Type III nomination, as a shortage situation, then the nominator would complete this field by filling in the address of the location where the diagnostician would work (e.g., State animal disease diagnostic laboratory).
Congressional intent is for this program to incentivize applicants to “serve in veterinary service shortage areas with the greatest need.” There is therefore the presumption that all areas nominated as shortage situations should be classified as at least “moderate priority” shortages. To assist nomination merit review panelists and award phase peer panelists in scoring shortage nominations and ranking applications from VMLRP applicants, SAHOs are asked to characterize each shortage situation nomination as “Moderate Priority”, “High Priority”, or “Critical Priority” shortages.
SAHOs identifying this shortage type must check one or more boxes indicating which specie(s) constitute the veterinary shortage situation. Indicate either “Must Cover” or “May Cover” to stipulate which species a future awardee must be prepared, willing, and committed to provide services for, versus which species an awardee could treat using a minor percentage of their time obligated under a VMLRP contract. The Type I shortage situation must entail at least an 80 percent time commitment to private practice food supply veterinary medicine. The nominator will specify the minimum percent time (between 80 and 100 percent of a standard 40 hour week) a veterinarian must commit in order to satisfactorily fill the specific nominated situation. The shortage situation may be located anywhere (rural or non-rural) so long as the veterinary service shortages to be mitigated are consistent with the definition of “practice of food supply veterinary medicine.” The minimum 80 percent time commitment is, in part, recognition of the fact that occasionally food animal veterinary practitioners are expected to meet the needs of other veterinary service sectors such as clientele owning companion and exotic animals. Type I nominations are intended to address those shortage situations where the nominator believes a veterinarian can operate profitably committing between 80 and 100 percent time to food animal medicine activities in the designated shortage area, given the client base and other socio-economic factors impacting viability of veterinary practices in the area. This generally corresponds to a shortage area where clients can reasonably be expected to pay for professional veterinary services and where food animal populations are sufficiently dense to support a (or another) veterinarian. The personal residence of the veterinarian (VMLRP awardee) and the address of veterinary practice employing the veterinarian may or may not fall within the geographic bounds of the designated shortage area.
SAHOs identifying this shortage type must check one or more boxes indicating which specie(s) constitute the veterinary shortage situation. Indicate either “Must Cover” or “May Cover” to stipulate which species a future awardee must be prepared, willing, and committed to provide services for, versus which species an awardee could treat using a minor percentage of their time obligated under a VMLRP contract. The shortage situation must be in an area satisfying the definition of “rural.” The minimum 30 percent-time (12 hr/wk) commitment of an awardee to serve in a rural shortage situation is in recognition of the fact that there may be some remote or economically depressed rural areas in need of food animal veterinary services that are unable to support a practitioner predominately serving the food animal sector, yet the need for food animal veterinary services for an existing, relatively small, proportion of available food animal business is nevertheless great. The Type II nomination is therefore intended to address those rural shortage situations where the nominator believes there is a shortage of food supply veterinary services, and that a veterinarian can operate profitably committing 30 to 100 percent to food animal medicine in the designated rural shortage area. The nominator will specify the minimum percent time (between 30 and 100 percent) a veterinarian must commit in order to satisfactorily fill the specific nominated situation. Under the Type II nomination category, the expectation is that the veterinarian may provide veterinary services to other veterinary sectors (e.g., companion animal clientele) as a means of achieving financial viability. As with Type I nominations, the residence of the veterinarian (VMLRP awardee) and/or the address of veterinary practice employing the veterinarian may or may not fall within the geographic bounds of the designated shortage area. However, the awardee is required to verify the specified minimum percent time commitment (30 percent to 100 percent, based on a standard 40 hour work week) to service within the specified geographic shortage area.
SAHOs identifying this shortage type must, in the spaces provided, identify the “Employer” and the presumptive “Position Title”, and check one or more of the appropriate boxes identifying the specialty/disciplinary area(s) being nominated as a shortage situation. This is a broad nomination category comprising many types of specialized veterinary training and employment areas relating to food supply veterinary workforce capacity and capability. These positions are typically located in city, county, State and Federal Government, and institutions of higher education. Examples of positions within the public practice sector include university faculty and staff, veterinary laboratory diagnostician, County Public Health Officer, State Veterinarian, State Public Health Veterinarian, State Epidemiologist, FSIS meat inspector, Animal and Plant Health Inspection Service (APHIS) Area Veterinarian in Charge (AVIC), and Federal Veterinary Medical Officer (VMO).
Veterinary shortage situations such as those listed above are eligible for consideration under Type III nomination. However, nominators should be aware that Congress has stipulated that the VMLRP must emphasize private food animal practice shortage situations. Accordingly, NIFA anticipates that loan repayments for the Public Practice sector will be limited to approximately 10 percent of total nominations and available funds.
The minimum time commitment serving under a Type III shortage nomination is 49 percent. The nominator will specify the minimum percent time (between 49 percent and 100 percent) a veterinarian must commit in order to satisfactorily fill the specific nominated situation. NIFA understands that some public practice employment opportunities that are shortage situations may be part-time positions. For example, a veterinarian pursuing an advanced degree (in a shortage discipline area) on a part-time basis may also be employed by the university for the balance of the veterinarian's time to provide part-time professional veterinary service(s) such as teaching, clinical service, or laboratory animal care that may or may not also qualify as veterinary shortage situations. The 49 percent minimum therefore provides flexibility to nominators wishing to certify public practice shortage situations that would be ineligible under more stringent minimum percent time requirements.
Within the allowed word limit the nominator should clearly state overarching objectives the State hopes to achieve by placing a veterinarian in the nominated situation. Include the minimum percent time commitment (within the range of the shortage type selected) the awardee is expected to devote to filling the specific food supply veterinary shortage situation.
Within the allowed word limit the nominator should clearly state the principal day-to-day professional activities that would have to be conducted in order to achieve the objectives described in a) above.
Within the allowed word limit the nominator should explain any prior efforts to mitigate this veterinary service shortage and prospects for recruiting veterinarian(s) in the future.
Within the allowed word limit the nominator should explain the consequences of not addressing this veterinary shortage situation.
Minimum percent FTE service obligated under the VMLRP is specified for each of the three shortage types. However, the nominator may indicate, in the box provided on page 2 of the nomination form, a greater percent FTE than the specified minimum, according to the following guidelines. For a Type I shortage, the minimum FTE obligation is 80%, but the nominator may specify up to 100% (100% FTE corresponds to 40 hrs/week). The minimum FTE obligation is 30% for Type II shortage situation, but the nominator may specify up to 79%. Higher percentages should be submitted as Type I shortages. The minimum FTE obligation is 49% for Type III (public practice) shortage situations, but the nominator may specify up to 100%. An entry should be made in the box for specification of percent FTE if the percentage specified is other than the default minimum. Otherwise the box should be left blank. In assigning a percentage FTE, SAHOs should be cognizant of the impact this has on an eventual awardee. If the percentage is too high for an awardee to achieve, he or she could fall into breach status under the program and owe substantial financial penalties. NIFA requires formal quarterly certification that minimum service time was worked before each quarterly loan repayment is paid to the awardee's lender(s). Accordingly, NIFA advises that a nomination be submitted only if the SAHO is confident that an awardee can meet the default, or optionally specified, minimum FTE percentage each and every one of the 12 quarters (i.e, twelve 3-month periods) constituting the 3-year duration of service under the program.
SAHOs submitting shortage nominations should check both “affirmation” boxes on the last page of the nomination form. These two affirmations provide assurance that submitting SAHOs understand the shortage nomination process and the importance of the SAHO having reasonable confidence that the nomination submitted describes a bona fide shortage area. The second assurance is particularly important to help avoid the placement of a VMLRP awardee where veterinary coverage already exists, and where undue competition could lead to insufficient clientele demand to support either the awardee or the veterinary practice originally serving the area.
NIFA will convene a panel of food supply veterinary medicine experts from Federal and state agencies, as well as institutions receiving Animal Health and Disease Research Program funds under section 1433 of NARETPA, who will review the nominations and make recommendations to the NIFA Program Manager. NIFA explored the possibility of including experts from non-governmental professional organizations and sectors for this process, but under NARETPA section 1409A(e), panelists for the purposes of this process are limited to Federal and State agencies and cooperating state institutions (i.e., NARETPA section 1433 recipients).
NIFA will review the panel recommendations and designate the VMLRP shortage situations. The list of shortage situations will be made available on the VMLRP Web site at
Criteria used by the shortage situation nomination review panel and NIFA for certifying a veterinary shortage situation will be consistent with the information requested in the shortage situations nomination form. NIFA understands that defining the risk landscape associated with shortages of veterinary services throughout a state is a process that may require consideration of many qualitative and quantitative factors. In addition, each shortage situation will be characterized by a different array of subjective and objective supportive information that must be developed into a cogent case identifying, characterizing, and justifying a given geographic or disciplinary area as one deficient in certain types of veterinary capacity or service. To accommodate the uniqueness of each shortage situation, the nomination form provides opportunities to present a case using both supportive metrics and narrative explanations to define and explain the proposed need. At the same time, the elements of the nomination form provide a common structure for the information collection process which will in turn facilitate fair comparison of the relative merits of each nomination by the evaluation panel.
While NIFA anticipates some arguments made in support of a given shortage situation will be qualitative, respondents are encouraged to present verifiable quantitative and qualitative evidentiary information where ever possible. Absence of quantitative data such as animal and veterinarian census data for the proposed shortage area(s) may lead the panel to recommend not approving the shortage nomination.
The maximum point value review panelists may award for each element is as follows:
20 points: Describe the objectives of a veterinarian meeting this shortage situation as well as being located in the community, area, state/insular area, or position requested above.
20 points: Describe the activities of a veterinarian meeting this shortage situation and being located in the community, area, state/insular area, or position requested above.
5 points: Describe any past efforts to recruit and retain a veterinarian in the shortage situation identified above.
35 points: Describe the risk of this veterinarian position not being secured or retained. Include the risk(s) to the production of a safe and wholesome food supply and/or to animal, human, and environmental health not only in the community but in the region, state/
An additional 20 points will be used to evaluate overall merit/quality of the case made for each nomination.
Prior to the panel being convened, shortage situation nominations will be evaluated and scored according to the established scoring system by a primary reviewer. When the panel convenes, the primary reviewer will present each nomination orally in summary form. After each presentation, panelists will have an opportunity, if necessary, to discuss the nomination, with the primary reviewer leading the discussion and recording comments. After the panel discussion is complete, any scoring revisions will be made by and at the discretion of the primary reviewer. The panel is then polled to recommend, or not recommend, the shortage situation for designation. Nominations scoring 70 or higher by the primary reviewer (on a scale of 0 to 100), and receiving a simple majority vote in support of designation as a shortage situation will be “recommended for designation as a shortage situation.” Nominations scoring below 70 by the primary reviewer, and failure to achieve a simple majority vote in support of designation will be “not recommended for designation as a shortage situation.” In the event of a discrepancy between the primary reviewer's scoring and the panel poll results, the VMLRP program manager will be authorized to make the final determination on the nomination's designation.
Office of Advocacy and Outreach, USDA.
Extension of time for submitting nominations.
We are giving notice that the Secretary of Agriculture will extend the time to submit nominations and applications to serve on the Advisory Committee on Beginning Farmers and Ranchers (the “Committee”) for an additional term of 2 years through December 14, 2014. This will give interested persons additional time to prepare and submit nomination packages.
Consideration will be given to nominations received on or before January 15, 2013.
Mrs. R. J. Cabrera, Designated Federal Official, USDA OAO, 1400 Independence Avenue, Room 520–A, Washington, DC 20250–0170; Telephone (202) 720–6350; Fax (202) 720–7704; Email:
Nomination packages may be sent by postal mail or commercial delivery to: Mrs. R. J. Cabrera, Designated Federal Official, USDA OAO, 1400 Independence Avenue, Room 520–A, Washington, DC 20250–0170. Nomination packages may also be faxed to (202) 720–7704.
On December 20, 2012 we published in the
We are soliciting nominations from interested organizations and individuals from among ranching and farming producers (industry), related government, State, and Tribal agricultural agencies, academic institutions, commercial banking entities, trade associations, and related nonprofit enterprises. An organization may nominate individuals from within or outside its membership; alternatively, an individual may nominate herself or himself. Nomination packages should include a nomination form along with a cover letter or resume that documents the nominee's background and experience. Nomination forms are available on the Internet at
The Secretary will select up to 20 members from among those organizations and individuals solicited, in order to obtain the broadest possible representation on the Committee. Equal opportunity practices, in line with the USDA policies, will be followed in all appointments to the Committee. To ensure that the recommendations of the Committee have taken into account the needs of the diverse groups served by the Department, membership should include, to the extent practicable, individuals with demonstrated ability to represent minorities, women, and persons with disabilities.
The Department of Commerce will submit to the Office of Management and Budget (OMB) for clearance the following proposal for collection of information under the emergency provisions of the Paperwork Reduction Act (44 U.S.C. Chapter 35).
The Act establishes the First Responder Network Authority (FirstNet) as an independent authority within
The Act also charges NTIA with establishing a grant program to assist state, regional, tribal, and local jurisdictions with identifying, planning, and implementing the most efficient and effective means to use and integrate the infrastructure, equipment, and other architecture associated with the nationwide PSBN to satisfy the wireless broadband and data services needs of their jurisdictions. NTIA will use the collection of information to ensure that States applying for SLIGP grants meet eligibility and programmatic requirements as well as to monitor and evaluate how SLIGP recipients are achieving the core purposes of the program established by the Act.
NTIA is seeking to emergency review of the SLIGP request to begin the application process in the first quarter of calendar year 2013 and award grants no later than June 1, 2013. In order to meet this deadline, NTIA must receive clearance for the application and reporting requirements by December 31, 2012 in order to: (1) Ensure applicants have reasonable notice of the federal funding opportunity; (2) provide applicants sufficient time to complete and submit their applications; and (3) allow NTIA adequate time to properly execute the application review process and make the awards.
Copies of the above information collection proposal can be obtained by calling or writing Jennifer Jessup, Departmental Paperwork Clearance Officer, (202) 482–0336, Department of Commerce, Room 6616, 14th and Constitution Avenue NW., Washington, DC 20230 (or via the Internet at
Written comments and recommendations for the proposed information collection should be sent by January 7, 2013 to Nicholas Fraser, OMB Desk Officer, FAX number (202) 395–7285, or via the Internet at
On August 20, 2012, the Piedmont Triad Partnership, grantee of FTZ 230, submitted a notification of proposed production activity to the Foreign-Trade Zones (FTZ) Board on behalf of Sonoco Corrflex, within FTZ 230—Sites 24–27, in Rural Hall and Winston-Salem, North Carolina.
The notification was processed in accordance with the regulations of the FTZ Board (15 CFR part 400), including notice in the
Tsudis Chocolate Company (Tsudis), an operator of FTZ 33, submitted a notification of proposed export production activity for its facility in Pittsburgh, Pennsylvania. The notification conforming to the requirements of the regulations of the Foreign-Trade Zones Board (15 CFR 400.22) was received on December 4, 2012.
The Tsudis facility is located within Site 10 of FTZ 33. Activity at the facility would involve the production of chocolate confectionery bars for export (no shipments for U.S. consumption would occur). For shipments to Canada or Mexico, production under FTZ procedures could allow reduced duty treatment under NAFTA Duty Deferral requirements. For shipments to other export markets, FTZ procedures could exempt Tsudis from customs duty payments on the foreign status material used in its production. The sole foreign-origin material to be used in the export production is liquid chocolate (duty rate: 52.8¢/kg+4.3%). Customs duties also could possibly be deferred or reduced on foreign status production equipment or foreign liquid chocolate scrapped or destroyed under customs procedures.
Public comment is invited from interested parties. Submissions shall be addressed to the Board's Executive Secretary at the address below. The closing period for their receipt is February 11, 2013.
A copy of the notification will be available for public inspection at the Office of the Executive Secretary, Foreign-Trade Zones Board, Room 21013, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230–0002, and in the “Reading Room” section of the Board's Web site, which is accessible via
For further information, contact Pierre Duy at
Import Administration, International Trade Administration, Department of Commerce.
On October 24, 2012, the United States Court of International Trade (CIT) sustained the Department of Commerce's (the Department's) results of redetermination pursuant to the CIT's remand order in
Elizabeth Eastwood, AD/CVD Operations, Office 2, Import Administration—International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC, 20230; telephone (202) 482–3874.
On August 18, 2010, the Department published its final results in the antidumping duty administrative review of OJ from Brazil covering the POR of March 1, 2008, through February 28, 2009.
Consistent with the decision of the CAFC in
Based on the CIT's affirmation of the Remand Results, the Department amends its
The Department will instruct U.S. Customs and Border Protection to assess antidumping duties on entries of the subject merchandise exported during the POR from Fischer based on the revised assessment rates calculated by the Department.
This notice is issued and published in accordance with sections 516A(c)(1), 751(a)(1), and 777(i)(1) of the Act.
Import Administration, International Trade Administration, Department of Commerce.
The Department of Commerce (“the Department”) has received requests to conduct administrative reviews of various antidumping and countervailing duty orders and findings with November anniversary dates. In accordance with the Department's regulations, we are initiating those administrative reviews. The Department also received a request to revoke one antidumping duty order in part.
Effective December 31, 2012.
Brenda E. Waters, Office of AD/CVD Operations, Customs Unit, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230, telephone: (202) 482–4735.
The Department has received timely requests, in accordance with 19 CFR 351.213(b), for administrative reviews of various antidumping and countervailing duty orders and findings with November anniversary dates. The Department also received a timely request to revoke in part the antidumping duty order on Fresh Garlic from the People's Republic of China (“PRC”) for one exporter.
All deadlines for the submission of various types of information, certifications, or comments or actions by the Department discussed below refer to the number of calendar days from the applicable starting time.
If a producer or exporter named in this notice of initiation had no exports, sales, or entries during the period of review (“POR”), it must notify the Department within 60 days of publication of this notice in the
In the event the Department limits the number of respondents for individual examination for administrative reviews, the Department intends to select respondents based on U.S. Customs and Border Protection (“CBP”) data for U.S. imports during the POR. We intend to release the CBP data under Administrative Protective Order (“APO”) to all parties having an APO within seven days of publication of this initiation notice and to make our decision regarding respondent selection within 21 days of publication of this
In the event the Department decides it is necessary to limit individual examination of respondents and conduct respondent selection under section 777A(c)(2) of the Act:
In general, the Department has found that determinations concerning whether particular companies should be “collapsed” (
Pursuant to 19 CFR 351.213(d)(1), a party that has requested a review may withdraw that request within 90 days of the date of publication of the notice of initiation of the requested review. The regulation provides that the Department may extend this time if it is reasonable to do so. In order to provide parties additional certainty with respect to when the Department will exercise its discretion to extend this 90-day deadline, interested parties are advised that, with regard to reviews requested on the basis of anniversary months on or after August 2011, the Department does not intend to extend the 90-day deadline unless the requestor demonstrates that an extraordinary circumstance has prevented it from submitting a timely withdrawal request. Determinations by the Department to extend the 90-day deadline will be made on a case-by-case basis.
In proceedings involving non-market economy (“NME”) countries, the Department begins with a rebuttable presumption that all companies within the country are subject to government control and, thus, should be assigned a single antidumping duty deposit rate. It is the Department's policy to assign all exporters of merchandise subject to an administrative review in an NME country this single rate unless an exporter can demonstrate that it is sufficiently independent so as to be entitled to a separate rate.
To establish whether a firm is sufficiently independent from government control of its export activities to be entitled to a separate rate, the Department analyzes each entity exporting the subject merchandise under a test arising from the
All firms listed below that wish to qualify for separate rate status in the administrative reviews involving NME countries must complete, as appropriate, either a separate rate application or certification, as described below. For these administrative reviews, in order to demonstrate separate rate eligibility, the Department requires entities for whom a review was requested, that were assigned a separate rate in the most recent segment of this proceeding in which they participated, to certify that they continue to meet the criteria for obtaining a separate rate. The Separate Rate Certification form will be available on the Department's Web site at
Entities that currently do not have a separate rate from a completed segment of the proceeding
For exporters and producers who submit a separate-rate status application or certification and subsequently are selected as mandatory respondents, these exporters and producers will no longer be eligible for separate rate status unless they respond to all parts of the questionnaire as mandatory respondents.
In accordance with 19 CFR 351.221(c)(1)(i), we are initiating administrative reviews of the following antidumping and countervailing duty orders and findings. We intend to issue the final results of these reviews not later than November 30, 2013.
During any administrative review covering all or part of a period falling between the first and second or third and fourth anniversary of the publication of an antidumping duty order under 19 CFR 351.211 or a determination under 19 CFR 351.218(f)(4) to continue an order or suspended investigation (after sunset review), the Secretary, if requested by a domestic interested party within 30 days of the date of publication of the notice of initiation of the review, will determine, consistent with
For the first administrative review of any order, there will be no assessment of antidumping or countervailing duties on entries of subject merchandise entered, or withdrawn from warehouse, for consumption during the relevant provisional-measures “gap” period, of the order, if such a gap period is applicable to the period of review.
Interested parties must submit applications for disclosure under administrative protective orders in accordance with 19 CFR 351.305. On January 22, 2008, the Department published
Any party submitting factual information in an antidumping duty or countervailing duty proceeding must certify to the accuracy and completeness of that information.
These initiations and this notice are in accordance with section 751(a) of the Act (19 USC 1675(a)) and 19 CFR 351.221(c)(1)(i).
Import Administration, International Trade Administration, Department of Commerce
Patrick Edwards or Angelica Mendoza, AD/CVD Operations, Office 7, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230, at (202) 482–8029 or (202) 482–3019, respectively.
The Department of Commerce (the Department) is revoking the antidumping duty and countervailing duty orders on honey from Argentina because we have concluded that substantially all domestic producers lack interest in the relief provided by these orders.
On December 10, 2001, the Department published the antidumping and countervailing duty orders on honey from Argentina.
On October 2, 2012, the Department published a notice of initiation of changed circumstances reviews of the
Accordingly, we are notifying the public of the revocation of the antidumping duty order, in whole, with respect to products entered, or withdrawn from warehouse, for consumption on or after December 1, 2010, and the countervailing duty order, in whole, with respect to products entered, or withdrawn from warehouse, for consumption on or after December 1, 2011, because domestic parties have expressed no interest in the continuation of the
The merchandise covered by the orders is honey from Argentina. The products covered are natural honey, artificial honey containing more than 50 percent natural honey by weight, preparations of natural honey containing more than 50 percent natural honey by weight, and flavored honey. The subject merchandise includes all grades and colors of honey whether in liquid, creamed, comb, cut comb, or chunk form, and whether packaged for retail or in bulk form. The merchandise is currently classifiable under subheadings 0409.00.00, 1702.90.90, and 2106.90.99 of the Harmonized Tariff Schedule of the United States (HTSUS). Although the HTSUS subheadings are provided for convenience and customs purposes, the Department's written description of the merchandise under the orders is dispositive.
Pursuant to section 751(d)(1) of the Tariff Act of 1930, as amended (the Act), and 19 CFR 351.222(g), the Department may revoke an antidumping or countervailing duty order, in whole or in part, based on a review under section 751(b) of the Act (
As noted in the
Therefore, in accordance with sections 751(b), 751(d), and 782(h) of the Act, and 19 CFR 351.222(g), the Department concludes that there is a reasonable basis to believe that changed circumstances exist sufficient to warrant revocation of the
The Department will instruct U.S. Customs and Border Protection (CBP) to terminate suspension of liquidation effective December 1, 2010, for the
This notice is published in accordance with section 751(b)(1) of the Act and 19 CFR 351.216, 351.221(c)(3), and 351.222.
Import Administration, International Trade Administration, Department ofCommerce.
The Department of Commerce (the Department) is rescinding the 2010–2011 antidumping duty administrative review on honey from Argentina because all parties have withdrawn their requests for review and the antidumping duty order on imports of honey from Argentina is being revoked, effective December 1, 2010.
Effective December 31, 2012.
Patrick Edwards or Angelica Mendoza, AD/CVD Operations, Office 7, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW, Washington, DC 20230, at (202) 482–8029 or (202) 482–3019, respectively.
On December 10, 2001, the Department published the antidumping duty order on honey from Argentina.
On February 23, 2012, the Department released the results of a data query to U.S. Customs and Border Protection (CBP) regarding imports into the United States of honey from Argentina during the period of review (POR).
Because petitioners timely withdrew their request for review regarding HoneyMax, and because HoneyMax did not self-request a review, we issued a supplemental respondent selection memorandum, selecting CIPSA as the alternate mandatory respondents.
On July 24, 2012, petitioners filed a submission withdrawing their review requests for the remaining companies for which they had requested a review and further indicated that they were simultaneously filing a request for the initiation of a “no interest” changed circumstances review, under which petitioners would be seeking the revocation of the
The POR is December 1, 2010, through November 30, 2011.
The merchandise covered by the order is honey from Argentina. The products covered are natural honey, artificial honey containing more than 50 percent natural honey by weight, preparations of natural honey containing more than 50 percent natural honey by weight, and flavored honey. The subject merchandise includes all grades and colors of honey whether in liquid, creamed, comb, cut comb, or chunk form, and whether packaged for retail or in bulk form. The merchandise is currently classifiable under subheadings 0409.00.00, 1702.90.90, and 2106.90.99 of the Harmonized Tariff Schedule of the United States (HTSUS). Although the HTSUS subheadings are provided for convenience and customs purposes, the Department's written description of the merchandise under the order is dispositive.
As the
Given the revocation of the
This notice serves as a reminder to parties subject to administrative protective order (APO) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely written notification of the return or destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and terms of an APO is a sanctionable violation.
We are issuing and publishing this notice in accordance with sections 751(a)(1) and 777(i)(1) of the Tariff Act of 1930, as amended, and 19 CFR 351.213(d)(4).
International Trade Administration, Department of Commerce.
Notice.
The U.S. Department of Commerce, International Trade Administration, U.S. and Foreign Commercial Service (CS), is organizing a Healthcare Trade Mission to Moscow and St. Petersburg, Russia from June 3–7, 2013 which will be led by a senior Commerce official.
Russia, with 140 million consumers and rapidly growing demand for healthcare products and services, presents lucrative opportunities for U.S. companies. Equipment, technologies, and investments are needed in the healthcare sector, specifically in the medical equipment, dental equipment and biotechnology sub-sectors. This healthcare mission will directly contribute to the National Export Initiative (NEI) by assisting U.S. businesses in entering the Russian healthcare market and increasing U.S. exports. It will also be a deliverable for the U.S.-Russia Bilateral Presidential Commission Business Development and Economic Relations Working Group.
The mission will help participants gain market insights, make industry contacts, solidify business strategies, and advance specific projects with the goal of increasing U.S. exports to Russia. The mission will include one-on-one business appointments with pre-screened potential partners, market briefings, and networking events. Joining this official U.S. delegation will provide participating companies an opportunity to assess the Russian healthcare market.
Russia is one of the world's fastest growing economies and its healthcare system is evolving rapidly with a promising outlook for U.S. healthcare exports, particularly in the medical equipment, dental equipment and biotechnology subsectors. Russia's National Health Project aims at improving access and funding for healthcare and improving Russia's healthcare sector, and has created opportunities for increased U.S. exports in the healthcare sector.
Approximately 20% of overall health care spending is covered out-of- pocket by patients. Voluntary healthcare insurance programs currently account for approximately one-third of total private healthcare expenditures. According to future reform plans, mandatory insurance funds will serve as the main source of healthcare funding and will provide transparency and monetary control within the system.
The National Health Project was signed by President Putin in 2005 and was designed to significantly improve Russian healthcare. From 2011–2013, $15.4 billion was allocated from both the federal budget and the Mandatory Healthcare Insurance Fund [to the National Health Project?]. The Program of Modernization in Healthcare 2011–2012, aimed at renovating and upgrading healthcare facilities, was financed at $11 billion. The significant funding reflects the current need for new modern technologies for diagnostics and treatment. Russian patients are becoming more aware of modern medical technologies around the world and expect the same types of treatment in Russia.
In addition to these programs that are currently being implemented, the Ministry of Health has recently developed a draft government program called “Development of Healthcare in the Russian Federation.” This document is currently under review for approval. It contains the principles of preventive
The Ministry of Industry and Trade is also currently developing a strategy for the development of the medical industry through 2020. With continued growth in this sector, World Trade Organization (WTO) accession, and government plans to modernize and invest in Russian healthcare through 2020, American companies should be poised to make significant contributions to the Russian healthcare market.
The medical equipment sector is one of the fastest-growing sectors of the economy. There is a relatively stable macroeconomic situation in Russia with much unsatisfied deferred demand for medical equipment across the country. In addition, the Russian government is focused on this sector and has increased government financing for the purchase of medical equipment. For example, the Program of High-Tech Medical Assistance 2011–2013 was financed at $4 billion.
In 2011, the market for medical equipment was estimated at $4.9 billion. During the next nine years, experts expect yearly market growth to be 13.5%. The most promising market segments include diagnostics and visualization, cardiovascular, ophthalmology, orthopedics, laboratory diagnostics and urology equipment and technology. For example, the average annual increase from 2006–2011 in market share for diagnostics and visualization equipment was 18% and in medical IT 10%.
Since commercialization of medical equipment manufactured in Russia remains low, the market for medical equipment is heavily dependent on imports. The average annual increase in the import market for medical equipment from 2006 to 2011 was approximately 23%. Medical equipment imports in 2006 were $14.2 billion, with steady growth to $41 billion in 2011.
Membership in the WTO will also benefit foreign exports to Russia. After full implementation of the WTO accession and Permanent Normal Trade Relations, tariffs for medical equipment are estimated to range from 0% to 7%. Currently, tariffs range as high as 15% to 20%.
The Russian dental market is also a sector that is expanding and showing good growth potential. In 2011, total world imports into Russia for dental equipment were approximately $500 million, reflecting the need for dental equipment for use in the large market for dental services in Russia, which was approximately $6 billion in 2011.
The number of clinics, practicing dentists, technicians and patient visits are all on the rise. There are over 9,500 dental units operating in Moscow, with 3,000 state clinics and over 6,500 private clinics. There are 670 municipal dental clinics and 2900 dental departments within those clinics. The highest level of dental industry privatization is in the Moscow region.
The number of practicing dentists in Russia is 68,000, of which 35,000 are members of the Russian Dental Association. The number of patient visits is approximately 150 million a year. However, the ratio of dentists to patients in Russia is still only 45/100,000 people, which is below levels in the United States and most European countries. In the United States, the ratio of patients to dentists is 60/100,000.
The dental market is one of the most organized markets in Russia. The largest associations are the Russian Dental Association, which has 69 regional divisions and the Dental Industry (DI ROSI) which has 45 member companies. These associations play an important role in the introduction of new technologies and practices, actively participate in trade events, and regularly publish in professional journals. As a result, they have a large impact on the industry. The two major dental universities are Moscow State Medical and Dental University and the Sechenov Medical Academy in Moscow.
Domestic production of dental equipment is insufficient for the Russian market and very few new products are produced domestically. Local manufacturers such as Averon, VladMiVa, Raduga Rossii, Geosoft, Stomadent Omega, and Tselit produce a wide range of dental equipment. Since Russia's domestic dental production level meets only 20% of total demand, imports play a significant role in the market. The majority of dental equipment is supplied from the United States, Germany, France, Switzerland, Japan, and other countries.
Many large U.S. and international companies have offices in Russia, including Densply, 3M, Nobel Biocare, Mileston, Midmarek, 3i, Sirona, Kavo, Colgate, Kodak-Eastman, Philips-Sonicare, Discuss Dental (now owned by Philips), Oral B, and Wrigley Adeck.
There are about 500 distributors of dental equipment in Russia. The major distributors are located in Moscow and work in other regions through smaller local distributors or through regional representatives. Import customs clearances are executed more easily in larger cities like Moscow and St. Petersburg. There are strict product registration and certification procedures necessary for the release of dental equipment into the market. The registration and certification process can be complicated, time-consuming, and expensive. It may require a regular market presence by the manufacturer or an authorized representative with competent Russian language skills and knowledge of the local market to be able to complete the process.
In the last several years, Russia has been developing an innovative modern economy by focusing on information technologies and nanotechnologies. The biotechnologies area has large potential and is underdeveloped, but is evolving because of the need to extend life expectancies within the country. LargeU.S. multinational companies like Celgene, Amgen, and Genzyme are established in the market and are already working in the biotechnology field. Despite the fact that major companies from Europe and the U.S. have already entered the market, there is still room for small innovative companies in the biotechnology area. Good examples include two small U.S. biotechnology companies, Bind and Selecta, which have recently opened offices in Russia to start research and development, which is a priority of the Russian government.
The Government Commission on High Technologies and Innovations signed a decision in April, 2011 to create a State Coordination Program for the Development of Biotechnology in the Russian Federation through 2020. The Ministry of Economic Development is responsible for this State Coordination Program, which focuses on several areas including biopharmaceuticals and biomedicine.
1. Biopharmaceuticals (essential medicines, including biogenerics, hormones, cytokines, therapeutic monoclonal antibodies, peptides, phytomedicines, new generation vaccines, antibiotics and bacteriophages)
2. Biomedicine (molecular diagnostics, personalized medicine, engineered cell and tissue for therapeutic purposes, biocompatible materials)
The Russian market for biopharmaceuticals in 2010 was estimated at $2.2 billion, of which $1.3 billion was dedicated to cytokines, genetically engineered hormones (including insulin), coagulants and therapeutic enzymes, monoclonal
The Russian biotechnology market is focused on the development and manufacturing of products for the diagnosis and treatment of human diseases and for the prevention of harmful effects of the environment on humans. The world market for biotechnology (used for molecular genetics diagnostic technologies) was $13.5 billion in 2010, and is expected to be $33.3 billion by 2015. The access to credible data for the Russian market is low because the segment has not been fully developed, but it is expected to mature in the near future.
Biotechnology is a large part of the overall pharmaceutical sector. According to industry experts, Russia is currently one of the ten largest pharmaceutical markets in the world. In 2011, the pharmaceutical market volume amounted to $26 billion in end user prices, which is 12% higher than in 2010.
An important recent trend was the planning and formation of “pharmaceutical clusters”. This was due in part to the completion of the “Strategy of Development of the Pharmaceutical Industry- 2020”, developed by the Ministry of Industry and Trade which outlines some government priorities.
The Russian pharmaceutical market is import driven with 76% of drugs taken in Russia produced abroad. The only domestic manufacturer in the top 20 leading players in the Russian pharmaceutical market is Pharmstandart.
The goal of the Healthcare Trade Mission to Russia is to promote the export of U.S. goods and services by: (1) Introducing U.S. companies to industry representatives and potential clients and partners; and (2) introducing U.S. companies to industry experts to learn about policy initiatives that will impact the Russian healthcare industry in general as well as the medical equipment, dental equipment and biotechnology sectors.
In Moscow, trade mission members will participate in an Embassy briefing from industry experts and take part in one-on-one business appointments with private-sector organizations. In addition, they will enjoy a networking event with industry leaders and potential partners. In St. Petersburg, all of the delegates will have customized one-on-one business appointments and attend another networking reception.
Matchmaking efforts will involve partners such as the Association of International Pharmaceutical Manufacturers (AIPM), Innovative Pharma, Association of International Manufacturers of Medical Devices (IMEDA), the American Chamber of Commerce in Russia, and the Russian Dental Association. U.S. participants will be counseled before, during, and after the mission by CS Russia staff actively involved in the healthcare trade mission.
All parties interested in participating in the trade mission must be active in the healthcare sector and complete and submit an application package for consideration by the Department of Commerce. All applicants will be evaluated on their ability to meet certain conditions and best satisfy the selection criteria as outlined below. A minimum of 10 and maximum of 13 companies will be selected to participate in the mission from the applicant pool. Applicants that are U.S. companies already doing business in Russia as well as those seeking to enter the Russian market for the first time may apply.
After a company has been selected to participate in the mission, a payment to the Department of Commerce in the form of a participation fee is required. The participation fee will be $5950 for large firms and $5350 for a small or medium-sized enterprise (SME) trade association, which will cover one representative.*
An applicant must submit a completed and signed mission application and supplemental application materials, including adequate information on the company's products and/or services, primary
Each applicant must also certify that the products and services it seeks to export through the mission are either produced in the United States, or, if not, marketed under the name of a U.S. firm and have at least 51 percent U.S. content of the value of the finished product or service. In the case of a trade association, the applicant must certify that for each company to be represented by the association, the products and/or services the represented company seeks to export are either produced in the United States or, if not, marketed under the name of a U.S. firm and have at least fifty-one percent U.S. content.
Selection will be based on the following criteria:
• Suitability of the company's (or in the case of a trade association, member companies') products or services to the market.
• Applicant's (or in the case of a trade association, member companies') potential for business in Russia and in the region, including likelihood of exports resulting from the mission.
• Consistency of the applicant's (or in the case of a trade association, member companies') goals and objectives with the stated scope of the mission.
Diversity of company size, sector or subsector, and location may also be considered during the review process.
Referrals from political organizations and any documents containing references to partisan political activities (including political contributions) will be removed from an applicant's submission and not considered during the selection process.
Mission recruitment will be conducted in an open and public manner, including publication in the
International Trade Administration, Department of Commerce.
Notice; Correction.
The United States Department of Commerce, International Trade Administration, U.S. and Foreign Commercial Service published a document in the
Arica N Young, Commercial Service Trade Missions Program, Tel: 202–482–6219, Fax: 202–482–9000, Email:
In the
National Institute of Standards and Technology (NIST), Commerce.
Notice.
The Department of Commerce, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on proposed and/or continuing information collections, as required by the Paperwork Reduction Act of 1995.
Written comments must be submitted on or before March 1, 2013.
Direct all written comments to Jennifer Jessup, Departmental Paperwork Clearance Officer, Department of Commerce, Room 6616, 14th and Constitution Avenue NW., Washington, DC 20230 (or via the Internet at
Requests for additional information or copies of the information collection instrument and instructions should be directed to Dawn Bailey, Baldrige Performance Excellence Program, 100 Bureau Drive, Stop 1020, National Institute of Standards and Technology, Gaithersburg, Maryland 20899–1020; telephone (301) 975–3074, fax (301) 948–3716, email
The Department of Commerce is responsible for the Baldrige Performance Excellence Program (BPEP) and the Malcolm Baldrige National Quality (BNQP) Award. Directly associated with this Award is the Board of Examiners, an integral volunteer workforce for BPEP (managed by NIST). An applicant for the MBNQA is
The application to be a member of the Board of Examiners is a one-step, online process. Each year, BPEP recruits highly skilled experts in the fields of manufacturing, service, small business, health care, education, and nonprofit, the six Award eligibility categories, to evaluate the applications that BPEP receives. Examiners serve for a one-year term; participation on the board is entirely voluntary.
Award applicants must comply in writing according to the Eligibility Certification Form and Baldrige Award Application Form available at
Comments are invited on: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency's estimate of the burden (including hours and cost) of the proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology.
Comments submitted in response to this notice will be summarized and/or included in the request for OMB approval of this information collection; they also will become a matter of public record.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Notice of public meeting.
The Scientific and Statistical Committee (SSC) of the Mid-Atlantic Fishery Management Council (Council) will hold a meeting.
The meeting will be held on Wednesday, January 23, 2013 from 9 a.m. to 5 p.m.
The meeting will be held at the Hilton Baltimore BWI Airport, 1739 West Nursery Road, Linthicum Heights, MD 21090; telephone: (410) 694–0808.
Christopher M. Moore Ph.D., Executive Director, Mid-Atlantic Fishery Management Council, 800 N. State Street, Suite 201, Dover, DE 19901; telephone: (302) 526–5255.
The purpose of the SSC meeting is to address the Council's request that the SSC reconsider its acceptable biological catch (ABC) recommendations for black sea bass for 2013–14.
Although non-emergency issues not contained in this agenda may come before this group for discussion, those issues may not be the subject of formal action during this meeting. Action will be restricted to those issues specifically listed in this notice and any issues arising after publication of this notice that require emergency action under section 305(c) of the Magnuson-Stevens Fishery Conservation and Management Act, provided the public has been notified of the Council's intent to take final action to address the emergency.
The meeting is physically accessible to people with disabilities. Requests for sign language interpretation or other auxiliary aids should be directed to M. Jan Saunders at the Mid-Atlantic Council Office, (302) 526–5251, at least 5 days prior to the meeting date.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Notice of a public meeting.
The Mid-Atlantic Fishery Management Council (Council) announces its intent to hold a workshop. The purpose of the workshop is to consider options for improving the management of the longfin and Illex squid fisheries, with a focus on responsive harvest strategies that account for changing stock conditions over the course of the year. The Council intends for managers, scientists, and fishermen to collaboratively consider if responsive harvest strategies are feasible and appropriate for optimizing yield in these fisheries. Discussions at the workshop will culminate in a workshop report and a series of follow-up port meetings that will inform consideration of future management actions.
The workshop will be held from 1 p.m. Tuesday, January 15, 2013 until 1 p.m. Thursday, January 17, 2013.
The workshop will be held at: Hyatt Place Long Island/East End; 451 East Main Street; Riverhead, NY 11901; telephone: (631) 208–0002.
Chris Moore, Ph.D., Executive Director, Mid-Atlantic Fishery Management Council, (302) 526–5255, or Jason Didden, Mackerel-Squid-Butterfish Plan Coordinator, (302) 526–5254.
Additional information (agenda, briefing materials, meeting summary, etc) will be posted to:
Although non-emergency issues not contained in this agenda may come before this group for discussion, those issues may not be the subject of formal action during this meeting. Action will be restricted to those issues specifically listed in this notice and any issues arising after publication of this notice that require emergency action under section 305(c) of the Magnuson-Stevens Fishery Conservation and Management Act, provided the public has been notified of the Council's intent to take final action to address the emergency.
The meeting is accessible to people with physical disabilities. Requests for sign language interpretation or other auxiliary aids should be directed to Chris Moore, Ph.D. (see
16 U.S.C. 1801
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Meeting of the South Atlantic Fishery Management Council's (Council) Golden Crab Advisory Panel (AP).
The South Atlantic Fishery Management Council (SAFMC) will hold a meeting of Golden Crab Advisory Panel (AP) in Fort Lauderdale, FL.
The meeting will be held on Thursday, January 31, 2013, from 1 p.m. until 5 p.m.
The meeting will be held at the Harbor Beach Marriott, 3030 Holiday Drive, Fort Lauderdale, FL 33316; telephone: (954) 525–4000; fax: (954) 766–6185.
Kim Iverson, Public Information Officer, SAFMC; telephone: (843) 571–4366 or toll free: (866) SAFMC–10; fax: (843) 769–4520; email:
The items of discussion in the AP's agenda are as follows:
1. Discuss management measures other than a catch share program that could potentially improve the current management of the fishery.
2. Receive an overview of Council actions regarding golden crab management since the last AP meeting, including the status of draft Amendment 6 to the Golden Crab Fishery Management Plan (FMP) for the South Atlantic Region.
3. Suggest and discuss management alternatives as recommendations for Council consideration.
Although non-emergency issues not contained in this agenda may come before this group for discussion, those issues may not be the subject of formal action during this meeting. Action will be restricted to those issues specifically identified in this notice and any issues arising after publication of this notice that require emergency action under section 305(c) of the Magnuson-Stevens Fishery Conservation and Management Act, provided the public has been notified of the Council's intent to take final action to address the emergency.
The meeting is physically accessible to people with disabilities. Requests for auxiliary aids should be directed to the Council office (see
The times and sequence specified in this agenda are subject to change.
Committee for Purchase From People Who Are Blind or Severely Disabled.
Additions to the Procurement List.
This action adds products and services to the Procurement List that will be furnished by nonprofit agencies employing persons who are blind or have other severe disabilities.
Committee for Purchase From People Who Are Blind or Severely Disabled, Jefferson Plaza 2, Suite 10800, 1421 Jefferson Davis Highway, Arlington, Virginia, 22202–3259.
Barry S. Lineback, Telephone: (703) 603–7740, Fax: (703) 603–0655, or email
On 10/12/2012 (77 FR 62219–62220), 10/19/2012 (77 FR 64326–64327) and 11/9/2012 (77 FR 67343–67344), the Committee for Purchase From People Who Are Blind or Severely Disabled published notices of proposed additions to the Procurement List.
After consideration of the material presented to it concerning capability of qualified nonprofit agencies to provide the products and services and impact of the additions on the current or most recent contractors, the Committee has determined that the products and services listed below are suitable for procurement by the Federal Government under 41 U.S.C. 8501–8506 and 41 CFR 51–2.4.
I certify that the following action will not have a significant impact on a substantial number of small entities. The major factors considered for this certification were:
1. The action will not result in any additional reporting, recordkeeping or other compliance requirements for small entities other than the small organizations that will furnish the
2. The action will result in authorizing small entities to furnish the products and services to the Government.
3. There are no known regulatory alternatives which would accomplish the objectives of the Javits-Wagner-O'Day Act (41 U.S.C. 8501–8506) in connection with the products and services proposed for addition to the Procurement List.
Accordingly, the following products and services are added to the Procurement List:
Committee for Purchase From People Who Are Blind or Severely Disabled.
Proposed Additions to the Procurement List.
The Committee is proposing to add products and a service to the Procurement List that will be furnished by nonprofit agencies employing persons who are blind or have other severe disabilities.
Committee for Purchase From People Who Are Blind or Severely Disabled, Jefferson Plaza 2, Suite 10800, 1421 Jefferson Davis Highway, Arlington, Virginia 22202–3259.
Barry S. Lineback, Telephone: (703) 603–7740, Fax: (703) 603–0655, or email
This notice is published pursuant to 41 U.S.C. 8503 (a)(2) and 41 CFR 51–2.3. Its purpose is to provide interested persons an opportunity to submit comments on the proposed actions.
If the Committee approves the proposed additions, the entities of the Federal Government identified in this notice will be required to procure the products and service listed below from nonprofit agencies employing persons who are blind or have other severe disabilities.
The following products and service are proposed for addition to the Procurement List for production by the nonprofit agencies listed:
Commodity Futures Trading Commission.
Notice.
The Commodity Futures Trading Commission (CFTC) is announcing an opportunity for public comment on the proposed collection of certain information by the agency. Under the Paperwork Reduction Act of 1995 (PRA), 44 U.S.C. 3501
Comments must be submitted on or before March 1, 2013.
Send comments regarding the burden estimated or any other aspect of the information collection, including suggestions for reducing the burden, to the addresses below. Please refer to OMB Control No. 3038–0012 in any correspondence.
Comments may be mailed to Gary J. Martinaitis, Division of Economic Analysis, U.S. Commodity Futures Trading Commission, 1155 21st Street, NW., Washington, DC 20581, and Office of Information and Regulatory Affairs, Office of Management and Budget,
Comments may also be submitted by any of the following methods:
The agency's Web site, at
Please submit your comments using only one method and identity that it is for the renewal of 3038–0012.
All comments must be submitted in English, or if not, accompanied by an English translation. Comments will be posted as received to
Gary J. Martinaitis, (202) 418–5209; FAX: (202) 418–5527; email:
Under the PRA, Federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. “Collection of information” is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3(c) and includes agency requests or requirements that members of the public submit reports, keep records, or provide information to a third party. Section 3506(c)(2)(A) of the PRA, 44 USC 3506(c)(2)(A), requires Federal agencies to provide a 60-day notice in the
With respect to the following collection of information, the CFTC invites comments on:
• Whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information will have a practical use;
• The accuracy of the Commission's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
• Ways to enhance the quality, usefulness, and clarity of the information to be collected; and
• Ways to minimize the burden of collection of information on those who are to respond, including through the use of appropriate automated electronic, mechanical, or other technological collection techniques or other forms of information technology;
Commission Regulation 16.01 requires the U.S. futures exchanges to publish daily information on the items listed in the title of the collection. The information required by this rule is in the public interest and is necessary for market surveillance. This rule is promulgated pursuant to the Commission's rulemaking authority contained in Sections 5 and 5a of the Commodity Exchange Act, 7 U.S.C. 7 and 7a (2000).
The Commission estimates the burden of this collection of information as follows:
Corporation for National and Community Service.
Notice.
The Corporation for National and Community Service (CNCS), as part of its continuing effort to reduce paperwork and respondent burden, conducts a pre-clearance consultation program to provide the general public and federal agencies with an opportunity to comment on proposed and/or continuing collections of information in accordance with the Paperwork Reduction Act of 1995 (PRA95) (44 U.S.C. 3506(c)(2)(A)). This program helps to ensure that requested data can be provided in the desired format, reporting burden (time and financial resources) is minimized, collection instruments are clearly understood, and the impact of collection requirement on respondents can be properly assessed.
Currently, CNCS is soliciting comments concerning clearance of the Social Innovation Fund Continuation Application Guidance. Social Innovation Fund grantees seeking continuation funding will complete the application. Continuation funding is
Copies of the information collection request can be obtained by contacting the office listed in the addresses section of this notice.
Written comments must be submitted to the individual and office listed in the
You may submit comments, identified by the title of the information collection activity, by any of the following methods:
(1)
(2) By hand delivery or by courier to the CNCS mailroom at Room 8100 at the mail address given in paragraph (1) above, between 9:00 a.m. and 4:00 p.m. Eastern Time, Monday through Friday, except Federal holidays.
(3)
(4) Electronically through www.regulations.gov. Individuals who use a telecommunications device for the deaf (TTY–TDD) may call 1–800–833–3722 between 8:00 a.m. and 8:00 p.m. Eastern Time, Monday through Friday.
Kirsten Breckinridge, (202)606–7570, or by email at
CNCS is particularly interested in comments that:
• Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of CNCS, including whether the information will have practical utility;
• Evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
• Enhance the quality, utility, and clarity of the information to be collected; and
• Minimize the burden of the collection of information on those who are expected to respond, including the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology (e.g., permitting electronic submissions of responses).
Existing Social Innovation Fund grantees submit this information in order to receive continuation funding for their approved grant program. This information provides program staff a full accounting of program progress and informs staff of any anticipated changes to the approved grant program. This information is submitted electronically via the eGrants system and via an excel sheet addendum.
This is a new information collection request.
Comments submitted in response to this notice will be summarized and/or included in the request for Office of Management and Budget approval of the information collection request; they will also become a matter of public record.
Department of Defense, Defense Security Cooperation Agency.
Notice.
The Department of Defense is publishing the unclassified text of a section 36(b)(1) arms sales notification. This is published to fulfill the requirements of section 155 of Public Law 104–164 dated July 21, 1996.
Ms. B. English, DSCA/DBO/CFM, (703) 601–3740. The following is a copy of a letter to the Speaker of the House of Representatives, Transmittal 12–66 with attached transmittal, policy justification, and Sensitivity of Technology.
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The Sultanate of Oman has requested a possible sale of 27 AIM–120C–7 Advanced Medium Range Air-to-Air Missiles (AMRAAM), 162 GBU–12 PAVEWAY II 500-lb Laser Guided Bombs, 162 FMU–152 bomb fuzes, 150 BLU–111B/B 500-lb Conical Fin General Purpose Bombs (Freefall Tail), 60 BLU–111B/B 500-lb Retarded Fin General Purpose Bombs (Ballute Tail), and 32 CBU–105 Wind Corrected Munitions Dispensers (WCMD). Also included are 20mm projectiles, Aerial Gunnery Target System (AGTS–36), training munitions, flares, chaff, containers, impulse cartridges, weapon support equipment and components, repair and return, spare and repair parts, publications and technical documentation, personnel training and training equipment, U.S. Government and contractor representative logistics and technical support services, site survey, and other related elements of logistics support. The estimated cost is $117 million.
This proposed sale will contribute to the foreign policy and national security of the United States by helping to improve the security of a friendly country which has been, and continues to be, an important force for political stability and economic progress in the Middle East.
The proposed purchase of munitions will improve Oman's capability to meet current and future regional threats and will provide a significant increase in the Royal Air Force of Oman's (RAFO) capability to support both its own air defense needs as well as those of coalition operations. This potential sale is in support of RAFO's current twelve F–16s as well as its ongoing acquisition of twelve additional F–16s. Oman should have no difficulty absorbing this additional capability into its armed forces.
The proposed sale of this equipment and support will not alter the basic military balance in the region.
The principal contractors will be Raytheon Company in Waltham, Massachusetts; Textron Defense Systems in Wilmington, Massachusetts; General Dynamics in Falls Church, Virginia; and McAlester Army Ammunition Plant in McAlester, Oklahoma. There are no known offset agreements proposed in connection with this potential sale.
Implementation of this proposed sale will require multiple trips to Oman involving many U.S. Government or contractor representatives over a period of up to or over 15 years for program and technical support and training.
There will be no adverse impact on U.S. defense readiness as a result of this proposed sale.
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1. The AIM–120C–7 Advanced Medium Range Air-to-Air Missile (AMRAAM) is a supersonic, air launched, aerial intercept, guided missile featuring digital technology and micro-miniature solid-state electronics. The missile employs active radar target tracking, proportional navigation guidance, and active Radio Frequency target detection. It can be launched day or night, in any weather and increases pilot survivability by allowing the pilot to disengage after missile launch and to engage other targets. AMRAAM capabilities include lookdown/shootdown, multiple launches against multiple targets, resistance to electronic countermeasures, and interception of high- and low-flying and maneuvering targets. AMRAAM All-Up-Round (AUR) is classified Confidential; major components and subsystems range from Unclassified to Confidential; and technical data and other documentation are classified up to Secret.
2. The GBU–12 (Paveway II) is a 500-lb laser guided bomb. It consists of a MAU–169L/B Computer Control Group and MXU–650C/B Airfoil Group that converts an existing unguided BLU–111B/B free-fall bomb into precision-guided “smart” bomb. The control and airfoil groups enable the dumb bomb to acquire and guide to a point designated by an on or off board laser. Precision-guided munitions offer improved accuracy over free-fall bombs, thus providing the potential for reduced collateral damage. Information revealing target designation tactics and associated aircraft maneuvers, the probability of destroying specific/peculiar targets, vulnerabilities regarding countermeasures and the electromagnetic environment is classified Secret.
3. The FMU–152 is an electrical fuze used with a variety of precision guided weapons. It enables the bombs with which it is paired to function with a number of cockpit-selectable parameters. Hardware and technical data is Unclassified.
4. The BLU–111B/B is a 500-pound, unguided, general purpose bomb that can be fitted with an array of fuzes (proximity, mechanical, electrical) and nose/tail kits (conical, retarded, and precision guided). Hardware, technical data, and other documentation may range from Unclassified to Secret depending upon the configuration of the bomb (as unguided or precision guided).
5. The CBU–105D/B Sensor Fused Weapon (SFW) is an advanced, 1,000-pound cluster bomb munition containing sensor fused sub-munitions that are designed to attack and defeat a wide range of moving or stationary land and maritime threats with minimal collateral damage. The SFW is the currently the only combat-proven, weapon that meets U.S. legal and policy requirements for cluster munition safety standards. Major components include the SUU–66 Tactical Munitions Dispenser (TMD), ten (10) BLU–108 sub-munitions, each with four (4) “hockey puck” shaped skeet infrared sensing projectiles for a total of forty (40) warheads. The munition, in its All-Up-Round (AUR) configuration, is Unclassified, while submunitions and technical data are classified up to Secret. Anti-tamper security measures are incorporated into the munition to prevent exploitation.
6. Common Munitions Bit/Reprogramming Equipment (CMBRE)—CMBRE is a piece of support equipment used to interface with weapon systems to initiate Built-in-Test (BIT), report BIT results, and upload/download flight software. CMBRE supports multiple munitions platforms with a range of applications that perform preflight checks, periodic maintenance checks, loading of Operational Flight Program
7. Software, hardware, and other data/information, which is classified or sensitive, is reviewed prior to release to protect system vulnerabilities, design data, and performance parameters. Some end-item hardware, software, and other data identified above are classified at the Confidential and Secret level. Potential compromise of these systems is controlled through management of the hardware and software weapon systems on a case-by-case basis.
8. If a technologically advanced adversary were to obtain knowledge of the specific hardware or software source code in this proposed sale, the information could be used to develop countermeasures which might reduce weapon system effectiveness or be used in the development of systems with similar or advance capabilities.
Department of Defense, Defense Security Cooperation Agency.
Notice.
The Department of Defense is publishing the unclassified text of a section 36(b)(1) arms sales notification. This is published to fulfill the requirements of section 155 of Public Law 104–164 dated July 21, 1996.
Ms. B. English, DSCA/DBO/CFM, (703) 601–3740.
The following is a copy of a letter to the Speaker of the House of Representatives, Transmittals 12–69 with attached transmittal, policy justification, and Sensitivity of Technology.
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The Government of Israel has requested a possible sale of 6,900 Joint Direct Attack Munitions (JDAM) tail kits (which include 3,450 JDAM Anti-Jam KMU–556 (GBU–31) for MK–84 warheads; 1,725 KMU–557 (GBU–31) for BLU–109 warheads and 1,725 KMU–572 (GBU–38) for MK–82 warheads); 3,450 MK–84 2000 lb General Purpose Bombs; 1,725 MK–82 500 lb General Purpose Bombs; 1,725 BLU–109 Bombs; 3,450 GBU–39 Small Diameter Bombs; 11,500 FMU–139 Fuses; 11,500 FMU–143 Fuses; and 11,500 FMU–152 Fuses. Also included are spare and repair parts, support equipment, personnel training and training equipment, publications and technical documentation, U.S. Government and contractor engineering and technical support, and other related elements of program support.
The estimated cost is $647 million.
The United States is committed to the security of Israel, and it is vital to U.S. national interests to assist Israel to develop and maintain a strong and ready self-defense capability. This proposed sale is consistent with those objectives.
The proposed sale of munitions will enable Israel to maintain operational capability of its existing systems. Israel, which already has these munitions in its inventory, will have no difficulty absorbing these additional munitions into its armed forces.
The proposed sale of munitions will not alter the basic military balance in the region.
The principal contractors will be The Boeing Company in St. Charles, Missouri; KDI Precision Products in Cincinnati, Ohio; ATK (Alliant Tech Systems, Inc.) in Edina, Minnesota; Kaman Dayron in Orlando, Florida; General Dynamics in Garland, Texas; and Elwood National Forge Co. in Irvine, Pennsylvania. There are no known offset agreements proposed in connection with this potential sale.
Implementation of this proposed sale will not require the assignment of any additional U.S. Government or contractor representatives to Israel.
There will be no adverse impact on U.S. defense readiness as a result of this proposed sale.
1. The Joint Direct Attack Munition is a weapon guidance kit that converts existing unguided free-fall bombs into precision-guided “smart” munitions. By adding a new tail section containing Inertial Navigation System (INS) guidance/Global Positioning System (GPS) guidance to unguided bombs, the cost effective JDAM provides precise weapon delivery in any weather, given an accurate set of coordinates The INS, using updates from the GPS, helps guide the bomb to the target via the use of movable tail fins. Weapon accuracy is dependent on the quality of target coordinates and present position as entered into the guidance control unit. After weapon release, movable tail fins guide the weapon to the target coordinates. In addition to the tail kit, other elements in the overall system that are essential for successful employment include:
Access to accurate target coordinates
INS/GPS capability
Operational Test and Evaluation Plan
2. The Guided Bomb Unit-39 (GBU–39) Small Diameter Bomb (SDB) is a 250-lb precision guided munition that is intended to provide aircraft with the potential to simultaneously strike an increased number of targets per sortie. Aircraft are able to carry four SDBs in place of one 2,000-lb bomb. The GBU–39 is a conventional munition that is currently integrated in the F–15 air-to-ground platform. The SDB is equipped with a GPS-aided inertial navigation system to attack fixed/stationary targets such as fuel depots and bunkers.
3. If a technologically advanced adversary were to obtain knowledge of specific hardware, the information could be used to develop countermeasures which might reduce weapons system effectiveness or be used in the development of a system with similar or advanced capabilities.
DoD.
Establishment of Federal Advisory Committee.
Under the provisions of 10 U.S.C. 2166(e), the Federal Advisory Committee Act of 1972 (5 U.S.C. Appendix), the Government in the Sunshine Act of 1976 (5 U.S.C. 552b), and 41 CFR 102–3.50(a), the Department of Defense gives notice that it is establishing the charter for the Vietnam War Commemoration Advisory Committee (hereafter referred to as “the Committee”).
The Committee shall provide the Secretary of Defense and the Deputy Secretary of Defense, through the Director of Administration and Management (DA&M), independent advice and recommendations on the Department of Defense's (DoD) program to commemorate the 50th Anniversary of the Vietnam War.
The Committee shall report to the Secretary and Deputy Secretary of Defense, through the DA&M. The DA&M may act upon the Committee's advice and recommendations. The Committee shall be composed of no more than 20 members, who are appointed by the Secretary of Defense. These members shall represent Vietnam Veterans, their families, and the American public. Candidates for the Committee shall be selected from the Military Services (both retired veterans and active members who served during the Vietnam era), the Department of Defense, the Department of State, the Department of Veterans Affairs, and the Intelligence Community. In addition, candidates
The Secretary of Defense, through the DA&M, may appoint additional experts and consultants to provide advice to the Committee as subject matter experts. These subject matter experts may be regular government officers/employees or individuals appointed under the authority of 5 U.S.C. 3109; however, subject matter experts shall not participate in the Committee's deliberations and shall not have Committee voting rights. Each Committee member is appointed to provide advice on behalf of the government on the basis of his or her best judgment without representing any particular point of view and in a manner that is free from conflict of interest. The Department, when necessary and consistent with the Committee's mission and DoD policies and procedures, may establish Subcommittees, task groups, or working groups to support the Committee. Establishment of Subcommittees will be based upon a written determination, to include terms of reference, by the Secretary of Defense, the Deputy Secretary of Defense, or the Committee's sponsor.
These Subcommittees shall not work independently of the chartered Committee, and shall report all of their recommendations and advice solely to the Committee for full deliberation and discussion. Subcommittees have no authority to make decisions and recommendations, verbally or in writing, on behalf of the chartered Committee; nor can any Subcommittee or its members update or report directly to the DoD or any Federal officers or employees. All Subcommittee members shall be appointed in the same manner as the Committee members; that is, the Secretary of Defense shall appoint Subcommittee members even if the member in question is already a Committee member. Subcommittee members, with the approval of the Secretary of Defense, may serve a term of service on the Subcommittee of three years; however, no member shall serve more than two consecutive terms of service on the Subcommittee, unless authorized by the Secretary of Defense.
Subcommittee members, if not full-time or part-time government employees, shall be appointed to serve as experts and consultants under the authority of 5 U.S.C. 3109, and shall serve as special government employees, whose appointments must be renewed by the Secretary of Defense on an annual basis. With the exception of travel and per diem for official Committee-related travel, Subcommittee members shall serve without compensation. Each Subcommittee member is appointed to provide advice on behalf of the government on the basis of his or her best judgment without representing any particular point of view and in a manner that is free from conflict of interest.
All subcommittees operate under the provisions of FACA, the Government in the Sunshine Act, governing Federal statutes and regulations, and governing DoD policies/procedures.
Jim Freeman, Deputy Advisory Committee Management Officer for the Department of Defense, 703–692–5952.
The Committee shall meet at the call of the Designated Federal Officer (DFO), in consultation with the Committee's Chairperson. The estimated number of Committee meetings is two per year.
The Committee's DFO is required to be in attendance at all Committee and Subcommittee meetings for the entire duration of each and every meeting. However, in the absence of the Committee's DFO, a properly approved Alternate DFO, duly appointed to the Committee according to DoD policies/procedures, shall attend the entire duration of the Committee or Subcommittee meeting.
Pursuant to 41 CFR 102–3.105(j) and 102–3.140, the public or interested organizations may submit written statements to the Committee membership about the Committee's mission and functions. Written statements may be submitted at any time or in response to the stated agenda of planned meeting of the Committee.
All written statements shall be submitted to the DFO, and this individual will ensure that the written statements are provided to the membership for their consideration. Contact information for the Committee's DFO can be obtained from the GSA's FACA Database—
The DFO, pursuant to 41 CFR 102–3.150, will announce planned meetings of the Committee. The DFO, at that time, may provide additional guidance on the submission of written statements that are in response to the stated agenda for the planned meeting in question.
DoD.
Meeting notice.
Under the provisions of the Federal Advisory Committee Act of 1972 (5 U.S.C., Appendix, as amended), the Government in the Sunshine Act of 1976 (5 U.S.C. 552b, as amended), and 41 CFR § 102–3.150, the Department of Defense announces the following Federal advisory committee meeting of the Defense Business Board (DBB).
The public meeting of the Defense Business Board (hereafter referred to as “the Board”) will be held on Thursday, January 24, 2013. The meeting will begin at 9:15 a.m. and end at 11:30 a.m. (Escort required; see guidance in
Room 3E863 in the Pentagon, Washington, DC (Escort required; See guidance in
The Board's Designated Federal Officer (DFO) is Phyllis Ferguson, Defense Business Board, 1155 Defense Pentagon, Room 5B1088A, Washington, DC 20301–1155, Phyllis.Ferguson@osd.mil, 703–695–7563. For meeting information please contact Ms. Debora Duffy, Defense Business Board, 1155 Defense Pentagon, Room 5B1088A, Washington, DC 20301–1155, Debora.Duffy@osd.mil, (703) 697–2168.
Special Accommodations: Individuals requiring special accommodations to access the public meeting should contact Ms. Duffy at least five (5) business days prior to the meeting so that appropriate arrangements can be made.
Pursuant to 41 CFR §§ 102–3.105(j) and 102–3.140, and section 10(a)(3) of the Federal Advisory Committee Act of 1972, the public or interested organizations may submit written comments to the Board about its mission and topics pertaining to this public meeting.
Written comments should be received by the DFO at least five (5) business days prior to the meeting date so that the comments may be made available to the Board for their consideration prior to the meeting. Written comments should be submitted via email to the address for the DFO given in this notice in either Adobe Acrobat or Microsoft Word format. Please note that since the Board operates under the provisions of the Federal Advisory Committee Act, as amended, all submitted comments and public presentations will be treated as public documents and will be made available for public inspection, including, but not limited to, being posted on the Board's web site.
Defense Contract Audit Agency, DoD.
Notice to delete a Systems of Records.
The Defense Contract Audit Agency (DCAA) is deleting a system of records in its existing inventory of record systems subject to the Privacy Act of 1974 (5 U.S.C. 552a), as amended.
This proposed actions will be effective on January 31, 2013 unless comments are received which result in a contrary determination. Comments will be accepted on or before January 30, 2013.
You may submit comments, identified by docket number and title, by any of the following methods:
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Defense Contract Audit Agency Privacy Management Analyst, Information and Records Management Branch, 8725 John J. Kingman Road, Suite 2135, Fort Belvoir, VA 22060–6219 or at (703) 767–1022.
The Defense Contract Audit Agency (DCAA) systems of records notices subject to the Privacy Act of 1974 (5 U.S.C. 552a), as amended, have been published in the
The proposed deletion is not within the purview of subsection (r) of the Privacy Act of 1974 (5 U.S.C. 552a), as amended, which requires the submission of new or altered systems reports.
Employee Assistance Program (EAP) Counseling Records (November 20, 1997, 62 FR 62003).
The Defense Contract Audit Agency contracts our Employee Assistance Program (EAP) with the United States Department of Health & Human Services (HHS). HHS has a Systems of Records Notice 09–90–0010 that covers EAP records. Because EAP records are no longer maintained by the Agency, system notice RDCAA 367.5 is not needed and should be deleted.
Defense Contract Audit Agency, DoD.
Notice to amend a System of Records.
The Defense Contract Audit Agency is amending a system of records notice in its existing inventory of record systems subject to the Privacy Act of 1974 (5 U.S.C. 552a), as amended.
This proposed action will be effective on January 31, 2013 unless comments are received which result in a contrary determination. Comments will be accepted on or before January 30, 2013.
You may submit comments, identified by docket number and title, by any of the following methods:
*
Mr. Keith Mastromichalis, DCAA FOIA/Privacy Act Management Analyst, 8725 John J. Kingman Road, Suite 2135, Fort Belvoir, VA 22060–6219, Telephone number: (703) 767–1022.
The Defense Contract Audit Agency systems of records notices subject to the Privacy Act of 1974 (5 U.S.C. 552a), as amended, have been published in the
The proposed changes to the record system being amended are set forth below. The proposed amendment is not within the purview of subsection (r) of the Privacy Act of 1974 (5 U.S.C. 552a), as amended, which requires the submission of a new or altered system report.
Grievance and Appeal Files (November 20, 1997, 62 FR 62003).
Delete and replace with “5 U.S.C. 301, Departmental Regulations; 5 U.S.C. 7121, Grievance Procedures; and DoD Directive 5105.36, Defense Contract Audit Agency.”
Delete and replace with “DCAA's rules for accessing records, for contesting contents and appealing initial agency determinations are published in DCAA Instruction 5410.10; 32 CFR part 317; or may be obtained from the system manager.”
Department of Defense/Department of the Air Force/Headquarters, Air Force Reserve Officer Training Corps (AFROTC).
Notice.
In compliance with Section 3506(c)(2)(A) of the
Consideration will be given to all comments received by March 1, 2013.
You may submit comments, identified by docket number and title, by any of the following methods:
•
•
To request more information on this proposed information collection or to obtain a copy of the proposal and associated collection instruments, please write to the above addresses AFROTC/HQ 551 E. Maxwell Blvd. Maxwell AFB, AL 36112 or call 334–953–0266.
Respondents are college students desiring to join the Air Force ROTC program. AFROTC Form 20 provides vital information needed by detachment
Department of the Air Force, DoD.
Notice to delete a System of Records.
The Department of the Air Force is deleting a system of records notice in its existing inventory of record systems subject to the Privacy Act of 1974 (5 U.S.C. 552a), as amended.
This proposed action will be effective on January 31, 2013 unless comments are received which result in a contrary determination. Comments will be accepted on or before January 30, 2013.
You may submit comments, identified by docket number and title, by any of the following methods:
*
*
Mr. Charles J. Shedrick, Department of the Air Force Privacy Office, Air Force Privacy Act Office, Office of Warfighting Integration and Chief Information officer, ATTN: SAF/XCPPI, 1800 Air Force Pentagon, Washington DC 20330–1800 or at 202–404–6575.
The Department of the Air Force systems of records notices subject to the Privacy Act of 1974, (5 U.S.C. 552a), as amended, have been published in the
The Department of the Air Force proposes to delete one system of records notice from its inventory of record systems subject to the Privacy Act of 1974 (5 U.S.C. 552a), as amended. The proposed deletion is not within the purview of subsection (r) of the Privacy Act of 1974 (5 U.S.C. 552a), as amended, which requires the submission of a new or altered system report.
Ideas, Inventions, Scientific Achievements (May 7, 1999, 64 FR 24605).
The Innovative Development through Employee Awareness (IDEA) Program Data System (IPDS) has been modified to retrieve records based on an assigned Idea number or key word search; data is no longer retrieved by an individual's name, number, personal or unique identifier. IPDS is used as a management tool for statistical and analysis tracking, reporting, and evaluation of program effectiveness. Modules (electronic records) previously used to process IDEA awards by individual have been eliminated from the system. Paper records are maintained in individual military or civilian personnel records covered under System of Records Notices F036 AF PC C and OPM/GOVT–1. Therefore F038 AFCQMI A, Ideas, Inventions, Scientific Achievements (May 7, 1999, 64 FR 24605) can be deleted.
Department of the Air Force, DoD.
Notice to alter a System of Records.
The Department of the Air Force proposes to alter a system of records notice in its existing inventory of records systems subject to the Privacy Act of 1974 (5 U.S.C. 552a), as amended.
This proposed action will be effective on January 31, 2013 unless comments are received which result in a contrary determination. Comments will be accepted on or before January 30, 2013.
You may submit comments, identified by docket number and title, by any of the following methods:
Follow the instructions for submitting comments.
•
Mr. Charles J. Shedrick, Department of the Air Force Privacy Office, Air Force Privacy Act Office, Office of Warfighting Integration and Chief Information Officer, ATTN: SAF/CIO A6, 1800 Air Force Pentagon, Washington, DC 20330–1800, or by phone at (202) 404–6575.
The Department of the Air Force's notices for systems of records subject to the Privacy Act of 1974 (5 U.S.C. 552a), as amended, have been published in the
The proposed systems reports, as required by 5 U.S.C. 552a(r) of the Privacy Act of 1974, as amended, were submitted on December 12, 2012 to the House Committee on Oversight and Government Reform, the Senate Committee on Homeland Security and Governmental Affairs, and the Office of Management and Budget (OMB) pursuant to paragraph 4c of Appendix I to OMB Circular No. A–130, “Federal Agency Responsibilities for Maintaining Records about Individuals,” dated February 8, 1996, (February 20, 1996, 61 FR 6427).
United States Air Force (USAF) Airman Retraining Program (June 11, 1997, 62 FR 31793)
Delete entry and replace with “F036 AFPC Y.”
Delete entry and replace with “Headquarters, United States Air Force, Air Force Personnel Center (AFPC), 550 C Street West, Randolph Air Force Base, TX 78150–4703, major command headquarters, and consolidated base personnel offices. Official mailing addresses are published as an appendix to the Air Force's compilation of systems of records notices.”
Delete entry and replace with “Name, grade, rank, Social Security Number (SSN) and/or DoD ID Number, recommendation memorandums, test scores, medical qualification for individual requesting to be retrained into another career field.”
Delete entry and replace with “10 U.S.C. 8013, Secretary of the Air Force; 10 U.S.C. Chapter 901, Training Generally; implemented by Air Force Instruction 36–2626, Airman Retraining Program; and E.O. 9397 (SSN), as amended.”
Delete entry and replace with “Used by military personnel officials at base, major commands, and Headquarters Air Force Personnel Command to evaluate decisions on retraining applications.”
Delete entry and replace with “Electronic storage media.”
Delete entry and replace with “Name, SSN and/or DoD ID Number.”
Delete entry and replace with “Encrypted electronic records are accessed by the Retraining program manager and by persons cleared for need-to-know. They are stored in buildings that are locked and have controlled access entry requirements, and are only accessed by authorized personnel with Secure Common Access Card (CAC) and need-to-know.”
Delete entry and replace with “Electronic records are retained in office until superseded, no longer needed, separation or reassignment of individual on Permanent Change of Assignment (PCA) or Permanent Change of Duty Station (PCS).”
Delete entry and replace with “Assistant Deputy Chief of Staff, Air Force Personnel Center, 550 C Street West, Randolph Air Force Base, TX 78150–4703.”
Delete entry and replace with “Individuals seeking to determine whether information about themselves is contained in this system should address written inquiries to or visit the Assistant Deputy Chief of Staff, Air Force Personnel Center, 550 C Street West, Randolph Air Force Base, TX 78150–4703.
For verification purposes, individuals should provide their full name, SSN and/or DoD ID Number, any details which may assist in locating records, and their signature.
In addition, the requester must provide a notarized statement or an unsworn declaration made in accordance with 28 U.S.C. 1746, in the following format:
`I declare (or certify, verify, or state) under penalty of perjury under the laws of the United States of America that the foregoing is true and correct. Executed on (date). (Signature)'.
`I declare (or certify, verify, or state) under penalty of perjury that the foregoing is true and correct. Executed on (date). (Signature)'.”
Delete entry and replace with “Individuals seeking access to information about themselves contained in this system should address written inquiries to or visit the Assistant Deputy Chief of Staff, Air Force Personnel Center, 550 C Street West, Randolph Air Force Base, TX 78150–4703.
For verification purposes, individuals should provide their full name, SSN and/or DoD ID Number, any details which may assist in locating records, and their signature.
In addition, the requester must provide a notarized statement or an unsworn declaration made in accordance with 28 U.S.C. 1746, in the following format:
`I declare (or certify, verify, or state) under penalty of perjury under the laws of the United States of America that the foregoing is true and correct. Executed on (date). (Signature)'.
`I declare (or certify, verify, or state) under penalty of perjury that the foregoing is true and correct. Executed on (date). (Signature)'.”
Office of Federal Student Aid (FSA), Department of Education (ED).
Notice.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 3501
Interested persons are invited to submit comments on or before February 28, 2013.
Comments submitted in response to this notice should be submitted electronically through the Federal eRulemaking Portal at
Electronically mail
The Department of Education (ED), in accordance with the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3506(c)(2)(A)), provides the general public and Federal agencies with an opportunity to comment on proposed, revised, and continuing collections of information. This helps the Department assess the impact of its information collection requirements and minimize the public's reporting burden. It also helps the public understand the Department's information collection requirements and provide the requested data in the desired format. ED is soliciting comments on the proposed information collection request (ICR) that is described below. The Department of Education is especially interested in public comment addressing the following issues: (1) Is this collection necessary to the proper functions of the Department; (2) will this information be processed and used in a timely manner; (3) is the estimate of burden accurate; (4) how might the Department enhance the quality, utility, and clarity of the information to be collected; and (5) how might the Department minimize the burden of this collection on the respondents, including through the use of information technology. Please note that written comments received in response to this notice will be considered public records.
Office of Special Education and Rehabilitative Services (OSERS), Department of Education.
Notice.
National Institute on Disability and Rehabilitation Research (NIDRR)—Small Business Innovation Research Program (SBIR)—Phase I
Notice inviting applications for new awards for fiscal year (FY) 2013.
Catalog of Federal Domestic Assistance (CFDA) Number: 84.133S–1.
• Stimulate technological innovation in the private sector.
• Encourage participation in innovation and entrepreneurship by socially and economically disadvantaged persons.
• Strengthen the role of small business in meeting Federal research and development (R&D) needs.
• Increase private-sector commercialization of innovations derived from U.S. Department of Education (Department) R&D funding.
The Small Business Innovation Development Act of 1982 (Act), Public Law 97–219, established the SBIR program. The Act requires certain agencies, including the Department, to reserve a statutory percentage of their extramural R&D budgets for the three-phase SBIR program.
Phase I awards are to determine, insofar as possible, the scientific or technical merit, feasibility, and commercial potential of R&D projects submitted under the SBIR program. Phase I awards are for amounts up to $75,000 for a period of up to six months. Phase II projects continue the development of Phase I projects. Funding is based on the results achieved in Phase I and the scientific and technical merit and commercial potential of the proposed Phase II project. Only Phase I grantees are eligible to apply for Phase II funding. Phase II awards are for amounts up to $500,000 over a period of two years.
In Phase III, the small business grantee pursues commercial applications of the Phase I and II R&D. The SBIR program does not fund Phase III.
All SBIR projects funded by NIDRR must address the needs of individuals with disabilities. (See 29 U.S.C. 760.) Project activities may include:
• Conducting manufacturing-related R&D that encompasses improvements in existing methods or processes, or wholly new processes, machines, or systems, that benefit individuals with disabilities;
• Exploring the uses of technology to ensure equal access to education, employment, community environments, and information for individuals with disabilities; and
• Improving the quality and utility of disability and rehabilitation research.
Executive Order 13329 states that continued technological innovation is critical to a strong manufacturing sector in the United States economy and seeks to ensure that Federal agencies assist the private sector in its manufacturing innovation efforts. The Department's
Manufacturing-related R&D encompasses improvements in existing methods and processes, as well as wholly new processes, machines, and systems. The Department's SBIR program supports a range of manufacturing-related R&D projects, including projects relating to the manufacture of such items as artificial intelligence and information technology devices, software, and systems. For more information on Executive Order 13329, please visit the following Web site: www.sba.gov/content/executive-order-13329-encouraging-innovation-manufacturing-0 or contact Vanessa Tesoriero at:
This program is in concert with NIDRR's currently approved long-range plan (the Plan). The Plan is comprehensive and integrates many issues relating to disability and rehabilitation research. The Plan, which was published in the
Through the implementation of the Plan, NIDRR seeks to—(1) Improve the quality and utility of disability and rehabilitation research; (2) foster an exchange of expertise, information, and training methods to facilitate the advancement of knowledge and understanding of the unique needs of individuals with disabilities from traditionally underserved populations; (3) determine best strategies and programs to improve rehabilitation outcomes for individuals with disabilities from underserved populations; (4) identify research gaps; (5) identify mechanisms for integrating research and practice; and (6) disseminate findings.
Each of the following invitational priorities relates to innovative research utilizing new technologies to address the needs of individuals with disabilities. These priorities are:
(1) Increased independence of individuals with disabilities in the workplace, recreational settings, or educational settings through the development of technology to support access and promote integration of individuals with disabilities.
(2) Enhanced sensory or motor function of individuals with disabilities through the development of technology to support improved functional capacity.
(3) Enhanced workforce participation through the development of technology to increase access to employment, promote sustained employment, and support employment advancement for individuals with disabilities.
(4) Enhanced community living and participation for individuals with disabilities through the development of accessible information technology including cloud computing, software, systems, and devices that promote access to information in educational, employment, and community settings, and voting technology that improves access for individuals with disabilities.
(5) Improved health-care interventions and increased use of related resources through the development of technology to support independent access to community health-care services for individuals with disabilities.
Applicants should describe the approaches they expect to use to collect empirical evidence demonstrating the effectiveness of the technology they are proposing. This empirical evidence should facilitate the assessment of the efficacy and usefulness of the technology.
In responding to all invitational priorities, NIDRR encourages applicants to adhere to universal design principles and guidelines. The term “universal design” is defined as “the design of products and environments to be usable by all people, to the greatest extent possible, without the need for adaptation or specialized design” (The Center for Universal Design, 1997). Universal design of consumer products minimizes or alleviates barriers that reduce the ability of individuals with disabilities to effectively or safely use standard consumer products. (For more information see:
The estimated amount of funds available for new Phase I awards is based upon the estimated SBIR allocation for OSERS, minus prior commitments for Phase II continuation awards.
Contingent upon the availability of funds and the quality of applications, we may make additional awards in FY 2013 from the list of approved but unfunded applicants from this competition.
The maximum award amount includes direct and indirect costs and fees.
The Department is not bound by any estimates in this notice.
1.
If it appears that an applicant organization does not meet the eligibility requirements, we will request an evaluation by the SBA. Under
Technology, science, and engineering firms with strong research capabilities in any of the priority areas listed in this notice are encouraged to participate. Consultative or other arrangements between these firms and universities or other nonprofit organizations are permitted, but the small business concern must serve as the grantee. For Phase I projects, at least two-thirds of the research or analytic activities must be performed by the small business concern grantee.
2.
3.
1.
You can contact ED Pubs at its Web site, also: www.EDPubs.gov or at its email address:
If you request an application from ED Pubs, be sure to identify this competition as follows: CFDA number 84.133S–1.
Individuals with disabilities can obtain a copy of the application package in an accessible format (e.g., braille, large print, audiotape, or compact disc) by contacting the team listed under
2. a.
Page Limit: The application narrative is where you, the applicant, address the selection criteria that reviewers use to evaluate your application. You must limit the application narrative to the equivalent of no more than 50 pages, using the following standards:
• A “page” is 8.5” × 11”, on one side only, with 1” margins at the top, bottom, and both sides.
• Double space (no more than three lines per vertical inch) all text in the application narrative. You are not required to double space titles, headings, footnotes, references, captions, or text in charts, tables, figures, and graphs.
• Use a font that is either 12 point or larger or no smaller than 10 pitch (characters per inch).
• Use one of the following fonts: Times New Roman, Courier, Courier New, or Arial.
The page limit does not apply to the cover sheet; the budget section, including the narrative budget justification; the assurances and certifications; the one-page abstract, the resumes, the bibliography, or the letters of support; related applications or awards; or the documentation of previous Phase II awards (required only if the small business concern has received more than 15 Phase II awards in the prior five fiscal years). However, the page limit does apply to all of the application narrative section.
We will reject your application if you exceed the page limit or if you apply other standards and exceed the equivalent of the page limit.
b.
Given the types of projects that may be proposed in applications for the SBIR program, your application may include business information that you consider proprietary. The Department's regulations define “business information” in 34 CFR 5.11.
Because we plan to publicly highlight success stories on our Web site, you may wish to request confidentiality of business information.
Consistent with Executive Order 12600, please designate in your application any information that you feel is exempt from disclosure under Exemption 4 of the Freedom of Information Act. In the appropriate Appendix section of your application, under “Other Attachments Form,” please list the page number or numbers on which we can find this information. For additional information please see 34 CFR 5.11(c).
3.
Applications for grants under this program must be submitted electronically using the Grants.gov Apply site (Grants.gov). For information (including dates and times) about how to submit your application electronically, or in paper format by mail or hand delivery if you qualify for an exception to the electronic submission requirement, please refer to section IV. 7.
We do not consider an application that does not comply with the deadline requirements.
Individuals with disabilities who need an accommodation or auxiliary aid in connection with the application process should contact the person listed under
4.
5.
6.
a. Have a Data Universal Numbering System (DUNS) number and a Taxpayer Identification Number (TIN);
b. Register both your DUNS number and TIN with the Central Contractor Registry (CCR)—and, after July 24, 2012, with the System for Award Management (SAM), the Government's primary registrant database;
c. Provide your DUNS number and TIN on your application; and
d. Maintain an active CCR or SAM registration with current information while your application is under review by the Department and, if you are awarded a grant, during the project period.
You can obtain a DUNS number from Dun and Bradstreet. A DUNS number can be created within one business day.
If you are a corporate entity, agency, institution, or organization, you can obtain a TIN from the Internal Revenue Service. If you are an individual, you can obtain a TIN from the Internal Revenue Service or the Social Security Administration. If you need a new TIN,
The CCR or SAM registration process may take five or more business days to complete. If you are currently registered with the CCR, you may not need to make any changes. However, please make certain that the TIN associated with your DUNS number is correct. Also, note that you will need to update your registration annually. This may take three or more business days to complete. Information about SAM is available at SAM.gov.
In addition, if you are submitting your application via Grants.gov, you must (1) be designated by your organization as an Authorized Organization Representative (AOR); and (2) register yourself with Grants.gov as an AOR. Details on these steps are outlined at the following Grants.gov Web page:
7.
a.
Applications for grants under the SBIR Program, CFDA number 84.133S–1, must be submitted electronically using the Governmentwide Grants.gov Apply site at
We will reject your application if you submit it in paper format unless, as described elsewhere in this section, you qualify for one of the exceptions to the electronic submission requirement
You may access the electronic grant application for the SBIR Program at www.Grants.gov. You must search for the downloadable application package for this program by the CFDA number. Do not include the CFDA number's alpha suffix in your search (e.g., search for 84.326, not 84.326A).
Please note the following:
• When you enter the Grants.gov site, you will find information about submitting an application electronically through the site, as well as the hours of operation.
• Applications received by Grants.gov are date and time stamped. Your application must be fully uploaded and submitted and must be date and time stamped by the Grants.gov system no later than 4:30:00 p.m., Washington, DC time, on the application deadline date. Except as otherwise noted in this section, we will not accept your application if it is received—that is, date and time stamped by the Grants.gov system—after 4:30:00 p.m., Washington, DC time, on the application deadline date. We do not consider an application that does not comply with the deadline requirements. When we retrieve your application from Grants.gov, we will notify you if we are rejecting your application because it was date and time stamped by the Grants.gov system after 4:30:00 p.m., Washington, DC time, on the application deadline date.
• The amount of time it can take to upload an application will vary depending on a variety of factors, including the size of the application and the speed of your Internet connection. Therefore, we strongly recommend that you do not wait until the application deadline date to begin the submission process through Grants.gov.
• You should review and follow the Education Submission Procedures for submitting an application through Grants.gov that are included in the application package for this competition to ensure that you submit your application in a timely manner to the Grants.gov system. You can also find the Education Submission Procedures pertaining to Grants.gov under News and Events on the Department's G5 system home page at
• You will not receive additional point value because you submit your application in electronic format, nor will we penalize you if you qualify for an exception to the electronic submission requirement, as described elsewhere in this section, and submit your application in paper format.
• You must submit all documents electronically, including all information you typically provide on the following forms: the Application for Federal Assistance (SF 424), the Department of Education Supplemental Information for SF 424, Budget Information—Non-Construction Programs (ED 524), and all necessary assurances and certifications.
• You must upload any narrative sections and all other attachments to your application as files in a PDF (Portable Document) read-only, non-modifiable format. Do not upload an interactive or fillable PDF file. If you upload a file type other than a read-only, non-modifiable PDF or submit a password-protected file, we will not review that material.
• Your electronic application must comply with any page-limit requirements described in this notice.
• After you electronically submit your application, you will receive from Grants.gov an automatic notification of receipt that contains a Grants.gov tracking number. (This notification indicates receipt by Grants.gov only, not receipt by the Department.) The Department then will retrieve your application from Grants.gov and send a second notification to you by email. This second notification indicates that the Department has received your application and has assigned your application a PR/Award number (an ED-specified identifying number unique to your application).
• We may request that you provide us original signatures on forms at a later date.
If you are prevented from electronically submitting your application on the application deadline date because of technical problems with the Grants.gov system, we will grant you an extension until 4:30:00 p.m., Washington, DC time, the following business day to enable you to transmit your application electronically or by hand delivery. You also may mail your application by following the mailing instructions described elsewhere in this notice.
If you submit an application after 4:30:00 p.m., Washington, DC time, on the application deadline date, please contact the person listed under
The extensions to which we refer in this section apply only to the unavailability of, or technical problems with, the Grants.gov system. We will not grant you an extension if you failed to fully register to submit your application to Grants.gov before the application deadline date and time or if the technical problem you experienced is unrelated to the Grants.gov system.
• You do not have access to the Internet; or
• You do not have the capacity to upload large documents to the Grants.gov system; and
• No later than two weeks before the application deadline date (14 calendar days or, if the fourteenth calendar day before the application deadline date falls on a Federal holiday, the next business day following the Federal holiday), you mail or fax a written statement to the Department, explaining which of the two grounds for an exception prevent you from using the Internet to submit your application.
If you mail your written statement to the Department, it must be postmarked no later than two weeks before the application deadline date. If you fax your written statement to the Department, we must receive the faxed statement no later than two weeks before the application deadline date.
Address and mail or fax your statement to: Lynn Medley, U.S. Department of Education, 400 Maryland Avenue SW., room 5140, PCP, Washington, DC 20202–2700.
Your paper application must be submitted in accordance with the mail or hand delivery instructions described in this notice.
b.
If you qualify for an exception to the electronic submission requirement, you may mail (through the U.S. Postal Service or a commercial carrier) your application to the Department. You must mail the original and two copies of your application, on or before the application deadline date, to the Department at the following address: U.S. Department of Education, Application Control Center, Attention: (CFDA Number 84.133S–1), LBJ Basement Level 1, 400 Maryland Avenue SW., Washington, DC 20202–4260.
You must show proof of mailing consisting of one of the following:
(1) A legibly dated U.S. Postal Service postmark.
(2) A legible mail receipt with the date of mailing stamped by the U.S. Postal Service.
(3) A dated shipping label, invoice, or receipt from a commercial carrier.
(4) Any other proof of mailing acceptable to the Secretary of the U.S. Department of Education.
If you mail your application through the U.S. Postal Service, we do not accept either of the following as proof of mailing:
(1) A private metered postmark.
(2) A mail receipt that is not dated by the U.S. Postal Service.
If your application is postmarked after the application deadline date, we will not consider your application.
The U.S. Postal Service does not uniformly provide a dated postmark. Before relying on this method, you should check with your local post office.
c.
If you qualify for an exception to the electronic submission requirement, you (or a courier service) may deliver your paper application to the Department by hand. You must deliver the original and two copies of your application by hand, on or before the application deadline date, to the Department at the following address: U.S. Department of Education, Application Control Center, Attention: (CFDA Number 84.133S–1), 550 12th Street SW., Room 7041, Potomac Center Plaza, Washington, DC 20202–4260.
The Application Control Center accepts hand deliveries daily between 8:00 a.m. and 4:30:00 p.m., Washington, DC time, except Saturdays, Sundays, and Federal holidays.
(1) You must indicate on the envelope and—if not provided by the Department—in Item 11 of the SF 424 the CFDA number, including suffix letter, if any, of the competition under which you are submitting your application; and
(2) The Application Control Center will mail to you a notification of receipt of your grant application. If you do not receive this notification within 15 business days from the application deadline date, you should call the U.S. Department of Education Application Control Center at (202) 245–6288.
1.
2.
In addition, in making a competitive grant award, the Secretary also requires various assurances including those applicable to Federal civil rights laws that prohibit discrimination in programs or activities receiving Federal financial assistance from the Department of Education (34 CFR 100.4, 104.5, 106.4, 108.8, and 110.23).
3.
1.
If your application is not evaluated or not selected for funding, we notify you.
2.
We reference the regulations outlining the terms and conditions of an award in the
3.
(b) At the end of your project period, you must submit a final performance
4.
Department of Education program performance reports, which include information on NIDRR programs, are available on the Department's Web site:
5.
Lynn Medley, U.S. Department of Education, 400 Maryland Avenue SW., room 5140, PCP, Washington, DC 20202–2700. Telephone: (202) 245–7338 or by email: lynn.medley@ed.gov.
Marlene Spencer, U.S. Department of Education, 400 Maryland Avenue SW., room 5133, PCP, Washington, DC 20202–2700. Telephone: (202) 245–7532 or by email:
If you use a TDD or TTY, call the FRS, toll free, at 1–800–877–8339.
You may also access documents of the Department published in the
Office of Innovation and Improvement, Department of Education.
Notice.
Notice inviting applications for new awards for fiscal year (FY) 2013.
For FY 2013 and any subsequent year in which we make awards from the list of unfunded applicants from this competition, these priorities are competitive preference priorities. Under 34 CFR 280.30(f) we will award up to 30 additional points to an application, depending on how well the applicant addresses Competitive Preference Priorities 1, 2, and 3. Under 34 CFR 75.105(c)(2)(i) we will award up to an additional 10 points to an application, depending on how well the application addresses Competitive Preference Priority 4. Together, depending on how
These priorities are:
(a) The costs of fully implementing the magnet schools project as proposed;
(b) The resources available to the applicant to carry out the project if funds under the program were not provided;
(c) The extent to which the costs of the project exceed the applicant's resources; and
(d) The difficulty of effectively carrying out the approved plan and the project for which assistance is sought, including consideration of how the design of the magnet schools project—e.g., the type of program proposed, the location of the magnet school within the LEA—impacts on the applicant's ability to successfully carry out the approved plan.
(a) Providing students with increased access to rigorous and engaging coursework in STEM.
(b) Increasing the opportunities for high-quality preparation of, or professional development for, teachers or other educators of STEM subjects.
Additional background information pertaining to this priority can be found in the Notice of Final Supplemental Priorities and Definitions for Discretionary Grant Programs published in the
20 U.S.C. 7231–7231j.
The Administration has requested $99,611,000 for the MSAP for FY 2013, of which we intend to use an estimated $96,622,670 for awards under this competition. The actual level of funding, if any, depends on final congressional action. However, we are inviting applications to allow enough time to complete the grant process before the end of the current fiscal year, if Congress appropriates funds for this program.
Contingent upon the availability of funds and the quality of applications, we may make additional awards in FY 2014 from the list of unfunded applicants from this competition.
The Department is not bound by any estimates in this notice.
1.
2.
3.
In addition to the particular data and other items for required and voluntary desegregation plans described in the application package, an application must include—
• Projected enrollment by race and ethnicity for magnet and feeder schools);
• Signed civil rights assurances (included in the application package); and
• An assurance that the desegregation plan is being implemented or will be implemented if the application is funded.
1. Desegregation plans required by a court order. An applicant that submits a desegregation plan required by a court order must submit complete and signed copies of all court documents demonstrating that the magnet schools are a part of the approved desegregation plan. Examples of the types of documents that would meet this requirement include a Federal or State court order that establishes specific magnet schools, amends a previous order or orders by establishing additional or different specific magnet schools, requires or approves the establishment of one or more unspecified magnet schools, or that authorizes the inclusion of magnet schools at the discretion of the applicant.
2. Desegregation plans required by a State agency or official of competent jurisdiction. An applicant submitting a desegregation plan ordered by a State agency or official of competent jurisdiction must provide documentation that shows that the desegregation plan was ordered based upon a determination that State law was
3. Desegregation plans required by Title VI. An applicant that submits a desegregation plan required by OCR under Title VI must submit a complete copy of the desegregation plan demonstrating that magnet schools are part of the approved plan.
4. Modifications to required desegregation plans. A previously approved desegregation plan that does not include the magnet school or program for which the applicant is now seeking assistance must be modified to include the magnet school component. The modification to the desegregation plan must be approved by the court, agency, or official that originally approved the plan. An applicant that wishes to modify a previously approved OCR Title VI desegregation plan to include different or additional magnet schools must submit the proposed modification for review and approval to the OCR regional office that approved its original plan.
An applicant should indicate in its application if it is seeking to modify its previously approved desegregation plan. However, all applicants must submit proof of approval of all modifications to their plans to the Department by April 1, 2013. Proof of plan modifications should be mailed to the person and address identified under
A voluntary desegregation plan must be approved by the Department each time an application is submitted for funding. Even if the Department has approved a voluntary desegregation plan in an LEA in the past, the desegregation plan must be resubmitted for approval as part of the application.
An applicant's voluntary desegregation plan must demonstrate how the LEA will reduce, eliminate, or prevent minority group isolation, and demonstrate that the proposed voluntary desegregation plan is adequate under Title VI. For additional guidance on how an LEA can voluntarily reduce minority group isolation and promote diversity in an LEA in light of the Supreme Court's decision in
Complete and accurate enrollment forms and other information as required by the regulations in 34 CFR 280.20(f) and (g) for applicants with voluntary desegregation plans are critical to the Department's determination of an applicant's eligibility under a voluntary desegregation plan (specific requirements are detailed in the application package).
Voluntary desegregation plan applicants must submit evidence of school board approval or evidence of other official adoption of the plan as required by the regulations in 34 CFR 280.20(f)(2).
1.
To obtain a copy via the Internet, use the following address:
To obtain a copy from ED Pubs, write, fax, or call the following: Education Publications Center, P.O. Box 22207, Alexandria, VA 22304. Telephone, toll free: 1–877–433–7827. FAX: (703) 605–6794. If you use a telecommunications device for the deaf (TDD) or text telephone (TTY), call, toll free: 1–877–576–7734.
You can contact ED Pubs at its Web site, also:
If you request an application from ED Pubs, be sure to identify this program as follows: CFDA number 84.165A.
To obtain a copy from the program office, contact: Rosie Kelley, U.S. Department of Education, 400 Maryland Avenue SW., room 4W227, Washington, DC 20202–5970. Telephone: (202)453–5601 or by email: msap.team@ed.gov. If you use a TDD or TTY, call the Federal Relay Service (FRS), toll free, at 1–800–877–8339.
Individuals with disabilities can obtain a copy of the application package in an accessible format (e.g., braille, large print, audiotape, or compact disc) by contacting the program contact person listed in this section.
2.
a. Requirements concerning the content of an application, together with the forms you must submit, are in the application package for this competition.
• A “page” is 8.5” x 11”, on one side only, with 1” margins at the top, bottom, and both sides.
• Double space (no more than three lines per vertical inch) all text in the application narrative, including titles, headings, footnotes, quotations, references, and captions, as well as all text in charts, tables, figures, and graphs.
• Use a font that is either 12-point or larger or no smaller than 10 pitch (characters per inch).
• Use of one of the following fonts is strongly encouraged: Times New Roman, Courier, Courier New, or Arial.
• Include page numbers at the bottom of each page in your narrative.
The suggested page limit does not apply to the Part I, the cover sheet; Part II, the budget section, including the narrative budget justification; Part IV, the assurances, certifications, the desegregation plan and related information, and the forms used to respond to Competitive Preference Priority 2—New or revised magnet schools projects and Competitive Preference Priority 3—Selection of students; or the one-page abstract, the resumes, or letters of support. However, the suggested page limit does apply to all of the application narrative in Part III.
b.
Given the types of projects that may be proposed in applications for the MSAP program an application may include business information that the applicant considers proprietary. The Department's regulations define “business information” in 34 CFR 5.11.
Because we plan to make successful applications available to the public, you may wish to request confidentiality of business information.
Consistent with Executive Order 12600, please designate in your application any information that you feel is exempt from disclosure under Exemption 4 of the Freedom of Information Act. In the appropriate Appendix section of your application, under “Other Attachments Form,” please list the page number or numbers on which we can find this information. For additional information please see 34 CFR 5.11(c).
3.
The Department will hold a pre-application Webinar for prospective applicants on Tuesday, January 17, 2013, from 1:00 to 4:30 p.m., Washington, DC time. The Webinar will discuss the purpose of the MSAP competitive preference priorities, selection criteria, application content, submission requirements, and reporting requirements. Interested parties may obtain information about this Webinar from the program Web site at http://www2.ed.gov/programs/magnet/index.html. A recording of this Webinar will be available on the Web site following the session.
Applications for grants under this competition must be submitted electronically using the Grants.gov Apply site (Grants.gov). For information (including dates and times) about how to submit your application electronically, or in paper format by mail or hand delivery if you qualify for an exception to the electronic submission requirement, please refer to section IV. 7.
We do not consider an application that does not comply with the deadline requirements.
Individuals with disabilities who need an accommodation or auxiliary aid in connection with the application process should contact the person listed under
4.
5.
6.
a. Have a Data Universal Numbering System (DUNS) number and a Taxpayer Identification Number (TIN);
b. Register both your DUNS number and TIN with the Central Contractor Registry (CCR)—and, after July 24, 2012, with the System for Award Management (SAM), the Government's primary registrant database;
c. Provide your DUNS number and TIN on your application; and
d. Maintain an active CCR or SAM registration with current information while your application is under review by the Department and, if you are awarded a grant, during the project period.
You can obtain a DUNS number from Dun and Bradstreet. A DUNS number can be created within one business day.
If you are a corporate entity, agency, institution, or organization, you can obtain a TIN from the Internal Revenue Service. If you are an individual, you can obtain a TIN from the Internal Revenue Service or the Social Security Administration. If you need a new TIN, please allow 2–5 weeks for your TIN to become active.
The CCR or SAM registration process may take five or more business days to complete. If you are currently registered with the CCR, you may not need to make any changes. However, please make certain that the TIN associated with your DUNS number is correct. Also note that you will need to update your registration annually. This may take three or more business days to complete. Information about SAM is available at SAM.gov.
In addition, if you are submitting your application via Grants.gov, you must (1) be designated by your organization as an Authorized Organization Representative (AOR); and (2) register yourself with Grants.gov as an AOR. Details on these steps are outlined at the following Grants.gov Web page:
7.
a.
Applications for grants under the Magnet Schools Assistance Program, CFDA number 84.165A, must be submitted electronically using the Governmentwide Grants.gov Apply site at www.Grants.gov. Through this site, you will be able to download a copy of the application package, complete it offline, and then upload and submit your application. You may not email an electronic copy of a grant application to us.
We will reject your application if you submit it in paper format unless, as described elsewhere in this section, you qualify for one of the exceptions to the electronic submission requirement
You may access the electronic grant application for the Magnet Schools Assistance Program at www.Grants.gov. You must search for the downloadable application package for this program Magnet Schools Assistance Program (MSAP 84.165) by the CFDA number. Do not include the CFDA number's alpha suffix in your search (e.g., search for 84.165, not 84.165A).
Please note the following:
• When you enter the Grants.gov site, you will find information about submitting an application electronically through the site, as well as the hours of operation.
• Applications received by Grants.gov are date and time stamped. Your application must be fully uploaded and submitted and must be date and time
• The amount of time it can take to upload an application will vary depending on a variety of factors, including the size of the application and the speed of your Internet connection. Therefore, we strongly recommend that you do not wait until the application deadline date to begin the submission process through Grants.gov.
• You should review and follow the Education Submission Procedures for submitting an application through Grants.gov that are included in the application package for the Magnet Schools Assistance Program to ensure that you submit your application in a timely manner to the Grants.gov system. You can also find the Education Submission Procedures pertaining to Grants.gov under News and Events on the Department's G5 system home page at www.G5.gov.
• You will not receive additional point value because you submit your application in electronic format, nor will we penalize you if you qualify for an exception to the electronic submission requirement, as described elsewhere in this section, and submit your application in paper format.
• You must submit all documents electronically, including all information you typically provide on the following forms: the Application for Federal Assistance (SF 424), the Department of Education Supplemental Information for SF 424, Budget Information—Non-Construction Programs (ED 524), and all necessary assurances and certifications.
• You must upload any narrative sections and all other attachments to your application as files in a PDF (Portable Document) read-only, non-modifiable format. Do not upload an interactive or fillable PDF file. If you upload a file type other than a read-only, non-modifiable PDF or submit a password-protected file, we will not review that material.
• Your electronic application must comply with any page-limit requirements described in this notice.
• After you electronically submit your application, you will receive from Grants.gov an automatic notification of receipt that contains a Grants.gov tracking number. (This notification indicates receipt by Grants.gov only, not receipt by the Department.) The Department then will retrieve your application from Grants.gov and send a second notification to you by email. This second notification indicates that the Department has received your application and has assigned your application a PR/Award number (an ED-specified identifying number unique to your application).
• We may request that you provide us original signatures on forms at a later date.
If you are prevented from electronically submitting your application on the application deadline date because of technical problems with the Grants.gov system, we will grant you an extension until 4:30:00 p.m., Washington, DC time, the following business day to enable you to transmit your application electronically or by hand delivery. You also may mail your application by following the mailing instructions described elsewhere in this notice.
If you submit an application after 4:30:00 p.m., Washington, DC time, on the application deadline date, please contact the person listed under
The extensions to which we refer in this section apply only to the unavailability of, or technical problems with, the Grants.gov system. We will not grant you an extension if you failed to fully register to submit your application to Grants.gov before the application deadline date and time or if the technical problem you experienced is unrelated to the Grants.gov system.
• You do not have access to the Internet; or
• You do not have the capacity to upload large documents to the Grants.gov system;
• No later than two weeks before the application deadline date (14 calendar days or, if the fourteenth calendar day before the application deadline date falls on a Federal holiday, the next business day following the Federal holiday), you mail or fax a written statement to the Department, explaining which of the two grounds for an exception prevent you from using the Internet to submit your application.
If you mail your written statement to the Department, it must be postmarked no later than two weeks before the application deadline date. If you fax your written statement to the Department, we must receive the faxed statement no later than two weeks before the application deadline date.
Address and mail or fax your statement to: Rosie E. Kelley, U.S. Department of Education, 400 Maryland Avenue SW. room 4W227, Washington, DC 20202–5970. FAX: (202) 205–5630.
Your paper application must be submitted in accordance with the mail or hand delivery instructions described in this notice.
b.
If you qualify for an exception to the electronic submission requirement, you may mail (through the U.S. Postal Service or a commercial carrier) your application to the Department. You must mail the original and two copies of your application, on or before the application deadline date, to the Department at the following address: U.S. Department of Education, Application Control Center, Attention: (CFDA Number 84.165A), LBJ Basement Level 1, 400 Maryland Avenue SW., Washington, DC 20202–4260.
You must show proof of mailing consisting of one of the following:
(1) A legibly dated U.S. Postal Service postmark.
(2) A legible mail receipt with the date of mailing stamped by the U.S. Postal Service.
(3) A dated shipping label, invoice, or receipt from a commercial carrier.
(4) Any other proof of mailing acceptable to the Secretary of the U.S. Department of Education.
If you mail your application through the U.S. Postal Service, we do not accept either of the following as proof of mailing:
(1) A private metered postmark.
(2) A mail receipt that is not dated by the U.S. Postal Service.
If your application is postmarked after the application deadline date, we will not consider your application.
The U.S. Postal Service does not uniformly provide a dated postmark. Before relying on this method, you should check with your local post office.
c.
If you qualify for an exception to the electronic submission requirement, you (or a courier service) may deliver your paper application to the Department by hand. You must deliver the original and two copies of your application by hand, on or before the application deadline date, to the Department at the following address: U.S. Department of Education, Application Control Center, Attention: (CFDA Number 84.165A), 550 12th Street SW., Room 7041, Potomac Center Plaza, Washington, DC 20202–4260.
The Application Control Center accepts hand deliveries daily between 8:00 a.m. and 4:30:00 p.m., Washington, DC time, except Saturdays, Sundays, and Federal holidays.
If you mail or hand deliver your application to the Department—
(1) You must indicate on the envelope and—if not provided by the Department—in Item 11 of the SF 424 the CFDA number, including suffix letter, if any, of the competition under which you are submitting your application; and
(2) The Application Control Center will mail to you a notification of receipt of your grant application. If you do not receive this notification within 15 business days from the application deadline date, you should call the U.S. Department of Education Application Control Center at (202) 245–6288.
The maximum score for all of the selection criteria is 100 points. The maximum score for each criterion is included in parentheses. Each criterion also includes the factors that reviewers will consider in determining the extent to which an applicant meets the criterion.
Points awarded under these selection criteria are in addition to any points an applicant earns under the competitive preference priorities in this notice. The maximum score that an application may receive under the competitive preference priorities and the selection criteria is 140 points.
(a)
(1) The Secretary reviews each application to determine the quality of the plan of operation for the project.
(2) The Secretary determines the extent to which the applicant demonstrates—
(i) (5 points) The effectiveness of its management plan to ensure proper and efficient administration of the project;
(ii) (5 points) The effectiveness of its plan to attain specific outcomes that—
(A) Will accomplish the purposes of the program;
(B) Are attainable within the project period;
(C) Are measurable and quantifiable; and
(D) For multi-year projects, can be used to determine the project's progress in meeting its intended outcomes;
(iii) (2 points) The effectiveness of its plan for utilizing its resources and personnel to achieve the objectives of the project, including how well it utilizes key personnel to complete tasks and achieve the objectives of the project;
(iv) (3 points) How it will ensure equal access and treatment for eligible project participants who have been traditionally underrepresented in courses or activities offered as part of the magnet school, e.g. women and girls in mathematics, science, or technology courses, and disabled students; and
(v) (15 points) The effectiveness of its plan to recruit students from different social, economic, ethnic, and racial backgrounds into the magnet schools.
(b)
(1) The Secretary reviews each application to determine the qualifications of the personnel the applicant plans to use on the project.
(2) The Secretary determines the extent to which—
(i) (5 points) The project director (if one is used) is qualified to manage the project;
(ii) (4 points) Other key personnel are qualified to manage the project;
(iii) (5 points) Teachers who will provide instruction in participating magnet schools are qualified to implement the special curriculum of the magnet schools; and
(iv) (1 point) The applicant, as part of its nondiscriminatory employment practices, will ensure that its personnel are selected for employment without regard to race, religion, color, national origin, sex, age, or disability.
(3) To determine personnel qualifications, the Secretary considers experience and training in fields related to the objectives of the project, including the key personnel's knowledge of and experience in curriculum development and desegregation strategies.
(c)
(1) The Secretary reviews each application to determine the quality of the project design based on sections 5305(b)(1)(A), 5305(b)(1)(B), 5305(b)(1)(D)(i), 5305(b)(2)(D) of the ESEA.
(2) The Secretary determines the extent to which each magnet school for which funding is sought will—
(i) (10 points) Promote desegregation, including how each proposed magnet school program will increase interaction among students of different social, economic, ethnic, and racial backgrounds;
(ii) (10 points) Improve student academic achievement for all students attending each magnet school program, including the manner and extent to which each magnet school program will increase student academic achievement in the instructional area or areas offered by the school; and
(iii) (10 points) Encourage greater parental decision-making and involvement.
(d)
The Secretary reviews each application to determine the adequacy of the resources and the cost-effectiveness of the budget for the project, including—
(1) (1 points) The adequacy of the facilities that the applicant plans to use;
(2) (2 points) The adequacy of the equipment and supplies that the applicant plans to use; and
(3) (2 points) The adequacy and reasonableness of the budget for the project in relation to the objectives of the project.
(e)
The Secretary determines the extent to which the evaluation plan for the project—
(1) (2 points) Includes methods that are appropriate to the project;
(2) (6 points) Will determine how successful the project is in meeting its intended outcomes, including its goals for desegregating its students and increasing student achievement; and
(3) (2 points) Includes methods that are objective and that will produce data that are quantifiable.
(f)
(1) The Secretary reviews each application to determine whether the applicant is likely to continue the magnet school activities after assistance under the program is no longer available.
(2) The Secretary determines the extent to which the applicant—
(i) (5 points) Is committed to the magnet schools project; and
(ii) (5 points) Has identified other resources to continue support for the magnet school activities when assistance under this program is no longer available.
2.
In addition, in making a competitive grant award, the Secretary also requires various assurances including those applicable to Federal civil rights laws that prohibit discrimination in programs or activities receiving Federal financial assistance from the Department of Education (34 CFR 100.4, 104.5, 106.4, 108.8, and 110.23).
3.
1.
If your application is not evaluated or not selected for funding, we notify you.
2.
We reference the regulations outlining the terms and conditions of an award in the
3.
(b) At the end of your project period, you must submit a final performance report, including financial information, as directed by the Secretary. If you receive a multi-year award, you must submit an annual performance report that provides the most current performance and financial expenditure information as directed by the Secretary under 34 CFR 75.118. The Secretary may also require more frequent performance reports under 34 CFR 75.720(c). For specific requirements on reporting, please go to www.ed.gov/fund/grant/apply/appforms/appforms.html.
4.
(a) The percentage of magnet schools receiving assistance whose student enrollment reduces, eliminates, or prevents minority group isolation.
(b) The percentage of students from major racial and ethnic groups in magnet schools receiving assistance who score proficient or above on State assessments in reading/language arts.
(c) The percentage of students from major racial and ethnic groups in magnet schools receiving assistance who score proficient or above on State assessments in mathematics.
(d) The cost per student in a magnet school receiving assistance.
(e) The percentage of magnet schools that received assistance that are still operating magnet school programs three years after Federal funding ends.
(f) The percentage of magnet schools that received assistance that meet the State's annual measurable objectives and, for high schools, graduation rate targets at least three years after Federal funding ends.
5.
Rosie Kelley, U.S. Department of Education, 400 Maryland Avenue SW., room 4W227, Washington, DC 20202–5970. Telephone: (202) 453–5601 or by email:
You may also access documents of the Department published in the
Office of Special Education and Rehabilitative Services; Department of Education.
Notice.
The Secretary is publishing the following list of correspondence from the U.S. Department of Education (Department) to individuals during the previous quarter. The correspondence describes the Department's interpretations of the Individuals with Disabilities Education Act (IDEA) or the regulations that implement the IDEA. This list and the letters or other documents described in this list, with personally identifiable information redacted, as appropriate, can be found at:
Jessica Spataro or Mary Louise Dirrigl. Telephone: (202) 245–7468.
If you use a telecommunications device for the deaf (TDD) or a text telephone (TTY), you can call the Federal Relay Service (FRS), toll free, at 1–800–877–8339.
Individuals with disabilities can obtain a copy of this list and the letters or other documents described in this list in an accessible format (e.g., braille, large print, audiotape, or compact disc) by contacting Jessica Spataro or Mary Louise Dirrigl at (202) 245–7468.
The following list identifies correspondence from the Department issued from April 1, 2012, through June 30, 2012. Under section 607(f) of the IDEA, the Secretary is required to publish this list quarterly in the
○ Letter dated May 9, 2012, to Special Education Advocate Ellen M. Chambers, regarding whether instruction or services provided in a school district's regular education program can be considered “specially-designed instruction” or “related services.”
○ Letter dated June 22, 2012, to Disability Rights Wisconsin Managing Attorney Jeffrey Spitzer-Resnick, regarding how the least restrictive environment requirements apply to work placements that are part of a student's transition plan.
○ Letter dated June 13, 2012, to East End Special Education Parents, Inc., President Kathleen Chamberlain, regarding children with disabilities enrolled by their parents in private schools when free appropriate public education (FAPE) is at issue and clarification of child find requirements for parentally placed private school children.
○ Letter dated April 4, 2012, to Center for Law and Education co-director Kathleen Boundy, regarding the local educational agency (LEA) maintenance of
○ Letter dated June 6, 2012, to West Virginia attorney James Gerl, regarding whether an LEA may offer mediation when parents revoke consent to the continued provision of special education and related services to their child.
○ Letter dated April 9, 2012, to individual (personally identifiable information redacted), regarding various requirements of Part B of the IDEA, including functional behavioral assessments, out-of-State transfer students, State complaint procedures, and education records.
○ Letter dated April 11, 2012, to Cumberland County Schools Exceptional Children's Programs Executive Director Ruben A. Reyes, regarding timeframes for initial evaluations.
○ Letter dated April 10, 2012, to Little Cypress-Mauriceville Special Programs Director Robert H. Finch, regarding comparable services for transfer students.
○ Letter dated April 26, 2012, to Family Soup Executive Director Cindy E. Chandler, regarding when an LEA must provide prior written notice to parents.
○ Letter dated April 23, 2012, to Maryland attorney Michael J. Eig, regarding parent participation in resolution meetings.
○ Letter dated June 21, 2012, to New York attorney Edward Sarzynski, regarding how discipline procedures apply to bus suspensions (when school districts temporarily prohibit a student from riding the bus).
○ Letter dated June 22, 2012, to Virginia Department of Education Assistant Superintendent H. Douglas Cox, regarding timelines for expedited due process hearings when school is not in session.
○ Letter dated June 26, 2012, to U.S. Congresswoman Lynn C. Woolsey, regarding the Office of Special Education Programs' monitoring of States' compliance with requirements of the IDEA.
You may also access documents of the Department published in the
Office of Energy Efficiency and Renewable Energy, Department of Energy.
Notice of petition for waiver, notice of grant of interim waiver, and request for comments.
This notice announces receipt of and publishes the BSH Corporation (BSH) petition for waiver from specified portions of the U.S. Department of Energy (DOE) test procedure for determining the energy consumption of dishwashers. Today's notice also grants an interim waiver of the dishwasher test procedure. Through this notice, DOE also solicits comments with respect to the BSH petition.
DOE will accept comments, data, and information with respect to the BSH petition until January 30, 2013.
You may submit comments, identified by case number DW–009, by any of the following methods:
•
•
•
•
Mr. Bryan Berringer, U.S. Department of Energy, Building Technologies Program, Mail Stop EE–2J, Forrestal Building, 1000 Independence Avenue SW., Washington, DC 20585–0121. Telephone: (202) 586–0371. Email:
Ms. Elizabeth Kohl, U.S. Department of Energy, Office of the General Counsel, Mail Stop GC–71, Forrestal Building, 1000 Independence Avenue SW, Washington, DC 20585–0103. Telephone: (202) 586–7796. Email:
Title III, Part B of the Energy Policy and Conservation Act of 1975 (EPCA), Public Law 94–163 (42 U.S.C. 6291–6309, as codified) established the Energy Conservation Program for Consumer Products Other Than Automobiles, a program covering most major household appliances, which includes dishwashers.
The regulations set forth in 10 CFR 430.27 contain provisions that enable a person to seek a waiver from the test procedure requirements for covered consumer products. A waiver will be granted by the Assistant Secretary for Energy Efficiency and Renewable Energy (the Assistant Secretary) if it is determined that the basic model for which the petition for waiver was submitted contains one or more design characteristics that prevents testing of the basic model according to the prescribed test procedures, or if the prescribed test procedures may evaluate the basic model in a manner so unrepresentative of its true energy consumption characteristics as to provide materially inaccurate comparative data. 10 CFR 430.27(l). Petitioners must include in their petition any alternate test procedures known to the petitioner to evaluate the basic model in a manner representative of its energy consumption. The Assistant Secretary may grant the waiver subject to conditions, including adherence to alternate test procedures. 10 CFR 430.27(l). Waivers remain in effect pursuant to the provisions of 10 CFR 430.27(m).
The waiver process also allows the Assistant Secretary to grant an interim waiver from test procedure requirements to manufacturers that have petitioned DOE for a waiver of such prescribed test procedures. 10 CFR 430.27(a)(2) An interim waiver must be granted if it is determined that the applicant will experience economic hardship if the application for interim waiver is denied, if it appears likely that the petition for waiver will be granted, and/or the Assistant Secretary determines that it would be desirable for public policy reasons to grant immediate relief pending a determination of the petition for waiver. (10 CFR 430.27(g)) An interim waiver remains in effect for 180 days or until DOE issues its determination on the petition for waiver, whichever is sooner. DOE may extend an interim waiver for an additional 180 days. 10 CFR 430.27(h)
On November 30, 2012, BSH submitted the petition for waiver and interim waiver from the test procedure applicable to dishwashers set forth in 10 CFR part 430, subpart B, appendix C. In every respect except the introduction of new model numbers, the petition is identical to petitions submitted by BSH
BSH states that “hard” water can reduce customer satisfaction with dishwasher performance resulting in increased pre-rinsing and/or hand washing as well as increased detergent and rinse agent usage. According to BSH, a dishwasher equipped with a water softener will minimize pre-rinsing and rewashing, and consumers will have less reason to periodically run their dishwasher through a clean-up cycle. BSH also states that the amount of water consumed by the regeneration operation of a water softener in a dishwasher is very small, but that it varies significantly depending on the adjustment of the softener. The regeneration operation takes place infrequently, and the frequency is related to the level of water hardness.
In its petition, BSH requests that constant values of 47.6 gallons per year for water consumption and 8.0 kWh per year for energy consumption be used to estimate the water and energy consumption resulting from water softener regeneration. BSH included calculations showing this water and energy use, which was derived using the same method as that used by Whirlpool in its petition for waiver, which was granted by DOE. (75 FR 62127, Oct. 7, 2010).
DOE has determined that BSH's application for interim waiver does not provide sufficient market, equipment price, shipments, and other manufacturer impact information to permit DOE to evaluate the economic hardship BSH might experience absent a favorable determination on its application for interim waiver. DOE has also determined, however, that it is likely BSH's petition will be granted, and that it is desirable for public policy reasons to grant BSH relief pending a determination on the petition. Based on the information provided by BSH and Whirlpool, use of the DOE test procedure may provide materially inaccurate comparative data. In addition, the constant values submitted by BSH provide a reasonable estimate of the energy and water used during water softener regeneration for the basic model set forth in this petition and BSH's previous petition.
Based on these considerations, and the waivers granted to BSH and Whirlpool for similar models, it appears likely that the petition for waiver will be granted. DOE also believes that the energy efficiency of similar products should be tested and rated in the same manner. As a result, DOE grants BSH's application for interim waiver for the basic models of dishwashers specified in its petition for waiver, pursuant to 10 CFR 430.27(g). Therefore,
The application for interim waiver filed by BSH is hereby granted for the specified BSH dishwasher basic models, subject to the specifications and conditions below.
BSH shall be required to test and rate the specified dishwasher products according to the alternate test procedure as set forth in section III, “Alternate Test Procedure.”
The interim waiver applies to the following basic model groups:
DOE makes decisions on waivers and interim waivers for only those models specifically set out in the petition, not future models that may be manufactured by the petitioner. BSH may submit a subsequent petition for waiver and request for grant of interim waiver, as appropriate, for additional models of clothes washers for which it seeks a waiver from the DOE test procedure. In addition, DOE notes that grant of an interim waiver or waiver does not release a petitioner from the certification requirements set forth at 10 CFR part 429.
EPCA requires that manufacturers use DOE test procedures to make representations about the energy consumption and energy consumption costs of products covered by the statute. (42 U.S.C. 6293(c)) Consistent representations are important for manufacturers to use in making representations about the energy efficiency of their products and to demonstrate compliance with applicable DOE energy conservation standards. Pursuant to its regulations applicable to waivers and interim waivers from the relevant test procedures, set forth at 10 CFR 430.27, DOE will consider setting an alternate test procedure for BSH in a subsequent Decision and Order.
During the period of the interim waiver granted in this notice, BSH shall test its dishwasher basic models according to the existing DOE test procedure at 10 CFR 430, subpart B, appendix C with the modification set forth below.
Under appendix C, the water energy consumption, W or Wg, is calculated based on the water consumption as set forth in Sect. 4.3:
§ 4.3
Where the regeneration of the water softener depends on demand and water hardness, and does not take place on every cycle, BSH shall measure the water consumption of dishwashers having water softeners without including the water consumed by the dishwasher during softener regeneration. If a regeneration operation takes place within the test, the water consumed by the regeneration operation shall be disregarded when declaring water and energy consumption. Constant values of 47.6 gallons/year of water and 8 kWh/year of energy shall be added to the values measured by appendix C.
Please note that on October 31, 2012, DOE published a test procedure final rule (77 FR 65941) to include measures of energy and water consumption due to periodic water softener regeneration. The rule is effective on December 17, 2012 and requires compliance on or after May 13, 2013. Products tested on or after May 13, 2013, must be tested with the new DOE test procedure.
Through today's notice, DOE announces receipt of BSH's petition for waiver from certain parts of the test procedure that apply to dishwashers and grants an interim waiver. DOE is publishing BSH's petition for waiver in its entirety. The petition contains no confidential information. The petition includes a suggested alternate test procedure, in which the reported energy and water consumption would include an estimate of the energy and water consumption of dishwashers with water softeners during softener regeneration.
DOE solicits comments from interested parties on all aspects of the petition. Any person submitting written comments to DOE must also send a copy of such comments to the petitioner. The contact information for the petitioner is
BSH Home Appliance Corporation (“BSH”) hereby submits this Petition for Waiver and Application for Interim Waiver pursuant to 10 CFR 430.27, concerning the test procedure for measuring energy consumption of Dishwashers.
BSH is the manufacturer of household appliances bearing the brand names of Bosch, Thermador, and Gaggenau. Its appliances include dishwashers, washing machines, clothes dryers, refrigerator-freezers, ovens, and microwave ovens, and are sold worldwide, including in the United States. BSH's United States operations are headquartered in Irvine, California.
10 CFR 430.27(a)(1) provides that any interested person may submit a petition to waive for a particular basic model any requirement of Section 430.23, or of any appendix to this subpart, upon grounds that the basic model contains one or more design characteristics which either prevent testing of the basic model according to the prescribed test procedures, or the prescribed test procedures may evaluate the basic model in a manner so unrepresentative of its true energy consumption characteristics, or water consumption characteristics as to provide materially inaccurate comparative data. Additionally, 10 CFR 430.27 (b)(2) allows any applicant of a Petition of Waiver to also request an Interim Waiver if it can be demonstrated the likely success of the Petition for Waiver, while addressing the economic hardship and/or competitive disadvantage that is likely to result absent a favorable determination on the Application for Interim Waiver.
This request for Waiver is directed to Dishwashers containing a built-in or integrated water softener, specifically addressing the energy and water used in the regeneration process of the integrated water softener. This request is similar to several previously approved waivers (such as Waiver Case Number DW–005). Further, the water softening technology used in these models is identical to the models that were previously approved.
Based on the reasoning indicated herein, BSH submits that the testing of Dishwashers equipped with a water softener under the current DOE test procedure may lead to information that could be considered misleading to consumers.
The Dishwasher models manufactured by BSH which contain an integrated water softener and were not included in previous Waiver applications is as follows:
Bosch brand:
Gaggenau brand:
The design characteristic that is unique among the above listed models is an integrated water softener. The primary function of a water softener is to reduce the high mineral content of “hard” water. Hard water reduces the effectiveness of detergents leading to additional detergent usage. Hard water also causes increased water spots on dishware, resulting in the need to use more rinse aid to counterbalance this effect. “Hard” water can reduce customer satisfaction with Dishwasher performance resulting in increased pre-rinsing and/or hand washing as well as increased detergent and rinse agent usage.
The water softening process requires water usage for both the regeneration process and to flush the system. For purposes of this Waiver request, the term “regeneration” will include the water and energy used in both the flushing and regeneration process of the water softener. The water used in the regeneration process is in addition to the water used in the dish washing process. The water used in the regeneration process does not occur with each use of the Dishwasher. The frequency of the regeneration process is dependent upon an adjustable water softener setting that is controlled by the end user, and based on the home water hardness. Regeneration frequency will vary greatly depending upon the customer setting of the water softener. Data from the U.S. Geological Survey shows considerable variation in the water hardness within the U.S. and for many locations the use of a water softener is not necessary. Water hardness varies throughout the U.S. with the mean hardness of 217 mg/liter or 12.6 grains/gallon (based on information provided by the U.S. Geological Survey located at
Dishwashers are subjected to test methods outlined in 10 CFR Part 430, Subpart B, App. C, Section 4.3, which specifies the method for the water energy calculation.
10 CFR 430.27 (a)(1) provides that a Petition to waive a requirement of 430.23 may be submitted upon grounds that the basic model contains one or more design characteristics which either prevent testing of the basic model according to the prescribed test procedures, or the prescribed test procedures may evaluate the basic model in a manner so unrepresentative of its true energy consumption characteristics as to provide materially inaccurate comparative data.
If a water softener regeneration process was to occur while running an energy test, the water usage would be overstated. In this case, the water energy usage would be unrepresentative of the product providing inaccurate data resulting in a competitive disadvantage to BSH.
Granting of an Interim Waiver in this case is justified since the prescribed test procedures would potentially evaluate the basic model in a manner so unrepresentative of its true energy consumption characteristics as to provide materially inaccurate comparative data. In addition, a similar Interim Waiver and Waiver have previously been granted to BSH.
Web based research shows that at least two other manufacturers are currently selling dishwashers with an integrated water softener, Miele Inc. and Whirlpool Corporation (Waiver Granted).
Manufacturers selling dishwashers in the United States include AGA Marvel, Arcelik A.S., ASKO Appliances, Inc., Electrolux North America, Inc., Fagor America, Inc., Fisher & Paykel Appliances, GE Appliances and Lighting, Haier America, Indesit Company Sa, Teka USA, Inc., LG Electronics USA, Miele, Inc., Samsung Electronics Co., Viking Range Corporation and Whirlpool Corporation.
BSH will notify all companies listed above (as well as AHAM), as required by the Department's rules, providing them with a copy of this Petition for Waiver and Interim Waiver.
BSH Home Appliances Corporation hereby requests approval of the Waiver petition and Interim Waiver. By granting said Waivers the Department of Energy will further ensure that water energy is measured in the same way by all Dishwasher Manufacturer's that have a integrated water softener. Further, BSH would request that these Waivers be in good standing until such time that the test procedure can be formally modified to account for integrated water softeners.
BSH Home Appliances certifies that all manufacturers of domestic Dishwashers as listed above have been notified by letter.
Federal Energy Regulatory Commission, DOE.
Notice of information collection and request for comments.
In compliance with the requirements of the Paperwork Reduction Act of 1995, 44 USC 3506(c)(2)(A), the Federal Energy Regulatory Commission (Commission or FERC) is soliciting public comment on the currently approved information collection, OMB No. 1902–0075, FERC Form No. 556, “Certification of Qualifying Facility (QF) Status for a Small Power Production or Cogeneration Facility” (Form No. 556).
Comments on the collection of information are due March 1, 2013.
You may submit comments (identified by Docket No. IC13–8–000) by either of the following methods:
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Ellen Brown may be reached by email at
A primary statutory objective is the conservation of energy through efficient use of energy resources and facilities by electric utilities. One means of achieving this goal is to encourage production of electric power by cogeneration facilities which make use of reject heat associated with commercial or industrial processes, and by small power production facilities which use other wastes and renewable resources. PURPA, encourages the development of small power production facilities and cogeneration facilities which meet certain technical and corporate criteria through establishment of various regulatory benefits. Facilities that meet these criteria are called Qualifying Facilities or QFs.
FERC's regulations
• The certification procedures which must be followed by owners or operators of small power production and cogeneration facilities;
• The criteria which must be met;
• The information which must be submitted to FERC in order to obtain qualifying status;
• The PURPA benefits which are available to QFs to encourage small power production and cogeneration; and
• The requirements pertaining to PURPA implementation plans regarding the transaction obligations that electric utilities have with respect to QFs.
Among PURPA provisions in Part 292 are requirements for electric utilities to:
• Purchase energy and capacity from QFs favorably priced on the basis of the avoided cost of the power that is displaced by the QF power (i.e. the incremental cost to the purchasing utility if it had generated the displaced power or purchased it from another source);
• Sell backup, maintenance and other power services to QFs at rates based on the cost of rendering the services;
• Provide certain interconnection and transmission services priced on a nondiscriminatory basis;
• Operate in “parallel” with other interconnected QFs so that they may be electrically synchronized with electric utility grids; and
• Make available to the public avoided cost information and system capacity needs.
18 CFR Part 292 exempts QFs from certain corporate, accounting, reporting and rate regulation requirements, certain state laws and in certain instances, regulation under the Federal Power Act
The total estimated annual cost burden to respondents is $374,757.40 [6,340 * $59.11].
Federal Energy Regulatory Commission, Energy.
Notice of information collection and request for comments.
In compliance with the requirements of the Paperwork Reduction Act of 1995, 44 U.S.C. 3506(c)(2)(A), the Federal Energy Regulatory Commission (Commission or FERC) is soliciting public comment on the currently approved information collection, FERC–730, Report of Transmission Investment Activity.
Comments on the collection of information are due March 1, 2013.
You may submit comments (identified by Docket No. IC13–9–000) by either of the following methods:
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Ellen Brown may be reached by email at
• Actual transmission investment for the most recent calendar year, and projected, incremental investments for the next five calendar years (in dollar terms); and
• A project by project listing that specifies for each project the most up to date, expected completion date, percentage completion as of the date of filing, and reasons for delays for all current and projected investments over the next five calendar years. Projects with projected costs less than $20 million are excluded from this listing.
To ensure that Commission rules are successfully meeting the objectives of Section 219, the Commission collects industry data, projections and related information that detail the level of investment. FERC–730 information regarding projected investments as well as information about completed projects allows the Commission to monitor the success of the transmission pricing reforms and to determine the status of critical projects and reasons for delay.
The total estimated annual cost burden to respondents is $130,428.17 [1,890 hours ÷ 2080
Notice of Intent To File License Application, Filing of Pre-Application Document (PAD), Commencement of Pre-Filing Process and Scoping; Request For Comments on the Pad and Scoping Document, and Identification of Issues and Associated Study Requests
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l. With this notice, we are designating Black Bear Hydro as the Commission's non-federal representative for carrying out informal consultation pursuant to section 7 of the Endangered Species Act, section 305(b) of the Magnuson-Stevens Fishery Conservation and Management Act, and section 106 of the National Historic Preservation Act.
m. Black Bear Hydro filed with the Commission a Pre-Application Document (PAD; including a proposed process plan and schedule), pursuant to 18 CFR 5.6 of the Commission's regulations.
n. A copy of the PAD is available for review at the Commission in the Public Reference Room or may be viewed on the Commission's Web site (
Register online at
o. With this notice, we are soliciting comments on the PAD and Commission staff's Scoping Document 1 (SD1), as well as study requests. All comments on the PAD and SD1, and study requests should be sent to the address above in paragraph h. In addition, all comments on the PAD and SD1, study requests, requests for cooperating agency status, and all communications to and from Commission staff related to the merits of the potential application must be filed with the Commission. Documents may be filed electronically via the Internet. See 18 CFR 385.2001(a)(1)(iii) and the instructions on the Commission's Web site
All filings with the Commission must include on the first page, the project name (Ellsworth Hydroelectric Project) and number (P–2727–086), and bear the appropriate heading: “Comments on Pre-Application Document,” “Study Requests,” “Comments on Scoping Document 1,” “Request for Cooperating Agency Status,” or “Communications to and from Commission Staff.” Any individual or entity interested in submitting study requests, commenting on the PAD or SD1, and any agency requesting cooperating status must do so by February 21, 2013.
p. We intend to prepare an environmental assessment (EA) for this project. The scoping meetings identified below satisfy the NEPA scoping requirements.
Commission staff will hold two scoping meetings in the vicinity of the project at the time and place noted below. The daytime meeting will focus on resource agency, Indian tribes, and non-governmental organization concerns, while the evening meeting is primarily for receiving input from the public. We invite all interested individuals, organizations, and agencies to attend one or both of the meetings, and to assist staff in identifying particular study needs, as well as the scope of environmental issues to be addressed in the environmental document. The times and locations of these meetings are as follows:
Scoping Document 1 (SD1), which outlines the subject areas to be
At the scoping meetings, staff will: (1) Initiate scoping of the issues; (2) review and discuss existing conditions and resource management objectives; (3) review and discuss existing information and identify preliminary information and study needs; (4) review and discuss the process plan and schedule for pre-filing activity that incorporates the time frames provided for in Part 5 of the Commission's regulations and, to the extent possible, maximizes coordination of federal, state, and tribal permitting and certification processes; and (5) discuss the appropriateness of any federal or state agency or Indian tribe acting as a cooperating agency for development of an environmental document.
Meeting participants should come prepared to discuss their issues and/or concerns. Please review the PAD in preparation for the scoping meetings. Directions on how to obtain a copy of the PAD and SD1 are included in item n. of this document.
The meetings will be recorded by a stenographer and will be placed in the public records of the project.
Take notice that the Commission has received the following Natural Gas Pipeline Rate and Refund Report filings:
Any person desiring to intervene or protest in any of the above proceedings must file in accordance with Rules 211 and 214 of the Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.
Any person desiring to protest in any the above proceedings must file in accordance with Rule 211 of the Commission's Regulations (18 CFR 385.211) on or before 5:00 p.m. Eastern time on the specified comment date.
The filings are accessible in the Commission's eLibrary system by clicking on the links or querying the docket number.
eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, and service can be found at:
Take notice that the Commission has received the following Natural Gas Pipeline Rate and Refund Report filings:
Any person desiring to intervene or protest in any of the above proceedings must file in accordance with Rules 211 and 214 of the Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.
Any person desiring to protest in any the above proceedings must file in accordance with Rule 211 of the Commission's Regulations (18 CFR 385.211) on or before 5:00 p.m. Eastern time on the specified comment date.
The filings are accessible in the Commission's eLibrary system by clicking on the links or querying the docket number.
eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, and service can be found at:
Take notice that the Commission received the following electric corporate filings:
Take notice that the Commission received the following electric rate filings:
The filings are accessible in the Commission's eLibrary system by clicking on the links or querying the docket number.
Any person desiring to intervene or protest in any of the above proceedings must file in accordance with Rules 211 and 214 of the Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.
eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, service, and qualifying facilities filings can be found at: http://www.ferc.gov/docs-filing/efiling/filing-req.pdf. For other information, call (866) 208–3676 (toll free). For TTY, call (202) 502–8659.
Take notice that on November 12, 2012, City of Banning, California submitted its tariff filing per 35.28(e): Filing 2013 TRBAA and ETC Update to be effective 1/1/2013.
Any person desiring to intervene or to protest this filing must file in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211, 385.214). Protests will be considered by the Commission in determining the appropriate action to be taken, but will not serve to make protestants parties to the proceeding. Any person wishing to become a party must file a notice of intervention or motion to intervene, as appropriate. Such notices, motions, or protests must be filed on or before the comment date. On or before the comment date, it is not necessary to serve motions to intervene or protests on persons other than the Applicant.
The Commission encourages electronic submission of protests and interventions in lieu of paper using the “eFiling” link at
This filing is accessible on-line at
This is a supplemental notice in the above-referenced proceeding, of Carson Cogeneration Company's application for market-based rate authority, with an accompanying rate schedule, noting that such application includes a request for blanket authorization, under 18 CFR part 34, of future issuances of securities and assumptions of liability.
Any person desiring to intervene or to protest should file with the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426, in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211 and 385.214). Anyone filing a motion to intervene or protest must serve a copy of that document on the Applicant.
Notice is hereby given that the deadline for filing protests with regard to the applicant's request for blanket authorization, under 18 CFR part 34, of future issuances of securities and assumptions of liability is January 10, 2013.
The Commission encourages electronic submission of protests and interventions in lieu of paper, using the FERC Online links at
Persons unable to file electronically should submit an original and 14 copies of the intervention or protest to the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426.
The filings in the above-referenced proceeding(s) are accessible in the Commission's eLibrary system by clicking on the appropriate link in the above list. They are also available for review in the Commission's Public Reference Room in Washington, DC. There is an eSubscription link on the Web site that enables subscribers to receive email notification when a document is added to a subscribed docket(s). For assistance with any FERC Online service, please email
On Wednesday, January 9, 2013, Commission staff will meet with York Haven Power Company, LLC (applicant) in Washington, DC. The purpose of the meeting is to discuss the required supporting design report, as well as potential studies, dam safety issues, and requirements related to the applicant's proposed nature-like fishway for the York Haven Hydroelectric Project No. 1888. The meeting will begin at 10 a.m. at the Federal Energy Regulatory Commission headquarters building located at 888 First Street NE., Washington, DC. For further information please contact Emily Carter at 202–502–6512.
Environmental Protection Agency (EPA).
Notice.
In compliance with the Paperwork Reduction Act (44 U.S.C. 3501
Additional comments may be submitted on or before January 30, 2013.
Submit your comments, referencing docket ID number EPA–HQ–OECA–2012–0497, to: (1) EPA online, using
Learia Williams, Monitoring, Assistance, and Media Programs Division, Office of Compliance, Mail Code 2227A, Environmental Protection Agency, 1200 Pennsylvania Avenue NW., Washington, DC 20460; telephone number: (202) 564–4113; fax number: (202) 564–0050; email address:
EPA has submitted the following ICR to OMB for review and approval according to the procedures prescribed in 5 CFR 1320.12. On August 9, 2012 (77
EPA has established a public docket for this ICR under docket ID number EPA–HQ–OECA–2012–0497, which is available for public viewing online at
Use EPA's electronic docket and comment system at
Environmental Protection Agency (EPA).
Notice.
In compliance with the Paperwork Reduction Act (44 U.S.C. 3501
Additional comments may be submitted on or before January 30, 2013.
Submit your comments, referencing docket ID number EPA–HQ–OECA–2012–0499, to (1) EPA online using
Learia Williams, Monitoring, Assistance, and Media Programs Division, Office of Compliance, Mail Code 2227A, Environmental Protection Agency, 1200 Pennsylvania Avenue NW., Washington, DC 20460; telephone number: (202) 564–4113; fax number: (202) 564–0050; email address:
EPA has submitted the following ICR to OMB for review and approval according to the procedures prescribed in 5 CFR 1320.12. On August 9, 2012 (77 FR 47631), EPA sought comments on this ICR pursuant to 5 CFR 1320.8(d). EPA received no comments. Any additional comments on this ICR should be submitted to both EPA and OMB within 30 days of this notice.
EPA has established a public docket for this ICR under docket ID number EPA–HQ–OECA–2012–0499, which is available for public viewing online at
Use EPA's electronic docket and comment system at
Owners or operators of the affected facilities must make an initial notification report, performance tests, periodic reports, and maintain records of the occurrence and duration of any startup, shutdown, or malfunction in the operation of an affected facility, or any period during which the monitoring system is inoperative. Reports are also required semiannually.
There is an increase in respondent Operations and Maintenance costs compared to the costs in the previous ICR. This increase is also due to industry growth and reflects O&M costs that will be incurred by both existing facilities and new facilities since the most recent ICR.
U.S. Environmental Protection Agency (EPA) Region 4.
Notice of Intent to prepare an Environmental Assessment (EA) for the designation of an expanded ODMDS off Charleston, South Carolina.
Mr. Gary W. Collins, EPA Region 4, 61 Forsyth Street, Atlanta, Georgia 30303, phone 404–562–9393, email:
EPA in cooperation with the U.S. Army Corps of Engineers Charleston District (USACE) intends to prepare an EA to evaluate the proposed designation of an expanded ODMDS offshore Charleston, South Carolina. An EA will provide the environmental information necessary to evaluate the potential environmental impacts associated with expanding the ODMDS.
1. No action.
2. Expansion of the existing Charleston ODMDS. Expand the existing disposal zone and ODMDS to the north, south and east.
As of October 1, 2012, EPA will not accept paper copies or CDs of EISs for filing purposes; all submissions on or after October 1, 2012 must be made through e-NEPA. While this system eliminates the need to submit paper or CD copies to EPA to meet filing requirements, electronic submission does not change requirements for distribution of EISs for public review and comment. To begin using e-NEPA, you must first register with EPA's electronic reporting site—
The U.S. Department of Energy (DOE) has adopted the U.S. Department of the Interior's Mineral Management Service final EIS filed 1/09/2009. The DOE was not a cooperating agency for the above final EIS. Recirculation of the document is necessary under Section 1506.3(b) of the Council on Environmental Quality Regulations.
Environmental Protection Agency (EPA).
Notice.
EPA has received applications to register new uses for pesticide products containing currently registered active ingredients. Pursuant to the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), EPA is hereby providing notice of receipt and opportunity to comment on these applications.
Comments must be received on or before January 30, 2013.
Submit your comments, identified by docket identification (ID) number and the EPA Registration Number or EPA File Symbol of interest as shown in the body of this document, by one of the following methods:
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Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at
A contact person is listed at the end of each registration application summary and may be contacted by telephone, email, or mail. Mail correspondence to the Registration Division (RD) (7505P), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460–0001. As part of the mailing address, include the contact person's name, division, and mail code. The division and mail code is listed above in this paragraph.
You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:
• Crop production (NAICS code 111).
• Animal production (NAICS code 112).
• Food manufacturing (NAICS code 311).
• Pesticide manufacturing (NAICS code 32532).
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i. Identify the document by docket ID number and other identifying information (subject heading,
ii. 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.
iii. Explain why you agree or disagree; suggest alternatives and substitute language for your requested changes.
iv. Describe any assumptions and provide any technical information and/or data that you used.
v. If you estimate potential costs or burdens, explain how you arrived at your estimate in sufficient detail to allow for it to be reproduced.
vi. Provide specific examples to illustrate your concerns and suggest alternatives.
vii. Explain your views as clearly as possible, avoiding the use of profanity or personal threats.
viii. Make sure to submit your comments by the comment period deadline identified.
EPA has received applications to register new uses for pesticide products containing currently registered active ingredients. Pursuant to the provisions of FIFRA section 3(c)(4), EPA is hereby providing notice of receipt and opportunity to comment on these applications. Notice of receipt of these applications does not imply a decision by the Agency on these applications. For actions being evaluated under the Agency's public participation process for registration actions, there will be an additional opportunity for a 30–day public comment period on the proposed decision. Please see the Agency's public participation Web site for additional information on this process (
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Environmental protection, Pesticides and pest.
This notice is to inform the public that the Export-Import Bank of the United States has received an application for a $448 million loan guarantee to support the export of approximately $542 million in U.S. semiconductor manufacturing equipment and services to a (non-DRAM) semiconductor manufacturing facility in Singapore. The U.S. exports will enable the foreign buyer to manufacture about 80,000 wafers of 300mm NAND Flash memory semiconductors per month. Available information indicates that this new foreign production will be consumed globally. Interested parties may submit comments on this transaction by email to
The companies listed in this notice have applied to the Board for approval, pursuant to the Bank Holding Company Act of 1956 (12 U.S.C. 1841
The applications listed below, as well as other related filings required by the Board, are available for immediate inspection at the Federal Reserve Bank indicated. The applications will also be available for inspection at the offices of the Board of Governors. Interested persons may express their views in writing on the standards enumerated in the BHC Act (12 U.S.C. 1842(c)). If the proposal also involves the acquisition of a nonbanking company, the review also includes whether the acquisition of the nonbanking company complies with the standards in section 4 of the BHC Act (12 U.S.C. 1843). Unless otherwise noted, nonbanking activities will be conducted throughout the United States.
Unless otherwise noted, comments regarding each of these applications must be received at the Reserve Bank indicated or the offices of the Board of Governors not later than January 26, 2013.
A. Federal Reserve Bank of New York (Ivan Hurwitz, Vice President) 33 Liberty Street, New York, New York 10045–0001:
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The companies listed in this notice have applied to the Board for approval, pursuant to the Bank Holding Company Act of 1956 (12 U.S.C. 1841
The applications listed below, as well as other related filings required by the Board, are available for immediate inspection at the Federal Reserve Bank indicated. The applications will also be available for inspection at the offices of the Board of Governors. Interested persons may express their views in writing on the standards enumerated in the BHC Act (12 U.S.C. 1842(c)). If the proposal also involves the acquisition of a nonbanking company, the review also includes whether the acquisition of the nonbanking company complies with the standards in section 4 of the BHC Act (12 U.S.C. 1843). Unless otherwise noted, nonbanking activities will be conducted throughout the United States.
Unless otherwise noted, comments regarding each of these applications must be received at the Reserve Bank indicated or the offices of the Board of Governors not later than January 22, 2013.
A. Federal Reserve Bank of Boston (Richard Walker, Community Affairs Officer) 600 Atlantic Avenue, Boston, Massachusetts 02210–2204:
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Board of Governors of the Federal Reserve System, December 21, 2012.
This gives notice under the Federal Advisory Committee Act (Pub. L. 92–463) of October 6, 1972, that the Mine Safety and Health Research Advisory Committee, Centers for Disease Control and Prevention, Department of Health and Human Services, has been renewed for a 2-year period through November 30, 2014.
For information, contact Jeffrey Kohler, Ph.D., Designated Federal Officer, Mine Safety and Health Research Advisory Committee, Centers for Disease Control and Prevention, Department of Health and Human Services, 626 Cochrans Mill Road, Mailstop P05, Pittsburgh, Pennsylvania
The Director, Management Analysis and Services Office, has been delegated the authority to sign
In accordance with section 10(a) (2) of the Federal Advisory Committee Act (Pub. L. 92–463), the Centers for Disease Control and Prevention (CDC) announces the following Meeting of the aforementioned committee:
Capital Hilton, Federal AB Rooms, 1001 16th Street NW., Washington, DC 20036–5701, Telephone: (202) 393–1000.
Open to the public, limited only by the space available. Those who wish to attend are encouraged to register with the contact person listed below. If you will require a sign language interpreter, or have other special needs, please notify the contact person by 4:30 p.m., EST on January 22, 2013.
The ICSH advises the Secretary, Department of Health and Human Services, and the Assistant Secretary for Health in the (a) coordination of all research and education programs and other activities within the Department and with other federal, state, local and private agencies and (b) establishment and maintenance of liaison with appropriate private entities, federal agencies, and state and local public health agencies with respect to smoking and health activities.
The topic of the meeting is “The Global Tobacco Control Experience”. The meeting will provide a review of global tobacco control efforts and best practices by the U.S. and global partners to inform U.S. domestic efforts as well as the U.S. efforts as a global partner.
Agenda items are subject to change as priorities dictate.
Ms. Monica L. Swann, Management and Program Analyst, Office on Smoking and Health, CDC, 395 E Street SW., Washington, DC 20024, Telephone: (202) 245–0552.
Substantive program information as well as summaries of the meeting and roster of committee members may be obtained from the internet at
Notice.
In compliance with the requirement for opportunity for public comment on proposed data collection projects (section 3506(c)(2)(A) of Title 44, United States Code, as amended by the Paperwork Reduction Act of 1995, Pub. L. 104–13), the Health Resources and Services Administration (HRSA) publishes periodic summaries of proposed projects being developed for submission to the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995. To request more information on the proposed project or to obtain a copy of the data collection plans and draft instruments, email
HRSA especially requests comments on: (1) The necessity and utility of the proposed information collection for the proper performance of the agency's functions, (2) the accuracy of the estimated burden, (3) ways to enhance the quality, utility, and clarity of the information to be collected, and (4) the use of automated collection techniques or other forms of information technology to minimize the information collection burden.
For this program, performance measures were drafted to provide data useful to the Flex program and to enable HRSA to provide aggregate program data required by Congress under the Government Performance and Results Act (GPRA) of 1993 (Public Law 103–62). These measures cover principal topic areas of interest to the Office of Rural Health Policy, including: (a) Quality reporting; (b) quality improvement interventions; (c) financial and operational improvement initiatives; and (d) multi-hospital
The annual estimate of burden is as follows:
Submit your comments to
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meetings.
The meetings will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meeting.
The meeting will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
This notice is being published less than 15 days prior to the meeting due to the timing limitations imposed by the review and funding cycle.
Federal Emergency Management Agency, DHS.
Notice.
This notice lists communities where the addition or modification of Base Flood Elevations (BFEs), base flood depths, Special Flood Hazard Area (SFHA) boundaries or zone designations, or the regulatory floodway (hereinafter referred to as flood hazard determinations), as shown on the Flood Insurance Rate Maps (FIRMs), and where applicable, in the supporting Flood Insurance Study (FIS) reports, prepared by the Federal Emergency Management Agency (FEMA) for each community, is appropriate because of new scientific or technical data. The FIRM, and where applicable, portions of the FIS report, have been revised to reflect these flood hazard determinations through issuance of a Letter of Map Revision (LOMR), in accordance with Title 44, Part 65 of the Code of Federal Regulations (44 CFR part 65). The LOMR will be used by insurance agents and others to calculate appropriate flood insurance premium rates for new buildings and the contents of those buildings. For rating purposes, the currently effective community number is shown in the table below and must be used for all new policies and renewals.
These flood hazard determinations will become effective on the dates listed in the table below and revise the FIRM panels and FIS report in effect prior to this determination for the listed communities.
From the date of the second publication of notification of these changes in a newspaper of local circulation, any person has ninety (90) days in which to request through the community that the Deputy Associate Administrator for Mitigation reconsider the changes. The flood hazard determination information may be changed during the 90-day period.
The affected communities are listed in the table below. Revised flood hazard information for each community is available for inspection at both the online location and the respective community map repository address listed in the table below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
Submit comments and/or appeals to the Chief Executive Officer of the community as listed in the table below.
Luis Rodriguez, Chief, Engineering Management Branch, Federal Insurance and Mitigation Administration, FEMA, 500 C Street SW., Washington, DC 20472, (202) 646–4064, or (email)
The specific flood hazard determinations are not described for each community in this notice. However, the online location and local community map repository address where the flood hazard determination information is available for inspection is provided.
Any request for reconsideration of flood hazard determinations must be submitted to the Chief Executive Officer of the community as listed in the table below.
The modifications are made pursuant to section 201 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4105, and are in accordance with the National Flood Insurance Act of 1968, 42 U.S.C. 4001
The FIRM and FIS report are the basis of the floodplain management measures that the community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP).
These flood hazard determinations, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities. The flood hazard determinations are in accordance with 44 CFR 65.4.
The affected communities are listed in the following table. Flood hazard determination information for each community is available for inspection at both the online location and the respective community map repository address listed in the table below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
Federal Emergency Management Agency, DHS.
Final Notice.
New or modified Base (1% annual-chance) Flood Elevations (BFEs), base flood depths, Special Flood Hazard Area (SFHA) boundaries or zone designations, and/or the regulatory floodway (hereinafter referred to as flood hazard determinations) as shown on the indicated Letter of Map Revision (LOMR) for each of the communities listed in the table below are finalized. Each LOMR revises the Flood Insurance Rate Maps (FIRMs), and in some cases the Flood Insurance Study (FIS) reports, currently in effect for the listed
The effective date for each LOMR is indicated in the table below.
Each LOMR is available for inspection at both the respective Community Map Repository address listed in the table below and online through the FEMA Map Service Center at
Luis Rodriguez, Chief, Engineering Management Branch, Federal Insurance and Mitigation Administration, FEMA, 500 C Street SW., Washington, DC 20472, (202) 646–4064, or (email)
The Federal Emergency Management Agency (FEMA) makes the final flood hazard determinations as shown in the LOMRs for each community listed in the table below. Notice of these modified flood hazard determinations has been published in newspapers of local circulation and ninety (90) days have elapsed since that publication. The Deputy Associate Administrator for Mitigation has resolved any appeals resulting from this notification.
The modified flood hazard determinations are made pursuant to section 206 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4105, and are in accordance with the National Flood Insurance Act of 1968, 42 U.S.C. 4001
For rating purposes, the currently effective community number is shown and must be used for all new policies and renewals.
The new or modified flood hazard determinations are the basis for the floodplain management measures that the community is required either to adopt or to show evidence of being already in effect in order to remain qualified for participation in the National Flood Insurance Program (NFIP).
These new or modified flood hazard determinations, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities.
These new or modified flood hazard determinations are used to meet the floodplain management requirements of the NFIP and also are used to calculate the appropriate flood insurance premium rates for new buildings, and for the contents in those buildings. The changes in flood hazard determinations are in accordance with 44 CFR 65.4.
Interested lessees and owners of real property are encouraged to review the final flood hazard information available at the address cited below for each community or online through the FEMA Map Service Center at
Federal Emergency Management Agency, DHS.
Final Notice.
New or modified Base (1% annual-chance) Flood Elevations (BFEs), base flood depths, Special Flood Hazard Area (SFHA) boundaries or zone designations, and/or the regulatory floodway (hereinafter referred to as flood hazard determinations) as shown on the indicated Letter of Map Revision (LOMR) for each of the communities listed in the table below are finalized. Each LOMR revises the Flood Insurance Rate Maps (FIRMs), and in some cases the Flood Insurance Study (FIS) reports, currently in effect for the listed communities. The flood hazard determinations modified by each LOMR will be used to calculate flood insurance premium rates for new buildings and their contents.
The effective date for each LOMR is indicated in the table below.
Each LOMR is available for inspection at both the respective Community Map Repository address listed in the table below and online through the FEMA Map Service Center at
Luis Rodriguez, Chief, Engineering Management Branch, Federal Insurance and Mitigation Administration, FEMA, 500 C Street SW., Washington, DC 20472, (202) 646–4064, or (email)
The Federal Emergency Management Agency (FEMA) makes the final flood hazard determinations as shown in the LOMRs for each community listed in the table below. Notice of these modified flood hazard determinations has been published in newspapers of local circulation and ninety (90) days have elapsed since that publication. The Deputy Associate Administrator for Mitigation has resolved any appeals resulting from this notification.
The modified flood hazard determinations are made pursuant to section 206 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4105, and are in accordance with the National Flood Insurance Act of 1968, 42 U.S.C. 4001
For rating purposes, the currently effective community number is shown and must be used for all new policies and renewals.
The new or modified flood hazard determinations are the basis for the floodplain management measures that the community is required either to adopt or to show evidence of being already in effect in order to remain qualified for participation in the National Flood Insurance Program (NFIP).
These new or modified flood hazard determinations, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities.
These new or modified flood hazard determinations are used to meet the floodplain management requirements of the NFIP and also are used to calculate the appropriate flood insurance premium rates for new buildings, and for the contents in those buildings. The changes in flood hazard determinations are in accordance with 44 CFR 65.4.
Interested lessees and owners of real property are encouraged to review the final flood hazard information available at the address cited below for each community or online through the FEMA Map Service Center at
Federal Emergency Management Agency, DHS.
Notice.
This notice lists communities where the addition or modification of Base Flood Elevations (BFEs), base flood depths, Special Flood Hazard Area (SFHA) boundaries or zone designations, or the regulatory floodway (hereinafter referred to as flood hazard determinations), as shown on the Flood Insurance Rate Maps (FIRMs), and where applicable, in the supporting Flood Insurance Study (FIS) reports, prepared by the Federal Emergency Management Agency (FEMA) for each community, is appropriate because of new scientific or technical data. The FIRM, and where applicable, portions of the FIS report, have been revised to reflect these flood hazard determinations through issuance of a Letter of Map Revision (LOMR), in accordance with Title 44, Part 65 of the Code of Federal Regulations (44 CFR part 65). The LOMR will be used by insurance agents and others to calculate appropriate flood insurance premium rates for new buildings and the contents of those buildings. For rating purposes, the currently effective community number is shown in the table below and must be used for all new policies and renewals.
These flood hazard determinations will become effective on the dates listed in the table below and revise the FIRM panels and FIS report in effect prior to this determination for the listed communities.
From the date of the second publication of notification of these changes in a newspaper of local circulation, any person has ninety (90) days in which to request through the community that the Deputy Associate Administrator for Mitigation reconsider the changes. The flood hazard determination information may be changed during the 90-day period.
The affected communities are listed in the table below. Revised flood hazard information for each community is available for inspection at both the online location and the respective community map repository address listed in the table below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
Submit comments and/or appeals to the Chief Executive Officer of the community as listed in the table below.
Luis Rodriguez, Chief, Engineering Management Branch, Federal Insurance and Mitigation Administration, FEMA, 500 C Street SW., Washington, DC 20472, (202) 646–4064, or (email)
The specific flood hazard determinations are not described for each community in this notice. However, the online location and local community map repository address where the flood hazard determination information is available for inspection is provided.
Any request for reconsideration of flood hazard determinations must be submitted to the Chief Executive Officer of the community as listed in the table below.
The modifications are made pursuant to section 201 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4105, and are in accordance with the National Flood Insurance Act of 1968, 42 U.S.C. 4001
The FIRM and FIS report are the basis of the floodplain management measures that the community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP).
These flood hazard determinations, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities. The flood hazard determinations are in accordance with 44 CFR 65.4.
The affected communities are listed in the following table. Flood hazard determination information for each community is available for inspection at both the online location and the respective community map repository address listed in the table below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
(Catalog of Federal Domestic Assistance No. 97.022, “Flood Insurance.”)
Bureau of Land Management, Interior.
Notice of Filing of Plats of Surveys.
The Bureau of Land Management (BLM) has officially filed the plats of survey of the lands described below in the BLM Idaho State Office, Boise, Idaho, effective 9:00 a.m., on the dates specified.
Bureau of Land Management, 1387 South Vinnell Way, Boise, Idaho, 83709–1657.
These surveys were executed at the request of the Bureau of Land Management to meet their administrative needs. The lands surveyed are:
The supplemental plat was prepared to correct the incorrectly labeled acreage tables, as depicted on the plat accepted October 13, 2004, T. 13 N., R. 28 E., Boise Meridian, Idaho, Group Number 1128, accepted October 19, 2012.
The plat representing the dependent resurvey of portions of the south boundary, east boundary, and subdivisional lines, and the subdivision of sections 24, 27, and 35, Township 8 North, Range 3 East, Boise Meridian, Idaho, Group Number 1320, was accepted November 28, 2012.
The plat representing the dependent resurvey of portions of the south boundary and subdivisional lines, and the subdivision of sections 27, 28, and 34, Township 2 North, Range 36 East, Boise Meridian, Idaho, Group Number 1358, was accepted December 12, 2012.
Bureau of Land Management, Interior.
Notice of public meeting.
In accordance with the Federal Land Policy and Management Act and the Federal Advisory Committee Act, the Bureau of Land Management's (BLM) Las Cruces District Resource Advisory Council (RAC) will meet as indicated below.
The RAC will meet on January 23, 2013, at the New Mexico Farm & Ranch Heritage Museum, 4100 Dripping Springs Road, Las Cruces, NM, 88005 from 9 a.m.-4 p.m. The public may send written comments to the RAC at the BLM Las Cruces District Office, 1800 Marquess Street, Las Cruces, NM 88005.
Rena Gutierrez, BLM Las Cruces District, 1800 Marquess Street, Las Cruces, NM, 88005, 575–525–4338. Persons who use a telecommunications device for the deaf (TDD) may call the Federal Information Relay Service (FIRS) at 1–800–877–8229 to contact the above individual during normal business hours. The FIRS is available 24 hours a day, 7 days a week, to leave a message or question with the above individual. You will receive a reply during normal business hours.
The 10-member Las Cruces District RAC advises the Secretary of the Interior, through the BLM, on a variety of planning and management issues associated with public land management in New Mexico. Planned agenda items include opening remarks from the BLM Las Cruces District Manager, updates on ongoing issues and planning efforts, and Restore New Mexico. The Restore New Mexico portion of the meeting is in junction with BLM New Mexico's 2-Million Acre Restore New Mexico celebration at the New Mexico Farm & Ranch Heritage Museum, 4100 Dripping Springs Road, Las Cruces, NM, which begins at 11:30 a.m.
A half-hour public comment period during which the public may address the RAC will begin at 3:00 p.m. All RAC meetings are open to the public. Depending on the number of individuals wishing to comment and time available, the time for individual oral comments may be limited.
Bureau of Land Management, U.S. Department of the Interior.
Notice of Public Meeting.
In accordance with the Federal Land Policy and Management Act (FLPMA) and the Federal Advisory Committee Act of 1972 (FACA), the U.S. Department of the Interior, Bureau of Land Management (BLM) Boise District Resource Advisory Council (RAC), will hold a meeting as indicated below.
The meeting will be held February 7, 2013, at the Boise District Office, located at 3948 S. Development Avenue, Boise, Idaho, beginning at 9:00 a.m. and adjourning at 2:30 p.m. Members of the public are invited to attend. A public comment period will be held.
Marsha Buchanan, Supervisory Administrative Specialist and RAC Coordinator, BLM Boise District, 3948 Development Ave., Boise, ID 83705, Telephone (208) 384–3364.
The 15-member Council advises the Secretary of the Interior, through the BLM, on a variety of planning and management issues associated with public land management in southwestern Idaho. Items on the agenda include an update on the State of Idaho Governor's Sage Grouse Committee. A report on the wildland fires within Boise District and the region will be provided. An update on the Paradigm Project will be provided by Council members. Each BLM field manager will discuss progress being made on priority actions in their offices. Agenda items and location may change due to changing circumstances. The public may present written or oral comments to members of the Council. At each full RAC meeting, time is provided in the agenda for hearing public comments. Depending on the number of persons wishing to comment and time available, the time for individual oral comments may be limited. Individuals who plan to attend and need special assistance should contact the BLM Coordinator as provided above. Persons who use a telecommunications device for the deaf (TDD) may call the Federal Information Relay Service (FIRS) at 1–800–877–8339 to contact the above individual during normal business hours. The FIRS is available 24 hours a day, 7 days a week, to leave a message or question with the above individual. You will receive a reply during normal business hours.
National Park Service, Interior.
Notice of Meetings.
In accordance with the Federal Advisory Committee Act (Pub. L. 92–463, 86 Stat. 770, 5 U.S.C. App 1, 10), notice is hereby given of the meetings of the Big Cypress National Preserve ORV Advisory Committee for 2013.
The Committee will meet on the following dates:
All meetings will be held at the Big Cypress Swamp Welcome Center, 33000 Tamiami Trail East, Ochopee, Florida. Written comments and requests for agenda items may be submitted electronically on the Web site
Pedro Ramos, Superintendent, Big Cypress National Preserve, 33100 Tamiami Trail East, Ochopee, Florida
The Committee was established (
National Park Service, Interior.
Meeting Notice.
This notice sets forth the dates of the February 22; May 17; August 23; and November 8, 2013, meetings of the Na Hoa Pili O Kaloko-Honokohau National Historical Park Advisory Commission.
The public meetings of the Advisory Commission will be held on Fridays, February 22; May 17; August 23; and November 8, 2013, at 11:00 a.m. (HAWAII STANDARD TIME).
The February 22; May 17; August 23; and November 8, 2013, Commission meetings will consist of the following:
Further information concerning these meetings may be obtained from the Superintendent Kathleen Billings, Kaloko-Honkohau National Historical Park, 73–4786 Kanalani Street, #14, Kailua Kona, HI 96740, telephone (808) 329–6881.
The meetings are open to the public. Interested persons may make oral/written presentations to the Commission or file written statements. Such requests should be made to the Superintendent at least seven days prior to the meetings. Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment–including your personal identifying information–may be made publicly available at any time. While you can ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so.
U.S. International Trade Commission.
Notice.
Notice is hereby given that the U.S. International Trade Commission has received a complaint entitled
Lisa R. Barton, Acting Secretary to the Commission, U.S. International Trade Commission, 500 E Street SW., Washington, DC 20436, telephone (202) 205–2000. The public version of the complaint can be accessed on the Commission's electronic docket (EDIS) at
General information concerning the Commission may also be obtained by accessing its Internet server (
The Commission has received a complaint and a submission pursuant to section 210.8(b) of the Commission's Rules of Practice and Procedure filed on behalf of Covidien LP on December 21, 2012. The complaint alleges violations of section 337 of the Tariff Act of 1930 (19 U.S.C. 1337) in the importation into the United States, the sale for importation, and the sale within the United States after importation of certain balloon dissection devices and products containing same. The complaint names as respondents Pajunk Medizintechnik GmbH of Germany, Pajunk Medizintechnolgie GmbH of Germany and Pajunk Medical Systems L.P. of Norcross, GA.
Proposed respondents, other interested parties, and members of the public are invited to file comments, not to exceed five (5) pages in length, inclusive of attachments, on any public interest issues raised by the complaint or section 210.8(b) filing. Comments should address whether issuance of the relief specifically requested by the complainant in this investigation would affect the public health and welfare in the United States, competitive conditions in the United States economy, the production of like or
In particular, the Commission is interested in comments that:
(i) Explain how the articles potentially subject to the requested remedial orders are used in the United States;
(ii) Identify any public health, safety, or welfare concerns in the United States relating to the requested remedial orders;
(iii) Identify like or directly competitive articles that complainant, its licensees, or third parties make in the United States which could replace the subject articles if they were to be excluded;
(iv) Indicate whether complainant, complainant's licensees, and/or third party suppliers have the capacity to replace the volume of articles potentially subject to the requested exclusion order and/or a cease and desist order within a commercially reasonable time; and
(v) Explain how the requested remedial orders would impact United States consumers.
Written submissions must be filed no later than by close of business, eight calendar days after the date of publication of this notice in the
Persons filing written submissions must file the original document electronically on or before the deadlines stated above and submit 8 true paper copies to the Office of the Secretary by noon the next day pursuant to section 210.4(f) of the Commission's Rules of Practice and Procedure (19 CFR 210.4(f)). Submissions should refer to the docket number (“Docket No. 2925”) in a prominent place on the cover page and/or the first page. (
Any person desiring to submit a document to the Commission in confidence must request confidential treatment. All such requests should be directed to the Secretary to the Commission and must include a full statement of the reasons why the Commission should grant such treatment.
This action is taken under the authority of section 337 of the Tariff Act of 1930, as amended (19 U.S.C. 1337), and of sections 201.10 and 210.8(c) of the Commission's Rules of Practice and Procedure (19 CFR 201.10, 210.8(c)).
By order of the Commission.
U.S. International Trade Commission.
Notice.
Notice is hereby given that the U.S. International Trade Commission has determined to review the presiding administrative law judge's (“ALJ”) final initial determination (“ID”) issued on October 22, 2012, finding no violation of section 337 of the Tariff Act of 1930, (as amended), 19 U.S.C. 1337 (“section 337”), in the above-captioned investigation. The Commission has also determined to remand-in-part the investigation to the ALJ.
Megan M. Valentine, Office of the General Counsel, U.S. International Trade Commission, 500 E Street SW., Washington, DC 20436, telephone (202) 708–2301. Copies of non-confidential documents filed in connection with this investigation are or will be available for inspection during official business hours (8:45 a.m. to 5:15 p.m.) in the Office of the Secretary, U.S. International Trade Commission, 500 E Street SW., Washington, DC 20436, telephone (202) 205–2000. General information concerning the Commission may also be obtained by accessing its Internet server at
The Commission instituted this investigation on September 14, 2011, based on a complaint filed by Industrial Technology Research Institute of Hsinchu, Taiwan and ITRI International Inc. of San Jose, California (collectively “ITRI”). 76 FR 56796–97 (Sept. 14, 2011). The complaint alleges violations of section 337 in the importation into the United States, the sale for importation, and the sale within the United States after importation of certain devices for improving uniformity used in a backlight module and components thereof and products containing same by reason of infringement of certain claims of U.S. Patent No. 6,883,932 (“the ’932 patent”). The complaint further alleges the existence of a domestic industry. The Commission's notice of investigation named as respondents LG Corporation of Seoul, Republic of South Korea; LG Electronics, Inc. of Seoul, Republic of South Korea; and LG Electronics, U.S.A., Inc. of Englewood Cliffs, New Jersey. The Office of Unfair Import Investigation was named as a participating party. The complaint was later amended to add respondents LG Display Co., Ltd. of Seoul, Republic of South Korea and LG Display America, Inc. of San Jose, California to the investigation. Notice (Feb. 2, 2012); Order No. 11 (Jan. 19, 2012). The Commission later terminated LG Corporation from the investigation. Notice (July 13, 2012); Order No. 18 (June 22, 2012).
On October 22, 2012, the ALJ issued his ID, finding no violation of section 337 as to the '932 patent. The ID included the ALJ's recommended determination (“RD”) on remedy and bonding. In particular, the ALJ found that claims 6, 9 and 10 of the ’932 patent are not infringed literally or under the Doctrine of Equivalents by the accused products under his construction of the claim limitation “structured arc sheet” found in claim 6. The ALJ also found that ITRI's domestic industry product does not satisfy the technical prong of the domestic industry requirement. The ALJ did find, however, that ITRI has satisfied the economic prong of the domestic industry requirement under 19 U.S.C. 1337(a)(3)(A) and (B). Because he found no infringement and no domestic industry, the ALJ did not reach the issues of patent validity or
On November 5, 2012, ITRI filed a petition for review of certain aspects of the final ID. Also on November 5, 2012, participating respondents LG Electronics, Inc., LG Electronics U.S.A., Inc., LG Display Co., Ltd., and LG Display America, Inc. (collectively “LG”) filed a contingent petition for review of certain aspects of the ID. On November 13, 2012, ITRI filed a response to LG's contingent petition for review. Also on November 13, 2012, LG filed a response to ITRI's petition for review. Further on November 13, 2012, the Commission investigative attorney filed a combined response to ITRI's and LG's petitions. No post-RD statements on the public interest pursuant to Commission Rule 210.50(a)(4) or in response to the post-RD Commission Notice issued on October 24, 2012, were filed.
Having examined the record of this investigation, including the ALJ's final ID, the petitions for review, and the responses thereto, the Commission has determined to review the final ID in its entirety. The Commission does not seek further briefing at this time. The Commission also remands the investigation to the ALJ to consider parties' invalidity and unenforceability arguments and make appropriate findings.
Briefing, if any, on remanded and reviewed issues will await Commission consideration of the remand ID. The current target date for this investigation is February 28, 2013.
The authority for the Commission=s determination is contained in section 337 of the Tariff Act of 1930, as amended (19 U.S.C. 1337), and in sections 210.42–46 and 210.50 of the Commission=s Rules of Practice and Procedure (19 CFR 210.42–46 and 210.50).
By order of the Commission.
U.S. International Trade Commission.
Notice.
Notice is hereby given that the U.S. International Trade Commission has determined not to review the final initial determination (“final ID” or “ID”) of the presiding administrative law judge in the above-identified investigation.
James A. Worth, Office of the General Counsel, U.S. International Trade Commission, 500 E Street SW., Washington, DC 20436, telephone 202–205–3065. Copies of non-confidential documents filed in connection with this investigation are or will be available for inspection during official business hours (8:45 a.m. to 5:15 p.m.) in the Office of the Secretary, U.S. International Trade Commission, 500 E Street SW., Washington, DC 20436, telephone 202–205–2000. General information concerning the Commission may also be obtained by accessing its Internet server (
The Commission instituted this investigation on August 29, 2011, based on a complaint filed by MyKey Technology Inc. (“MyKey”) of Gaithersburg, Maryland. 76 FR 53695 (Aug. 29, 2011). The complaint alleges violations of section 337 of the Tariff Act of 1930, as amended (19 U.S.C. 1337), in the importation into the United States, the sale for importation, and the sale within the United States after importation of certain computer forensic devices and products containing the same by reason of infringement of claims 1–8, 11–13, 16–38 and 40–45 of U.S. Patent No. 6,813,682 (the “ ’682 patent”), claims 1–9, 13–18 and 20–21 of U.S. Patent No. 7,159,086 and claims 1 and 2 of U.S. Patent No. 7,228,379 (the “ ’379 patent”). The notice of investigation named as respondents Data Protection Solutions by Arco of Hollywood, Florida; CRU Acquisitions Group LLC of Vancouver, Washington d/b/a CRU-DataPort LLC of Vancouver, Washington (“CRU”); Digital Intelligence, Inc. of New Berlin, Wisconsin (“Digital Intelligence”); Diskology, Inc. of Chatsworth, California; Guidance Software, Inc. of Pasadena, California and Guidance Tableau LLC of Pasadena, California (collectively, “Guidance”); Ji2, Inc. of Cypress, California; MultiMedia Effects, Inc. of Markham, Ontario;Voom Technologies, Inc. of South Lakeland, Minnesota; and YEC Co. Ltd. of Tokyo, Japan.
Only respondents Guidance, CRU, and Digital Intelligence remain in the investigation. The complainant has also narrowed the claims asserted to claims 1–8, 11–13, 16–21, 24–36, and 40–45 of the ’682 patent and claim 2 of the ’379 patent.
An evidentiary hearing was held from August 6 to August 10, 2012.
On October 26, 2012, the ALJ issued the final ID, finding no violation of Section 337. The ALJ found that MyKey had failed to satisfy the economic prong of the domestic industry requirement. No petitions for review of the ID were filed.
The Commission would ordinarily remand this investigation to the ALJ to address in the final ID all material issues presented because a hearing has concluded and all issues have been fully briefed before the ALJ. 19 CFR 210.42(d);
The authority for the Commission's determination is contained in section 337 of the Tariff Act of 1930, as amended (19 U.S.C. 1337), and in Part 210 of the Commission's Rules of Practice and Procedure (19 CFR part 210).
By order of the Commission.
Advisory Committee on Rules of Evidence, Judicial Conference of the United States.
Notice of Cancellation of Open Hearing.
The following public hearing on proposed amendments to the Federal Rules of Evidence has been canceled: Evidence Rules Hearing, January 22, 2013, Washington, DC.
Benjamin J. Robinson, Deputy Rules Officer and Counsel, Administrative Office of the United States Courts, Washington, DC 20544, telephone (202) 502–1820.
Notice is hereby given pursuant to the Antitrust Procedures and Penalties Act, 15 U.S.C. 16(b)–(h), that a proposed Final Judgment, Stipulation and Competitive Impact Statement have been filed with the United States District Court for the Southern District of New York in
Copies of the Complaint, proposed Final Judgment, and Competitive Impact Statement are available for inspection at the Department of Justice, Antitrust Division, Antitrust Documents Group, 450 Fifth Street NW., DC 20530 Suite 1010 (telephone: 202–514–2481), on the Department of Justice's Web site at http://www.justice.gov/atr, and at the Office of the Clerk of the United States District Court for the Southern District of New York. Copies of these materials may be obtained from the Antitrust Division upon request and payment of the copying fee set by Department of Justice regulations.
Public comment is invited within 60 days of the date of this notice. Such comments will be filed with the Court and will either be published in the
The United States of America, acting under the direction of the Attorney General of the United States, brings this civil antitrust action against Defendants Apple, Inc. (“Apple”); Hachette Book Group, Inc. (“Hachette”); HarperCollins Publishers L.L.C. (“HarperCollins”); Verlagsgruppe Georg von Holtzbrinck GmbH and Holtzbrinck Publishers, LLC d/b/a Macmillan (collectively, “Macmillan”); The Penguin Group, a division of Pearson plc and Penguin Group (USA), Inc. (collectively, “Penguin”); and Simon & Schuster, Inc. (“Simon & Schuster”; collectively with Hachette, HarperCollins, Macmillan, and Penguin, “Publisher Defendants”) to obtain equitable relief to prevent and remedy violations of Section 1 of the Sherman Act, 15 U.S.C. § 1. Plaintiff alleges:
1. Technology has brought revolutionary change to the business of publishing and selling books, including the dramatic explosion in sales of “e-books”—that is, books sold to consumers in electronic form and read on a variety of electronic devices, including dedicated e-readers (such as the Kindle or the Nook), multipurpose tablets, smartphones and personal computers. Consumers reap a variety of benefits from e-books, including 24-hour access to product with near-instant delivery, easier portability and storage, and adjustable font size. E-books also are considerably cheaper to produce and distribute than physical (or “print”) books.
2. E-book sales have been increasing rapidly ever since Amazon released its first Kindle device in November of 2007. In developing and then mass marketing its Kindle e-reader and associated e-book content, Amazon substantially increased the retail market for e-books. One of Amazon's most successful marketing strategies was to lower substantially the price of newly released and bestselling e-books to $9.99.
3. Publishers saw the rise in e-books, and particularly Amazon's price discounting, as a substantial challenge to their traditional business model. The Publisher Defendants feared that lower retail prices for e-books might lead eventually to lower wholesale prices for e-books, lower prices for print books, or other consequences the publishers hoped to avoid. Each Publisher Defendant desired higher retail e-book prices across the industry before “$9.99” became an entrenched consumer expectation. By the end of 2009, however, the Publisher Defendants had concluded that unilateral efforts to move Amazon away from its practice of offering low retail prices would not work, and they
4. The Defendants' conspiracy to limit e-book price competition came together as the Publisher Defendants were jointly devising schemes to limit Amazon's ability to discount e-books and Defendant Apple was preparing to launch its electronic tablet, the iPad, and considering whether it should sell e-books that could be read on the new device. Apple had long believed it would be able to “trounce Amazon by opening up [its] own ebook store,” but the intense price competition that prevailed among e-book retailers in late 2009 had driven the retail price of popular e-books to $9.99 and had reduced retailer margins on e-books to levels that Apple found unattractive. As a result of discussions with the Publisher Defendants, Apple learned that the Publisher Defendants shared a common objective with Apple to limit e-book retail price competition, and that the Publisher Defendants also desired to have popular e-book retail prices stabilize at levels significantly higher than $9.99. Together, Apple and the Publisher Defendants reached an agreement whereby retail price competition would cease (which all the conspirators desired), retail e-book prices would increase significantly (which the Publisher Defendants desired), and Apple would be guaranteed a 30 percent “commission” on each e-book it sold (which Apple desired).
5. To accomplish the goal of raising e-book prices and otherwise limiting retail competition for e-books, Apple and the Publisher Defendants jointly agreed to alter the business model governing the relationship between publishers and retailers. Prior to the conspiracy, both print books and e-books were sold under the longstanding “wholesale model.” Under this model, publishers sold books to retailers, and retailers, as the owners of the books, had the freedom to establish retail prices. Defendants were determined to end the robust retail price competition in e-books that prevailed, to the benefit of consumers, under the wholesale model. They therefore agreed jointly to replace the wholesale model for selling e-books with an “agency model.” Under the agency model, publishers would take control of retail pricing by appointing retailers as “agents” who would have no power to alter the retail prices set by the publishers. As a result, the publishers could end price competition among retailers and raise the prices consumers pay for e-books through the adoption of identical pricing tiers. This change in business model would not have occurred without the conspiracy among the Defendants.
6. Apple facilitated the Publisher Defendants' collective effort to end retail price competition by coordinating their transition to an agency model across all retailers. Apple clearly understood that its participation in this scheme would result in higher prices to consumers. As Apple CEO Steve Jobs described his company's strategy for negotiating with the Publisher Defendants, “We'll go to [an] agency model, where you set the price, and we get our 30%, and yes, the customer pays a little more, but that's what you want anyway.” Apple was perfectly willing to help the Publisher Defendants obtain their objective of higher prices for consumers by ending Amazon's “$9.99” price program as long as Apple was guaranteed its 30 percent margin and could avoid retail price competition from Amazon.
7. The plan—what Apple proudly described as an “aikido move”—worked. Over three days in January 2010, each Publisher Defendant entered into a functionally identical agency contract with Apple that would go into effect simultaneously in April 2010 and “chang[e] the industry permanently.” These “Apple Agency Agreements” conferred on the Publisher Defendants the power to set Apple's retail prices for e-books, while granting Apple the assurance that the Publisher Defendants would raise retail e-book prices at all other e-book outlets, too. Instead of $9.99, electronic versions of bestsellers and newly released titles would be priced according to a set of price tiers contained in each of the Apple Agency Agreements that determined de facto retail e-book prices as a function of the title's hardcover list price. All bestselling and newly released titles bearing a hardcover list price between $25.01 and $35.00, for example, would be priced at $12.99, $14.99, or $16.99, with the retail e-book price increasing in relation to the hardcover list price.
8. After executing the Apple Agency Agreements, the Publisher Defendants all then quickly acted to complete the scheme by imposing agency agreements on all their other retailers. As a direct result, those retailers lost their ability to compete on price, including their ability to sell the most popular e-books for $9.99 or for other low prices. Once in control of retail prices, the Publisher Defendants limited retail price competition among themselves. Millions of e-books that would have sold at retail for $9.99 or for other low prices instead sold for the prices indicated by the price schedules included in the Apple Agency Agreements—generally, $12.99 or $14.99. Other price and non-price competition among e-book publishers and among e-book retailers also was unlawfully eliminated to the detriment of U.S. consumers.
9. The purpose of this lawsuit is to enjoin the Publisher Defendants and Apple from further violations of the nation's antitrust laws and to restore the competition that has been lost due to the Publisher Defendants' and Apple's illegal acts.
10. Defendants' ongoing conspiracy and agreement have caused e-book consumers to pay tens of millions of dollars more for e-books than they otherwise would have paid.
11. The United States, through this suit, asks this Court to declare Defendants' conduct illegal and to enter injunctive relief to prevent further injury to consumers in the United States.
12. Apple, Inc. has its principal place of business at 1 Infinite Loop, Cupertino, CA 95014. Among many other businesses, Apple, Inc. distributes e-books through its iBookstore.
13. Hachette Book Group, Inc. has its principal place of business at 237 Park Avenue, New York, NY 10017. It publishes e-books and print books through publishers such as Little, Brown, and Company and Grand Central Publishing.
14. HarperCollins Publishers L.L.C. has its principal place of business at 10 E. 53rd Street, New York, NY 10022. It publishes e-books and print books through publishers such as Harper and William Morrow.
15. Holtzbrinck Publishers, LLC d/b/a Macmillan has its principal place of business at 175 Fifth Avenue, New York, NY 10010. It publishes e-books and print books through publishers such as Farrar, Straus and Giroux and St. Martin's Press. Verlagsgruppe Georg von Holtzbrinck GmbH owns Holtzbrinck Publishers, LLC d/b/a Macmillan and has its principal place of business at Gänsheidestraße 26, Stuttgart 70184, Germany.
16. Penguin Group (USA), Inc. has its principal place of business at 375 Hudson Street, New York, NY 10014. It publishes e-books and print books through publishers such as The Viking Press and Gotham Books. Penguin Group (USA), Inc. is the United States
17. Simon & Schuster, Inc. has its principal place of business at 1230 Avenue of the Americas, New York, NY 10020. It publishes e-books and print books through publishers such as Free Press and Touchstone.
18. Plaintiff United States of America brings this action pursuant to Section 4 of the Sherman Act, 15 U.S.C. § 4, to obtain equitable relief and other relief to prevent and restrain Defendants' violations of Section 1 of the Sherman Act, 15 U.S.C 1.
19. This Court has subject matter jurisdiction over this action under Section 4 of the Sherman Act, 15 U.S.C. 4, and 28 U.S.C. 1331, 1337(a), and 1345.
20. This Court has personal jurisdiction over each Defendant and venue is proper in the Southern District of New York under Section 12 of the Clayton Act, 15 U.S.C. 22, and 28 U.S.C. 1391, because each Defendant transacts business and is found within the Southern District of New York. The U.S. component of each Publisher Defendant is headquartered in the Southern District of New York, and acts in furtherance of the conspiracy occurred in this District. Many thousands of the Publisher Defendants' e-books are and have been sold in this District, including through Defendant Apple's iBookstore.
21. Defendants are engaged in, and their activities substantially affect, interstate trade and commerce. The Publisher Defendants sell e-books throughout the United States. Their e-books represent a substantial amount of interstate commerce. In 2010, United States consumers paid more than $300 million for the Publisher Defendants' e-books, including more than $40 million for e-books licensed through Defendant Apple's iBookstore.
22. Various persons, who are known and unknown to Plaintiff, and not named as defendants in this action, including senior executives of the Publisher Defendants and Apple, have participated as co-conspirators with Defendants in the offense alleged and have performed acts and made statements in furtherance of the conspiracy.
23. Authors submit books to publishers in manuscript form. Publishers edit manuscripts, print and bind books, provide advertising and related marketing services, decide when a book should be released for sale, and distribute books to wholesalers and retailers. Publishers also determine the cover price or “list price” of a book, and typically that price appears on the book's cover.
24. Retailers purchase print books directly from publishers, or through wholesale distributors, and resell them to consumers. Retailers typically purchase print books under the “wholesale model.” Under that model, retailers pay publishers approximately one-half of the list price of books, take ownership of the books, then resell them to consumers at prices of the retailer's choice. Publishers have sold print books to retailers through the wholesale model for over 100 years and continue to do so today.
25. E-books are books published in electronic formats. E-book publishers avoid some of the expenses incurred in producing and distributing print books, including most manufacturing expenses, warehousing expenses, distribution expenses, and costs of dealing with unsold stock.
26. Consumers purchase e-books through Web sites of e-book retailers or through applications loaded onto their reading devices. Such electronic distribution allows e-book retailers to avoid certain expenses they incur when they sell print books, including most warehousing expenses and distribution expenses.
27. From its very small base in 2007 at the time of Amazon's Kindle launch, the e-book market has exploded, registering triple-digit sales growth each year. E-books now constitute at least ten percent of general interest fiction and non-fiction books (commonly known as “trade” books
28. The Publisher Defendants compete against each other for sales of trade e-books to consumers. Publishers bid against one another for print- and electronic-publishing rights to content that they expect will be most successful in the market. They also compete against each other in bringing those books to market. For example, in addition to price-setting, they create cover art and other on-book sales inducements, and also engage in advertising campaigns for some titles.
29. The Publisher Defendants are five of the six largest publishers of trade books in the United States. They publish the vast majority of their newly released titles as both print books and e-books. Publisher Defendants compete against each other in the sales of both trade print books and trade e-books.
30. When Amazon launched its Kindle device, it offered newly released and bestselling e-books to consumers for $9.99. At that time, Publisher Defendants routinely wholesaled those e-books for about that same price, which typically was less than the wholesale price of the hardcover versions of the same titles, reflecting publisher cost savings associated with the electronic format. From the time of its launch, Amazon's e-book distribution business has been consistently profitable, even when substantially discounting some newly released and bestselling titles.
31. To compete with Amazon, other e-book retailers often matched or approached Amazon's $9.99-or-less prices for e-book versions of new releases and
32. The Publisher Defendants feared that $9.99 would become the standard price for newly released and bestselling e-books. For example, one Publisher Defendant's CEO bemoaned the “wretched $9.99 price point” and Penguin USA CEO David Shanks worried that e-book pricing “can't be $9.99 for hardcovers.”
33. The Publisher Defendants believed the low prices for newly released and bestselling e-books were disrupting the industry. The Amazon-led $9.99 retail price point for the most popular e-books troubled the Publisher Defendants because, at $9.99, most of these e-book titles were priced substantially lower than hardcover versions of the same title. The Publisher Defendants were concerned these lower
34. The Publisher Defendants also feared that the $9.99 price point would make e-books so popular that digital publishers could achieve sufficient scale to challenge the major incumbent publishers' basic business model. The Publisher Defendants were especially concerned that Amazon was well positioned to enter the digital publishing business and thereby supplant publishers as intermediaries between authors and consumers. Amazon had, in fact, taken steps to do so, contracting directly with authors to publish their works as e-books—at a higher royalty rate than the Publisher Defendants offered. Amazon's move threatened the Publisher Defendants' traditional positions as the gate-keepers of the publishing world. The Publisher Defendants also feared that other competitive advantages they held as a result of years of investments in their print book businesses would erode and, eventually, become irrelevant, as e-book sales continued to grow.
35. Each Publisher Defendant knew that, acting alone, it could not compel Amazon to raise e-book prices and that it was not in its economic self-interest to attempt unilaterally to raise retail e-book prices. Each Publisher Defendant relied on Amazon to market and distribute its e-books, and each Publisher Defendant believed Amazon would leverage its position as a large retailer to preserve its ability to compete and would resist any individual publisher's attempt to raise the prices at which Amazon sold that publisher's e-books. As one Publisher Defendant executive acknowledged Amazon's bargaining strength, “we've always known that unless other publishers follow us, there's no chance of success in getting Amazon to change its pricing practices.” In the same email, the executive wrote, “without a critical mass behind us Amazon won't `negotiate,' so we need to be more confident of how our fellow publishers will react. * * *”
36. Each Publisher Defendant also recognized that it would lose sales if retail prices increased for only its e-books while the other Publisher Defendants' e-books remained competitively priced. In addition, higher prices for just one publisher's e-books would not change consumer perceptions enough to slow the erosion of consumer-perceived value of books that all the Publisher Defendants feared would result from Amazon's $9.99 pricing policy.
37. Beginning no later than September 2008, the Publisher Defendants' senior executives engaged in a series of meetings, telephone conversations and other communications in which they jointly acknowledged to each other the threat posed by Amazon's pricing strategy and the need to work collectively to end that strategy. By the end of the summer of 2009, the Publisher Defendants had agreed to act collectively to force up Amazon's retail prices and thereafter considered and implemented various means to accomplish that goal, including moving under the guise of a joint venture. Ultimately, in late 2009, Apple and the Publisher Defendants settled on the strategy that worked—replacing the wholesale model with an agency model that gave the Publisher Defendants the power to raise retail e-book prices themselves.
38. The evidence showing conspiracy is substantial and includes:
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39. Starting no later than September of 2008 and continuing for at least one year, the Publisher Defendants' CEOs (at times joined by one non-defendant publisher's CEO) met privately as a group approximately once per quarter. These meetings took place in private dining rooms of upscale Manhattan restaurants and were used to discuss confidential business and competitive matters, including Amazon's e-book retailing practices. No legal counsel was present at any of these meetings.
40. In September 2008, Penguin Group CEO John Makinson was joined by Macmillan CEO John Sargent and the CEOs of the other four large publishers at a dinner meeting in “The Chef's Wine Cellar,” a private room at Picholene. One of the CEOs reported that business matters were discussed.
41. In January 2009, the CEO of one Publisher Defendant, a United States subsidiary of a European corporation, promised his corporate superior, the CEO of the parent company, that he would raise the future of e-books and Amazon's potential role in that future at an upcoming meeting of publisher CEOs. Later that month, at a dinner meeting hosted by Penguin Group CEO John Makinson, again in “The Chef's Wine Cellar” at Picholene, the same group of publisher CEOs met once more.
42. On or about June 16, 2009, Mr. Makinson again met privately with other Publisher Defendant CEOs and discussed,
43. On or about September 10, 2009, Mr. Makinson once again met privately with other Publisher Defendant CEOs and the CEO of one non-defendant publisher in a private room of a different Manhattan restaurant, Alto. They discussed the growth of e-books and complained about Amazon's role in that growth.
44. In addition to the CEO dinner meetings, Publisher Defendants' CEOs and other executives met in-person, one-on-one to communicate about e-books multiple times over the course of 2009 and into 2010. Similar meetings took place in Europe, including meetings in the fall of 2009 between executives of Macmillan parent company Verlagsgruppe Georg von Holtzbrinck GmbH and executives of another Publisher Defendant's parent company. Macmillan CEO John Sargent joined at least one of these parent company meetings.
45. These private meetings provided the Publisher Defendants' CEOs the opportunity to discuss how they collectively could solve “the $9.99 problem.”
46. While each Publisher Defendant recognized that it could not solve “the $9.99 problem” by itself, collectively the Publisher Defendants accounted for nearly half of Amazon's e-book revenues, and by refusing to compete with one another for Amazon's business, the Publisher Defendants could force Amazon to accept the Publisher Defendants' new contract terms and to change its pricing practices.
47. The Publisher Defendants thus conspired to act collectively, initially in the guise of joint ventures. These ostensible joint ventures were not meant to enhance competition by bringing to market products or services that the publishers could not offer unilaterally, but rather were designed as anticompetitive measures to raise prices.
48. All five Publisher Defendants agreed in 2009 at the latest to act collectively to raise retail prices for the most popular e-books above $9.99. One CEO of a Publisher Defendant's parent company explained to his corporate superior in a July 29, 2009 email message that “[i]n the USA and the UK, but also in Spain and France to a lesser degree, the `top publishers' are in discussions to create an alternative platform to Amazon for e-books. The goal is less to compete with Amazon as to force it to accept a price level higher than 9.99. * *”* I am in NY this week to promote these ideas and the movement is positive with [the other four Publisher Defendants].” (Translated from French).
49. Less than a week later, in an August 4, 2009 strategy memo for the board of directors of Penguin's ultimate parent company, Penguin Group CEO John Makinson conveyed the same message:
Competition for the attention of readers will be most intense from digital companies whose objective may be to disintermediate traditional publishers altogether. This is not a new threat but we do appear to be on a collision course with Amazon, and possibly Google as well. It will not be possible for any individual publisher to mount an effective response, because of both the resources necessary and the risk of retribution, so the industry needs to develop a common strategy. This is the context for the development of the Project Z initiatives [joint ventures] in London and New York.
50. To raise e-book prices, the Publisher Defendants also began to consider in late 2009 selling e-books under an “agency model” that would take away Amazon's ability to set low retail prices. As one CEO of a Publisher Defendant's parent company explained in a December 6, 2009 email message, “[o]ur goal is to force Amazon to return to acceptable sales prices through the establishment of agency contracts in the USA . . . . To succeed our colleagues must know that we entered the fray and follow us.” (Translated from French).
51. Apple's entry into the e-book business provided a perfect opportunity for collective action to implement the agency model and use it to raise retail e-book prices. Apple was in the process of developing a strategy to sell e-books on its new iPad device. Apple initially contemplated selling e-books through the existing wholesale model, which was similar to the manner in which Apple sold the vast majority of the digital media it offered in its iTunes store. On February 19, 2009, Apple Vice President of Internet Services Eddy Cue explained to Apple CEO Steve Jobs in an email, “[a]t this point, it would be very easy for us to compete and I think trounce Amazon by opening up our own ebook store.” In addition to considering competitive entry at that time, though, Apple also contemplated illegally dividing the digital content world with Amazon, allowing each to “own the category” of its choice—audio/video to Apple and e-books to Amazon.
52. Apple soon concluded, though, that competition from other retailers—especially Amazon—would prevent Apple from earning its desired 30 percent margins on e-book sales. Ultimately, Apple, together with the Publisher Defendants, set in motion a plan that would compel all non-Apple e-book retailers also to sign onto agency or else, as Apple's CEO put it, the Publisher Defendants all would say, “we're not going to give you the books.”
53. The executive in charge of Apple's inchoate e-books business, Eddy Cue, telephoned each Publisher Defendant and Random House on or around December 8, 2009 to schedule exploratory meetings in New York City on December 15 and December 16. Hachette and HarperCollins took the lead in working with Apple to capitalize on this golden opportunity for the Publisher Defendants to achieve their goal of raising and stabilizing retail e-book prices above $9.99 by collectively imposing the agency model on the industry.
54. It appears that Hachette and HarperCollins communicated with each other about moving to an agency model during the brief window between Mr. Cue's first telephone calls to the Publisher Defendants and his visit to meet with their CEOs. On the morning of December 10, 2009, a HarperCollins executive added to his calendar an appointment to call a Hachette executive at 10:50 a.m. At 11:01 a.m., the Hachette executive returned the phone call, and the two spoke for six minutes. Then, less than a week later in New York, both Hachette and HarperCollins executives told Mr. Cue in their initial meetings with him that they wanted to sell e-books under an agency model, a dramatic departure from the way books had been sold for over a century.y
55. The other Publisher Defendants also made clear to Apple that they
56. Apple saw a way to turn the agency scheme into a highly profitable model for itself. Apple determined to give the Publisher Defendants what they wanted while shielding itself from retail price competition and realizing margins far in excess of what e-book retailers then averaged on each newly released or bestselling e-book sold. Apple realized that, as a result of the scheme, “the customer” would “pay[] a little more.”
57. On December 16, 2009, the day after both companies' initial meetings with Apple, Penguin Group CEO John Makinson had a breakfast meeting at a London hotel with the CEO of another Publisher Defendant's parent company. Consistent with the Publisher Defendants' other efforts to conceal their activities, Mr. Makinson's breakfast companion wrote to his U.S. subordinate that he would recount portions of his discussion with Mr. Makinson only by telephone.
58. By the time Apple arrived for a second round of meetings during the week of December 21, 2009, the agency model had become the focus of its discussions with all of the Publisher Defendants. In these discussions, Apple proposed that the Publisher Defendants require
59. The Publisher Defendants acknowledged to Apple their common objective to end Amazon's $9.99 pricing. As Mr. Cue reported in an email message to Apple's CEO Steve Jobs, the three publishers with whom he had met saw the “plus” of Apple's position as “solv[ing the] Amazon problem.” The “negative” was that Apple's proposed retail prices—topping out at $12.99 for newly released and bestselling e-books—were a “little less than [the publishers] would like.” Likewise, Mr. Jobs later informed an executive of one of the Publisher Defendant's corporate parents that “[a]ll major publishers” had told Apple that “Amazon's $9.99 price for new releases is eroding the value perception of their products in customer's minds, and they do not want this practice to continue for new releases.”
60. As perhaps the only company that could facilitate their goal of raising retail e-book prices across the industry, Apple knew that it had significant leverage in negotiations with Publisher Defendants. Apple exercised this leverage to demand a thirty percent commission—a margin significantly above the prevailing competitive margins for e-book retailers. The Publisher Defendants worried that the combination of paying Apple a higher commission than they would have liked and pricing their e-books lower than they wanted might be too much to bear in exchange for Apple's facilitation of their agreement to raise retail e-book prices. Ultimately, though, they convinced Apple to allow them to raise prices high enough to make the deal palatable to them.
61. As it negotiated with the Publisher Defendants in December 2009 and January 2010, Apple kept each Publisher Defendant informed of the status of its negotiations with the other Publisher Defendants. Apple also assured the Publisher Defendants that its proposals were the same to each and that no deal Apple agreed to with one publisher would be materially different from any deal it agreed to with another publisher. Apple thus knowingly served as a critical conspiracy participant by allowing the Publisher Defendants to signal to one another both (a) which agency terms would comprise an acceptable means of achieving their ultimate goal of raising and stabilizing retail e-book prices, and (b) that they could lock themselves into this particular means of collectively achieving that goal by all signing their Apple Agency Agreement.
62. Apple's Mr. Cue emailed each Publisher Defendant between January 4, 2010, and January 6, 2010 an outline of what he tabbed “the best approach for e-books.” He reassured Penguin USA CEO David Shanks and other Publisher Defendant CEOs that Apple adopted the approach “[a]fter talking to all the other publishers.” Mr. Cue sent substantively identical email messages and proposals to each Publisher Defendant.
63. The outlined proposal that Apple circulated after consulting with each Publisher Defendant contained several key features. First, as Hachette and HarperCollins had initially suggested to Apple, the publisher would be the principal and Apple would be the agent for e-book sales. Consumer pricing authority would be transferred from retailers to publishers. Second, Apple's proposal mandated that every other retailer of each publisher's e-books—Apple's direct competitors—be forced to accept the agency model as well. As Mr. Cue wrote, “all resellers of new titles need to be in agency model.” Third, Apple would receive a 30 percent commission for each e-book sale. And fourth, each Publisher Defendant would have identical pricing tiers for e-books sold through Apple's iBookstore.
64. On January 11, 2010, Apple emailed its proposed e-book distribution agreement to all the Publisher Defendants. As with the outlined proposals Apple sent earlier in January, the proposed e-book distribution agreements were substantially the same. Also on January 11, 2010, Apple separately emailed to Penguin and two other Publisher Defendants charts showing how the Publisher Defendant's bestselling e-books would be priced at $12.99—the ostensibly maximum price under Apple's then-current price tier proposal—in the iBookstore.
65. The proposed e-book distribution agreement mainly incorporated the principles Apple set out in its email messages of January 4 through January 6, with two notable changes. First, Apple demanded that the Publisher Defendants provide Apple their complete e-book catalogs and that they not delay the electronic release of any title behind its print release. Second, and more important, Apple replaced the express requirement that each publisher adopt the agency model with each of its retailers with an unusual most favored nation (“MFN”) pricing provision. That provision was not structured like a standard MFN in favor of a retailer, ensuring Apple that it would receive the best available wholesale price. Nor did the MFN ensure Apple that the Publisher Defendants would not set a higher retail price on the iBookstore than they set on other Web sites where they controlled retail prices. Instead, the MFN here required each publisher to guarantee that it would lower the retail price of each e-book in Apple's iBookstore to match the lowest price offered by any other retailer, even if the Publisher Defendant did not control that other retailer's ultimate consumer price. That is, instead of an MFN designed to protect Apple's ability to compete, this MFN was designed to protect Apple from having to compete on price at all, while still maintaining Apple's 30 percent margin.
66. The purpose of these provisions was to work in concert to enforce the Defendants' agreement to raise and stabilize retail e-book prices. Apple and the Publisher Defendants recognized that coupling Apple's right to all of their e-books with its right to demand that those e-books not be priced higher on the iBookstore than on any other Web site effectively required that each Publisher Defendant take away retail pricing control from all other e-book
67. In negotiating the retail price MFN with Apple, “some of [the Publisher Defendants]” asserted that Apple did not need the provision “because they would be moving to an agency model with [the other e-book retailers,]” regardless. Ultimately, though, all Defendants agreed to include the MFN commitment mechanism.
68. On January 16, 2010, Apple, via Mr. Cue, offered revised terms to the Publisher Defendants that again were identical in substance. Apple modified its earlier proposal in two significant ways. First, in response to publisher requests, it added new maximum pricing tiers that increased permissible e-book prices to $16.99 or $19.99, depending on the book's hardcover list price. Second, Apple's new proposal mitigated these price increases somewhat by adding special pricing tiers for e-book versions of books on the
69. Each Publisher Defendant required assurances that it would not be the only publisher to sign an agreement with Apple that would compel it either to take pricing authority from Amazon or to pull its e-books from Amazon. The Publisher Defendants continued to fear that Amazon would act to protect its ability to price e-books at $9.99 or less if any one of them acted alone. Individual Publisher Defendants also feared punishment in the marketplace if only its e-books suddenly became more expensive at retail while other publishers continued to allow retailers to compete on price. As Mr. Cue noted, “all of them were very concerned about being the only ones to sign a deal with us.” Penguin explicitly communicated to Apple that it would sign an e-book distribution agreement with Apple only if at least three of the other “major[]” publishers did as well. Apple supplied the needed assurances.
70. While the Publisher Defendants were discussing e-book distribution terms with Apple during the week of January 18, 2010, Amazon met in New York City with a number of prominent authors and agents to unveil a new program under which copyright holders could take their e-books directly to Amazon—cutting out the publisher—and Amazon would pay royalties of up to 70 percent, far in excess of what publishers offered. This announcement further highlighted the direct competitive threat Amazon posed to the Publisher Defendants' business model. The Publisher Defendants reacted immediately. For example, Penguin USA CEO David Shanks reported being “really angry” after “hav[ing] read [Amazon's] announcement.” After thinking about it for a day, Mr. Shanks concluded, “[o]n Apple I am now more convinced that we need a viable alternative to Amazon or this nonsense will continue and get much worse.” Another decisionmaker stated he was “p****d” at Amazon for starting to compete directly against the publishers and expressed his desire “to screw Amazon.”
71. To persuade one of the Publisher Defendants to stay with the others and sign an agreement, Apple CEO Steve Jobs wrote to an executive of the Publisher Defendant's corporate parent that the publisher had only two choices apart from signing the Apple Agency Agreement: (i) accept the status quo (“Keep going with Amazon at $9.99”); or (ii) continue with a losing policy of delaying the release of electronic versions of new titles (“Hold back your books from Amazon”). According to Jobs, the Apple deal offered the Publisher Defendants a superior alternative path to the higher retail e-book prices they sought: “Throw in with Apple and see if we can all make a go of this to create a real mainstream e-books market at $12.99 and $14.99.”
72. In addition to passing information through Apple and during their private dinners and other in-person meetings, the Publisher Defendants frequently communicated by telephone to exchange assurances of common action in attempting to raise the retail price of e-books. These telephone communications increased significantly during the two-month period in which the Publisher Defendants considered and entered the Apple Agency Agreements. During December 2009 and January 2010, the Publisher Defendants' U.S. CEOs placed at least 56 phone calls to one another. Each CEO, including Penguin's Shanks and Macmillan's Sargent, placed at least seven such phone calls.
73. The timing, frequency, duration, and content of the Publisher Defendant CEOs' phone calls demonstrate that the Publisher Defendants used them to seek and exchange assurances of common strategies and business plans regarding the Apple Agency Agreements. For example, in addition to the telephone calls already described in this complaint:
• Near the time Apple first presented the agency model, one Publisher Defendant's CEO used a telephone call—ostensibly made to discuss a marketing joint venture—to tell Penguin USA CEO David Shanks that “everyone is in the same place with Apple.”
• After receiving Apple's January 16, 2010 revised proposal, executives of several Publisher Defendants responded to the revised proposal and meetings by, again, seeking and exchanging confidential information. For example, on Sunday, January 17, one Publisher Defendant's CEO used his mobile phone to call another Publisher Defendant's CEO and talk for approximately ten minutes. And on the morning of January 19, Penguin USA CEO David Shanks had an extended telephone conversation with the CEO of another Publisher Defendant.
• On January 21, 2010, the CEO of one Publisher Defendant's parent company instructed his U.S. subordinate via email to find out Apple's progress in agency negotiations with other publishers. Four minutes after that email was sent, the U.S. executive called another Publisher Defendant's CEO, and the two spoke for over eleven minutes.
• On January 22, 2010, at 9:30 a.m., Apple's Cue met with one Publisher Defendant's CEO to make what Cue hoped would be a “final go/no-go decision” about whether the Publisher Defendant would sign an agreement with Apple. Less than an hour later, the Publisher Defendant's CEO made phone calls, two minutes apart, to two other Publisher Defendants' CEOs, including Macmillan's Sargent. The CEO who placed the calls admitted under oath to placing them specifically to learn if the other two Publisher Defendants would sign with Apple prior to Apple's iPad launch.
• On the evening of Saturday, January 23, 2010, Apple's Cue emailed his boss, Steve Jobs, and noted that Penguin USA CEO David Shanks “want[ed] an assurance that he is 1 of 4 before signing.” The following Monday morning, at 9:46 a.m., Mr. Shanks called another Publisher Defendant's CEO and
74. On January 24, 2010, Hachette signed an e-book distribution agreement with Apple. Over the next two days, Simon & Schuster, Macmillan, Penguin, and HarperCollins all followed suit and signed e-book distribution agreements with Apple. Within these three days, the Publisher Defendants agreed with Apple to abandon the longstanding wholesale model for selling e-books. The Apple Agency Agreements took effect simultaneously on April 3, 2010 with the release of Apple's new iPad.
75. The final version of the pricing tiers in the Apple Agency Agreements contained the $12.99 and $14.99 price points for bestsellers, discussed earlier, and also established prices for all other newly released titles based on the hardcover list price of the same title. Although couched as maximum retail prices, the price tiers in fact established the retail e-book prices to be charged by Publisher Defendants.
76. By entering the Apple Agency Agreements, each Publisher Defendant effectively agreed to require all of their e-book retailers to accept the agency model. Both Apple and the Publisher Defendants understood the Agreements would compel the Publisher Defendants to take pricing authority from all non-Apple e-book retailers. A February 10, 2010 presentation by one Publisher Defendant applauded this result (emphasis in original): “The Apple agency model deal means that we will have to shift to an agency model with Amazon which [will] strengthen our control over pricing.”
77. Apple understood that the final Apple Agency Agreements ensured that the Publisher Defendants would raise their retail e-book prices to the ostensible limits set by the Apple price tiers not only in Apple's forthcoming iBookstore, but on Amazon.com and all other consumer sites as well. When asked by a
78. Apple understood that the retail price MFN was the key commitment mechanism to keep the Publisher Defendants advancing their conspiracy in lockstep. Regarding the effect of the MFN, Apple executive Pete Alcorn remarked in the context of the European roll-out of the agency model in the spring of 2010:
I told [Apple executive Keith Moerer] that I think he and Eddy [Cue] made it at least halfway to changing the industry permanently, and we should keep the pads on and keep fighting for it. I might regret that later, but right now I feel like it's a giant win to keep pushing the MFN and forcing people off the [A]mazon model and onto ours. If anything, the place to give is the pricing—long run, the mfn is more important. The interesting insight in the meeting was Eddy's explanation that it doesn't have to be that broad—any decent MFN forces the model.
79. Within the four months following the signing of the Apple Agency Agreements, and over Amazon's objections, each Publisher Defendant had transformed its business relationship with all of the major e-book retailers from a wholesale model to an agency model and imposed flat prohibitions against e-book discounting or other price competition on all non-Apple e-book retailers.
80. For example, after it signed its Apple Agency Agreement, Macmillan presented Amazon a choice: adopt the agency model or lose the ability to sell e-book versions of new hardcover titles for the first seven months of their release. Amazon rejected Macmillan's ultimatum and sought to preserve its ability to sell e-book versions of newly released hardcover titles for $9.99. To resist Macmillan's efforts to force it to accept either the agency model or delayed electronic availability, Amazon effectively stopped selling Macmillan's print books and e-books.
81. When Amazon stopped selling Macmillan titles, other Publisher Defendants did not view the situation as an opportunity to gain market share from a weakened competitor. Instead, they rallied to support Macmillan. For example, the CEO of one Publisher Defendant's parent company instructed the Publisher Defendant's CEO that “[Macmillan CEO] John Sargent needs our help!” The parent company CEO explained, “M[acm]illan have been brave, but they are small. We need to move the lines. And I am thrilled to know how A[mazon] will react against 3 or 4 of the big guys.”
82. The CEO of one Publisher Defendant's parent company assured Macmillan CEO John Sargent of his company's support in a January 31, 2010 email: “I can ensure you that you are not going to find your company alone in the battle.” The same parent company CEO also assured the head of Macmillan's corporate parent in a February 1 email that “others will enter the battle field!” Overall, Macmillan received “hugely supportive” correspondence from the publishing industry during Macmillan's effort to force Amazon to accept the agency model.
83. As its battle with Amazon continued, Macmillan knew that, because the other Publisher Defendants, via the Apple Agency Agreements, had locked themselves into forcing agency on Amazon to advance their conspiratorial goals, Amazon soon would face similar edicts from a united front of Publisher Defendants. And Amazon could not delist the books of all five Publisher Defendants because they together accounted for nearly half of Amazon's e-book business. Macmillan CEO John Sargent explained the company's reasoning: “we believed whatever was happening, whatever Amazon was doing here, they were going to face—they're going to have more of the same in the future one way or another.” Another Publisher Defendant similarly recognized that Macmillan was not acting unilaterally but rather was “leading the charge on moving Amazon to the agency model.”
84. Amazon quickly came to fully appreciate that not just Macmillan but all five Publisher Defendants had irrevocably committed themselves to the agency model across all retailers, including taking control of retail pricing and thereby stripping away any opportunity for e-book retailers to compete on price. Just two days after it stopped selling Macmillan titles, Amazon capitulated and publicly announced that it had no choice but to accept the agency model, and it soon resumed selling Macmillan's e-book and print book titles.
85. When a company takes a pro-competitive action by introducing a new product, lowering its prices, or even adopting a new business model that helps it sell more product at better prices, it typically does not want its competitors to copy its action, but prefers to maintain a first-mover or competitive advantage. In contrast, when companies jointly take collusive action, such as instituting a coordinated price increase, they typically want the rest of their competitors to join them in that action. Because collusive actions are not pro-competitive or consumer friendly, any competitor that does not go along with the conspirators can take more consumer friendly actions and see its market share rise at the expense of the conspirators. Here, the Defendants
86. Penguin appears to have taken the lead in these efforts. Its U.S. CEO, David Shanks, twice directly told the executives of the holdout major publisher about his displeasure with their decision to continue selling e-books on the wholesale model. Mr. Shanks tried to justify the actions of the conspiracy as an effort to save brick-and-mortar bookstores and criticized the other publisher for “not helping” the group. The executives of the other publisher responded to Mr. Shanks's complaints by explaining their objections to the agency model.
87. Mr. Shanks also encouraged a large print book and e-book retailer to punish the other publisher for not joining Defendants' conspiracy. In March 2010, Mr. Shanks sent an email message to an executive of the retailer complaining that the publisher “has chosen to stay on their current model and will allow retailers to sell at whatever price they wish.” Mr. Shanks argued that “[s]ince Penguin is looking out for [your] welfare at what appears to be great costs to us, I would hope that [you] would be equally brutal to Publishers who have thrown in with your competition with obvious disdain for your welfare. . . . I hope you make [the publisher] hurt like Amazon is doing to [the Publisher Defendants].”
88. When the third-party retailer continued to promote the non-defendant publisher's books, Mr. Shanks applied more pressure. In a June 22, 2010 email to the retailer's CEO, Mr. Shanks claimed to be “baffled” as to why the retailer would promote that publisher's books instead of just those published by “people who stood up for you.”
89. Throughout the summer of 2010, Apple also cajoled the holdout publisher to adopt agency terms in line with those of the Publisher Defendants, including on a phone call between Apple CEO Steve Jobs and the holdout publisher's CEO. Apple flatly refused to sell the holdout publisher's e-books unless and until it agreed to an agency relationship substantially similar to the arrangement between Apple and the Publisher Defendants defined by the Apple Agency Agreements.
90. The ostensible maximum prices included in the Apple Agency Agreements' price schedule represent, in practice, actual e-book prices. Indeed, at the time the Publisher Defendants snatched retail pricing authority away from Amazon and other e-book retailers, not one of them had built an internal retail pricing apparatus sufficient to do anything other than set retail prices at the Apple Agency Agreements' ostensible caps. Once their agency agreements took effect, the Publisher Defendants raised e-book prices at all retail outlets to the maximum price level within each tier. Even today, two years after the Publisher Defendants began setting e-book retail prices according to the Apple price tiers, they still set the retail prices for the electronic versions of all or nearly all of their bestselling hardcover titles at the ostensible maximum price allowed by those price tiers.
91. The Publisher Defendants' collective adoption of the Apple Agency Agreements allowed them (facilitated by Apple) to raise, fix, and stabilize retail e-book prices in three steps: (a) they took away retail pricing authority from retailers; (b) they then set retail e-book prices according to the Apple price tiers; and (c) they then exported the agency model and higher retail prices to the rest of the industry, in part to comply with the retail price MFN included in each Apple Agency Agreement.
92. Defendants' conspiracy and agreement to raise and stabilize retail e-book prices by collectively adopting the agency model and Apple price tiers led to an increase in the retail prices of newly released and bestselling e-books. Prior to the Defendants' conspiracy, consumers benefited from price competition that led to $9.99 prices for newly released and bestselling e-books. Almost immediately after Apple launched its iBookstore in April 2010 and the Publisher Defendants imposed agency model pricing on all retailers, the Publisher Defendants' e-book prices for most newly released and bestselling e-books rose to either $12.99 or $14.99.
93. Defendants' conspiracy and agreement to raise and stabilize retail e-book prices by collectively adopting the agency model and Apple price tiers for their newly released and bestselling e-books also led to an increase in average retail prices of the balance of Publisher Defendants' e-book catalogs, their so-called “backlists.” Now that the Publisher Defendants control the retail prices of e-books—but Amazon maintains control of its print book retail prices—Publisher Defendants' e-book prices sometimes are higher than Amazon's prices for print versions of the same titles.
94. Beginning no later than 2009, and continuing to date, Defendants and their co-conspirators have engaged in a conspiracy and agreement in unreasonable restraint of interstate trade and commerce, constituting a violation of Section 1 of the Sherman Act, 15 U.S.C. 1. This offense is likely to continue and recur unless the relief requested is granted.
95. The conspiracy and agreement consists of an understanding and concert of action among Defendants and their co-conspirators to raise, fix, and stabilize retail e-book prices, to end price competition among e-book retailers, and to limit retail price competition among the Publisher Defendants, ultimately effectuated by collectively adopting and adhering to functionally identical methods of selling e-books and price schedules.
96. For the purpose of forming and effectuating this agreement and conspiracy, some or all Defendants did the following things, among others:
a. Shared their business information, plans, and strategies in order to formulate ways to raise retail e-book prices;
b. Assured each other of support in attempting to raise retail e-book prices;
c. Employed ostensible joint venture meetings to disguise their attempts to raise retail e-book prices;
d. Fixed the method of and formulas for setting retail e-book prices;
e. Fixed tiers for retail e-book prices;
f. Eliminated the ability of e-book retailers to fund retail e-book price decreases out of their own margins; and
g. Raised the retail prices of their newly released and bestselling e-books to the agreed prices—the ostensible price caps—contained in the pricing schedule of their Apple Agency Agreements.
97. Defendants' conspiracy and agreement, in which the Publisher Defendants and Apple agreed to raise, fix, and stabilize retail e-book prices, to end price competition among e-book retailers, and to limit retail price competition among the Publisher Defendants by fixing retail e-book prices, constitutes a
98. Moreover, Defendants' conspiracy and agreement has resulted in obvious and demonstrable anticompetitive effects on consumers in the trade e-books market by depriving consumers of the benefits of competition among e-book retailers as to both retail prices and retail innovations (such as e-book clubs and subscription plans), such that it
99. Where, as here, defendants have engaged in a
100. The relevant geographic market is the United States. The rights to license e-books are granted on territorial bases, with the United States typically forming its own territory. E-book retailers typically present a unique storefront to U.S. consumers, often with e-books bearing different retail prices than the same titles would command on the same retailer's foreign Web sites.
101. The Publisher Defendants possess market power in the market for trade e-books. The Publisher Defendants successfully imposed and sustained a significant retail price increase for their trade e-books. Collectively, they create and distribute a wide variety of popular e-books, regularly comprising over half of the
102. Defendants' agreement and conspiracy has had and will continue to have anticompetitive effects, including:
a. Increasing the retail prices of trade e-books;
b. Eliminating competition on price among e-book retailers;
c. Restraining competition on retail price among the Publisher Defendants;
d. Restraining competition among the Publisher Defendants for favorable relationships with e-book retailers;
e. Constraining innovation among e-book retailers;
f. Entrenching incumbent publishers' favorable position in the sale and distribution of print books by slowing the migration from print books to e-books;
g. Making more likely express or tacit collusion among publishers; and
h. Reducing competitive pressure on print book prices.
103. Defendants' agreement and conspiracy is not reasonably necessary to accomplish any procompetitive objective, or, alternatively, its scope is broader than necessary to accomplish any such objective.
104. To remedy these illegal acts, the United States requests that the Court:
a. Adjudge and decree that Defendants entered into an unlawful contract, combination, or conspiracy in unreasonable restraint of interstate trade and commerce in violation of Section 1 of the Sherman Act, 15 U.S.C. 1;
b. Enjoin the Defendants, their officers, agents, servants, employees and attorneys and their successors and all other persons acting or claiming to act in active concert or participation with one or more of them, from continuing, maintaining, or renewing in any manner, directly or indirectly, the conduct alleged herein or from engaging in any other conduct, combination, conspiracy, agreement, understanding, plan, program, or other arrangement having the same effect as the alleged violation or that otherwise violates Section 1 of the Sherman Act, 15 U.S.C. 1, through fixing the method and manner in which they sell e-books, or otherwise agreeing to set the price or release date for e-books, or collective negotiation of e-book agreements, or otherwise collectively restraining retail price competition for e-books;
c. Prohibit the collusive setting of price tiers that can de facto fix prices;
d. Declare null and void the Apple Agency Agreements and any agreement between a Publisher Defendant and an e-book retailer that restricts, limits, or impedes the e-book retailer's ability to set, alter, or reduce the retail price of any e-book or to offer price or other promotions to encourage consumers to purchase any e-book, or contains a retail price MFN;
e. Reform the agreements between Apple and Publisher Defendants to strike the retail price MFN clauses as void and unenforceable; and
f. Award to Plaintiff its costs of this action and such other and further relief as may be appropriate and as the Court may deem just and proper.
Pursuant to Section 2(b) of the Antitrust Procedures and Penalties Act (“APPA” or “Tunney Act”), 15 U.S.C. 16(b)–(h), Plaintiff United States of America (“United States”) files this Competitive Impact Statement relating to the proposed Final Judgment against Defendant Penguin Group (USA), Inc. and The Penguin Group, a division of Pearson PLC, (collectively these two entities are referred to herein as “Penguin”), submitted on December 18, 2012, for entry in this antitrust proceeding.
On April 11, 2012, the United States filed a civil antitrust Complaint alleging that Apple, Inc. (“Apple”) and five of the six largest publishers in the United States (“Publisher Defendants”) restrained competition in the sale of electronic books (“e-books”), in violation of Section 1 of the Sherman Act, 15 U.S.C. 1. Shortly after filing the Complaint, the United States filed a proposed final judgment (“Original Judgment”) with respect to Defendants
Penguin has now agreed to settle on substantially the same terms as those contained in the Original Judgment. A proposed Final Judgment with respect to Penguin (“Penguin Final Judgment” or “PFJ”) that embodies that settlement was filed today. Of course, the case against the remaining Defendants—Apple, Inc., Verlagsgruppe Georg von Holtzbrinck GmbH, and Holtzbrinck Publishers, LLC d/b/a Macmillan—will continue.
The Penguin Final Judgment is described in more detail in Section III below. Because the language of the Penguin Final Judgment closely follows the language of the Original Judgment, this Competitive Impact Statement incorporates but does not repeat the extensive record relating to the Original Judgment.
The United States and Penguin have stipulated that the Penguin Final Judgment may be entered after compliance with the APPA, unless the United States withdraws its consent. Entry of the Penguin Final Judgment would terminate this action as to Penguin, except to the extent that Penguin has stipulated that it will cooperate in the United States' ongoing prosecution of the remaining Defendants, and that this Court would retain jurisdiction to construe, modify, and enforce the Penguin Final Judgment and to punish violations thereof.
As described in detail in the United States' Complaint (Docket No. 1), and the Competitive Impact Statement relating to the Original Judgment (“Original CIS,” Docket No. 5), Publisher Defendants desired to raise retail prices for e-books. (Compl. ¶ 3.) They were primarily upset by Amazon.com, Inc.'s (“Amazon's”) pricing of newly released and bestselling e-books at $9.99 or less. (Compl. ¶¶ 32–34.) Publisher Defendants feared that Amazon would resist any unilateral attempt to force an increase in e-book prices and that, even if an individual Publisher Defendant succeeded in such an attempt, that Publisher Defendant would lose sales to any competitors that had not forced the price of their books to supracompetitive levels. (Compl. ¶¶ 35–36, 46.) They met privately to discuss ways to collectively solve “the $9.99 problem.” (Compl. ¶¶ 39–45.) Ultimately, Publisher Defendants agreed to act collectively to raise retail e-book prices. (Compl. ¶¶ 47–50.)
Apple's entry into the e-book business provided a perfect opportunity to coordinate the Publisher Defendants' collective action to raise e-book prices. (Compl. ¶ 51.) At the suggestion of two Publisher Defendants, Apple began to consider selling e-books under an “agency model,” whereby the publishers would set the prices consumers ultimately paid for e-books and Apple would take a 30 percent commission as the selling agent. (Compl. ¶¶ 52–54, 63.) Apple recognized that, under this scheme, “the customer” would “pay[] a little more,” but that Apple would realize margins far in excess of what other retailers then averaged on their sales of newly-released and bestselling e-books. (Compl. ¶ 56.) To achieve this goal, Apple first expressly proposed to each Publisher Defendant that it adopt an agency pricing model with every outlet that would compete with Apple for retail e-book sales, Compl. ¶ 58, and later replaced that express requirement with a unique most favored nation (“MFN”) pricing provision that effectively enforced the Publisher Defendants' commitment to impose the agency pricing model on all other retailers. (Compl. ¶¶ 65–66.) This MFN protected Apple from price competition from other retailers, guaranteeing that its 30 percent margin would not be disturbed. (Compl. ¶ 65.) Apple kept each Publisher Defendant informed about the status of its negotiations with other Publisher Defendants. (Compl. ¶ 61.) In January 2010, Apple sent to each Publisher Defendant substantively identical term sheets that Apple told them were devised after “talking to all the other publishers.” (Compl. ¶¶ 62–64.) Those term sheets formed the basis of the nearly identical agency agreements signed by each Publisher Defendant (“Apple Agency Agreements”). The purpose of these agreements was to raise and stabilize e-book prices. (Compl. ¶ 66.) Apple CEO Steve Jobs explained to one Publisher Defendant that the Apple Agency Agreements provided a path for the Publisher Defendants away from $9.99 and to higher retail e-book prices. (Compl. ¶ 71.) He urged the Publisher Defendants to “[t]hrow in with Apple and see if we can all make a go of this to create a real mainstream e-books market at $12.99 and $14.99.”
The language and relief contained in the Penguin Final Judgment is largely identical to the terms included in the Original Judgment. Below, we describe, in abbreviated form, the purpose of each provision of the Penguin Final Judgment. Penguin's decision to join the other settling Publisher Defendants in agreeing to the settlement terms will provide prompt, certain, and effective remedies that will continue the effort to restore competition to the marketplace. Settlement likely will lead to lower e-book prices for many Penguin titles; prices for titles offered by HarperCollins, Hachette, and Simon & Schuster fell soon after those publishers entered into new contracts as a result of the Original Judgment.
The Penguin Final Judgment begins by addressing those agreements used
Further, in order to reduce the risk that Penguin may use future joint ventures to eliminate competition among Publisher Defendants, Section IV.C requires that Penguin provide advance notice to the Department of Justice before forming or modifying a joint venture between it and another publisher related to e-books.
Finally, to ensure Penguin's compliance with the Penguin Final Judgment, Section IV.D requires that Penguin provide, on a quarterly basis, each e-book agreement it has reached with any e-book retailer on or after January 1, 2012.
In order to ensure that e-book retailers can compete on the price of e-books sold to consumers in the future, the Penguin Final Judgment also prohibits terms that prevent retail price competition. Sections V.A, V.B, and V.C limit Penguin's ability to enter new agreements (and enforce old agreements) that contain two components of the Apple Agency Agreements: the ban on retailer discounting, and the retail price-matching MFNs that ensured agency terms were exported to all e-book retailers. Sections V.A. and V.B. prevent Penguin, for a two-year period, from forbidding retailers to offer price promotions or discounts on its e-books. Allowing e-book retailers to negotiate new contracts with Penguin, without permitting Penguin, for a set period, to prohibit retailers from discounting, will help ensure that new contracts will not be set under the collusive conditions that produced the Apple Agency Agreements.
Further, Penguin may not retaliate against or punish an e-book retailer based on the retailer's e-book prices or its discounting or promotional choices. PFJ § V.D. Nor may Penguin repeat its previous attempt to retaliate by proxy, as this provision bars Penguin from encouraging another company to retaliate against an e-book retailer on its behalf. However, the anti-retaliation provision does not prohibit Penguin from unilaterally entering into and enforcing agency agreements with e-book retailers after the two-year proscription, required in Sections V.A and V.B, has expired.
In addition to addressing terms used in the Apple Agency Agreements to implement the conspiracy, the Penguin Final Judgment also forbids a recurrence of the alleged conspiracy, and prohibits industry practices that facilitated it. Section V.E prohibits Penguin from agreeing with other Defendants or e-book publishers to raise or set e-book retail prices or coordinate terms relating to the licensing, distribution, or sale of e-books. Section V.F likewise prohibits Penguin from directly or indirectly conveying confidential or competitively sensitive information to any other e-book publisher. Banning such communications is critical here, where communications among publishing competitors were a common practice, and led directly to the collusive agreement alleged in the Complaint.
The Penguin Final Judgment also specifically carves out some conduct—which normally is permitted under the antitrust laws—that Penguin may unilaterally pursue. Section VI.A of the Penguin Final Judgment allows Penguin to compensate e-book retailers for services that they provide to publishers or consumers and help promote or sell more e-books. Section VI.B permits Penguin to negotiate a commitment from an e-book retailer that a retailer's aggregate expenditure on discounts and promotions of Penguin's e-books will not exceed the retailer's aggregate commission under an agency agreement in which Penguin sets the e-book price and the retailer is compensated through a commission. These provisions allow Penguin to prevent a retailer selling its entire catalogue at a sustained loss, while still permitting retailers to offer discounts under Sections V.A and V.B. Absent the collusion here, the antitrust laws would normally permit a publisher unilaterally to negotiate for such protections.
As outlined in Section VII, Penguin also must designate an Antitrust Compliance Officer, who is required to distribute copies of the Penguin Final Judgment; ensure training related to the Penguin Final Judgment and the antitrust laws; certify compliance with the Penguin Final Judgment; and conduct an annual antitrust compliance audit. This compliance program is necessary considering the extensive communication among competitors' CEOs that facilitated Defendants' agreement.
The United States considered, as an alternative to the Penguin Final Judgment, a full trial on the merits against Penguin. The United States believes that the relief contained in the Penguin Final Judgment will more quickly restore retail price competition to consumers.
Section 4 of the Clayton Act, 15 U.S.C. 15, provides that any person who has been injured as a result of conduct prohibited by the antitrust laws may bring suit in federal court to recover three times the damages the person has suffered, as well as costs and reasonable attorneys' fees. Entry of the Penguin Final Judgment will neither impair nor assist the bringing of any private antitrust damage action. Under the provisions of Section 5(a) of the Clayton Act, 15 U.S.C. 16(a), the Penguin Final Judgment has no
The United States and Penguin have stipulated that the Penguin Final Judgment may be entered by this Court after compliance with the provisions of the APPA, provided that the United States has not withdrawn its consent. The APPA conditions entry of the decree upon this Court's determination that the Penguin Final Judgment is in the public interest.
The APPA provides a period of at least sixty (60) days preceding the effective date of the Penguin Final Judgment within which any person may submit to the United States written comments regarding the Penguin Final Judgment. Any person who wishes to comment should do so within sixty (60) days of publication of this Competitive Impact Statement in the
All comments received during this period will be considered by the United States Department of Justice, which remains free to withdraw its consent to the Penguin Final Judgment at any time prior to the Court's entry of judgment. The comments and the responses of the United States will be filed with the Court and published either in the
The Penguin Final Judgment provides that the Court retains jurisdiction over this action, and the parties may apply to the Court for any order necessary or appropriate for modification, interpretation, or enforcement of the Final Judgment
The Clayton Act, as amended by the APPA, requires that proposed consent judgments in antitrust cases brought by the United States be subject to a sixty-day comment period, after which the court shall determine whether entry of the proposed Final Judgment “is in the public interest.” 15 U.S.C. 16(e)(1). In making that determination, the court is directed to consider:
(A) the competitive impact of such judgment, including termination of alleged violations, provisions for enforcement and modification, duration of relief sought, anticipated effects of alternative remedies actually considered, whether its terms are ambiguous, and any other competitive considerations bearing upon the adequacy of such judgment that the court deems necessary to a determination of whether the consent judgment is in the public interest; and
(B) the impact of entry of such judgment upon competition in the relevant market or markets, upon the public generally and individuals alleging specific injury from the violations set forth in the complaint including consideration of the public benefit, if any, to be derived from a determination of the issues at trial.
15 U.S.C. 16(e)(1)(A) & (B);
In other words, under the Tunney Act, a court considers, among other things, the relationship between the remedy secured and the specific allegations set forth in the government's complaint, whether the decree is sufficiently clear, whether enforcement mechanisms are sufficient, and whether the decree may positively harm third parties.
There are no determinative materials or documents within the meaning of the APPA that were considered by the United States in formulating the Penguin Final Judgment.
Additionally, courtesy copies of this Competitive Impact Statement have been provided to the following:
v.
This Court has jurisdiction over the subject matter of this action and over Penguin. The Complaint states a claim upon which relief may be granted against Penguin under Section 1 of the Sherman Act, as amended, 15 U.S.C. ' 1.
As used in this Final Judgment:
A. “Agency Agreement” means an agreement between an E-book Publisher and an E-book Retailer under which the E-book Publisher Sells E-books to consumers through the E-book Retailer, which under the agreement acts as an agent of the E-book Publisher and is paid a commission in connection with the Sale of one or more of the E-book Publisher's E-books.
B. “Apple” means Apple, Inc., a California corporation with its principal place of business in Cupertino, California, its successors and assigns, and its parents, subsidiaries, divisions, groups, affiliates, partnerships, and joint ventures, and their directors, officers, managers, agents, and employees.
C. “Department of Justice” means the Antitrust Division of the United States Department of Justice.
D. “E-book” means an electronically formatted book designed to be read on a computer, a handheld device, or other electronic devices capable of visually displaying E-books. For purposes of this Final Judgment, the term E-book does not include (1) an audio book, even if delivered and stored digitally; (2) a standalone specialized software application or “app” sold through an “app store” rather than through an e-book store (
E. “E-book Publisher” means any Person that, by virtue of a contract or other relationship with an E-book's author or other rights holder, owns or controls the necessary copyright or other authority (or asserts such ownership or control) over any E-book sufficient to distribute the E-book within the United States to E-book Retailers and to permit such E-book Retailers to Sell the E-book to consumers in the United States. Publisher Defendants are E-book Publishers. For purposes of this Final Judgment, E-book Retailers are not E-book Publishers.
F. “E-book Retailer” means any Person that lawfully Sells (or seeks to lawfully Sell) E-books to consumers in the United States, or through which a Publisher Defendant, under an Agency Agreement, Sells E-books to consumers. For purposes of this Final Judgment, Publisher Defendants and all other Persons whose primary business is book publishing are not E-book Retailers.
G. “Hachette” means Hachette Book Group, Inc., a Delaware corporation with its principal place of business in New York, New York, its successors and assigns, and its subsidiaries, divisions, groups, and partnerships, and their directors, officers, managers, agents, and employees.
H. “HarperCollins” means HarperCollins Publishers L.L.C., a Delaware limited liability company with its principal place of business in New York, New York, its successors and assigns, and its subsidiaries, divisions, groups, and partnerships, and their directors, officers, managers, agents, and employees.
I. “Including” means including, but not limited to.
J. “Macmillan” means (1) Holtzbrinck Publishers, LLC d/b/a Macmillan, a New York limited liability company with its principal place of business in New York, New York; and (2) Verlagsgruppe
K. “Penguin” means (1) Penguin Group (USA), Inc., a Delaware corporation with its principal place of business in New York, New York; (2) The Penguin Group, a division of U.K. corporation Pearson plc with its principal place of business in London, England; (3) The Penguin Publishing Company Ltd, a company registered in England and Wales with its principal place of business in London, England; and (4) Dorling Kindersley Holdings Limited, a company registered in England and Wales with its principal place of business in London, England; and each of their respective successors and assigns (expressly including Penguin Random House and any similar joint venture between Penguin and Random House Inc.); each of their respective subsidiaries, divisions, groups, partnerships; and each of their respective directors, officers, managers, agents, and employees. Where Section IV.A, IV.B, IV.D, or VII imposes an obligation on Penguin to engage in certain conduct by either a date certain or by a specified day after entry of this Final Judgment, any successor or assign whose acquisition of or combination or other relationship with Penguin is consummated after entry of this Final Judgment shall meet each such obligation within thirty days after consummation. The prohibitions of Section V.A of this Final Judgment shall expire for any successor or assign of Penguin on the dates on which such prohibitions would have expired for Penguin had the acquisition, combination, or other relationship not occurred. Where the Final Judgment imposes an obligation on Penguin to engage in or refrain from engaging in certain conduct, that obligation shall apply to Penguin and to any joint venture or other business arrangement established by Penguin and one or more Publisher Defendants.
L. “Penguin Random House” means the joint venture entities, which will operate under the name “Penguin Random House,” that will be formed pursuant to the Contribution Agreement, dated October 29, 2012, by and between Pearson plc and Bertelsmann SE & Co. KGaA.
M. “Person” means any natural person, corporation, company, partnership, joint venture, firm, association, proprietorship, agency, board, authority, commission, office, or other business or legal entity, whether private or governmental.
N. “Price MFN” means a term in an agreement between an E-book Publisher and an E-book Retailer under which
1. the Retail Price at which an E-book Retailer or, under an Agency Agreement, an E-book Publisher Sells one or more E-books to consumers depends in any way on the Retail Price, or discounts from the Retail Price, at which any other E-book Retailer or the E-book Publisher, under an Agency Agreement, through any other E-book Retailer Sells the same E-book(s) to consumers;
2. the Wholesale Price at which the E-book Publisher Sells one or more E-books to that E-book Retailer for Sale to consumers depends in any way on the Wholesale Price at which the E-book Publisher Sells the same E-book(s) to any other E-book Retailer for Sale to consumers; or
3. the revenue share or commission that E-book Retailer receives from the E-book Publisher in connection with the Sale of one or more E-books to consumers depends in any way on the revenue share or commission that (a) any other E-book Retailer receives from the E-book Publisher in connection with the Sale of the same E-book(s) to consumers, or (b) that E-book Retailer receives from any other E-book Publisher in connection with the Sale of one or more of the other E-book Publisher's E-books.
For purposes of this Final Judgment, it will not constitute a Price MFN under subsection 3 of this definition if Penguin agrees, at the request of an E-book Retailer, to meet more favorable pricing, discounts, or allowances offered to the E-book Retailer by another E-book Publisher for the period during which the other E-book Publisher provides that additional compensation, so long as that agreement is not or does not result from a pre-existing agreement that requires Penguin to meet all requests by the E-book Retailer for more favorable pricing within the terms of the agreement.
O. “Publisher Defendants” means Hachette, HarperCollins, Macmillan, Penguin, and Simon & Schuster. Where this Final Judgment imposes an obligation on Publisher Defendants to engage in or refrain from engaging in certain conduct, that obligation shall apply to each Publisher Defendant individually and to any joint venture or other business arrangement established by any two or more Publisher Defendants.
P. “Purchase” means a consumer's acquisition of one or more E-books as a result of a Sale.
Q. “Retail Price” means the price at which an E-book Retailer or, under an Agency Agreement, an E-book Publisher Sells an E-book to a consumer.
R. “Sale” means delivery of access to a consumer to read one or more E-books (purchased alone, or in combination with other goods or services) in exchange for payment; “Sell” or “Sold” means to make or to have made a Sale of an E-book to a consumer.
S. “Simon & Schuster” means Simon & Schuster, Inc., a New York corporation with its principal place of business in New York, New York, its successors and assigns, and its subsidiaries, divisions, groups, and partnerships, and their directors, officers, managers, agents, and employees.
T. “Wholesale Price” means (1) the net amount, after any discounts or other adjustments (not including promotional allowances subject to Section 2(d) of the Robinson-Patman Act, 15 U.S.C. 13(d)), that an E-book Retailer pays to an E-book Publisher for an E-book that the E-book Retailer Sells to consumers; or (2) the Retail Price at which an E-book Publisher, under an Agency Agreement, Sells an E-book to consumers through an E-book Retailer minus the commission or other payment that E-book Publisher pays to the E-book Retailer in connection with or that is reasonably allocated to that Sale.
This Final Judgment applies to Penguin and all other Persons in active concert or participation with Penguin who receive actual notice of this Final Judgment by personal service or otherwise.
A. Within seven days after entry of this Final Judgment, Penguin shall terminate any agreement with Apple relating to the Sale of E-books that was executed prior to Penguin's stipulation to the entry of this Final Judgment.
B. For each agreement between Penguin and an E-book Retailer other than Apple that (1) restricts, limits, or impedes the E-book Retailer's ability to set, alter, or reduce the Retail Price of any E-book or to offer price discounts or any other form of promotions to encourage consumers to Purchase one or more E-books; or (2) contains a Price MFN, Penguin shall notify the E-book Retailer, by January 8, 2013, that the E-book Retailer may terminate the agreement with thirty-days notice and shall, thirty days after the E-book Retailer provides such notice, release the E-book Retailer from the agreement. For each such agreement that the E-book
C. Penguin shall notify the Department of Justice in writing at least sixty days in advance of the formation or material modification of any joint venture or other business arrangement relating to the Sale, development, or promotion of E-books in the United States in which Penguin and at least one other E-book Publisher (including another Publisher Defendant) are participants or partial or complete owners. Such notice shall describe the joint venture or other business arrangement, identify all E-book Publishers that are parties to it, and attach the most recent version or draft of the agreement, contract, or other document(s) formalizing the joint venture or other business arrangement. Within thirty days after Penguin provides notification of the joint venture or business arrangement, the Department of Justice may make a written request for additional information. If the Department of Justice makes such a request, Penguin shall not proceed with the planned formation or material modification of the joint venture or business arrangement until thirty days after substantially complying with such additional request(s) for information. The failure of the Department of Justice to request additional information or to bring an action under the antitrust laws to challenge the formation or material modification of the joint venture shall neither give rise to any inference of lawfulness nor limit in any way the right of the United States to investigate the formation, material modification, or any other aspects or activities of the joint venture or business arrangement and to bring actions to prevent or restrain violations of the antitrust laws.
The notification requirements of this Section IV.C shall not apply to ordinary course business arrangements between Penguin and another E-book Publisher (not a Publisher Defendant) that do not relate to the Sale of E-books to consumers, or to business arrangements the primary or predominant purpose or focus of which involves: (i) E-book Publishers co-publishing one or more specifically identified E-book titles or a particular author's E-books; (ii) Penguin licensing to or from another E-book Publisher the publishing rights to one or more specifically identified E-book titles or a particular author's E-books; (iii) Penguin providing technology services to or receiving technology services from another E-book Publisher (not a Publisher Defendant) or licensing rights in technology to or from another E-book Publisher; or (iv) Penguin distributing E-books published by another E-book Publisher (not a Publisher Defendant). The notification requirements of this Section IV.C shall also not apply to the formation of Penguin Random House, review of which is pending before the Department of Justice.
D. Penguin shall furnish to the Department of Justice (1) by January 8, 2013, one complete copy of each agreement, executed, renewed, or extended on or after January 1, 2012, between Penguin and any E-book Retailer relating to the Sale of E-books, and, (2) thereafter, on a quarterly basis, each such agreement executed, renewed, or extended since Penguin's previous submission of agreements to the Department of Justice.
A. For two years, Penguin shall not restrict, limit, or impede an E-book Retailer's ability to set, alter, or reduce the Retail Price of any E-book or to offer price discounts or any other form of promotions to encourage consumers to Purchase one or more E-books, such two-year period to run separately for each E-book Retailer, at Penguin's option, from either:
1. the termination of an agreement between Penguin and the E-book Retailer that restricts, limits, or impedes the E-book Retailer's ability to set, alter, or reduce the Retail Price of any E-book or to offer price discounts or any other form of promotions to encourage consumers to Purchase one or more E-books; or
2. the date on which Penguin notifies the E-book Retailer in writing that Penguin will not enforce any term(s) in its agreement with the E-book Retailer that restrict, limit, or impede the E-book Retailer from setting, altering, or reducing the Retail Price of one or more E-books, or from offering price discounts or any other form of promotions to encourage consumers to Purchase one or more E-books.
Penguin shall notify the Department of Justice of the option it selects for each E-book Retailer within seven days of making its selection.
B. For two years after Penguin's stipulation to the entry of this Final Judgment, Penguin shall not enter into any agreement with any E-book Retailer that restricts, limits, or impedes the E-book Retailer from setting, altering, or reducing the Retail Price of one or more E-books, or from offering price discounts or any other form of promotions to encourage consumers to Purchase one or more E-books.
C. Penguin shall not enter into any agreement with an E-book Retailer relating to the Sale of E-books that contains a Price MFN.
D. Penguin shall not retaliate against, or urge any other E-book Publisher or E-book Retailer to retaliate against, an E-book Retailer for engaging in any activity that Penguin is prohibited by Sections V.A, V.B, and VI.B.2 of this Final Judgment from restricting, limiting, or impeding in any agreement with an E-book Retailer. After the expiration of prohibitions in Sections V.A and V.B of this Final Judgment, this Section V.D shall not prohibit Penguin from unilaterally entering into or enforcing any agreement with an E-book Retailer that restricts, limits, or impedes the E-book Retailer from setting, altering, or reducing the Retail Price of any of Penguin's E-books or from offering price discounts or any other form of promotions to encourage consumers to Purchase any of Penguin's E-books.
E. Penguin shall not enter into or enforce any agreement, arrangement, understanding, plan, program, combination, or conspiracy with any E-book Publisher (including another Publisher Defendant) to raise, stabilize, fix, set, or coordinate the Retail Price or Wholesale Price of any E-book or fix, set, or coordinate any term or condition relating to the Sale of E-books.
This Section V.E shall not prohibit Penguin from entering into and enforcing agreements relating to the distribution of another E-book Publisher's E-books (not including the E-books of another Publisher Defendant) or to the co-publication with another E-book Publisher of specifically identified E-book titles or a particular author's E-books, or from participating in output-enhancing industry standard-setting activities relating to E-book security or technology.
F. Penguin (including each officer of each parent of Penguin who exercises direct control over Penguin's business decisions or strategies) shall not convey or otherwise communicate, directly or indirectly (including by communicating indirectly through an E-book Retailer with the intent that the E-book Retailer convey information from the communication to another E-book Publisher or knowledge that it is likely to do so), to any other E-book Publisher (including to an officer of a parent of a Publisher Defendant) any competitively sensitive information, including:
1. its business plans or strategies;
2. its past, present, or future wholesale or retail prices or pricing
3. any terms in its agreement(s) with any retailer of books Sold in any format; or
4. any terms in its agreement(s) with any author.
This Section V.F shall not prohibit Penguin from communicating (a) in a manner and through media consistent with common and reasonable industry practice, the cover prices or wholesale or retail prices of books sold in any format to potential purchasers of those books; or (b) information Penguin needs to communicate in connection with (i) its enforcement or assignment of its intellectual property or contract rights, (ii) a contemplated merger, acquisition, or purchase or sale of assets, (iii) its distribution of another E-book Publisher's E-books, or (iv) a business arrangement under which E-book Publishers agree to co-publish, or an E-book Publisher agrees to license to another E-book Publisher the publishing rights to, one or more specifically identified E-book titles or a particular author's E-books.
A. Nothing in this Final Judgment shall prohibit Penguin unilaterally from compensating a retailer, including an E-book Retailer, for valuable marketing or other promotional services rendered.
B. Notwithstanding Sections V.A and V.B of this Final Judgment, Penguin may enter into Agency Agreements with E-book Retailers under which the aggregate dollar value of the price discounts or any other form of promotions to encourage consumers to Purchase one or more of Penguin's E-books (as opposed to advertising or promotions engaged in by the E-book Retailer not specifically tied or directed to Penguin's E-books) is restricted;
Within thirty days after entry of this Final Judgment, Penguin shall designate its general counsel or chief legal officer, or an employee reporting directly to its general counsel or chief legal officer, as Antitrust Compliance Officer with responsibility for ensuring Penguin's compliance with this Final Judgment. The Antitrust Compliance Officer shall be responsible for the following:
A. Furnishing a copy of this Final Judgment, within thirty days of its entry, to each of Penguin's officers and directors, and to each of Penguin's employees engaged, in whole or in part, in the distribution or Sale of E-books;
B. furnishing a copy of this Final Judgment in a timely manner to each officer, director, or employee who succeeds to any position identified in Section VII.A of this Final Judgment;
C. ensuring that each person identified in Sections VII.A and VII.B of this Final Judgment receives at least four hours of training annually on the meaning and requirements of this Final Judgment and the antitrust laws, such training to be delivered by an attorney with relevant experience in the field of antitrust law;
D. obtaining, within sixty days after entry of this Final Judgment and on each anniversary of the entry of this Final Judgment, from each person identified in Sections VII.A and VII.B of this Final Judgment, and thereafter maintaining, a certification that each such person (a) has read, understands, and agrees to abide by the terms of this Final Judgment; and (b) is not aware of any violation of this Final Judgment or the antitrust laws or has reported any potential violation to the Antitrust Compliance Officer;
E. conducting an annual antitrust compliance audit covering each person identified in Sections VII.A and VII.B of this Final Judgment, and maintaining all records pertaining to such audits;
F. communicating annually to Penguin's employees that they may disclose to the Antitrust Compliance Officer, without reprisal, information concerning any potential violation of this Final Judgment or the antitrust laws;
G. taking appropriate action, within three business days of discovering or receiving credible information concerning an actual or potential violation of this Final Judgment, to terminate or modify Penguin's conduct to assure compliance with this Final Judgment; and, within seven days of taking such corrective actions, providing to the Department of Justice a description of the actual or potential violation of this Final Judgment and the corrective actions taken;
H. furnishing to the Department of Justice on a quarterly basis electronic copies of any non-privileged communications with any Person containing allegations of Penguin's noncompliance with any provisions of this Final Judgment;
I. maintaining, and furnishing to the Department of Justice on a quarterly basis, a log of all oral and written communications, excluding privileged or public communications, between or among (1) any of Penguin's officers, directors, or employees involved in the development of Penguin's plans or strategies relating to E-books, and (2) any person employed by or associated with another Publisher Defendant, relating, in whole or in part, to the distribution or sale in the United States of books sold in any format, including an identification (by name, employer, and job title) of the author and recipients of and all participants in the communication, the date, time, and duration of the communication, the medium of the communication, and a description of the subject matter of the communication (for a collection of communications solely concerning a single business arrangement that is specifically exempted from the reporting requirements of Section IV.C of this Final Judgment, Penguin may provide a summary of the communications rather than logging each communication individually); and
J. providing to the Department of Justice annually, on or before the anniversary of the entry of this Final Judgment, a written statement as to the fact and manner of Penguin's compliance with Sections IV, V, and VII of this Final Judgment.
U. For purposes of determining or securing compliance with this Final Judgment, or of determining whether the Final Judgment should be modified or vacated, and subject to any legally recognized privilege, from time to time duly authorized representatives of the Department of Justice, including consultants and other persons retained by the Department of Justice, shall, upon written request of an authorized representative of the Assistant Attorney General in charge of the Antitrust Division, and on reasonable notice to Penguin, be permitted:
1. Access during Penguin's office hours to inspect and copy, or at the option of the United States, to require Penguin to provide to the United States hard copy or electronic copies of all books, ledgers, accounts, records, data,
2. to interview, either informally or on the record, Penguin's officers, employees, or agents, who may have their individual counsel present, regarding such matters. The interviews shall be subject to the reasonable convenience of the interviewee and without restraint or interference by Penguin.
V. Upon the written request of an authorized representative of the Assistant Attorney General in charge of the Antitrust Division, Penguin shall submit written reports or respond to written interrogatories, under oath if requested, relating to any of the matters contained in this Final Judgment as may be requested. Written reports authorized under this paragraph may, in the sole discretion of the United States, require Penguin to conduct, at their cost, an independent audit or analysis relating to any of the matters contained in this Final Judgment.
W. No information or documents obtained by the means provided in this Section shall be divulged by the United States to any person other than an authorized representative of the executive branch of the United States, except in the course of legal proceedings to which the United States is a party (including grand jury proceedings), or for the purpose of securing compliance with this Final Judgment, or as otherwise required by law.
X. If at the time information or documents are furnished by Penguin to the United States, Penguin represents and identifies in writing the material in any such information or documents to which a claim of protection may be asserted under Rule 26(c)(1)(G) of the Federal Rules of Civil Procedure, and Penguin marks each pertinent page of such material, “Subject to claim of protection under Rule 26(c)(1)(G) of the Federal Rules of Civil Procedure,” then the United States shall give Penguin ten calendar days notice prior to divulging such material in any civil or administrative proceeding.
This Court retains jurisdiction to enable any party to apply to this Court at any time for further orders and directions as may be necessary or appropriate to carry out or construe this Final Judgment, to modify any of its provisions, to enforce compliance, and to punish violations of its provisions.
Nothing in this Final Judgment shall limit the right of the United States to investigate and bring actions to prevent or restrain violations of the antitrust laws concerning any past, present, or future conduct, policy, or practice of Penguin.
Unless this Court grants an extension, this Final Judgment shall expire five years from the date of its entry.
Entry of this Final Judgment is in the public interest. The parties have complied with the requirements of the Antitrust Procedures and Penalties Act, 15 U.S.C. ' 16, including making copies available to the public of this Final Judgment, the Competitive Impact Statement, and any comments thereon and the United States' responses to comments. Based upon the record before the Court, which includes the Competitive Impact Statement and any comments and response to comments filed with the Court, entry of this Final Judgment is in the public interest.
Court approval subject to procedures set forth in the Antitrust Procedures and Penalties Act, 15 U.S.C. 16
Notice.
The Department of Labor (DOL) is submitting the Employment and Training Administration (ETA) sponsored information collection request (ICR) revision titled, “Reporting for the National Farmworker Jobs Program under Section 167 of Title I of the Workforce Investment Act,” to the Office of Management and Budget (OMB) for review and approval for use in accordance with the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501 et seq.).
Submit comments on or before January 30, 2013.
A copy of this ICR with applicable supporting documentation; including a description of the likely respondents, proposed frequency of response, and estimated total burden may be obtained from the
Submit comments about this request to the Office of Information and Regulatory Affairs, Attn: OMB Desk Officer for DOL–ETA, Office of Management and Budget, Room 10235, 725 17th Street NW., Washington, DC 20503, Fax: 202–395–6881 (this is not a toll-free number), email:
Contact Michel Smyth by telephone at 202–693–4129 (this is not a toll-free number) or by email at
44 U.S.C. 3507(a)(1)(D).
This ICR relates to the operation of employment and training programs for migrant and seasonal farmworkers under title I, section 167 of the Workforce Investment Act (WIA). It also contains the basis of the performance standards system for WIA section 167 grantees, which is used for program oversight, evaluation, and performance assessment.
This information collection is subject to the PRA. A Federal agency generally cannot conduct or sponsor a collection of information, and the public is generally not required to respond to an information collection, unless it is approved by the OMB under the PRA and displays a currently valid OMB Control Number. In addition, notwithstanding any other provisions of law, no person shall generally be subject to penalty for failing to comply with a collection of information that does not display a valid Control Number.
Interested parties are encouraged to send comments to the OMB, Office of
• Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
• Evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
• Enhance the quality, utility, and clarity of the information to be collected; and
• Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.
Notice.
The Department of Labor (DOL) is submitting the Employment and Training Administration (ETA) sponsored information collection request (ICR) revision titled, “Workforce Investment Act Management Information and Reporting System,” to the Office of Management and Budget (OMB) for review and approval for use in accordance with the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501
Submit comments on or before January 30, 2013.
A copy of this ICR with applicable supporting documentation; including a description of the likely respondents, proposed frequency of response, and estimated total burden may be obtained from the RegInfo.gov Web site,
Submit comments about this request to the Office of Information and Regulatory Affairs, Attn: OMB Desk Officer for DOL–ETA, Office of Management and Budget, Room 10235, 725 17th Street NW., Washington, DC 20503, Fax: 202–395–6881 (this is not a toll-free number), email: OIRA_submission@omb.eop.gov.
Contact Michel Smyth by telephone at 202–693–4129 (this is not a toll-free number) or by email at DOL_PRA_PUBLIC@dol.gov.
44 U.S.C. 3507(a)(1)(D).
This ICR is for a three-year extension to the OMB PRA approval for the Workforce Investment Act Management Information and Reporting System with modifications to make Workforce Investment Act (WIA) performance reporting completely compatible with workforce investment streamlined performance reporting. This WIA reporting structure includes quarterly (ETA 9090) and annual (ETA 9091) reports, as well as a standardized individual record file for program participants, called the Workforce Investment Act Standardized Record Data (WIASRD). States submit WIASRD to the ETA and include participant level information on customer demographics, type of services received, and statutorily defined measures of outcomes. This ICR also covers customer satisfaction surveys related to the program.
This information collection is subject to the PRA. A Federal agency generally cannot conduct or sponsor a collection of information, and the public is generally not required to respond to an information collection, unless it is approved by the OMB under the PRA and displays a currently valid OMB Control Number. In addition, notwithstanding any other provisions of law, no person shall generally be subject to penalty for failing to comply with a collection of information that does not display a valid Control Number.
Interested parties are encouraged to send comments to the OMB, Office of Information and Regulatory Affairs at the address shown in the
• Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
• Evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
• Enhance the quality, utility, and clarity of the information to be collected; and
• Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.
Mine Safety and Health Administration, Labor.
Notice.
Section 101(c) of the Federal Mine Safety and Health Act of 1977 and 30 CFR part 44 govern the application, processing, and disposition of petitions for modification. This notice is a summary of petitions for modification submitted to the Mine Safety and Health Administration (MSHA) by the parties listed below to modify the application of existing mandatory safety standards codified in Title 30 of the Code of Federal Regulations.
All comments on the petitions must be received by the Office of Standards, Regulations and Variances on or before January 30, 2013.
You may submit your comments, identified by “docket number” on the subject line, by any of the following methods:
1.
2.
3.
MSHA will consider only comments postmarked by the U.S. Postal Service or proof of delivery from another delivery service such as UPS or Federal Express on or before the deadline for comments.
Barbara Barron, Office of Standards, Regulations and Variances at 202–693–9447 (Voice),
Section 101(c) of the Federal Mine Safety and Health Act of 1977 (Mine Act) allows the mine operator or representative of miners to file a petition to modify the application of any mandatory safety standard to a coal or other mine if the Secretary of Labor determines that:
(1) An alternative method of achieving the result of such standard exists which will at all times guarantee no less than the same measure of protection afforded the miners of such mine by such standard; or
(2) That the application of such standard to such mine will result in a diminution of safety to the miners in such mine.
In addition, the regulations at 30 CFR 44.10 and 44.11 establish the requirements and procedures for filing petitions for modification.
(1) The Kentucky Office of Mine Safety and Licensing requires “a warning device” to be placed installed on the second row of permanent roof support outby unsupported roof.
(2) MSHA's approved Precautions for Remote Control Operation of Continuous Mining Machines states that “while using remote controls, the continuous mining machine operator and all other persons will position themselves no closer than the second “full row” of installed roof bolts outby the face.
(3) This petition is necessary to improve safety and to attain commonality between State and Federal regulations.
(4) Safety increases when the distance an employee keeps from unsupported roof increases.
The petitioner asserts that the proposed alternative method will at all times guarantee no less than the same measure of protection afforded by the existing standard.
(1) To comply with requirements for mine ventilation maps and mine maps in 30 CFR 75.372 and 75.1200, use of the most practical and accurate surveying equipment is necessary.
(2) Application of the existing standard would result in a diminution of safety to the miners. Underground mining by its nature and size, and the complexity of mine plans, requires that accurate and precise measurements be completed in a prompt and efficient manner. The petitioner proposes the following as an alternative to the existing standard:
(a) Nonpermissible electronic surveying equipment will be used when equivalent permissible electronic surveying equipment is not available. Such nonpermissible surveying equipment includes portable battery-operated total station surveying equipment, mine transits, distance meters, and data loggers.
(b) All nonpermissible electronic surveying equipment to be used in or inby the last open crosscut will be examined by surveying personnel prior to use to ensure the equipment is being maintained in a safe operating condition. These examinations will include the following steps:
(i) Checking the instrument for any physical damage and the integrity of the case.
(ii) Removing the battery and inspecting for corrosion.
(iii) Inspecting the contact points to ensure a secure connection to the battery.
(iv) Reinserting the battery and powering up and shutting down to ensure proper connections.
(v) Checking the battery compartment cover to ensure that it is securely fastened.
(c) The results of such examinations will be recorded and retained for one year and made available to MSHA on request.
(d) A qualified person as defined in 30 CFR 75.151 will continuously monitor for methane immediately before and during the use of nonpermissible surveying equipment in or inby the last open crosscut.
(e) Nonpermissible surveying equipment will not be used if methane is detected in concentrations at or above one percent for the area being surveyed. When methane is detected at such levels while the nonpermissible surveying equipment is being used, the equipment will be deenergized immediately and the nonpermissible electronic equipment withdrawn outby the last open crosscut.
(f) All hand-held methane detectors will be MSHA-approved and maintained in permissible and proper operating condition as defined in 30 CFR 75.320.
(g) Batteries in the surveying equipment will be changed out or charged in fresh air outby the last open crosscut.
(h) Qualified personnel who use surveying equipment will be properly trained to recognize the hazards associated with the use of nonpermissible surveying equipment in areas where methane could be present.
(i) The nonpermissible surveying equipment will not be put into service until MSHA has initially inspected the equipment and determined that it is in compliance with all the terms and conditions in this petition.
Within 60 days after the Proposed Decision and Order becomes final, the petitioner will submit proposed revisions for its approved 30 CFR part 48 training plan to the District Manager. The revisions will specify initial and refresher training regarding the terms and conditions in the Proposed Decision and Order.
The petitioner asserts that the proposed alternative method will at all times guarantee no less than the same measure of protection as that afforded by the existing standard.
(1) To comply with requirements for mine ventilation maps and mine maps in 30 CFR 75.372 and 75.1200, use of the most practical and accurate surveying equipment is necessary.
(2) Application of the existing standard would result in a diminution of safety to the miners. Underground mining by its nature and size, and the complexity of mine plans, requires that accurate and precise measurements be completed in a prompt and efficient manner. The petitioner proposes the following as an alternative to the existing standard:
(a) Nonpermissible electronic surveying equipment will be used when equivalent permissible electronic surveying equipment is not available. Such nonpermissible surveying equipment includes portable battery-operated total station surveying equipment, mine transits, distance meters, and data loggers.
(b) All nonpermissible electronic surveying equipment to be used in return airways will be examined by surveying personnel prior to use to ensure the equipment is being maintained in a safe operating condition. These examinations will include the following steps:
(i) Checking the instrument for any physical damage and the integrity of the case.
(ii) Removing the battery and inspecting for corrosion.
(iii) Inspecting the contact points to ensure a secure connection to the battery.
(iv) Reinserting the battery and powering up and shutting down to ensure proper connections.
(v) Checking the battery compartment cover to ensure that it is securely fastened.
(c) The results of such examinations will be recorded and retained for one year and made available to MSHA on request.
(d) A qualified person as defined in 30 CFR 75.151 will continuously monitor for methane immediately before and during the use of nonpermissible surveying equipment in return airways.
(e) Nonpermissible surveying equipment will not be used if methane is detected in concentrations at or above one percent for the area being surveyed. When methane is detected at such levels while the nonpermissible surveying equipment is being used, the equipment will be deenergized immediately and the nonpermissible electronic equipment withdrawn out of the return airways.
(f) All hand-held methane detectors will be MSHA-approved and maintained in permissible and proper operating condition as defined in 30 CFR 75.320.
(g) Batteries in the surveying equipment will be changed out or charged in fresh air out of the return.
(h) Qualified personnel who use surveying equipment will be properly trained to recognize the hazards associated with the use of nonpermissible surveying equipment in areas where methane could be present.
(i) The nonpermissible surveying equipment will not be put into service until MSHA has initially inspected the equipment and determined that it is in compliance with all the terms and conditions in this petition.
Within 60 days after the Proposed Decision and Order becomes final, the petitioner will submit proposed revisions for its approved 30 CFR part 48 training plan to the District Manager. The revisions will specify initial and refresher training regarding the terms and conditions in the Proposed Decision and Order.
The petitioner asserts that the proposed alternative method will at all times guarantee no less than the same measure of protection as that afforded by the existing standard.
(1) To comply with requirements for mine ventilation maps and mine maps in 30 CFR 75.372 and 75.1200, use of the most practical and accurate surveying equipment is necessary. To ensure the safety of the miners in active mines and to protect miners in future mines that may mine in close proximity to these same active mines, it is necessary to determine the exact location and extent of the mine workings.
(2) Application of the existing standard would result in a diminution of safety to the miners. Underground mining by its nature and size, and the complexity of mine plans, requires that accurate and precise measurements be completed in a prompt and efficient manner. The petitioner proposes the following as an alternative to the existing standard:
(a) Nonpermissible electronic surveying equipment will be used when equivalent permissible electronic surveying equipment is not available. Such nonpermissible surveying equipment includes portable battery-operated total station surveying equipment, mine transits, distance meters, and data loggers.
(b) All nonpermissible electronic surveying equipment to be used within 150 feet of pillar workings or longwall faces will be examined by surveying personnel prior to use to ensure the equipment is being maintained in a safe operating condition. These examinations will include the following steps:
(i) Checking the instrument for any physical damage and the integrity of the case.
(ii) Removing the battery and inspecting for corrosion.
(iii) Inspecting the contact points to ensure a secure connection to the battery.
(iv) Reinserting the battery and powering up and shutting down to ensure proper connections.
(v) Checking the battery compartment cover to ensure that it is securely fastened.
(c) The results of such examinations will be recorded and retained for one year and made available to MSHA on request.
(d) A qualified person as defined in 30 CFR 75.151 will continuously monitor for methane immediately before and during the use of nonpermissible surveying equipment within 150 feet of pillar workings and longwall faces.
(e) Nonpermissible surveying equipment will not be used if methane is detected in concentrations at or above one percent for the area being surveyed. When methane is detected at such levels while the nonpermissible surveying equipment is being used, the equipment will be deenergized immediately and the nonpermissible electronic equipment withdrawn further than 150 feet from pillar workings.
(f) All hand-held methane detectors will be MSHA-approved and maintained in permissible and proper operating condition as defined in 30 CFR 75.320.
(g) Batteries in the surveying equipment will be changed out or charged in fresh air more than 150 feet from pillar workings.
(h) Qualified personnel who use surveying equipment will be properly trained to recognize the hazards and limitations associated with the use of nonpermissible surveying equipment in areas where methane could be present.
(i) The nonpermissible surveying equipment will not be put into service until MSHA has initially inspected the equipment and determined that it is in compliance with all the terms and conditions in this petition.
Within 60 days after the Proposed Decision and Order becomes final, the petitioner will submit proposed revisions for its approved 30 CFR part 48 training plan to the District Manager. The revisions will specify initial and refresher training regarding the terms and conditions in the Proposed Decision and Order.
The petitioner asserts that the proposed alternative method will at all times guarantee no less than the same measure of protection as that afforded by the existing standard.
(1) To comply with requirements for mine ventilation maps and mine maps in 30 CFR 75.372 and 75.1200, use of the most practical and accurate surveying equipment is necessary.
(2) Application of the existing standard would result in a diminution of safety to the miners. Underground mining by its nature and size, and the complexity of mine plans, requires that accurate and precise measurements be completed in a prompt and efficient manner. The petitioner proposes the following as an alternative to the existing standard:
(a) Nonpermissible electronic surveying equipment will be used when equivalent permissible electronic surveying equipment is not available. Such nonpermissible surveying equipment includes portable battery-operated total station surveying equipment, mine transits, distance meters, and data loggers.
(b) All nonpermissible electronic surveying equipment to be used in or inby the last open crosscut will be examined by surveying personnel prior to use to ensure the equipment is being maintained in a safe operating condition. These examinations will include the following steps:
(i) Checking the instrument for any physical damage and the integrity of the case.
(ii) Removing the battery and inspecting for corrosion.
(iii) Inspecting the contact points to ensure a secure connection to the battery.
(iv) Reinserting the battery and powering up and shutting down to ensure proper connections.
(v) Checking the battery compartment cover to ensure that it is securely fastened.
(c) The results of such examinations will be recorded and retained for one year and made available to MSHA on request.
(d) A qualified person as defined in 30 CFR 75.151 will continuously monitor for methane immediately before and during the use of nonpermissible surveying equipment in or inby the last open crosscut.
(e) Nonpermissible surveying equipment will not be used if methane is detected in concentrations at or above one percent for the area being surveyed. When methane is detected at such levels while the nonpermissible surveying equipment is being used, the equipment will be deenergized immediately and the nonpermissible electronic equipment withdrawn outby the last open crosscut.
(f) All hand-held methane detectors will be MSHA-approved and maintained in permissible and proper
(g) Batteries in the surveying equipment will be changed out or charged in fresh air outby the last open crosscut.
(h) Qualified personnel who use surveying equipment will be properly trained to recognize the hazards associated with the use of nonpermissible surveying equipment in areas where methane could be present.
(i) The nonpermissible surveying equipment will not be put into service until MSHA has initially inspected the equipment and determined that it is in compliance with all the terms and conditions in this petition.
Within 60 days after the Proposed Decision and Order becomes final, the petitioner will submit proposed revisions for its approved 30 CFR part 48 training plan to the District Manager. The revisions will specify initial and refresher training regarding the terms and conditions in the Proposed Decision and Order.
The petitioner asserts that the proposed alternative method will at all times guarantee no less than the same measure of protection as that afforded by the existing standard.
(1) To comply with requirements for mine ventilation maps and mine maps in 30 CFR 75.372 and 75.1200, use of the most practical and accurate surveying equipment is necessary.
(2) Application of the existing standard would result in a diminution of safety to the miners. Underground mining by its nature and size, and the complexity of mine plans, requires that accurate and precise measurements be completed in a prompt and efficient manner. The petitioner proposes the following as an alternative to the existing standard:
(a) Nonpermissible electronic surveying equipment will be used when equivalent permissible electronic surveying equipment is not available. Such nonpermissible surveying equipment includes portable battery-operated total station surveying equipment, mine transits, distance meters, and data loggers.
(b) All nonpermissible electronic surveying equipment to be used in return airways will be examined by surveying personnel prior to use to ensure the equipment is being maintained in a safe operating condition. These examinations will include the following steps:
(i) Checking the instrument for any physical damage and the integrity of the case.
(ii) Removing the battery and inspecting for corrosion.
(iii) Inspecting the contact points to ensure a secure connection to the battery.
(iv) Reinserting the battery and powering up and shutting down to ensure proper connections.
(v) Checking the battery compartment cover to ensure that it is securely fastened.
(c) The results of such examinations will be recorded and retained for one year and made available to MSHA on request.
(d) A qualified person as defined in 30 CFR 75.151 will continuously monitor for methane immediately before and during the use of nonpermissible surveying equipment in return airways.
(e) Nonpermissible surveying equipment will not be used if methane is detected in concentrations at or above one percent for the area being surveyed. When methane is detected at such levels while the nonpermissible surveying equipment is being used, the equipment will be deenergized immediately and the nonpermissible electronic equipment withdrawn out of the return airways.
(f) All hand-held methane detectors will be MSHA-approved and maintained in permissible and proper operating condition as defined in 30 CFR 75.320.
(g) Batteries in the surveying equipment will be changed out or charged in fresh air out of the return.
(h) Qualified personnel who use surveying equipment will be properly trained to recognize the hazards associated with the use of nonpermissible surveying equipment in areas where methane could be present.
(i) The nonpermissible surveying equipment will not be put into service until MSHA has initially inspected the equipment and determined that it is in compliance with all the terms and conditions in this petition.
Within 60 days after the Proposed Decision and Order becomes final, the petitioner will submit proposed revisions for its approved 30 CFR part 48 training plan to the District Manager. The revisions will specify initial and refresher training regarding the terms and conditions in the Proposed Decision and Order.
The petitioner asserts that the proposed alternative method will at all times guarantee no less than the same measure of protection as that afforded by the existing standard.
(1) To comply with requirements for mine ventilation maps and mine maps in 30 CFR 75.372 and 75.1200, use of the most practical and accurate surveying equipment is necessary. To ensure the safety of the miners in active mines and to protect miners in future mines that may mine in close proximity to these same active mines, it is necessary to determine the exact location and extent of the mine workings.
(2) Application of the existing standard would result in a diminution of safety to the miners. Underground mining by its nature and size, and the complexity of mine plans, requires that accurate and precise measurements be completed in a prompt and efficient manner. The petitioner proposes the following as an alternative to the existing standard:
(a) Nonpermissible electronic surveying equipment will be used when equivalent permissible electronic surveying equipment is not available. Such nonpermissible surveying
(b) All nonpermissible electronic surveying equipment to be used within 150 feet of pillar workings or longwall faces will be examined by surveying personnel prior to use to ensure the equipment is being maintained in a safe operating condition. These examinations will include the following steps:
(i) Checking the instrument for any physical damage and the integrity of the case.
(ii) Removing the battery and inspecting for corrosion.
(iii) Inspecting the contact points to ensure a secure connection to the battery.
(iv) Reinserting the battery and powering up and shutting down to ensure proper connections.
(v) Checking the battery compartment cover to ensure that it is securely fastened.
(c) The results of such examinations will be recorded and retained for one year and made available to MSHA on request.
(d) A qualified person as defined in 30 CFR 75.151 will continuously monitor for methane immediately before and during the use of nonpermissible surveying equipment within 150 feet of pillar workings.
(e) Nonpermissible surveying equipment will not be used if methane is detected in concentrations at or above one percent for the area being surveyed. When methane is detected at such levels while the nonpermissible surveying equipment is being used, the equipment will be deenergized immediately and the nonpermissible electronic equipment withdrawn further than 150 feet from pillar workings and longwall faces.
(f) All hand-held methane detectors will be MSHA-approved and maintained in permissible and proper operating condition as defined in 30 CFR 75.320.
(g) Batteries in the surveying equipment will be changed out or charged in fresh air more than 150 feet from pillar workings.
(h) Qualified personnel who use surveying equipment will be properly trained to recognize the hazards and limitations associated with the use of nonpermissible surveying equipment in areas where methane could be present.
(i) The nonpermissible surveying equipment will not be put into service until MSHA has initially inspected the equipment and determined that it is in compliance with all the terms and conditions in this petition.
Within 60 days after the Proposed Decision and Order becomes final, the petitioner will submit proposed revisions for its approved 30 CFR part 48 training plan to the District Manager. The revisions will specify initial and refresher training regarding the terms and conditions in the Proposed Decision and Order.
The petitioner asserts that the proposed alternative method will at all times guarantee no less than the same measure of protection as that afforded by the existing standard.
Nuclear Regulatory Commission.
Standard review plan-draft section revision: request for comment.
The U.S. Nuclear Regulatory Commission (NRC or the Commission) is soliciting public comment on NUREG–0800, “Standard Review Plan for the Review of Safety Analysis Reports for Nuclear Power Plants” LWR Edition: Section 13.6.4, “Access Authorization—Operational Program.” The NRC seeks comments on the new Section 13.6.4 of the Standard Review Plan (SRP) concerning implementation of an access authorization program through revisions to the nuclear power reactor licensee Commission-approved Physical Security Plan under of Title 10 of the
Comments must be filed no later than 30 days from the date of publication of this notice in the
You may access information and comment submissions related to this document, which the NRC possesses and is publicly available, by searching on
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For additional direction on accessing information and submitting comments, see “Accessing Information and Submitting Comments” in the
Amy E. Cubbage, Division of Advanced Reactors and Rulemaking, Office of New Reactors, U.S. Nuclear Regulatory Commission, Washington, DC 20555–0001, telephone: 301–415–2875, email:
Please refer to Docket ID NRC–2012–0314 when contacting the NRC about the availability of information regarding this document. You may access information related to this document, which the NRC possesses and are publicly available, by any of the following methods:
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Please include Docket ID NRC–2012–0314 in the subject line of your comment submission, in order to ensure that the NRC is able to make your comment submission available to the public in this docket.
The NRC cautions you not to include identifying or contact information in comment submissions that you do not want to be publicly disclosed. The NRC posts all comment submissions at
If you are requesting or aggregating comments from other persons for submission to the NRC, then you should inform those persons not to include identifying or contact information in their comment submissions that they do not want to be publicly disclosed. Your request should state that the NRC does not routinely edit comment submissions to remove such information before making the comment submissions available to the public or entering the comment submissions into ADAMS.
The NRC seeks public comment on a proposed a new section of the SRP Section 13.6.4, “Access Authorization—Operational Program,” (ADAMS Accession No. ML12125A098). This section has been developed to assist NRC staff with the review of applications for certain construction permits, early site permits, licenses, license amendments, and combined licenses and to inform new reactor applicants and other affected entities of proposed SRP guidance regarding an acceptable method by which to evaluate a proposed access authorization program for compliance with 10 CFR Part 26, 10 CFR 73.56 and 73.57. Following NRC staff evaluation of public comments, the NRC intends to incorporate the final approved guidance into the next revision of NUREG–0800. The SRP is guidance for the NRC staff. The SRP is not a substitute for the NRC regulations, and compliance with the SRP is not required. Accordingly, issuance of the SRP does not constitute “backfitting” as defined in 10 CFR 50.109(a)(1) of the Backfit Rule and is not otherwise inconsistent with the applicable issue finality provisions in 10 CFR Part 52.
For the Nuclear Regulatory Commission.
Nuclear Regulatory Commission.
Notice of availability.
Mark C. Roberts, Senior Health Physicist, Decommissioning Branch, Division of Nuclear Materials Safety, Region I, U.S. Nuclear Regulatory Commission, King of Prussia, PA 19406; telephone: 610–337–5094; fax number: 610–337–5269; email:
The U.S. Nuclear Regulatory Commission (NRC) is considering the issuance of a license amendment to NRC License No. 19–00915–03, issued to the United States Department of Agriculture (USDA or the licensee), to authorize decommissioning of its Low-Level Radiation Burial Site at the Beltsville Agricultural Research Center (or the Site) in Beltsville, Maryland, so that the residual radioactivity at the site can be reduced to a level that meets the criteria for release for unrestricted use. The USDA license would not be terminated at the time of release for unrestricted use because the USDA would continue to conduct authorized activities under this license at other locations. The NRC has prepared an Environmental Assessment (EA) in support of this amendment in accordance with the requirements of Part 51, “Environmental Protection Regulations for Domestic Licensing and Related Regulatory Functions,” to Title 10 of the
In 1949, the USDA initiated disposal of low-level radioactive waste from research laboratory operations at the USDA's Low-Level Radiation Burial Site at the Beltsville Agricultural Research Center in Beltsville, Maryland under agreement with the USDA and the U.S. Atomic Energy Commission (AEC) (predecessor of the NRC). The authorization for onsite disposal by burial in soil was subsequently established in AEC and NRC regulations (10 CFR 20.304, “Disposal by Burial in Soil”). In January 1981, the NRC rescinded the regulations in 10 CFR 20.304 that authorized generic onsite disposals by burial in soil. However, the USDA continued authorized disposal of low-level radioactive wastes at the Site under the regulations in 10 CFR 20.302, “Method for Obtaining Approval of Proposed Disposal Procedures,” with specific prior approval of the NRC. In 1987, the USDA initiated use of a commercial service to have radioactive waste transported and disposed at a licensed disposal facility and terminated radioactive waste disposal at the Site.
The low-level radioactive wastes generated by the USDA research laboratories included gloves, paper, liquid scintillation vials, small glass and plastic laboratory containers, metal and fiberboard drums, and decomposed small animal carcasses. The radioactive isotopes used at the USDA facilities and disposed as radioactive waste at the Site were primarily tritium and carbon-14, with significantly lesser quantities of chlorine-36, nickel-63, strontium-90, cesium-137, lead-210, and radium-226. In addition to the radioactive materials disposed as waste, non-radiological chemicals were included in the waste buried at the Site. The burials consisted
In accordance with 10 CFR 30.36, ”Expiration and Termination of Licenses and Decommissioning of Sites and Separate Buildings or Outdoor Areas,” the USDA is required to submit a Decommissioning Plan since principal licensed activities are no longer being performed at the Site. On August 20, 2009, the USDA requested that the NRC approve a Decommissioning Plan for the Site, which when completed, would allow the site to meet the radiological criteria for release for unrestricted use (Agencywide Document Access and Management System (ADAMS) Nos. ML092370149, ML092370159, and ML092370172). The NRC staff conducted reviews of the Decommissioning Plan and, in a September 14, 2010 letter (ADAMS No. ML102600244), requested additional information regarding the selection of input parameter values for the calculation of potential radiation dose from residual activity in the soil. The Revised Final Decommissioning Plan, Low Level Radioactive Burial Site, Beltsville Agricultural Research Center, Beltsville, Maryland (including the Final Status Survey Plan), dated January 2012 (ADAMS No. ML120600551), and the Addendum Memorandum to the Decommissioning Plan, dated February 2012 (ADAMS No. ML120600526), reflect resolution of NRC staff questions. On July 11, 2012 (77 FR 40917), the NRC issued a
The proposed action is to amend NRC License No. 19–00915–03 to authorize the decommissioning of the Site so that the residual radioactivity at the Site can be reduced to a level that meets the criteria for release for unrestricted use found in 10 CFR 20.1402, “Radiological Criteria for Unrestricted Use.” Section 20.1402 allow unrestricted use of a site if the maximum Total Effective Dose Equivalent to an average member of the critical group is 25 millirem per year and the residual radioactivity has been reduced to levels that are as low as reasonably achievable (ALARA). Because the USDA conducts authorized activities under this license at numerous other locations, the USDA is not requesting license termination.
The USDA desires to remove the buried waste and thus eliminate the source of radioactive contamination. The planned remediation actions for the Site should also be effective in addressing the non-radiological contaminants. The USDA explains that regulatory authority regarding the acceptability of any residual quantities of the non-radiological contaminants in soil (and potentially groundwater) lies with the USEPA under the authority of their ongoing evaluation of the Site under the Comprehensive Environmental Response, Compensation, and Liability Act.
The USDA proposes to exhume the waste from the burial pits and transport the waste and contaminated soil to authorized treatment or disposal facilities. Following completion of the removal and transportation activities, the USDA will conduct a final status survey of the remediated area. The area to be released under this decommissioning effort will be surveyed in accordance with the guidance contained in the “Multi-Agency Radiation Survey and Site Investigation Manual (MARSSIM),” NUREG–1575, Rev. 1 (ADAMS No. ML082470583). The final approval that the Site meets the radiological criteria for release for unrestricted use would be contingent upon the NRC staff's approval of the licensee's final status survey report.
The current USDA license does not authorize decommissioning activities to be conducted. The NRC regulations in 10 CFR 30.36 (g)(1), in part, require a Decommissioning Plan to be submitted if the procedures and activities necessary to carry out decommissioning have not been approved by the Commission and these procedures could increase potential health and safety impacts to workers or the public.
The NRC staff has reviewed the Decommissioning Plan for the USDA's Low-Level Radiation Burial Site and examined the impacts of decommissioning. Based on its review, the staff has determined that the affected environment and the environmental impacts associated with this decommissioning action (including waste transportation impacts) are bounded by information contained in the “Generic Environmental Impact Statement (GEIS) in Support of Rulemaking on Radiological Criteria for License Termination of NRC-Licensed Nuclear Facilities,” NUREG–1496, Vols. 1, 2 and 3 (ADAMS Nos. ML042310492, ML042320379, and ML042330385). The NRC staff determined that the contaminants, the potential dose scenarios or pathways, the physical size of the site, and the volumes of waste expected to be generated at USDA site are not sufficiently different from those in the GEIS reference facilities to change conclusions regarding environmental impacts. No additional non-radiological impacts were identified. A beneficial environmental impact of the proposed action is that there will no longer be migration of radioactive contamination to soil or groundwater because the source of the contamination will be removed.
In the Decommissioning Plan, the USDA indicates that they will implement controls and perform radiological sampling and analysis to limit the potential release of radioactive material. Contamination controls, such as the use of containment structures, covers for loaded containers, or water sprays for dust control, will be implemented during decommissioning activities to prevent airborne contamination from escaping the remediation work areas; therefore, no significant release of airborne contamination is anticipated. Air sampling and analysis will be conducted to ensure regulatory criteria are met for air effluents. No liquid effluents are expected to be generated during decommissioning. Controls, such as silt fences and water diversion berms will be put in place to control water inflow or runoff due to precipitation.
The USDA intends to use an NRC-licensed decommissioning contractor to perform remediation activities at the Site. The contractor will perform these activities under the authority of its NRC license. The USDA will oversee the activities and will maintain primary responsibility for the decommissioning project. The USDA indicates that the contractor will have developed adequate radiation protection procedures and capabilities and will implement an acceptable program to keep exposure to workers and the public from radioactive materials to levels that are ALARA. As noted, the USDA has prepared a Decommissioning Plan describing the work to be performed, and, as explained by the licensee, work activities are not anticipated to result in a dose to workers or the public in excess of the limits in 10 CFR Part 20, “Standards for Protection Against Radiation.” The NRC's past experience with decommissioning activities at sites similar to the USDA site indicates that public and worker exposure will be far below the limits in 10 CFR Part 20. The NRC staff will perform inspections at the site to confirm compliance with applicable regulations.
The NRC staff has also extensively reviewed and requested revisions to the USDA's dose analysis from residual contamination that may remain following decommissioning. Based on its review, the NRC staff concludes that the proposed Derived Concentration Guideline Levels developed for this project meet the relevant NRC requirements in 10 CFR 20.1402, “Radiological Criteria for Unrestricted Use.” Using the guidance in NUREG–1757, Vol.1, Rev. 2, “Consolidated Decommissioning Guidance, Decommissioning Process for Materials Licensees” (ADAMS No. ML063000243), the staff documented their review of the health and safety and environmental aspects of the Decommissioning Plan, including the evaluation of the proposed Derived Concentration Guideline Levels, in a Safety Evaluation Report (ADAMS No. ML12314A076).
The alternative the NRC staff considered is the no-action alternative, under which the staff would deny the amendment request to initiate remediation activities at the Site. This approach is not acceptable because the burial pits contain residual radioactive material exceeding NRC's criteria for release for unrestricted use and the no action alternative is inconsistent with the requirements in 10 CFR 30.36,”Expiration and Termination of Licenses and Decommissioning of Sites and Separate Buildings or Outdoor Areas,” for the decommissioning of sites where principal licensed activities are no longer being performed.
In accordance with Section 106 of the National Historic Preservation Act, NRC staff provided a location map and a description of the decommissioning project to the Maryland Historical Trust requesting information on historic properties in the vicinity of the proposed decommissioning project. (The Trust serves as Maryland's State Historic Preservation Office pursuant to the National Historic Preservation Act). The Maryland Historical Trust provided a response identifying one nearby property and indicating there would be “No Adverse Effect” to this property as a result of the decommissioning project (ADAMS No. ML12237A250). Therefore, the NRC staff has determined that the proposed action would have no adverse effects on historic properties.
In accordance with Section 7 of the Endangered Species Act, the NRC staff contacted relevant wildlife agencies for information on rare, threatened or endangered species that could be present in the vicinity of the Site. The United States Department of the Interior, U.S. Fish & Wildlife Service and the Wildlife and Heritage Service of the Maryland Department of Natural Resources provided responses indicating that there is no State or Federal records for rare, threatened or endangered species within the delineated boundaries of the project site (ADAMS Nos. ML12237A229 and ML12275A103, respectively). Therefore, the NRC staff has determined that the proposed action would not affect listed species or critical habitat.
In accordance with the Memorandum of Understanding between the USEPA and the NRC on “Consultation and Finality on Decommissioning and Decontamination of Contaminated Sites,” on March 22, 2012, the NRC provided a consultation letter to the USEPA regarding the planned level of residual radioactive soil concentrations in the proposed plan (ADAMS No. ML120760350).
On October 23, 2012, the NRC staff provided a draft of the EA to the Maryland Department of the Environment (MDE) for comment. MDE requested information confirming that the area to be remediated was under “Exclusive Federal Jurisdiction.” The NRC forwarded information provided by the USDA (ADAMS Nos. ML12325A201 and ML12325A228) to the MDE that confirmed that the area to be remediated was under “Exclusive Federal Jurisdiction.” On November 8, 2012, an MDE representative responded that the MDE had no additional comments on the EA (ADAMS No. ML12325A256).
The NRC staff has prepared an EA in support of the proposed license amendment for decommissioning the USDA's Low-Level Radiation Burial Site at the Beltsville Agricultural Research Center in Beltsville, Maryland to reduce residual radioactivity to levels consistent with the release for unrestricted use. The staff has found that the radiological environmental impacts from the proposed amendment are bounded by the impacts evaluated by the “Generic Environmental Impact Statement in Support of Rulemaking on Radiological Criteria for License termination of NRC-Licensed Facilities” (NUREG–1496) and that the relevant NRC requirements in 10 CFR 20.1402, “Radiological Criteria for Unrestricted Use,” will be met. The staff has also found that the non-radiological impacts are not significant. On the basis of the EA, NRC has concluded that there are no significant environmental impacts from the proposed amendment and has determined not to prepare an environmental impact statement.
Documents related to this action, including the application for amendment and supporting documentation, are available electronically at the NRC's Electronic Reading Room at
These documents may also be viewed electronically on the public computers located at the NRC's Public Document Room (PDR), O 1 F21, One White Flint North, 11555 Rockville Pike, Rockville, MD 20852. The PDR reproduction contractor will copy documents for a fee.
For the Nuclear Regulatory Commission.
Office of Personnel Management.
Renewal of advisory committee.
The U.S. Office of Personnel Management announces the renewal of the Hispanic Council on Federal Employment (Council). The Commission shall advise the Director of the U.S. Office of Personnel Management (OPM) on the implementation of leading employment practices in an effort to remove any unnecessary barriers to the recruitment, hiring, retention and advancement of Hispanics in the Federal workplace. The Council is an advisory committee composed of Federal employees and Hispanic organizations.
Veronica E. Villalobos, Director, Office of Diversity and Inclusion, U.S. Office of Personnel Management, 1900 E St. NW., Suite 5H35, Washington, DC 20415. Phone (202) 606–0020 Fax (202) 606–6042 or email at
The charter for the Hispanic Council on Federal Employment publishes as follows:
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a. Reviewing leading practices in strategic human resources management planning;
b. Providing advice on ways to increase outreach to Hispanic communities, with a focus on Veterans, students, and people with disabilities;
c. Recommending any further actions, as appropriate, to address the underrepresentation of Hispanics in the Federal workforce where it occurs;
d. Recommending any further actions, as appropriate, to promote successful retention and advancement efforts including training of department and agency personnel;
e. Implementing recommendations for innovative ways to improve the dissemination of information about Federal employment to the Hispanic communities; and
f. Recommending any further actions, as appropriate, to address the underrepresentation of Hispanics in the Federal workforce where it occurs.
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The Director of OPM may also designate other members of the Council. Such additional members may include, but are not limited to:
(1) The Chief Human Capital Officers of other Executive agencies; and
(2) Members who are designated on an
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Postal Service
Notice.
The Postal Service gives notice of filing a request with the Postal Regulatory Commission to add a domestic shipping services contract to the list of Negotiated Service Agreements in the Mail Classification Schedule's Competitive Products List.
Elizabeth A. Reed, 202–268–3179.
The United States Postal Service® hereby gives notice that, pursuant to 39 U.S.C. 3642 and 3632(b)(3), on December 20, 2012, it filed with the Postal Regulatory Commission a
Postal Service.
Notice.
The Postal Service gives notice of filing a request with the Postal Regulatory Commission to add a domestic shipping services contract to the list of Negotiated Service Agreements in the Mail Classification Schedule's Competitive Products List.
Elizabeth A. Reed, 202–268–3179.
The United States Postal Service® hereby gives notice that, pursuant to 39 U.S.C. 3642 and 3632(b)(3), on December 20, 2012, it filed with the Postal Regulatory Commission a
Securities and Exchange Commission (the “Commission”).
Notice of an application for an order under section 6(c) of the Investment Company Act of 1940 (the “Act”) for an exemption from sections 2(a)(32), 5(a)(1), 22(d) and 22(e) of the Act and rule 22c–1 under the Act, and under sections 6(c) and 17(b) of the Act for an exemption from sections 17(a)(1) and (2) of the Act, and under section 12(d)(1)(J) for an exemption from sections 12(d)(1)(A) and (B) of the Act.
Elizabeth M. Murphy, Secretary, U.S. Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549. Applicants, c/o W. John McGuire, Esq. and Michael Berenson, Esq., Bingham McCutchen LLP, 2020 K Street NW., Washington, DC 20006.
Mark N. Zaruba, Senior Counsel, at (202) 551–6878 or Mary Kay Frech, Branch Chief, at (202) 551–6821 (Division of Investment Management, Office of Investment Company Regulation).
The following is a summary of the application. The complete application may be obtained via the Commission's Web site by searching for the file number, or an applicant using the Company name box, at
1. The Trust is registered as an open-end management investment company under the Act and is organized as a Delaware statutory trust. The Trust will initially offer one actively-managed series (the “Initial Fund”), whose investment objective will be to provide a high level of current income, consistent with the preservation of capital.
2. Pyxis, a Delaware limited partnership, is, and any other Adviser (as defined below) will be, registered as an investment adviser under the Investment Advisers Act of 1940 (the “Advisers Act”). An Adviser will be the investment adviser to each Fund (as defined below) and, subject to the oversight and authority of the board of trustees (the “Board”) of the Trust, will implement each Fund's investment program and oversee the day-to-day portfolio activities of each Fund. A Fund may engage one or more subadvisers (“Subadvisers”) to manage specific strategies suited to their expertise. Any Subadviser will be registered under the Advisers Act. Nexbank, a Delaware corporation and an affiliate of Pyxis, is registered as a broker-dealer (“Broker) under the Securities Exchange Act of 1934 (the “Exchange Act”) and will serve as the principal underwriter and distributor
3. Applicants request that the order apply to the Initial Fund and to any future series of the Trust or to any other open-end investment company or series thereof that may be created in the future that, in each case, (a) is an actively managed exchange-traded fund (“ETF”), (b) is advised by Pyxis or any entity controlling, controlled by, or under common control with Pyxis (each such entity or any successor entity thereto, an “Adviser”)
4. Applicants also request that any exemption under section 12(d)(1)(J) of the Act from sections 12(d)(1)(A) and (B) apply to: (i) Any Fund; (ii) any Acquiring Fund (as defined below); and (iii) any Brokers selling Shares of a Fund to an Acquiring Fund or any principal underwriter of a Fund.
5. Applicants anticipate that a Creation Unit will consist of at least 25,000 Shares and that the trading price of a Share will range from $20 to $200. All orders to purchase Creation Units must be placed with the Distributor by or through an “Authorized Participant,” which is either (a) a Broker or other participant in the Continuous Net Settlement System of the National Securities Clearing Corporation (“NSCC”, and such process the “NSCC Process”), or (b) a participant in the Depository Trust Company (“DTC,” such participant “DTC Participant” and such process the “DTC Process”), which, in either case, has executed an agreement with the Distributor with respect to the purchase and redemption of Creation Units.
6. Shares will be purchased and redeemed in Creation Units and generally on an in-kind basis. Except where the purchase or redemption will include cash under the limited circumstances specified below, purchasers will be required to purchase Creation Units by making an in-kind deposit of specified instruments (“Deposit Instruments”), and shareholders redeeming their Shares will receive an in-kind transfer of specified instruments (“Redemption Instruments”).
7. Purchases and redemptions of Creation Units may be made in whole or in part on a cash basis, rather than in kind, solely under the following circumstances: (a) To the extent there is a Cash Amount, as described above; (b) if, on a given Business Day, a Fund announces before the open of trading that all purchases, all redemptions or all purchases and redemptions on that day will be made entirely in cash; (c) if, upon receiving a purchase or redemption order from an Authorized Participant, a Fund determines to require the purchase or redemption, as applicable, to be made entirely in cash; (d) if, on a given Business Day, a Fund requires all Authorized Participants purchasing or redeeming Shares on that day to deposit or receive (as applicable) cash in lieu of some or all of the Deposit Instruments or Redemption Instruments, respectively, solely because: (i) such instruments are not eligible for transfer through either the NSCC Process or DTC Process; or (ii) in the case of Global Funds and Foreign Funds, such instruments are not eligible for trading due to local trading restrictions, local restrictions on securities transfers or other similar circumstances; or (e) if a Fund permits an Authorized Participant to deposit or receive (as applicable) cash in lieu of some or all of the Deposit Instruments or Redemption Instruments, respectively, solely because: (i) Such instruments are, in the case of the purchase of a Creation Unit, not available in sufficient quantity; (ii) such instruments are not eligible for trading by an Authorized Participant or the investor on whose behalf the Authorized Participant is acting; or (iii) a holder of Shares of a Global Fund or Foreign Fund would be subject to unfavorable income tax treatment if the holder receives redemption proceeds in kind.
8. Each Business Day, before the open of trading on a national securities exchange, as defined in section 2(a)(26) of the Act (an “Exchange”), on which Shares are listed and traded, each Fund will cause to be published through the NSCC the names and quantities of the instruments comprising the Creation Basket, as well as the estimated Cash Amount (if any), for that day. The published Creation Basket will apply until a new Creation Basket is announced on the following Business Day, and there will be no intra-day changes to the Creation Basket except to correct errors in the published Creation Basket. For each Fund, the relevant Exchange will disseminate every 15 seconds throughout the trading a calculation of the estimated NAV of a Share (which estimate is expected to be accurate to within a few basis points).
9. Each Fund will recoup the settlement costs charged by NSCC and DTC by imposing a fee (the “Transaction Fee”) on investors purchasing or redeeming Creation Units.
10. Purchasers of Shares in Creation Units may hold such Shares or may sell such Shares into the secondary market. Shares will be listed and traded at negotiated prices on an Exchange and it is expected that the relevant Exchange will designate one or more member firms to maintain a market for the Shares.
11. Applicants expect that purchasers of Creation Units will include institutional investors and arbitrageurs. Applicants expect that secondary market purchasers of Shares will include both institutional and retail investors.
12. Shares will not be individually redeemable and owners of Shares may acquire those Shares from a Fund, or tender such shares for redemption to the Fund, in Creation Units only. To redeem, an investor must accumulate enough Shares to constitute a Creation Unit. Redemption requests must be placed by or through an Authorized Participant. As discussed above, redemptions of Creation Units will generally be made on an in-kind basis, subject to certain specified exceptions under which redemptions may be made in whole or in part on a cash basis, and will be subject to a Transaction Fee.
13. Neither the Trust nor any Fund will be advertised or marketed or otherwise held out as a traditional open-end investment company or mutual fund. Instead, each Fund will be marketed as an “exchange-traded fund.” All marketing materials that describe the features or method of obtaining, buying, or selling Creation Units, or Shares traded on an Exchange, or refer to redeemability, will prominently disclose that Shares are not individually redeemable and that the owners of Shares may acquire those Shares from a Fund or tender those Shares for redemption to the Fund in Creation Units only.
14. The Trust's Web site (the “Web site”), which will be publicly available prior to the offering of Shares, will include each Fund's prospectus (“Prospectus”), Statement of Additional Information (“SAI”), and summary prospectus, if used. The Web site will contain, on a per Share basis for each Fund, the prior Business Day's NAV and the market closing price or mid-point of the bid/ask spread at the time of calculation of such NAV (“Bid/Ask Price”), and a calculation of the premium or discount of the market closing price or the Bid/Ask Price against such NAV. On each Business Day, prior to the commencement of trading in Shares on an Exchange, the
1. Applicants request an order under section 6(c) of the Act granting an exemption from sections 2(a)(32), 5(a)(1), 22(d) and 22(e) of the Act and rule 22c–1 under the Act; and under sections 6(c) and 17(b) of the Act granting an exemption from sections 17(a)(1) and (2) of the Act, and under section 12(d)(1)(J) for an exemption from sections 12(d)(1)(A) and (B) of the Act.
2. Section 6(c) of the Act provides that the Commission may exempt any person, security or transaction, or any class of persons, securities or transactions, from any provision of the Act, if and to the extent that such exemption is necessary or appropriate in the public interest and consistent with the protection of investors and the purposes fairly intended by the policy and provisions of the Act. Section 17(b) of the Act authorizes the Commission to exempt a proposed transaction from section 17(a) of the Act if evidence establishes that the terms of the transaction, including the consideration to be paid or received, are reasonable and fair and do not involve overreaching on the part of any person concerned, and the proposed transaction is consistent with the policies of the registered investment company and the general provisions of the Act. Section 12(d)(1)(J) of the Act provides that the Commission may exempt any person, security, or transaction, or any class or classes of persons, securities or transactions, from any provision of section 12(d)(1) if the exemption is consistent with the public interest and the protection of investors.
3. Section 5(a)(1) of the Act defines an “open-end company” as a management investment company that is offering for sale or has outstanding any redeemable security of which it is the issuer. Section 2(a)(32) of the Act defines a redeemable security as any security, other than short-term paper, under the terms of which the holder, upon its presentation to the issuer, is entitled to receive approximately a proportionate share of the issuer's current net assets, or the cash equivalent. Because Shares will not be individually redeemable, applicants request an order that would permit the Trust and each Fund to redeem Shares in Creation Units only. Applicants state that investors may purchase Shares in Creation Units from each Fund and that Creation Units will always be redeemable in accordance with the provisions of the Act. Applicants further state that because the market price of Shares will be disciplined by arbitrage opportunities, investors should be able to sell Shares in the secondary market at prices that do not vary substantially from their NAV.
4. Section 22(d) of the Act, among other things, prohibits a dealer from selling a redeemable security that is currently being offered to the public by or through a principal underwriter, except at a current public offering price described in the prospectus. Rule 22c–1 under the Act generally requires that a dealer selling, redeeming, or repurchasing a redeemable security do so only at a price based on its NAV. Applicants state that secondary market trading in Shares will take place at negotiated prices, not at a current offering price described in the Prospectus, and not at a price based on NAV. Thus, purchases and sales of Shares in the secondary market will not comply with section 22(d) of the Act and rule 22c-1 under the Act. Applicants request an exemption under section 6(c) from these provisions.
5. Applicants assert that the concerns sought to be addressed by section 22(d) of the Act and rule 22c–1 under the Act with respect to pricing are equally satisfied by the proposed method of pricing Shares. Applicants maintain that, while there is little legislative history regarding section 22(d), its provisions, as well as those of rule 22c–1, appear to have been designed to (a) prevent dilution caused by certain riskless-trading schemes by principal underwriters and contract dealers, (b) prevent unjust discrimination or preferential treatment among buyers resulting from sales at different prices, and (c) assure an orderly distribution of investment company shares by eliminating price competition from brokers offering shares at less than the published sales price and repurchasing shares at more than the published redemption price.
6. Applicants believe that none of these purposes will be thwarted by permitting Shares to trade in the secondary market at negotiated prices. Applicants state that (a) secondary market trading in Shares does not involve the Funds as parties and cannot result in dilution of an investment in Shares, and (b) to the extent different prices exist during a given trading day, or from day to day, such variances occur as a result of third-party market forces, such as supply and demand. Therefore, applicants assert that secondary market transactions in Shares will not lead to discrimination or preferential treatment among purchasers. Finally, applicants contend that the proposed distribution system will be orderly because arbitrage activity will ensure that the difference between the market price of Shares and their NAV remains narrow.
7. Section 22(e) generally prohibits a registered investment company from suspending the right of redemption or postponing the date of payment of redemption proceeds for more than seven days after the tender of a security for redemption. Applicants observe that the settlement of redemptions of Creation Units of the Foreign and Global Funds is contingent not only on the settlement cycle of the U.S. securities markets but also on the delivery cycles present in foreign markets for underlying foreign Portfolio Securities in which those Funds invest. Applicants have been advised that, under certain circumstances, the delivery cycles for transferring Portfolio Securities to redeeming investors, coupled with local market holiday schedules, will require a delivery process of up to fourteen (14) calendar days. Applicants therefore request relief from section 22(e) in order to provide payment or satisfaction of redemptions within a longer number of calendar days as required for such payment or satisfaction in the principal local markets where transactions in the Portfolio Securities of each Foreign and Global Fund customarily clear and settle, but in all cases no later than fourteen (14) days following the tender of a Creation Unit.
8. Applicants state that section 22(e) was designed to prevent unreasonable, undisclosed or unforeseen delays in the actual payment of redemption proceeds. Applicants assert that the requested relief will not lead to the problems that section 22(e) was designed to prevent.
9. Section 12(d)(1)(A) of the Act prohibits a registered investment company from acquiring shares of an investment company if the securities represent more than 3% of the total outstanding voting stock of the acquired company, more than 5% of the total assets of the acquiring company, or, together with the securities of any other investment companies, more than 10% of the total assets of the acquiring company. Section 12(d)(1)(B) of the Act prohibits a registered open-end investment company, its principal underwriter, or any other broker or dealer from selling its shares to another investment company if the sale will cause the acquiring company to own more than 3% of the acquired company's voting stock, or if the sale will cause more than 10% of the acquired company's voting stock to be owned by investment companies generally.
10. Applicants request relief to permit Acquiring Funds to acquire Shares in excess of the limits in section 12(d)(1)(A) of the Act and to permit the Funds, their principal underwriters and any Broker to sell Shares to Acquiring Funds in excess of the limits in section 12(d)(l)(B) of the Act.
11. Applicants assert that the proposed transactions will not lead to any of the abuses that section 12(d)(1) was designed to prevent. Applicants submit that the proposed conditions to the requested relief address the concerns underlying the limits in section 12(d)(1), which include concerns about undue influence, excessive layering of fees and overly complex structures.
12. Applicants submit that their proposed conditions address any concerns regarding the potential for undue influence. To limit the control that an Acquiring Fund may have over a Fund, applicants propose a condition prohibiting the adviser of an Acquiring Management Company (“Acquiring Fund Adviser”), sponsor of an Acquiring Trust (“Sponsor”), any person controlling, controlled by, or under common control with the Acquiring Fund Adviser or Sponsor, and any investment company or issuer that would be an investment company but for sections 3(c)(1) or 3(c)(7) of the Act that is advised or sponsored by the Acquiring Fund Adviser, the Sponsor, or any person controlling, controlled by, or under common control with the Acquiring Fund Adviser or Sponsor (“Acquiring Fund's Advisory Group”) from controlling (individually or in the aggregate) a Fund within the meaning of section 2(a)(9) of the Act. The same prohibition would apply to any subadviser to an Acquiring Fund (“Acquiring Fund Subadviser”), any person controlling, controlled by or under common control with the Acquiring Fund Subadviser, and any investment company or issuer that would be an investment company but for sections 3(c)(1) or 3(c)(7) of the Act (or portion of such investment company or issuer) advised or sponsored by the Acquiring Fund Subadviser or any person controlling, controlled by or under common control with the Acquiring Fund Subadviser (“Acquiring Fund's Subadvisory Group”).
13. Applicants propose a condition to ensure that no Acquiring Fund or Acquiring Fund Affiliate
14. Applicants propose several conditions to address the potential for layering of fees. Applicants note that the board of directors or trustees of any Acquiring Management Company, including a majority of the directors or trustees who are not “interested persons” within the meaning of section 2(a)(19) of the Act (for any board of directors or trustees, the “Independent Directors”), will be required to find that the advisory fees charged under the contract are based on services provided that will be in addition to, rather than duplicative of, services provided under the advisory contract of any Fund in which the Acquiring Management Company may invest. Applicants also state that any sales charges and/or service fees charged with respect to shares of an Acquiring Fund will not exceed the limits applicable to a fund of funds as set forth in NASD Conduct Rule 2830.
15. Applicants submit that the proposed arrangement will not create an overly complex fund structure. Applicants note that a Fund will be prohibited from acquiring securities of any investment company or company relying on section 3(c)(1) or 3(c)(7) of the Act in excess of the limits contained in section 12(d)(1)(A) of the Act, except to the extent permitted by exemptive relief from the Commission permitting the Fund to purchase shares of other investment companies for short-term cash management purposes.
16. To ensure that an Acquiring Fund is aware of the terms and conditions of the requested order, the Acquiring Funds must enter into an agreement with the respective Funds (“Acquiring Fund Agreement”). The Acquiring Fund Agreement will include an acknowledgement from the Acquiring Fund that it may rely on the order only to invest in a Fund and not in any other investment company.
17. Section 17(a) of the Act generally prohibits an affiliated person of a registered investment company, or an affiliated person of such person (“Second Tier Affiliates”), from selling any security to or purchasing any security from the company. Section 2(a)(3) of the Act defines “affiliated person” to include any person directly or indirectly owning, controlling, or holding with power to vote 5% or more of the outstanding voting securities of the other person and any person directly or indirectly controlling, controlled by, or under common control with, the other person. Section 2(a)(9) of the Act provides that a control relationship will be presumed where one person owns more than 25% of another person's
18. Applicants request an exemption under sections 6(c) and 17(b) of the Act from sections 17(a)(1) and 17(a)(2) of the Act to permit in-kind purchases and redemptions of Creation Units from the Funds by persons that are affiliated persons or Second Tier Affiliates of the Funds solely by virtue of one or more of the following: (a) holding 5% or more, or more than 25%, of the Shares of the Trust of one or more Funds; (b) having an affiliation with a person with an ownership interest described in (a); or (c) holding 5% or more, or more than 25%, of the shares of one or more Affiliated Funds. Applicants also request an exemption in order to permit each Fund to sell Shares to and redeem Shares from, and engage in the transactions that would accompany such sales and redemptions with, any Acquiring Fund of which the Fund is an affiliated person or Second-Tier Affiliate.
19. Applicants contend that no useful purpose would be served by prohibiting such affiliated persons or Second Tier Affiliates from acquiring or redeeming Creation Units through in-kind transactions. Both the deposit procedures for in-kind purchases of Creation Units and the redemption procedures for in-kind redemptions will be the same for all purchases and redemptions. Deposit Instruments and Redemptions Instruments will be valued in the same manner as the Portfolio Securities held by the relevant Fund. Applicants thus believe that in-kind purchases and redemptions will not result in self-dealing or overreaching of the Fund.
20. Applicants also submit that the sale of Shares to and redemption of Shares from an Acquiring Fund satisfies the standards for relief under sections 17(b) and 6(c) of the Act. Applicants note that any consideration paid for the purchase or redemption of Creation Units directly from a Fund will be based on the NAV of the Fund.
Applicants agree that any order of the Commission granting the requested relief will be subject to the following conditions:
1. Neither the Trust nor any Fund will be advertised or marketed as an open-end investment company or mutual fund. Any advertising material that describes the purchase or sale of Creation Units or refers to redeemability will prominently disclose that the Shares are not individually redeemable and that owners of the Shares may acquire those Shares from the Fund and tender those Shares for redemption to the Fund in Creation Units only.
2. The Web site, which is and will be publicly accessible at no charge, will contain, on a per Share basis for each Fund, the prior Business Day's NAV and the market closing price or the Bid/Ask Price, and a calculation of the premium or discount of the market closing price or Bid/Ask Price against such NAV.
3. As long as a Fund operates in reliance on the requested order, its Shares will be listed on an Exchange.
4. On each Business Day, before commencement of trading in Shares on an Exchange, each Fund will disclose on its Web site the identities and quantities of the Portfolio Securities and other assets held by the Fund that will form the basis for the Fund's calculation of NAV at the end of that Business Day.
5. The Adviser or any Subadvisers, directly or indirectly, will not cause any Authorized Participant (or any investor on whose behalf an Authorized Participant may transact with the Fund) to acquire any Deposit Instrument for a Fund through a transaction in which the Fund could not engage directly.
6. The requested relief to permit ETF operations will expire on the effective date of any Commission rule under the Act that provides relief permitting the operation of actively-managed exchange-traded funds.
7. The members of an Acquiring Fund's Advisory Group will not control (individually or in the aggregate) a Fund within the meaning of section 2(a)(9) of the Act. The members of an Acquiring Fund's Subadvisory Group will not control (individually or in the aggregate) a Fund within the meaning of section 2(a)(9) of the Act. If, as a result of a decrease in the outstanding voting securities of a Fund, the Acquiring Fund's Advisory Group or the Acquiring Fund's Subadvisory Group, each in the aggregate, becomes a holder of more than 25 percent of the outstanding voting securities of a Fund, it will vote its Shares of the Fund in the same proportion as the vote of all other holders of that Fund's Shares. This condition does not apply to the Acquiring Fund's Subadvisory Group with respect to a Fund for which the Acquiring Fund Subadviser or a person controlling, controlled by, or under common control with the Acquiring Fund Subadviser acts as the investment adviser within the meaning of section 2(a)(20)(A) of the Act.
8. No Acquiring Fund or Acquiring Fund Affiliate will cause any existing or potential investment by the Acquiring Fund in a Fund to influence the terms of any services or transactions between the Acquiring Fund or an Acquiring Fund Affiliate and the Fund or a Fund Affiliate.
9. The board of trustees or directors of an Acquiring Management Company, including a majority of the Independent Directors, will adopt procedures reasonably designed to ensure that the Acquiring Fund Adviser and any Acquiring Fund Subadviser are conducting the investment program of the Acquiring Management Company without taking into account any consideration received by the Acquiring Management Company or an Acquiring Fund Affiliate from a Fund or a Fund
10. Once an investment by an Acquiring Fund in the Shares of a Fund exceeds the limit in section l2(d)(1)(A)(i) of the Act, the Board, including a majority of the Independent Directors, will determine that any consideration paid by the Fund to the Acquiring Fund or an Acquiring Fund Affiliate in connection with any services or transactions: (i) is fair and reasonable in relation to the nature and quality of the services and benefits received by the Fund; (ii) is within the range of consideration that the Fund would be required to pay to another unaffiliated entity in connection with the same services or transactions; and (iii) does not involve overreaching on the part of any person concerned. This condition does not apply with respect to any services or transactions between a Fund and its investment adviser(s), or any person controlling, controlled by or under common control with such investment adviser(s).
11. No Acquiring Fund or Acquiring Fund Affiliate (except to the extent it is acting in its capacity as an investment adviser to a Fund) will cause the Fund to purchase a security in any Affiliated Underwriting.
12. The Board, including a majority of the Independent Directors, will adopt procedures reasonably designed to monitor any purchases of securities by the Fund in an Affiliated Underwriting, once an investment by an Acquiring Fund in the securities of the Fund exceeds the limit of section 12(d)(1)(A)(i) of the Act, including any purchases made directly from an Underwriting Affiliate. The Board will review these purchases periodically, but no less frequently than annually, to determine whether the purchases were influenced by the investment by the Acquiring Fund in the Fund. The Board will consider, among other things: (i) whether the purchases were consistent with the investment objectives and policies of the Fund; (ii) how the performance of securities purchased in an Affiliated Underwriting compares to the performance of comparable securities purchased during a comparable period of time in underwritings other than Affiliated Underwritings or to a benchmark such as a comparable market index; and (iii) whether the amount of securities purchased by the Fund in Affiliated Underwritings and the amount purchased directly from an Underwriting Affiliate have changed significantly from prior years. The Board will take any appropriate actions based on its review, including, if appropriate, the institution of procedures designed to ensure that purchases of securities in Affiliated Underwritings are in the best interest of shareholders of the Fund.
13. Each Fund will maintain and preserve permanently in an easily accessible place a written copy of the procedures described in the preceding condition, and any modifications to such procedures, and will maintain and preserve for a period of not less than six years from the end of the fiscal year in which any purchase in an Affiliated Underwriting occurred, the first two years in an easily accessible place, a written record of each purchase of securities in Affiliated Underwritings, once an investment by an Acquiring Fund in the securities of the Fund exceeds the limit of section 12(d)(1)(A)(i) of the Act, setting forth from whom the securities were acquired, the identity of the underwriting syndicate's members, the terms of the purchase, and the information or materials upon which the determinations of the Board were made.
14. Before investing in Shares of a Fund in excess of the limits in section 12(d)(1)(A), each Acquiring Fund and the Fund will execute an Acquiring Fund Agreement stating, without limitation, that their boards of directors or boards of trustees and their investment adviser(s), or their Sponsors or trustees (each a “Trustee”), as applicable, understand the terms and conditions of the requested order, and agree to fulfill their responsibilities under the requested order. At the time of its investment in Shares of a Fund in excess of the limit in section 12(d)(1)(A)(i), an Acquiring Fund will notify the Fund of the investment. At such time, the Acquiring Fund will also transmit to the Fund a list of the names of each Acquiring Fund Affiliate and Underwriting Affiliate. The Acquiring Fund will notify the Fund of any changes to the list of the names as soon as reasonably practicable after a change occurs. The Fund and the Acquiring Fund will maintain and preserve a copy of the requested order, the Acquiring Fund Agreement, and the list with any updated information for the duration of the investment and for a period of not less than six years thereafter, the first two years in an easily accessible place.
15. The Acquiring Fund Adviser, Trustee or Sponsor, as applicable, will waive fees otherwise payable to it by the Acquiring Fund in an amount at least equal to any compensation (including fees received pursuant to any plan adopted under rule 12b-l under the Act) received from a Fund by the Acquiring Fund Adviser, Trustee or Sponsor, or an affiliated person of the Acquiring Fund Adviser, Trustee or Sponsor, other than any advisory fees paid to the Acquiring Fund Adviser, Trustee or Sponsor, or its affiliated person by the Fund, in connection with the investment by the Acquiring Fund in the Fund. Any Acquiring Fund Subadviser will waive fees otherwise payable to the Acquiring Fund Subadviser, directly or indirectly, by the Acquiring Fund in an amount at least equal to any compensation received from a Fund by the Acquiring Fund Subadviser, or an affiliated person of the Acquiring Fund Subadviser, other than any advisory fees paid to the Acquiring Fund Subadviser or its affiliated person by the Fund, in connection with any investment by the Acquiring Management Company in the Fund made at the direction of the Acquiring Fund Subadviser. In the event that the Acquiring Fund Subadviser waives fees, the benefit of the waiver will be passed through to the Acquiring Management Company.
16. Any sales charges and/or service fees charged with respect to shares of an Acquiring Fund will not exceed the limits applicable to a fund of funds as set forth in NASD Conduct Rule 2830.
17. No Fund will acquire securities of any other investment company or company relying on section 3(c)(1) or 3(c)(7) of the Act in excess of the limits contained in section 12(d)(1)(A) of the Act, except to the extent permitted by exemptive relief from the Commission permitting the Fund to purchase shares of other investment companies for short-term cash management purposes.
18. Before approving any advisory contract under section 15 of the Act, the board of trustees or directors of each Acquiring Management Company, including a majority of the Independent Trustees, will find that the advisory fees charged under such advisory contract are based on services provided that will be in addition to, rather than duplicative of, the services provided under the advisory contract(s) of any Fund in which the Acquiring Management Company may invest. These findings and their basis will be recorded fully in the minute books of the appropriate Acquiring Management Company.
For the Commission, by the Division of Investment Management, under delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange proposes a rule change with respect to the amendment of the by-laws of its parent corporation, The NASDAQ OMX Group, Inc. (“NASDAQ OMX” or the “Corporation”). The text of the proposed rule change is available at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements.
NASDAQ OMX is proposing amendments to provisions of its By-Laws pertaining to the compositional requirements of the NASDAQ OMX Board. The changes are primarily focused on amending the definition of “Industry Director” (and “Industry committee member”)
The By-Laws require Directors to be assigned to certain defined categories, based on their current and past affiliations.
(1) Is or has served in the prior three years as an officer, director, or employee of a broker or dealer, excluding an outside director or a director not engaged in the day-to-day management of a broker or dealer;
(2) is an officer, director (excluding an outside director), or employee of an entity that owns more than ten percent of the equity of a broker or dealer, and the broker or dealer accounts for more than five percent of the gross revenues received by the consolidated entity;
(3) owns more than five percent of the equity securities of any broker or dealer, whose investments in brokers or dealers exceed ten percent of his or her net worth, or whose ownership interest otherwise permits him or her to be engaged in the day-to-day management of a broker or dealer;
(4) provides professional services to brokers or dealers, and such services constitute 20 percent or more of the professional revenues received by the Director or 20 percent or more of the gross revenues received by the Director's firm or partnership;
(5) provides professional services to a director, officer, or employee of a broker, dealer, or corporation that owns 50 percent or more of the voting stock of a broker or dealer, and such services relate to the director's, officer's, or employee's professional capacity and constitute 20 percent or more of the professional revenues received by the Director or 20 percent or more of the gross revenues received by the Director's firm or partnership; or
(6) has a consulting or employment relationship with or provides professional services to the Corporation or any affiliate
Thus, the current definition focuses on a Director's affiliation with any broker-dealer, regardless of whether the broker-dealer is a member or member organization of a Self-Regulatory Subsidiary. The definition also features a three-year “look-back” period during which a Director formerly associated with a broker-dealer would continue to
(1) Is, or within the last year was, or has an immediate family member
(2) is, or within the last year was, employed by a member or a member organization of a Self-Regulatory Subsidiary;
(3) has an immediate family member who is, or within the last year was, an executive officer of a member or a member organization
(4) has within the last year received from any member or member organization of a Self-Regulatory Subsidiary more than $100,000 per year in direct compensation, or received from such members or member organizations in the aggregate an amount of direct compensation that in any one year is more than 10 percent of the Director's annual gross compensation for such year, excluding in each case director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service); or
(5) is affiliated, directly or indirectly, with a member or member organization of a Self-Regulatory Subsidiary.
NASDAQ OMX believes that the change is warranted to ensure that the definition of Industry Director is appropriately focused on the mitigation of potential conflicts of interest associated with Directors who are currently or were very recently employed by members or member organizations of Self-Regulatory Subsidiaries, or that otherwise have material affiliations with such members or member organizations. The current definition covers individuals who are employed by broker-dealers that are not members of Self-Regulatory Subsidiaries, or who retired from service at a broker-dealer more than one, but less than three years in the past. NASDAQ OMX and the Exchange believe that by deeming such potential Directors to be Industry Directors, the current By-Laws unnecessarily restrict highly qualified individuals with extensive knowledge of the financial services industry from serving on the Board.
In addition to this change, NASDAQ OMX is also proposing the following additional changes to the definitions applicable to categories of Directors:
(1) NASDAQ OMX proposes a new definition of “Staff Director.” Currently, the definition of “Staff Director” is included within the definition of “Industry Director,” and is defined as “any two officers of the Corporation, selected at the sole discretion of the Board, amongst those officers who may be serving as Directors.” By virtue of being designated as Staff Directors, these Directors are not considered to be Industry Directors for purposes of the compositional requirements of the By-Laws. Instead, NASDAQ OMX proposes a separate definition of “Staff Director” as “an officer of the Corporation that is serving as a Director.”
(2) NASDAQ OMX is adopting a new definition of “Issuer Director” and “Issuer committee member”. The By-Laws currently provide that the number of “Non-Industry Directors” (
(3) The definition of “Public Director” and “Public committee member” is being restated as follows: “a Director or committee member who (1) is not an Industry Director or Industry committee member, (2) is not an Issuer Director or Issuer committee member, and (3) has no material business relationship with a member or member organization of a Self-Regulatory Subsidiary, the Corporation or its affiliates, or FINRA.” The definition currently covers a person who “has no material business relationship with a broker or dealer, the Corporation or its affiliates, or FINRA.” Thus, the changes make it clear that any Industry Director or Issuer Director would not be considered a Public Director. As noted above, however, an
(4) The definition of “Non-Industry Director” or “Non-Industry committee member” is proposed to be amended to cover any “Director (excluding any Staff Director) or committee member who is (1) a Public Director or Public committee member; (2) an Issuer Director or Issuer committee member; or (3) any other individual who would not be an Industry Director or Industry committee member.” The revised definition is generally consistent with the current definition, but reflects the adoption of a definition for “Issuer Director or Issuer committee member”.
(5) NASDAQ OMX is making conforming changes to the letter designations of paragraphs in Article I of the By-Laws.
NASDAQ OMX is proposing to amend Section 4.3 of the By-Laws, which governs the qualifications and compositional requirements of the Board of Directors, to (i) increase the required number of Public Directors from one to two, (ii) replace the requirement to include at least one issuer representative (or at least two issuer representatives if the Board consists of ten or more Directors) with a requirement to include at least one, but no more than two, Issuer Directors, and (iii) provide that the number of Staff Directors may not exceed one, unless the Board consists of ten or more Directors, in which case the number may not exceed two. The section will continue to require that the number of Non-Industry Directors equals or exceeds the number of Industry Directors. Although these changes will not significantly modify the Board's compositional requirements, they will continue to ensure a diversity of representation among Industry, Staff, Issuer, and Public Directors, will place more stringent caps on the number of Issuer and Staff Directors, and will increase the requirement for Public Directors. NASDAQ OMX also proposes to make a conforming change to add the term “Issuer Director” to Section 4.8 and Section 4.13(h), which govern the filling of vacancies on the Board and the determination of Directors' qualifications by NASDAQ OMX's Secretary.
The changes to the compositional requirements imposed specifically by the By-Laws do not alter in any respect the compositional requirements imposed by NASDAQ listing standards on NASDAQ OMX as a public company. Specifically, NASDAQ Rule 5605 requires that the board of directors of a company listed on NASDAQ must have a majority of directors that are “independent” within the meaning of that rule. As provided in NASDAQ Rule 5605(a)(2) with respect to a company listed on NASDAQ (a “Company”), ” `Independent Director' means a person other than an Executive Officer
NASDAQ OMX is proposing a minor amendment to the compositional requirements of its Executive Committee. Currently, Section 4.13(d) of the By-Laws provides that the percentage of Public Directors on the Executive Committee must be at least as great as the percentage of Public Directors on the whole Board. As noted above, however, the By-Laws currently require only one Public Director on the whole Board (a requirement that NASDAQ OMX is proposing to raise to two Public Directors). Thus, the By-Laws currently reflect a standard under which voluntary inclusion of additional Public Directors on the full Board translates into a requirement to include ever increasing numbers of Public Directors on the Executive Committee, even though the requirements for the full Board itself may be satisfied with only one Public Director. Accordingly, NASDAQ OMX is proposing to make the requirements consistent by requiring at least two Public Directors on the Executive Committee.
Earlier this year, the Commission approved changes to the provisions of NASDAQ OMX's By-Laws pertaining to the composition of the Management Compensation Committee of its Board of Directors. NASDAQ OMX is now proposing comparable changes to the compositional requirements of its Audit Committee. Specifically, NASDAQ OMX is proposing to amend Section 4.13(g) to replace a requirement that the Audit Committee be composed of a majority of Non-Industry Directors with a requirement that the number of Non-Industry Directors on the committee equal or exceed the number of Industry Directors. Thus, in the case of a committee composed of four Directors, the current By-Law provides that only one Director may be an Industry Director, while the amended By-Law would allow up to two Directors to be Industry Directors. The proposed compositional requirement for the committee with regard to the balance between Industry Directors and Non-Industry Directors would be the same as that already provided for in the By-Laws with respect to the Executive Committee, the Nominating and Governance Committee, the Management Compensation Committee, and the full Board of Directors.
NASDAQ OMX and the Exchange believe that the change will provide greater flexibility to NASDAQ OMX with regard to populating a committee that includes Directors with relevant expertise and that is not excessively large in relation to the size of the full Board of Directors, while continuing to ensure that Directors associated with members and member organizations of the Self-Regulatory Subsidiaries do not exert disproportionate influence of the governance of NASDAQ OMX. As required by Section 10A of the Act,
Phlx believes that the proposed rule change is consistent with the provisions
In particular, Phlx believes that the change to the definition of Industry Director is warranted to ensure that it is appropriately focused on the mitigation of potential conflicts of interest associated with Directors who are currently or were very recently employed by members or member organizations of Self-Regulatory Subsidiaries, or that otherwise have material affiliations with such members or member organizations, without unnecessarily restricting highly qualified individuals with extensive knowledge of the financial services industry from serving on the Board. Phlx further believes that the other definitional changes and the changes to the compositional requirements of the NASDAQ OMX Board and the Executive Committee will enhance the clarity of these provisions and promote a diversity of backgrounds and viewpoints on the NASDAQ OMX Board. The Exchange believes that these changes will collectively promote the capacity of the NASDAQ OMX Board to fulfill its responsibilities.
With respect to the proposed changes to the Audit Committee's compositional requirements, Phlx believes that the change will provide greater flexibility to NASDAQ OMX with regard to populating a committee that includes Directors with relevant expertise and that is not excessively large in relation to the size of the full Board of Directors, while continuing to ensure that Directors associated with members and member organizations of Self-Regulatory Subsidiaries do not exert disproportionate influence of the governance of NASDAQ OMX. The change would not affect NASDAQ OMX's compliance with Section 10A of the Act,
The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes [sic] the Act. Specifically, the Exchange believes that the By-Laws of its holding company, NASDAQ OMX, do not directly affect competition between the Exchange and others that provide the same goods and services as the Exchange, since they do not affect the availability or pricing of such goods and services. To the extent that the proposed change to the By-Laws may be construed to have any bearing on competition, the Exchange believes that the change will promote competition between the Exchange and the subsidiaries of NYSE Euronext, since the change will allow NASDAQ OMX to have greater flexibility in the selection of its Directors in a manner similar to the flexibility available to NYSE Euronext under its Independence Policy.
Written comments were neither solicited nor received.
Within 45 days of the date of publication of this notice in the
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
December 21, 2012.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
OCC is amending its Schedule of Fees, effective January 2, 2013, so that it may charge an additional monthly fee to non-clearing member subscribers (“Subscribers”) of certain non-proprietary data that elect to receive such data on a real-time basis.
In its filing with the Commission, OCC included statements concerning the purpose of and basis for the rule change and discussed any comments it received on the rule change. The text of these statements may be examined at the places specified in Item IV below. OCC has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of this rule change is to amend OCC's Schedule of Fees so that OCC may charge non-clearing members a $250 per month fee if they elect to subscribe to a service that provides real-time series information data. OCC provides a variety of options-related data to Subscribers including data reflecting the symbol, expiration date, strike price, listed exchanges, and activation/inactivation date of a particular option (“Series Information Data”). Currently, OCC distributes Series Information data to Subscribers through a batch process at the end of each OCC business day.
Subscribers to Series Information data have requested that such data be provided on a real-time basis throughout each OCC business day in order to better meet the needs of their customers (
OCC determined that it can readily implement systems and processes to accommodate real-time feeds of Series Information data to Subscribers; however, implementation of such systems and processes will result in initial and ongoing costs incurred by OCC. To offset these costs, OCC plans to charge a $250 per month fee to Subscribers receiving real-time Series Information data. OCC will continue to offer Series Information data through the existing end-of-day batch process for Subscribers not interested in subscribing to the real-time service at the rates of $1,750.00 per month for non-distribution and $3,000.00 per month for distribution, as currently set forth in the Schedule of Fees, and use such batch process as back-up to the real-time service should the real-time service become temporarily unavailable.
The rule change is consistent with Section 17A of the Act because it promotes prompt and accurate settlement of securities transactions by enhancing an existing service provided to non-clearing members. In addition, OCC believes the monthly fee increase is minimal and non-clearing members may elect not to receive the Series Information Data in real-time to avoid the fee increase. The proposed rule change is not inconsistent with any rules of OCC, including any other rules proposed to be amended.
OCC does not believe the rule change would impose any burden on competition.
Written comments were not and are not intended to be solicited with respect to the rule change and none have been received.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(ii)
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC, 20549–1090.
All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–OCC–2012–25 and should be submitted on or before January 22, 2013.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
The Exchange proposes to amend Rule 1080(m) to provide for the distribution of auction messages for certain orders.
The Exchange proposes this amendment become operative on January 2, 2013.
The text of the proposed rule change is available on the Exchange's Web site at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of the proposed rule change is to amend Rule 1080 titled “Phlx XL and Phlx XL II,” which describes the Exchange's fully automated options trading system.
Currently, when the Exchange's disseminated bid or offer (“PBBO”) is inferior to the away best bid or offer (“ABBO”) the Phlx XL II system will route FIND
With respect to routable FIND and SRCH orders, today the Phlx XL II system has a Route Timer which provides for a system pause for a period not to exceed one second.
At this time, the Exchange is proposing to expose orders by broadcasting a notification to all Phlx XL II participants and other market participants who have elected to receive such notifications
The Exchange's proposal to expose the order by way of a broadcasting a notification to Phlx XL II participants and other market participants is an amendment to the Exchange's current rules. The Exchange is not proposing to amend any other functionality in Rule 1080(m) related to FIND or SRCH orders. Today, the Exchange executes any responses at a price at or better than the ABBO on a first come, first served basis prior to routing the order to an away market in accordance with the rules currently in effect in Rule 1080(m). If a response trades against new interest, the Route Timer would terminate early if the order is fully executed. This amendment is similar to rules at other options exchanges.
By way of an example, today assuming that Phlx's best offer is 1.22 for 200 contracts and the NBO is 1.19 for 10 contracts with one other market disseminating a 1.20 offer for 20 contracts. An order to buy 100 contracts at 1.22 is received. The order would be broadcast through a notification message at 1.19. A market participant submits a response to trade 10 contracts at 1.19. As a result 10 contracts trade against market participant A at 1.19 (leaving 90 contracts on the order). During the remaining time on the Route Timer market participant B submits a response to trade 20 contracts at 1.21. As soon as the Route Timer concludes (assuming away market prices have not changed), the Exchange will simultaneously: route an ISO to buy 10 contracts at 1.19 to the NBBO market, route an ISO to buy 20 contracts at 1.20 to the market displaying the 1.20 offer, execute 20 contracts at 1.21 market participant B, and execute the remaining 40 contracts against the Exchange's 1.22 offer.
With respect to non-routable DNR orders, today a DNR order may execute at a price equal to or better than, but not inferior to, the best away market price but, if that best away market remains, the DNR order will remain in the Phlx book and be displayed at a price one minimum price variation inferior to that away best bid/offer.
Similar to routable orders, the Exchange is proposing to expose the DNR order, upon receipt, to Phlx XL II participants and other market participants in a manner similar to FIND and SRCH orders. The Exchange proposes to expose the order by broadcasting a notification to Phlx XL II participants and other market participants. In the instance that the best away market changes to an inferior price, the DNR order automatically re-prices again. If, and only if, after repricing, the DNR order is still not displayed at its original limit price the Exchange will expose the order again to Phlx XL II participants and other market participants. The DNR order would remain on the book until executed or cancelled, and not route to an away market, pursuant to current Exchange rules. Any responses received to the exposed order would be executed in accordance with the current text of Rule 1080(m)(iv)(A).
By way of an example, today assuming that the PBBO is 1.00 bid/2.00 offer and the NBBO is 1.00 bid/1.20 offer and a DNR order to buy 100 contracts for 1.50 is received. The order would be broadcast through a notification message at 1.20 and the PBBO would be updated to 1.19 bid/2.00 offer. If the NBBO moved to 1.00 bid/1.50 offer, and the DNR order was not completely filled, the Exchange would reprice the DNR order and update the PBBO to 1.49 bid/2.00 offer and broadcast another notification message at 1.50. The Exchange would expose the order in this instance because the re-priced DNR order locked the market. The Exchange would also expose the repriced DNR order in the instance that the order crossed the market. For example, assuming that the PBBO is 1.00 bid/2.00 offer and the NBBO is 1.00 bid/1.20 offer and a DNR order to buy 100 contracts for 1.50 is received. The order would be broadcast through a notification message at 1.20. If the NBBO moved to 1.00 bid/1.40 offer, and the order was not completely filled, the Exchange would reprice the DNR order and update the PBBO to 1.39 bid/2.00 offer and rebroadcast the message at 1.40. If the NBBO moved to 1.00 bid/1.53 offer, and the order was not completely filled, the Exchange would reprice the DNR order to its limit of 1.50 and update the PBBO to 1.50 bid/2.00 offer. The DNR order, since posted at its limit, will not be rebroadcast and will remain on the book until it is either executed or cancelled. As previously stated, the Exchange is not proposing to add any additional functionality to the Phlx XL II system.
This proposal only seeks to expose certain orders by broadcasting a notification message to all Phlx XL II participants and market participants that subscribe to certain data feeds. The Exchange would send the notification message which exposes the order through both the TOPO Plus Order feed
The Exchange also proposes to rename Rule 1080(m) from “Order Routing” to “Away Markets and Order Routing” to better reflect the various order types in that section.
The Exchange proposes this amendment become operative on January 2, 2013.
The Exchange believes that its proposal is consistent with Section 6(b) of the Act
The Exchange believes that exposing certain orders has the potential to result in more efficient executions for customers as responses to exposed orders could result in quicker executions. The Exchange's proposal to expose the orders to all Phlx XL II market participants as well as other market participants is consistent with the protection of investors and the public interest. Broadcasting the message to all market participants should promote broader awareness of, and provide increased opportunities for greater participation in, these executions and consequentially, facilitate the ability of the Exchange to bring together participants and encourage more robust competition for these orders. In addition, the proposal would continue to guarantee that orders will receive an execution that is at a price at least as good as the price disseminated by the best away market at the time the order was received.
In addition, the Exchange believes that because all Phlx XL II participants and other market participants have the ability to subscribe to a data feed to provide them with the notifications exposing the orders, that all market participants may avail themselves of the same information. While Market Makers may receive the SQF data at no cost, Market Makers have burdensome quoting obligations
The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act, but rather this proposal should facilitate the ability of the Exchange to bring together participants and encourage more robust competition.
No written comments were either solicited or received.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the
Act
A proposed rule change filed under Rule 19b–4(f)(6) normally may not become operative prior to 30 days after the date of filing. However, Rule 19b–4(f)(6)(iii)
At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act.
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange proposes a rule change with respect to the amendment of the by-laws of its parent corporation, The NASDAQ OMX Group, Inc. (“NASDAQ OMX” or the “Corporation”). The text of the proposed rule change is available at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements.
NASDAQ OMX is proposing amendments to provisions of its By-Laws pertaining to the compositional requirements of the NASDAQ OMX Board. The changes are primarily focused on amending the definition of “Industry Director” (and “Industry committee member”)
The By-Laws require Directors to be assigned to certain defined categories, based on their current and past affiliations.
(1) Is or has served in the prior three years as an officer, director, or employee of a broker or dealer, excluding an outside director or a director not engaged in the day-to-day management of a broker or dealer;
(2) Is an officer, director (excluding an outside director), or employee of an entity that owns more than ten percent of the equity
(3) Owns more than five percent of the equity securities of any broker or dealer, whose investments in brokers or dealers exceed ten percent of his or her net worth, or whose ownership interest otherwise permits him or her to be engaged in the day-to-day management of a broker or dealer;
(4) Provides professional services to brokers or dealers, and such services constitute 20 percent or more of the professional revenues received by the Director or 20 percent or more of the gross revenues received by the Director's firm or partnership;
(5) Provides professional services to a director, officer, or employee of a broker, dealer, or corporation that owns 50 percent or more of the voting stock of a broker or dealer, and such services relate to the director's, officer's, or employee's professional capacity and constitute 20 percent or more of the professional revenues received by the Director or 20 percent or more of the gross revenues received by the Director's firm or partnership; or
(6) Has a consulting or employment relationship with or provides professional services to the Corporation or any affiliate
Thus, the current definition focuses on a Director's affiliation with any broker-dealer, regardless of whether the broker-dealer is a member or member organization of a Self-Regulatory Subsidiary. The definition also features a three-year “look-back” period during which a Director formerly associated with a broker-dealer would continue to be deemed an Industry Director. In lieu of this definition, NASDAQ OMX is proposing to adopt a definition that focuses on whether a Director is affiliated with a member or a member organization of a Self-Regulatory Subsidiary. Under the revised definition, an Industry Director will be defined as a Director who:
(1) Is, or within the last year was, or has an immediate family member
(2) Is, or within the last year was, employed by a member or a member organization of a Self-Regulatory Subsidiary;
(3) Has an immediate family member who is, or within the last year was, an executive officer of a member or a member organization
(4) Has within the last year received from any member or member organization of a Self-Regulatory Subsidiary more than $100,000 per year in direct compensation, or received from such members or member organizations in the aggregate an amount of direct compensation that in any one year is more than 10 percent of the Director's annual gross compensation for such year, excluding in each case director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service); or
(5) Is affiliated, directly or indirectly, with a member or member organization of a Self-Regulatory Subsidiary.
NASDAQ OMX believes that the change is warranted to ensure that the definition of Industry Director is appropriately focused on the mitigation of potential conflicts of interest associated with Directors who are currently or were very recently employed by members or member organizations of Self-Regulatory Subsidiaries, or that otherwise have material affiliations with such members or member organizations. The current definition covers individuals who are employed by broker-dealers that are not members of Self-Regulatory Subsidiaries, or who retired from service at a broker-dealer more than one, but less than three years in the past. NASDAQ OMX and the Exchange believe that by deeming such potential Directors to be Industry Directors, the current By-Laws unnecessarily restrict highly qualified individuals with extensive knowledge of the financial services industry from serving on the Board.
In addition to this change, NASDAQ OMX is also proposing the following additional changes to the definitions applicable to categories of Directors:
(1) NASDAQ OMX proposes a new definition of “Staff Director.” Currently, the definition of “Staff Director” is included within the definition of “Industry Director,” and is defined as “any two officers of the Corporation, selected at the sole discretion of the Board, amongst those officers who may be serving as Directors.” By virtue of being designated as Staff Directors, these Directors are not considered to be Industry Directors for purposes of the compositional requirements of the By-Laws. Instead, NASDAQ OMX proposes a separate definition of “Staff Director” as “an officer of the Corporation that is serving as a Director.”
(2) NASDAQ OMX is adopting a new definition of “Issuer Director” and “Issuer committee member”. The By-Laws currently provide that the number of “Non-Industry Directors” (
(3) The definition of “Public Director” and “Public committee member” is being restated as follows: “a Director or committee member who (1) Is not an Industry Director or Industry committee member, (2) is not an Issuer Director or Issuer committee member, and (3) has no material business relationship with a member or member organization of a Self-Regulatory Subsidiary, the Corporation or its affiliates, or FINRA.” The definition currently covers a person who “has no material business relationship with a broker or dealer, the Corporation or its affiliates, or FINRA.” Thus, the changes make it clear that any Industry Director or Issuer Director would not be considered a Public Director. As noted above, however, an independent director of an issuer of securities listed on NASDAQ could be considered a Public Director. In addition, in keeping with the change to the definition of Industry Director discussed above, the final clause of the definition is being revised to focus on the existence of a material business relationship with a member or member organization of a Self-Regulatory Subsidiary, rather than any broker or dealer. Thus, for example, a Director that had a material business relationship with a non-U.S. broker or dealer that was not a member or a member organization of a Self-Regulatory Subsidiary might be eligible to be a Public Director.
(4) The definition of “Non-Industry Director” or “Non-Industry committee member” is proposed to be amended to cover any “Director (excluding any Staff Director) or committee member who is (1) A Public Director or Public committee member; (2) an Issuer Director or Issuer committee member; or (3) any other individual who would not be an Industry Director or Industry committee member.” The revised definition is generally consistent with the current definition, but reflects the adoption of a definition for “Issuer Director or Issuer committee member”.
(5) NASDAQ OMX is making conforming changes to the letter designations of paragraphs in Article I of the By-Laws.
NASDAQ OMX is proposing to amend Section 4.3 of the By-Laws, which governs the qualifications and compositional requirements of the Board of Directors, to (i) Increase the required number of Public Directors from one to two, (ii) replace the requirement to include at least one issuer representative (or at least two issuer representatives if the Board consists of ten or more Directors) with a requirement to include at least one, but no more than two, Issuer Directors, and (iii) provide that the number of Staff Directors may not exceed one, unless the Board consists of ten or more Directors, in which case the number may not exceed two. The section will continue to require that the number of Non-Industry Directors equals or exceeds the number of Industry Directors. Although these changes will not significantly modify the Board's compositional requirements, they will continue to ensure a diversity of representation among Industry, Staff, Issuer, and Public Directors, will place more stringent caps on the number of Issuer and Staff Directors, and will increase the requirement for Public Directors. NASDAQ OMX also proposes to make a conforming change to add the term “Issuer Director” to Section 4.8 and Section 4.13(h), which govern the filling of vacancies on the Board and the determination of Directors' qualifications by NASDAQ OMX's Secretary.
The changes to the compositional requirements imposed specifically by the By-Laws do not alter in any respect the compositional requirements imposed by NASDAQ listing standards on NASDAQ OMX as a public company. Specifically, NASDAQ Rule 5605 requires that the board of directors of a company listed on NASDAQ must have a majority of directors that are “independent” within the meaning of that rule. As provided in NASDAQ Rule 5605(a)(2) with respect to a company listed on NASDAQ (a “Company”), ” `Independent Director' means a person other than an Executive Officer
NASDAQ OMX is proposing a minor amendment to the compositional requirements of its Executive Committee. Currently, Section 4.13(d) of the By-Laws provides that the percentage of Public Directors on the Executive Committee must be at least as great as the percentage of Public Directors on the whole Board. As noted above, however, the By-Laws currently require only one Public Director on the whole Board (a requirement that NASDAQ OMX is proposing to raise to two Public Directors). Thus, the By-Laws currently reflect a standard under which voluntary inclusion of additional Public Directors on the full Board translates into a requirement to include ever increasing numbers of Public Directors on the Executive Committee, even though the requirements for the full Board itself may be satisfied with only one Public Director. Accordingly, NASDAQ OMX is proposing to make the requirements consistent by requiring at least two Public Directors on the Executive Committee.
Earlier this year, the Commission approved changes to the provisions of NASDAQ OMX's By-Laws pertaining to the composition of the Management Compensation Committee of its Board of Directors. NASDAQ OMX is now proposing comparable changes to the
NASDAQ OMX and the Exchange believe that the change will provide greater flexibility to NASDAQ OMX with regard to populating a committee that includes Directors with relevant expertise and that is not excessively large in relation to the size of the full Board of Directors, while continuing to ensure that Directors associated with members and member organizations of the Self-Regulatory Subsidiaries do not exert disproportionate influence of the governance of NASDAQ OMX. As required by Section 10A of the Act,
BX believes that the proposed rule change is consistent with the provisions of Section 6 of the Act,
In particular, BX believes that the change to the definition of Industry Director is warranted to ensure that it is appropriately focused on the mitigation of potential conflicts of interest associated with Directors who are currently or were very recently employed by members or member organizations of Self-Regulatory Subsidiaries, or that otherwise have material affiliations with such members or member organizations, without unnecessarily restricting highly qualified individuals with extensive knowledge of the financial services industry from serving on the Board. BX further believes that the other definitional changes and the changes to the compositional requirements of the NASDAQ OMX Board and the Executive Committee will enhance the clarity of these provisions and promote a diversity of backgrounds and viewpoints on the NASDAQ OMX Board. The Exchange believes that these changes will collectively promote the capacity of the NASDAQ OMX Board to fulfill its responsibilities.
With respect to the proposed changes to the Audit Committee's compositional requirements, BX believes that the change will provide greater flexibility to NASDAQ OMX with regard to populating a committee that includes Directors with relevant expertise and that is not excessively large in relation to the size of the full Board of Directors, while continuing to ensure that Directors associated with members and member organizations of Self-Regulatory Subsidiaries do not exert disproportionate influence of the governance of NASDAQ OMX. The change would not affect NASDAQ OMX's compliance with Section 10A of the Act,
The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes [sic] the Act. Specifically, the Exchange believes that the By-Laws of its holding company, NASDAQ OMX, do not directly affect competition between the Exchange and others that provide the same goods and services as the Exchange, since they do not affect the availability or pricing of such goods and services. To the extent that the proposed change to the By-Laws may be construed to have any bearing on competition, the Exchange believes that the change will promote competition between the Exchange and the subsidiaries of NYSE Euronext, since the change will allow NASDAQ OMX to have greater flexibility in the selection of its Directors in a manner similar to the flexibility available to NYSE Euronext under its Independence Policy.
Written comments were neither solicited nor received.
Within 45 days of the date of publication of this notice in the
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
NASDAQ is filing with the Commission a proposal to add new Rule 5950 (Market Quality Program) to enable market makers that voluntarily commit to and do in fact enhance the market quality (quoted spread and liquidity) of certain securities listed on the Exchange to qualify for a fee credit pursuant to the Exchange's Market Quality Program and to exempt the Market Quality Program from Rule 2460 (Payment for Market Making). NASDAQ believes this voluntary program will benefit investors, issuers or companies, and market participants by significantly enhancing the quality of the market and trading in such listed securities.
The Market Quality Program set forth in Rule 5950 will be effective for a one year pilot period beginning from the date of implementation of the program. During the pilot, NASDAQ will periodically provide information to the Commission about market quality in respect of the Market Quality Program.
The text of the proposed rule change is available from NASDAQ's Web site at
In its filing with the Commission, NASDAQ included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. NASDAQ has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
This Amendment No.1 to SR–NASDAQ–2012–137 replaces and supercedes [sic] SR–NASDAQ–2012–137 in its entirety.
The purpose of the filing is to propose new Rule 5950 to enable Market Makers
Proposed Rule 5950 will be effective for a one year pilot period. The pilot period will commence when the Market Quality Program is implemented by the Exchange and an MQP Company,
The Exchange has a provision in its Rule 2460 that is, in respect of Exchange members, largely similar to FINRA Rule 5250.
The proposed Market Quality Program is a voluntary program designed to promote market quality in MQP Securities.
Other markets have considered various ways to increase liquidity in low volume securities. NYSE Euronext, for example, has advocated that a market-wide pilot program with wider spread increments for less liquid securities could be a worthwhile experiment. NYSE Euronext has also recognized that the creation of a program in which small companies could enter into agreements directly with broker-dealers or through exchanges to provide direct payments to a broker-dealer who agrees to make a market in the issuer's security is an idea that may warrant further review by FINRA and the Commission.
The Exchange believes that the MQP will be beneficial to the financial markets, to market participants including traders and investors, and to the economy in general. First, the MQP will encourage narrow spreads and liquid markets in situations that generally have not been, or may not be, conducive to naturally having such markets. The securities that comprise these markets may include less actively traded or less well known ETF products that are made up of securities of less well known or start-up companies as components.
There is support for paid for market making (also known as “PFMM”) at the highest governmental levels. Congressman Patrick McHenry, the Chairman of the House Committee on Governmental Reform and Oversight, for example, recently noted that agreements between issuers and market makers to pay for market making activity “* * *would allow small companies to produce an orderly, liquid market for their stocks. Research has shown that these agreements, already permitted overseas, have led to a positive influence on liquidity for small public companies.”
The Exchange believes that by establishing specific market quality requirements in the MQP to expand quote competition and liquidity in targeted securities such as ETFs, the Program will be conducive to capital formation—not only in the targeted securities or ETFs (
In a similar vein, Robert Greifeld, Chief Executive Officer of The NASDAQ OMX Group, Inc. (“NASDAQ OMX”), has noted that unlike the United States, “[t]he U.K., Canada and Sweden all have exchange markets that serve as “incubators” for smaller companies.
The practice of paid for market making to increase the liquidity of less liquid securities was examined by Johannes A. Skjeltorp and Bernt Arne Odegaard in a working paper from June 2011.
About six years prior to the Skjeltorp and Odegaard article, Amber Anand, Carsten Tanggaard, and Daniel G. Weaver studied liquidity provision through paid for market making on the Stockholm Stock Exchange (“SSE”), currently named NASDAQ OMX Stockholm AB.
More recently, Eric Noll, Executive Vice President, NASDAQ OMX, described the positive impact of paid for market making in the First North market, a European venue for smaller companies that has a program enabling companies to compensate market makers.
The Exchange believes that commensurate with the previously-discussed studies regarding paid for market making,
By way of background, the First North market is an alternative listing market to the NASDAQ OMX Nordic Main Market (“Main Market”).
The First North paid for market making system is based on a standard exchange-supplied contract between a listing firm and a designated market maker (“DMM”) that sets forth market obligations for the market maker. The Exchange sets forth obligations for the
The paid for market making model on NASDAQ's First North has operated since 2002 and has been demonstrably successful to the benefit of issuers and investors, without material regulatory issues. One of the definitive market quality attributes associated with expansion of liquidity through paid for market making is the significant narrowing of bid/ask spreads. This phenomenon is directly and immediately beneficial for all market participants including investors and listing companies (which may also benefit from accompanying volume increase). As depicted in the chart below, in 2010 and 2011 the Relative Time Weighted Average Spread (“RTWAS”)
The substantial positive advantage that market participants receive from PFMM is clearly demonstrated in the chart below, showing that non-PFMM security spreads were: (a) Often more than four times wider than PFMM security spreads; and (b) a majority of the time more than three times wider than PFMM spreads. Moreover, the spreads for stocks with PFMM were more stable through time.
A comparison of Relative Time Weighted Average Spread on First North shows the significant, consistent impact of PFMM in narrowing spreads.
In terms of regulation, the First North PFMM experience has not raised concerns. Based on Exchange discussions with the Office of General Counsel at NASDAQ OMX Nordic in respect of the First North market, the Exchange is not aware of regulatory oversight issues (
The Exchange believes that the MQP will, like paid for market making on First North, achieve positive results.
The Exchange believes that this proposal would help raise investor and issuer confidence in the fairness of their transactions and the markets in general by enhancing market maker quote competition in securities on the Exchange, narrowing spreads, increasing shares available at the inside, reducing transaction costs, supporting
To that end, the Exchange has recently put into place initiatives designed to expand the liquidity of certain targeted securities on transparent and displayed markets on the Exchange.
As noted, the proposal would enhance the market quality of targeted securities, particularly ETFs. The Exchange believes that ETFs offer great value to retail and institutional investment communities, as reflected in their popularity as investment vehicles both in the U.S. and abroad.
In addition, the Exchange believes that purchasers of ETFs that find success because of increased market quality (especially where such ETFs are smaller or niche funds with fewer components) may choose to invest directly in the fund components after a positive ETF market quality and execution experience.
Perhaps the most astonishing statistic, which clearly shows the critical need for a rules-based liquidity-enhancement program such as the MQP, is that ETF Deathwatch list surged 131% in the past year.
Moreover, while the MQP pilot is structured to initially apply only to ETFs, the goal is to expand the MQP, if successful, to small cap stocks and other similar products that may need liquidity enhancement. The Exchange believes that while this would benefit small cap MQP products and investors as well as overall market liquidity, perhaps even more importantly it would serve to help economic expansion and the economy as a whole.
Preliminarily, the Exchange is proposing to modify its Rule 2460, which prohibits direct or indirect payment by an issuer to a Market Maker, to indicate that Rule 2460 is not applicable to the MQP.
In the order approving NASD Rule 2460 (the 1997 order), upon which NASDAQ Rule 2460 is based (as is FINRA Rule 5250), the Commission discussed that NASD Rule 2460 preserved investor confidence, preserved the integrity of the marketplace, and established a clear standard of practice for member firms.
The Exchange designed the MQP to meet the goals of market integrity, investor confidence, and clear member standards as discussed in the 1997 order. In particular, the Exchange designed the MQP to have precise standards for all MQP Market Makers in the Program and to be highly transparent with clear public notification requirements; with clear entry, continuation, and termination requirements; with clear Market Maker accountability standards; and, perhaps most importantly, with clear market quality (liquidity) enhancement standards that benefit investors and market participants. Additionally, NASDAQ has ensured that issuers are unable to influence the selection or retention of MQP Market Makers, or the amount of incentive credits that any particular Market Maker receives from NASDAQ. The positive aspects of the MQP are objective, clear and unambiguous.
First, the entire MQP is clearly and accurately set forth in proposed Rule 5950. This includes the application and withdrawal process, the listing fee and credit structure, the market quality standards that an MQP Market Maker must meet and maintain to secure an MQP Credit, and the Program termination process. Second, the Exchange will provide notification on its public Web site regarding the variable aspects of the Program. Specifically, this notification will include: the names of the MQP Companies and the MQP Market Makers that are accepted into the Program; how many MQP Securities an MQP Company may have in the Program; the specific names of the MQP Securities that are listed pursuant to the Program; the identity of the MQP Market Makers in each MQP Security; and the amount of the supplemental MQP Fee, if one is established by an MQP Company in addition to the basic MQP Fee, as discussed below. Third, MQP Securities will be traded on a highly regulated and transparent exchange, namely NASDAQ, pursuant to the current trading and reporting rules of the Exchange, and pursuant to the established market surveillance and oversight procedures of the Exchange. And fourth, the MQP would encourage narrower spreads and better market quality (more liquid markets) for securities that generally have not been, or may not be, conducive to naturally having such markets. The Exchange believes that these factors, which directly benefit all market participants and investors, are instrumental to developing strong investor confidence in the MQP and the integrity of the market.
Moreover, the Exchange believes that the MQP does not implicate conflicts of interest. That is, unlike the situation that the NASD was trying to address in its Rule 2460 or NASD Notice to Members 75–16, where issuers had the ability to directly pay a market maker to illegally pump up the price of an issuer's stock, the proposed MQP does not encourage MQP Market Makers to improperly pump up prices nor, for that matter, establish any direct financial connection between MQP Market Makers and MQP Companies. First, an MQP Company must go through an MQP application process, and the Exchange must accept the MQP Company into the Program, before an MQP Company can list a product pursuant to the Program.
Moreover, NASDAQ notes, regarding the flow of funds, that the Exchange stands between an MQP Company and an MQP Market Maker; an MQP Company cannot and does not, under any circumstances, directly pay any funds to an MQP Market Maker.
Additionally, the Exchange notes that the MQP is proposed initially as a pilot program. This is significant for several reasons. First, NASDAQ is proposing the pilot as an attempt to repair a gap in market structure, namely the challenge of certain small or start-up securities lacking access to quality markets with adequate liquidity.
The Exchange believes that the MQP proposal would help raise investor and issuer confidence in the fairness of their transactions and the markets in general by enhancing market maker quote competition in securities on the Exchange, narrowing spreads, increasing shares available at the inside, reducing transaction costs, supporting the quality of price discovery, and promoting market transparency.
The MQP is available to Companies
The first step for an entity wishing to participate in the MQP by listing a security on the Exchange, and for a Market Maker wishing to participate in the MQP as an MQP Market Maker, is to submit an MQP application to the Exchange.
Moreover, to further enhance the transparency of the Program, proposed Rule 5950(a)(1)(C) indicates that NASDAQ will also provide notification on its Web site regarding the following: the total number of MQP Securities that any one MQP Company may have in the Program; and the names of MQP Securities that are listed on NASDAQ and the MQP Market Maker(s) in each listed MQP Security, and the dates that an MQP Company, on behalf of an MQP Security, commences participation in and withdraws or is terminated from the Program.
And per proposed Rule 5950(b)(1)(D), during such time that an MQP Company lists an MQP Security, the MQP Company must, on a product-specific Web site for each product, indicate that the product is in the MQP and provide the link to the Exchange's MQP Web site.
An MQP Company, on behalf of an MQP Security, and an MQP Market Maker may choose to withdraw from the Program. After an MQP Company, on behalf of an MQP Security, is in the MQP for six consecutive months but less than one year, it may voluntarily withdraw from the MQP on a quarterly basis. The MQP Company must notify NASDAQ in writing not less than one month prior to withdrawing from the MQP. NASDAQ may determine, however, to allow an MQP Company to withdraw from the MQP earlier.
After an MQP Company, on behalf of an MQP Security, is in the MQP for one year, the MQP and all obligations and requirements of the Program will automatically continue on an annual basis unless NAQSAQ terminates the Program by providing not less than one month prior notice of intent to terminate or the pilot Program is not extended or made permanent pursuant to a proposed rule change subject to filing with or approval by the Commission under Section 19(b) of the Exchange Act; the MQP Company withdraws from the Program pursuant to subsection (a)(2) of this rule; or the MQP Company is terminated from the Program pursuant to subsection (d) of Proposed Rule 5950.
(A) An MQP Security sustains an average daily trading volume (consolidated trades in all U.S. markets) (“ATV”) of one million shares or more for three consecutive months;
(B) An MQP Company, on behalf of an MQP Security, withdraws from the MQP, is no longer eligible to be in the MQP pursuant to this rule, or its Sponsor ceases to make MQP Fee payments to Nasdaq;
(C) An MQP Security is delisted or is no longer eligible for the MQP;
(D) An MQP Security does not have at least one MQP Market Maker for more than one quarter; or
(E) An MQP Security does not, for two consecutive quarters, have at least one MQP Market Maker that is eligible for MQP Credit.
Moreover, subsection (d) states that MQP Credits remaining upon termination of the MQP in respect of an MQP Security will be distributed on a pro rata basis to the MQP Market Makers that made a market in such MQP Security and were eligible to receive MQP Credit pursuant to this rule; and that termination of an MQP Company, MQP Security, or MQP Market Maker does not preclude the Exchange from allowing re-entry into the Program where the Exchange deems proper.
An MQP Company seeking to participate in the MQP shall incur an annual basic MQP Fee of $50,000 per MQP Security. The basic MQP Fee must be paid to NASDAQ prospectively on a quarterly basis.
An MQP Company may also incur an annual supplemental MQP Fee per MQP Security. The basic MQP Fee and supplemental MQP Fee when combined may not exceed $100,000 per year. The supplemental MQP Fee is a fee selected by an MQP Company on an annual basis, if at all. The supplemental MQP Fee must be paid to NASDAQ prospectively on a quarterly basis. The amount of the supplemental MQP Fee, if any, will be determined by the MQP Company initially per MQP Security and will remain the same for the period of a year. NASDAQ will provide notification on its Web site regarding the amount, if any, of any supplemental MQP Fee determined by an MQP Company per MQP Security.
The MQP Fee is in addition to the standard (non-MQP) NASDAQ listing fee applicable to the MQP Security and does not offset such standard listing fee.
When making a market in an MQP Security, an MQP Market Maker must, in addition to fulfilling the market making obligations per Rule 4613,
For example, regarding the first market quality standard (25%)—in an MQP Security where the NBBO is $25.00 x $25.10, for a minimum of 25% of the time when quotes can be entered in the Regular Market Session as averaged over the course of a month, an MQP Market Maker must maintain bids at or better than $25.00 for at least 500 shares and must maintain offers at or better than $25.10 for at least 500 shares. Thus, if there were 20 trading days in a given month and the MQP Market Maker met this requirement 20% of the time when quotes can be entered in the Regular Market Session for 10 trading sessions and 40% of the time when quotes can be entered in the Regular Market Session for 10 trading sessions then the MQP Market Maker would have met the requirement 30% of the time in that month.
For example, regarding the second market quality standard (90%)—in an MQP Security where the NBBO is $25.00 x $25.10, for a minimum of 90% of the time when quotes can be entered in the Regular Market Session as averaged over the course of a month, an MQP Market Maker must post bids for an aggregate of 2,500 shares between $24.50 and $25.00, and post offers for an aggregate of 2,500 shares between $25.10 and $25.60. Thus, if there were 20 trading days in a given month and the MQP Market Maker met this requirement 88% of the time when quotes can be entered in the Regular Market Session for 10 trading sessions and 98% of the time when quotes can be entered in the Regular Market Session for 10 trading sessions then the MQP Market Maker would have met the requirement 93% of the time in that month.
MQP Credits for each MQP Security will be calculated monthly and credited quarterly on a pro rata basis to one or more eligible MQP Market Makers
An MQP Credit will be credited quarterly to an MQP Market Maker on a pro rata basis for each month during such quarter that an MQP Market Maker is eligible to receive a credit pursuant to the proposed rule. However, the calculation to establish the eligibility of an MQP Market Maker will be done on a monthly basis. Thus, for example, if during a quarter an MQP Market Maker was eligible to receive a credit for two out of three months, he would receive a quarterly pro rata MQP Credit for those two months.
NASDAQ may limit, on a Program-wide basis, how many MQP Market Makers are permitted to register in an MQP Security, and will provide notification on its Web site of any such limitation. As discussed above, if a limit is established, NASDAQ will allocate available MQP Market Maker registrations in a first-come-first-served fashion based on successful completion of an MPQ Market Maker application.
Finally, to give the Exchange and the Commission an opportunity to evaluate the impact of the MQP on the quality of markets in MQP Securities, the Exchange is proposing that the MQP will be effective for a one year pilot period. During the pilot period, the Exchange will submit monthly reports to the Commission about market quality in respect of the MQP. The monthly reports will endeavor to compare, to the extent practicable, securities before and after they are in the MQP and will include information regarding the MQP such as: (1) Rule 605 metrics;
The first report will be submitted within sixty days after the MQP becomes operative.
The Exchange will issue to its members an information bulletin about the MQP prior to operation of the Program.
The Exchange believes that its surveillance procedures are adequate to properly monitor the trading of targeted securities (including ETFs) on the Exchange during all trading sessions, and to detect and deter violations of Exchange rules and applicable federal securities laws. Trading of the targeted MQP Securities through the Exchange will be subject to FINRA's surveillance procedures for derivative products including ETFs.
NASDAQ believes that the proposed rule change is consistent with the provisions of Section 6 of the Act,
The goal of the MQP—to incentivize members to make high-quality, liquid markets—supports the primary goal of the Act to promote the development of a resilient and efficient national market system. Congress instructed the Commission to pursue this goal by emphasizing multiple policies, including the promotion of price discovery, order interaction and competition among orders and markets. The MQP promotes all of these policies; it will enhance quote competition, improve NASDAQ liquidity, support the quality of price discovery, promote market transparency and increase competition for listings and trade executions while reducing spreads and transaction costs. Maintaining and increasing liquidity in exchange-listed securities executed on a registered exchange will help raise investors' confidence in the fairness of the market and their transactions. Improving liquidity in this manner is particularly important with respect to ETFs and low-volume securities, as noted by the Joint CFTC/SEC Advisory Commission on Emerging Regulatory Issues.
Each aspect of the MQP adheres to and supports the Act. First, the Program promotes the equitable allocation of fees and dues among issuers. The MQP is completely voluntary in that it will provide an additional means by which issuers may relate to the Exchange without modifying the existing listing options. Issuers can supplement the standard listing fees (which have already been determined to be consistent with the Act) with those of
The MQP also represents an equitable allocation of fees and dues among Market Makers. Again, the MQP is completely voluntary with respect to Market Maker participation in that it will provide an additional means by which members may qualify for a credit, without eliminating any of the existing means of qualifying for incentives on the Exchange. Currently, NASDAQ and other exchanges use multiple fee arrangements to incentivize Market Makers to maintain high quality markets or to improve the quality of executions, including various payment for order flow arrangements, liquidity provider credits, and NASDAQ's Investor Support Program (set forth in NASDAQ Rule 7014). Market Makers that choose to undertake increased burdens pursuant to the MQP will be rewarded with increased credits; those that do not undertake such burdens will receive no added benefit. As with issuers, Market Makers that choose to participate in the MQP will be permitted to withdraw from it after an initial commitment if they determine that the burdens imposed by the MQP outweigh the benefits provided.
Additionally, the MQP establishes an equitable allocation of MQP Credits among Market Makers that choose to participate and fulfill the obligations imposed by the rule. If one Market Maker fulfills those obligations, the MQP Credit will be distributed by NASDAQ to that Market Maker out of the General Fund; and if multiple Market Makers satisfy the standard, the MQP Credit will be distributed pro rata among them. In other words, all of the benefit of the MQP Credits will flow to high-performing Market Makers, provided that at least one Market Maker fulfills the obligations under the proposed rule.
The MQP is designed to avoid unfair discrimination among Market Makers and issuers. The proposed rule contains objective, measurable (universal) standards that NASDAQ will apply with care. These standards will be applied equally to ensure that similarly situated parties are treated similarly. This is equally true for inclusion of issuers and Market Makers, withdrawal of issuers and Market Makers, and termination of eligibility for the MQP. The standards are carefully constructed to protect the rights of all parties wishing to participate in the Program by providing notice of requirements and a description of the selection process. NASDAQ will apply these standards with the same care and experience with which it applies the many similar rules and standards in NASDAQ's rule manuals.
In contrast to the extensive benefits of the MQP, the participation of an MQP Company in the Program is substantially limited by design. In this regard, an MQP Company is limited to making only the following determinations regarding the Program: whether to participate in the Program; what MQP Security should be in the Program; when the MQP Security should exit the Program; and the level of Supplemental Fees, if any, that should be applied. The MQP Company can never choose an MQP Market Maker, nor influence how, when, or the specific amount that an MQP Market Maker receives as credit for making a market in an MQP Security; these functions are performed solely by the Exchange according to standards set forth in the Program.
NASDAQ notes that it operates in a highly competitive market in which market participants can readily favor competing venues if they deem fee levels at a particular venue to be excessive, or rebate opportunities available at other venues to be more favorable. In such an environment, NASDAQ must continually adjust its fees and program offerings to remain competitive with other exchanges and with alternative trading systems that have been exempted from compliance with the statutory standards applicable to exchanges. NASDAQ believes that all aspects of the proposed rule change reflect this competitive environment because the MQP is designed to increase the credits provided to members that enhance NASDAQ's market quality.
Finally, NASDAQ notes that the proposed paid for market making system has been used successfully for years on NASDAQ OMX Nordic's First North market. The First North paid for market making system has been quite beneficial to market participants including investors and listing companies (issuers) that have experienced market quality and liquidity with narrowed spreads. The Exchange believes that the proposed MQP will similarly enjoy positive results to the benefit of investors in MQP Securities and Companies related to them and the financial markets as a whole.
NASDAQ does not believe that the proposed rule change will result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act, as amended. To the contrary, NASDAQ believes the MQP program is pro-competitive in that it will increase competition in both the listings market and in the transaction services market. The MQP will promote competition in the listings market by advancing NASDAQ's reputation as an exchange that works tirelessly to develop a better market for all issuers, and for partnering with issuers to improve the quality of trading on NASDAQ. In fact, the MQP is itself a response to the competition provided by other markets that are developing similar programs, including NYSE Arca and BATS. NASDAQ fully expects that other listing venues will respond to the MQP by further enhancing their listings market offerings.
The MQP promotes competition in the transaction services market by creating incentives for market makers to make better quality markets. As market makers strive to attain the quality standards established by the MQP, the quality of NASDAQ's quotes will improve. This, in turn, will attract more liquidity to NASDAQ and further improve the quality of trading of MQP stocks. Again, if the MQP is successful in its goals, NASDAQ fully expects that competing markets will respond by creating incentives of their own to improve the quality of their markets and to attract liquidity to their markets.
Written comments were neither solicited nor received.
Within 45 days of the date of publication of this notice in the
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. The Commission previously received comments on SR–NASDAQ–2012–043, which proposed rule change was withdrawn by the Exchange,
Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On June 19, 2012, NYSE Arca, Inc. (“Exchange” or “NYSE Arca”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
The Commission initially received one comment letter, which opposed the proposed rule change.
In the V&F September 27 Letter, the commenter incorporated by reference all of its prior comments in opposition to NYSE Arca's proposal to list and trade shares of the JPM XF Physical Copper Trust.
Section 19(b)(2) of the Act
The Commission finds it appropriate to designate a longer period within which to issue an order approving or disapproving the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised in the comment letters that have been submitted in response to the proposed rule change. The Commission also finds that it is appropriate to designate a longer period within which to issue an order approving or disapproving the proposed rule change so that it has sufficient time to consider the data that has been provided by the commenters to support their positions.
Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On October 26, 2012, NYSE MKT LLC (the “Exchange”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
Section 19(b)(2) of the Act
The Commission finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider this proposed rule change, which would delete NYSE MKT Rules 95(c) and (d)—Equities and related Supplementary Material, and the potential issues raised by this proposal.
Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
BX is filing with the Commission a proposal to: extend through June 30, 2013, the Penny Pilot Program in options classes in certain issues (“Penny Pilot” or “Pilot”) and provide a procedure for replacement of any Penny Pilot issues that have been delisted.
The Exchange requests that the Commission waive the 30-day operative delay period contained in Exchange Act Rule 19b–4(f)(6)(iii)
Proposed new language is
(a) The Board may establish minimum quoting increments for options contracts traded on BX Options. Such minimum increments established by the Board will be designated as a stated policy, practice, or interpretation with respect to the administration of this Section within the meaning of Section 19 of the Exchange Act and will be filed with the SEC as a rule change for effectiveness upon filing. Until such time as the Board makes a change in the increments, the following principles shall apply:
(1) If the options series is trading at less than $3.00, five (5) cents;
(2) If the options series is trading at $3.00 or higher, ten (10) cents; and
(3) For a pilot period scheduled to expire on [December 31, 2012]
(b) No Change.
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of this filing is to amend Chapter VI, Section 5 to: extend the Penny Pilot through June 30, 2013, and add a procedure for replacing any Penny Pilot issues that have been delisted.
Under the Penny Pilot, the minimum price variation for all participating options classes, except for the Nasdaq-100 Index Tracking Stock (“QQQQ”), the SPDR S&P 500 Exchange Traded Fund (“SPY”) and the iShares Russell 2000 Index Fund (“IWM”), is $0.01 for all quotations in options series that are quoted at less than $3 per contract and $0.05 for all quotations in options series that are quoted at $3 per contract or greater. QQQQ, SPY and IWM are quoted in $0.01 increments for all options series. The Penny Pilot is currently scheduled to expire on December 31, 2012.
The Exchange proposes to extend the time period of the Penny Pilot through June 30, 2013, and to provide a procedure for adding classes that have been delisted from the Penny Pilot. The Exchange proposes that any Penny Pilot Program issues that have been delisted may be replaced on the second trading day following January 1, 2013.
All classes currently participating in the Penny Pilot will remain the same and all minimum increments will remain unchanged. The Exchange believes the benefits to public customers and other market participants who will be able to express their true prices to buy and sell options have been demonstrated to outweigh the potential increase in quote traffic.
The Exchange believes that its proposal is consistent with Section 6(b) of the Act
The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. To the contrary, this proposal is pro-competitive because it allows Penny Pilot issues to be traded on the Exchange.
No written comments were either solicited or received.
The Exchange has filed the proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act
A proposed rule change filed under Rule 19b–4(f)(6) normally does not become operative prior to 30 days after the date of the filing.
At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”),
The Exchange proposes to amend Exchange Rule 953NY—Trading Halts and Suspensions. The text of the proposed rule change is available on the Exchange's Web site at
In its filing with the Commission, the self-regulatory organization included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements.
The Exchange proposes to amend Exchange Rule 953NY by adopting a provision governing the nullification of trades that occur while the options class is subject to a trading halt. This proposal is based on and substantially similar to Rule 1092(c)(iv)(A) of NASDAQ OMX PHLX, LLC (“PHLX”).
Specifically, the Exchange proposes to adopt Commentary .04 to Rule 953NY, which provides that any trade that occurs during a trading halt on the Exchange in a given option shall be nullified.
Rule 953NY sets forth the circumstances when the Exchange may halt trading in an options contract or options series. Such trading halts are applicable to both electronic and open-outcry trading. Pursuant to Rule 953NY(a), NYSE Amex shall halt or suspend the trading of options whenever the Exchange deems such action appropriate in the interests of a fair and orderly market and to protect investors. Among the factors that may be considered are: (i) The trading in the
Notwithstanding a regulatory or non-regulatory trading halt in an options class, the Exchange recognizes that there could be occurrences where an aberrant trade might still occur after the Exchange has halted trading in a given options class. For example, this could happen because of a temporary systems outage, a communications issue between the electronic and floor-based markets, or other type of in-flight messaging scenario where the Exchange's automatic execution system executed an order, even though the options had been halted prior to the time of execution. Because the Exchange would have already halted trading of the option class, either because it was warranted in the interest of a fair and orderly market and the protection of investors pursuant to Rule 953NY(a), or required pursuant to Rule 953NY(b) because the underlying security was paused, the Exchange does not believe that any trade that takes place after an options class that has been halted on the Exchange should stand. Proposed Commentary .04 will require the Exchange to nullify these aberrant trades. The Exchange notes that executions occurring prior to a trading halt in an options class but not yet reported to the Exchange, will still be reported for dissemination to OPRA after the options have halted. Such trades would not be subject to nullification by the Exchange pursuant to proposed Commentary .04.
Under existing rules, the Exchange may only nullify a trade which occurred during a trading halt if, (i) pursuant to Rule 975NY the trade qualifies as an Obvious or Catastrophic Error, or (ii) pursuant to Rule 965NY Commentary .01, a Trading Official determines that the execution of such trade was done in violation of certain Exchange rules governing open outcry trading.
The Exchange notes that the PHLX Rule 1092(c)(iv) also includes other provisions related to trading halts and the nullification of trades. Paragraphs (B)–(C) of the PHLX rule deal with the nullification of an options trade whenever the underlying security or a certain percentage of the components of an underlying index have halted, regardless of whether the options themselves have halted. Exchange rules do not require that an options class be halted whenever the underlying security halts, therefore it would be inconsistent to nullify a trade simply because the underlying security or index components halted, unless the Exchange had also halted the trading of options overlying such security or index.
The proposed rule change is consistent with Section 6(b) of the Securities Exchange Act of 1934 (the “Act”),
The Exchange believes that the proposed rule changes are consistent with the Act because permitting the Exchange to nullify trades that occur during a trading halt helps to ensure that NYSE Amex may continue to meet its obligation to maintain a fair and orderly market and protect investors. In particular, the Exchange believes that the proposal promotes just and equitable principles of trade because it will ensure that when the Exchange is halted for trading, no trades that mistakenly were executed during the halt will be permitted to stand, thereby assuring consistent treatment of orders during a trading halt. Furthermore, the proposal removes impediments to and perfects the mechanism of a free and open market and a national market system by assuring that when trading is halted, no executions may occur and any aberrant trades are nullified.
The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act.
No written comments were solicited or received with respect to the proposed rule change.
Because the foregoing proposed rule does not (i) significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate if consistent with the protection of investors and the public interest, provided that the self-regulatory organization has given the Commission written notice of its intent to file the proposed rule change at least five business days prior to the date of filing of the proposed rule change or such shorter time as designated by the Commission, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act
At any time within 60 days of the filing of such proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
The purpose of the rule change is to update Schedule 502 of the ICC Rules in order to be consistent with the index maturities, which occurred on December 20, 2012.
In its filing with the Commission, ICC included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. ICC has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of the proposed rule change is to update Schedule 502 of the ICC Rules in order to be consistent with the index maturities, which occurred on December 20, 2012. The North American credit default swap indices that matured (“Maturing Indices”) are: Investment Grade, Series 9, 5-year; Investment Grade, Series 13, 3-year; Investment Grade High Volatility, Series 9, 5-year; and High Yield, Series 9, 5-year. The Maturing Indices update does not require any changes to the body of the ICC Rules. Also, the Maturing Indices update does not require any changes to the ICC risk management framework. The only change being submitted is the updates to the Maturing Indices in Schedule 502 of the ICC Rules.
Section 17A(b)(3)(F) of the Act
ICC does not believe the proposed rule change would have any impact, or impose any burden, on competition.
Written comments relating to the proposed rule change have not been solicited or received. ICC will notify the Commission of any written comments received by ICC.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(iii)
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC, 20549–1090.
All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–ICC–2012–25 and should be submitted on or before January 22, 2013.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
OCC is amending interpretative guidance relating to the adjustment of stock options and single stock futures for cash dividends and distributions on underlying securities.
In its filing with the Commission, OCC included statements concerning the purpose of and basis for the rule change and discussed any comments it received on the rule change. The text of these statements may be examined at the places specified in Item IV below. OCC has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
In 2008,
In addition to several technical revisions to the Interpretative Guidance, OCC is making two clarifications. First,
Second, OCC is amending the Interpretative Guidance in response to requests for clarification from clearing members and market participants regarding the application of the $.125 per share adjustment threshold to capital gains and other distributions made by exchange-traded funds (“Fund Share Distributions”). These distributions, when considered individually, may be less than $.125 per share but greater than $.125 per share when considered in aggregate. Pursuant to Article VI, Sections 11 and 11A of the OCC By-Laws, OCC's Securities Committee has determined that the $.125 per share adjustment threshold will generally be applied to the aggregate of capital gains and other non-ordinary Fund Share Distributions that have the same ex-date. OCC is amending the Interpretative Guidance to incorporate a reference to these previously announced determinations that such non-ordinary distributions are aggregated for purposes of determining whether the $.125 per share adjustment threshold is met. Notwithstanding this Interpretive Guidance, all adjustment decisions are made on a case-by-case basis and are within the sole discretion of OCC's Securities Committee.
OCC believes the rule change is consistent with Section 17A of the Act because it fosters cooperation and coordination among persons engaged in the clearance and settlement of securities transactions and contributes to the protection of investors
OCC does not believe the rule change would impose any burden on competition.
Written comments on the proposed rule change were not and are not intended to be solicited with respect to the proposed rule change and none have been received.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(ii)
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC, 20549–1090.
All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–OCC–2012–26 and should be submitted on or before January 22, 2013.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
ICE Clear Europe proposes to implement Commodity Futures Trading Commission (“CFTC') Rule 39.13(g)(8)(ii), which requires that FCM Clearing Members collect customer initial margin for customer non-hedge positions at a level that is greater than 100% of ICE Clear Europe's initial margin requirements. As a result, ICE Clear Europe has established a minimum percentage of 110% in respect of non-hedge customers for energy futures. All capitalized terms not defined herein are defined in the ICE Clear Europe Rules.
In its filing with the Commission, ICE Clear Europe included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. ICE Clear Europe has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of the change is to implement the requirements of CFTC Rule 39.13(g)(8)(ii). ICE Clear Europe has informed FCM Clearing Members of the new requirements of CFTC Rule 39.13(g)(8)(ii). This rule requires that FCM Clearing Members collect customer initial margin for customer non-hedge positions at a level that is greater than 100% of ICE Clear Europe's initial margin requirements. Accordingly, ICE Clear Europe has established a minimum percentage of 110% in respect of non-hedge customers for energy futures. As a result, as of October 4, 2012, FCM Clearing Members must collect an amount of no less than 110% of ICE Clear Europe's initial margin requirement in respect of those customers.
Section 17A(b)(3)(F) of the Act
ICE Clear Europe does not believe the proposed change would have any impact, or impose any burden, on competition.
Written comments relating to the proposed change have not been solicited or received. ICE Clear Europe will notify the Commission of any written comments received by ICE Clear Europe.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(iii)
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC, 20549–1090.
All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–ICEEU–2012–21 and should be submitted on or before January 22, 2013.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On October 26, 2012, New York Stock Exchange LLC (the “Exchange”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
Section 19(b)(2) of the Act
The Commission finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider this proposed rule change, which would delete NYSE Rules 95(c) and (d) and related Supplementary Material, and the potential issues raised by this proposal.
Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
CME proposes to make an adjustment to one particular component of its current CDS margin model. The text of the proposed rule change is below. Italicized text indicates additions; bracketed text indicates deletions.
(1) A concentration charge for market exposure as a function of absolute Spread DV01 (a portfolio sensitivity to 1% par spread shock); and
(2) A concentration charge for portfolio basis exposure as a function of Residual Spread DV01 (which is the difference between the Gross Spread DV01 and the Net Spread DV01 of the portfolio).
CME will also establish a floor component to the Liquidity Factor using the current Gross Notional Function with the following modifications: (1) the concentration scalar will be removed; and (2) the maximum DST would be replaced by series-tenor specific DST values based on the series and tenor of the relevant HY and IG positions, as applicable.
The text of the proposed change is also available at CME's Web site at
In its filing with the Commission, CME included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. CME has prepared summaries, set forth in sections A, B,
CME's currently approved credit default swap margin methodology utilizes a “multi-factor” portfolio model to determine margin requirements for credit default swap (“CDS”) instruments. The model incorporates risk-based factors that are designed to represent the different risks inherent to CDS products. The factors are aggregated to determine the total amount of margin required to protect a portfolio against exposures resulting from daily changes in CDS spreads. For both total and minimum margin calculations, CME evaluates each CDS contract held within a portfolio. These positions are distinguished by the single name of the underlying entity, the CDS tenor, the notional amount of the position, and the fixed spread or coupon rate. For consistency, margins for CDS indices in a portfolio are handled based on the required margin for each of the underlying components of the index.
CME proposes to make an adjustment to one particular component of its current CDS margin model, the liquidity risk factor. This CDS margin model component is designed to capture the risk that concentrated positions may be difficult or costly to unwind following the default of a CDS clearing member.
The current liquidity/concentration factor (“Liquidity Factor”) of CME's margin methodology for a portfolio of CDS indices is the product of (1) the gross notional amount for each family (i.e., CDX IG or CDX HY) of CDS positions in a portfolio (2) the current bid/ask of the 5 year tenor of the “on the run” (OTR) contract (3) the Duration/Series/Tenor (“DST”) factor and (4) a concentration factor based upon the gross notional for each of the CDX IG and CDX HY contracts (“Gross Notional Function”). The associated margin for a CDS portfolio attributed to the Liquidity Factor is the sum of the Liquidity Factor calculations for each family of CDS positions in the portfolio.
The calculation of the Liquidity Factor is based on the premise that the 5-year OTR index is the most liquid CDS index product. As such, the methodology is designed to evaluate the liquidity exposure of each position in a CDS portfolio relative to the 5-year OTR index.
For each index family (i.e., CDX IG and CDX HY), a DST matrix is calculated based on the historical bid-ask averages of each cleared position relative to the OTR 5-year historical bid-ask averages. Then, the maximum DST values are used as the DST factors. Such maximum DST factors are then applied to the product of 5-year OTR bid-ask spread (adjusted for duration for CDX IG only) and the Gross Notional of all positions within each index family. The resulting products are further scaled by concentration factors in order to account for oversized (as measured by Gross Notional) portfolios. The concentration factors are based on exponential functions of the Gross Notional of each index family in a given portfolio.
As liquidation costs are dependent on the risk in a portfolio, CME is proposing to use an index portfolio's market risk rather than its gross notional as the basis for determining the margins associated with the Liquidity Factor. The proposed changes would calculate the Liquidity Factor as the sum of two components:
(1) A concentration charge for market exposure as a function of absolute Spread DV01 (a portfolio sensitivity to 1% par spread shock); and
(2) A concentration charge for portfolio basis exposure as a function of Residual Spread DV01 (which is the difference between the Gross Spread DV01 and the Net Spread DV01 of the portfolio).
CME expects that these proposed changes would not generally impact smaller portfolios whose liquidation costs are driven by the market bid/ask spread rather than by the cost of hedging, and are therefore adequately captured by the existing Liquidity Factor methodology. To account for the risks associated with such smaller portfolios, CME also proposes to establish a floor component to the Liquidity Factor using the current Gross Notional Function described above with the following modifications: (1) the concentration scalar would be removed as concentration risk would already be accounted for by the concentration charge component outlined above; and (2) the maximum DST would be replaced by series-tenor specific DST values based on the series and tenor of the relevant HY and IG positions, as applicable. CME expects that large (by notional amount) portfolios will be impacted by the proposed changes more than smaller portfolios.
The proposed liquidity risk factor model adjustments do not require any changes to rule text in the CME rulebook and do not necessitate any changes to CME's CDS Manual of Operations. The change will be announced to CDS market participants in an advisory notice that will be issued prior to implementation.
CME believes the proposed rule changes are consistent with the requirements of the Exchange Act including Section 17A of the Exchange Act.
CME does not believe that the proposed rule change will have any impact, or impose any burden, on competition.
CME has not solicited comments regarding this proposed rule change. CME has not received any unsolicited written comments from interested parties.
Within 45 days of the date of publication of this notice in the
(A) By order approve or disapprove the proposed rule change or
(B) institute proceedings to determine whether the proposed rule change should be disapproved.
Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090.
All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–CME–2012–34 and should be submitted on or before January 22, 2013.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
FINRA is proposing to amend FINRA Rule 6440 (Trading and Quotation Halt in OTC Equity Securities to clarify that FINRA may (1) initiate a trading and quotation halt in an OTC Equity Security upon notice of a foreign regulatory halt for news pending, including notice from a reliable third-party source; (2) continue to halt trading and quoting in such OTC Equity Security until notice from the appropriate foreign regulatory authority is received that it has or intends to resume trading in the security, even if such halt is longer than 10 business days; and (3) extend a halt initiated under Rule 6440(a)(3) for an extraordinary event beyond 10 business days if it determines that the basis for the halt still exists.
The text of the proposed rule change is available on FINRA's Web site at
In its filing with the Commission, FINRA included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. FINRA has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
FINRA Rule 6440 (Trading and Quotation Halt in OTC Equity Securities) provides FINRA with the authority to initiate a trading and quotation halt for OTC Equity Securities.
FINRA is proposing to amend Rule 6440 to: (1) Eliminate the restriction in Rule 6440(a)(1) on FINRA's ability to initiate a Foreign Regulatory Halt when the foreign halt is imposed for material news; (2) modify the halt procedures outlined in paragraph (b) of the Rule to clarify that FINRA may initiate a trading and quotation halt in an OTC Equity Security as a result of a Foreign Regulatory Halt or Derivative Halt upon notice from a reliable third-party source; (3) modify the halt procedures outlined in paragraph (b) of the Rule to clarify that in instances where FINRA initiates a trading and quotation halt upon notice of a foreign halt pursuant to a Foreign Regulatory Halt or Derivative Halt, trading and quotation in the OTC Equity Security or the OTC ADR, FINRA may continue the halt until such time as FINRA receives notice that trading has been resumed in the security on the appropriate securities exchange on which it is listed or registered or by the other applicable regulatory authority, even if such halt is longer than 10 business days; and (4) amend Rule 6440 Supplementary Material .01 to clarify that FINRA may extend and continue in effect an Extraordinary Event Halt for subsequent periods of up to 10 business days each if, at the time of any such extension, FINRA finds that the basis for the halt still exists and determines that the continuation of the halt beyond the prior 10 business day period is necessary in the public interest and for the protection of investors.
FINRA performs several critical functions with respect to the OTC market in furtherance of its obligations under Exchange Act Section 15A to have rules that are designed “to foster cooperation and coordination with persons engaged in regulating, clearing, settling, processing information with respect to, and facilitating transactions in securities, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and, in general, to protect investors and the public interest.”
FINRA is proposing several amendments to Rule 6440. The first amendment that FINRA is proposing would eliminate the restriction in Rule 6440(a)(1) on FINRA's ability to initiate a halt as a result of a Foreign Regulatory Halt when the foreign halt is imposed for material news. FINRA has historically not halted in these instances because, as noted above, FINRA lacks privity with OTC issuers and cannot compel such issuers to disclose information to FINRA. However, with the growth of foreign securities markets and the ease at which trading can occur across jurisdictions and markets (especially exchanges in Canada where many issuers of OTC Equity Securities are listed), FINRA believes increased coordination of trading halts across markets will protect investors by reducing instances of potentially material disparities in information regarding the security or even fraudulent or manipulative trading in the security and act to protect U.S. investors. Moreover, such coordination is consistent with how FINRA currently imposes news pending trading halts on OTC Equity Securities that are derivatives or components of securities listed on national or foreign securities exchanges pursuant to Rule 6440(a)(2).
As noted above, FINRA would be relying on the ability of the foreign market on which the security is listed or registered to oversee the issuer and evaluate news pending or other information regarding the issuer and the securities to determine if a trading halt is warranted. For example, a foreign exchange may halt trading and quoting in the security of an issuer on its market when the issuer is the subject of a significant corporate event, such as a change in ownership or corporate structuring as a result of a merger or acquisition, borrows a significant amount of funds or triggers events of default, enters into or terminates a significant contract, or is subject to major litigation.
The limitations in Rule 6440(a)(1) relating to FINRA's halt authority where the Foreign Regulatory Halt is imposed solely for a regulatory filing deficiency would remain because FINRA believes that the regulatory filing deficiency may be a listing jurisdiction requirement that is not consistent across market centers and may be of less concern to market participants outside that jurisdiction. For example, in some instances, a foreign regulatory jurisdiction may impose a regulatory filing deficiency halt for failure to file timely financials or information related to significant corporate events. The limitation with regard to the operational halt would also remain because these halts may reflect local market trading conditions only. Rules relating to regulatory filing deficiency halts and operational halts are not consistent across market centers.
It is important to note that with respect to “domestic” OTC Equity Securities
The second amendment that FINRA is proposing would modify the halt procedures outlined in paragraph (b)(1) of the Rule to clarify that FINRA may initiate a trading and quotation halt in an OTC Equity Security as a result of a Foreign Regulatory Halt or Derivative Halt upon notice from another reliable third-party source where FINRA can validate the information provided. Rule 6440(b)(1) currently provides that, upon receipt of information from a securities exchange or market, or regulatory authority overseeing the issuer, exchange or market, FINRA will promptly evaluate the information and determine if a trading and quotation halt in the OTC Equity Security is
FINRA believes having the authority to halt trading and quotation in an OTC Equity Security upon notice from a reliable third-party source that can be validated provides a valuable tool that will allow FINRA to act more promptly to initiate trading and quotation halts in such securities.
The third amendment that FINRA is proposing would modify the halt procedures outlined in paragraph (b)(2) of the Rule to clarify the circumstances under which FINRA will resume trading after initiating a Foreign Regulatory Halt or Derivative Halt. Proposed Rule 6440(b)(2) clarifies that FINRA may continue the halt in trading and quoting in the OTC market for the OTC Equity Security until such time as FINRA receives notice that trading has resumed in the security on the national or foreign securities exchange on which it is listed or registered, even if such halt is longer than 10 business days. FINRA adopted the 10-business day halt standard largely to be consistent with trading suspensions ordered by the SEC pursuant to Exchange Act Section 12(k).
The fourth amendment that FINRA is proposing would modify Rule 6440 Supplementary Material .01 to clarify that FINRA may extend and continue in effect a trading and quotation halt under the Extraordinary Event Halt authority for subsequent periods of up to 10 business days each, if at the time of any such extension, FINRA finds that the basis for the halt still exists and determines that the continuation of the halt beyond the prior 10 business day period is necessary in the public interest and for the protection of investors. FINRA believes the authority to halt beyond the initial 10 business day period is vital in the OTC marketplace where concerns regarding settlement and clearance, pricing, or other extraordinary events can take time to be resolved. FINRA is also proposing to add headings to Rule 6440 Supplementary Material .01 and .02 for clarity.
FINRA will announce the effective date of the proposed rule change in a
FINRA believes that the proposed rule change is consistent with the provisions of Section 15A(b)(6) of the Act,
FINRA does not believe that the proposed rule change will result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. FINRA will exercise judgment in each trading halt situation to assure that the halt is necessary to protect investors and not unnecessarily burden competition.
Written comments were neither solicited nor received.
Within 45 days of the date of publication of this notice in the
(A) By order approve or disapprove such proposed rule change, or
(B) institute proceedings to determine whether the proposed rule change should be disapproved.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”),
The Exchange proposes to retire the automated quote management functionality described under Rules 4613(a)(2)(F) and (G) on January 16, 2013, and make conforming changes to Rule 4751(f)(15). The text of the proposed rule change is available at
In its filing with the Commission, NASDAQ included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements.
On August 2, 2012, the Commission approved the Exchange's new Market Maker Peg Order, which was designed to replace the automated quotation refresh functionality (“AQR”) provided to Exchange market makers under Rules 4613(a)(2)(F) and (G).
The Exchange is also proposing to amend Rule 4751(f)(15) to include language from Rule 4613(a)(2)(F), which is currently referenced only by citation in the rule. The proposed language taken from Rule 4613(a)(2)(F) merely provides the percentage move necessary to trigger a repricing of a Market Maker Peg Order, and in no way changes how the Market Maker Peg Order operates.
The statutory basis for the proposed rule change is Section 6(b)(5) of the Act,
NASDAQ does not believe that the proposed rule change will result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act, as amended.
Written comments were neither solicited nor received.
Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days after the date of the filing, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act
At any time within 60 days of the filing of such proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”)
The Exchange proposes to extend the bond trading license and the Bond Liquidity Provider pilot program, which is currently scheduled to expire on January 19, 2013, until the earlier of the approval of the Securities and Exchange Commission (“Commission”) to make such pilot permanent or January 19, 2014. The text of the proposed rule change is available on the Exchange's Web site at
In its filing with the Commission, the self-regulatory organization included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements.
The Exchange proposes to extend the bond trading license and the Bond Liquidity Provider (“BLP”) pilot program, which is currently scheduled to expire on January 19, 2013, until the earlier of the Commission's approval to make such pilot permanent or January 19, 2014.
On January 19, 2011, NYSE established a twelve-month pilot program to (1) adopt new Rule 87 to create a bond trading license for member organizations that desire to trade only debt securities on the NYSE, and (2) adopt new Rule 88 to establish BLPs, a new class of debt market participants.
Through this filing, the Exchange seeks to extend the current operation of the pilot program until January 19, 2014. The Exchange believes that the program has added meaningful liquidity to the marketplace and improved both NYSE and overall market quality. The Exchange will continue to monitor the efficacy of the program during the proposed extended pilot period.
The Exchange believes that its proposal is consistent with Section 6(b) of the Securities Exchange Act of 1934 (the “Act”),
The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act.
No written comments were solicited or received with respect to the proposed rule change.
Because the foregoing proposed rule change does not significantly affect the protection of investors or the public interest, does not impose any significant burden on competition, and, by its terms, does not become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act
At any time within 60 days of the filing of such proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange proposes a rule change with respect to the amendment of the by-laws of its parent corporation, The NASDAQ OMX Group, Inc. (“NASDAQ OMX” or the “Corporation”). The text of the proposed rule change is available at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements.
NASDAQ OMX is proposing amendments to provisions of its By-Laws pertaining to the compositional requirements of the NASDAQ OMX Board. The changes are primarily focused on amending the definition of “Industry Director” (and “Industry committee member”)
The By-Laws require Directors to be assigned to certain defined categories, based on their current and past affiliations.
(1) Is or has served in the prior three years as an officer, director, or employee of a broker or dealer, excluding an outside director or a director not engaged in the day-to-day management of a broker or dealer;
(2) Is an officer, director (excluding an outside director), or employee of an entity that owns more than ten percent of the equity of a broker or dealer, and the broker or dealer accounts for more than five percent of the gross revenues received by the consolidated entity;
(3) Owns more than five percent of the equity securities of any broker or dealer, whose investments in brokers or dealers exceed ten percent of his or her net worth, or whose ownership interest otherwise permits him or her to be engaged in the day-to-day management of a broker or dealer;
(4) Provides professional services to brokers or dealers, and such services constitute 20 percent or more of the professional revenues received by the Director or 20 percent or more of the gross revenues received by the Director's firm or partnership;
(5) Provides professional services to a director, officer, or employee of a broker, dealer, or corporation that owns 50 percent or more of the voting stock of a broker or dealer, and such services relate to the director's, officer's, or employee's professional capacity and constitute 20 percent or more of the professional revenues received by the Director or 20 percent or more of the gross revenues received by the Director's firm or partnership; or
(6) has a consulting or employment relationship with or provides professional services to the Corporation or any affiliate
Thus, the current definition focuses on a Director's affiliation with any broker-dealer, regardless of whether the broker-dealer is a member or member organization of a Self-Regulatory Subsidiary. The definition also features a three-year “look-back” period during which a Director formerly associated with a broker-dealer would continue to be deemed an Industry Director. In lieu of this definition, NASDAQ OMX is proposing to adopt a definition that focuses on whether a Director is affiliated with a member or a member organization of a Self-Regulatory Subsidiary. Under the revised definition, an Industry Director will be defined as a Director who:
(1) Is, or within the last year was, or has an immediate family member
(2) Is, or within the last year was, employed by a member or a member organization of a Self-Regulatory Subsidiary;
(3) Has an immediate family member who is, or within the last year was, an executive officer of a member or a member organization
(4) Has within the last year received from any member or member organization of a Self-Regulatory Subsidiary more than $100,000 per year in direct compensation, or received from such members or member organizations in the aggregate an amount of direct compensation that in any one year is more than 10 percent of the Director's annual gross compensation for such year, excluding in each case director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service); or
(5) Is affiliated, directly or indirectly, with a member or member organization of a Self-Regulatory Subsidiary.
NASDAQ OMX believes that the change is warranted to ensure that the definition of Industry Director is appropriately focused on the mitigation of potential conflicts of interest associated with Directors who are currently or were very recently employed by members or member organizations of Self-Regulatory Subsidiaries, or that otherwise have material affiliations with such members or member organizations. The current definition covers individuals who are employed by broker-dealers that are not members of Self-Regulatory Subsidiaries, or who retired from service at a broker-dealer more than one, but less than three years in the past. NASDAQ OMX and the Exchange believe that by deeming such potential Directors to be Industry Directors, the current By-Laws unnecessarily restrict highly qualified individuals with extensive knowledge of the financial services industry from serving on the Board.
In addition to this change, NASDAQ OMX is also proposing the following additional changes to the definitions applicable to categories of Directors:
(1) NASDAQ OMX proposes a new definition of “Staff Director.” Currently, the definition of “Staff Director” is included within the definition of “Industry Director,” and is defined as “any two officers of the Corporation, selected at the sole discretion of the Board, amongst those officers who may be serving as Directors.” By virtue of being designated as Staff Directors, these Directors are not considered to be Industry Directors for purposes of the compositional requirements of the By-Laws. Instead, NASDAQ OMX proposes a separate definition of “Staff Director” as “an officer of the Corporation that is serving as a Director.”
(2) NASDAQ OMX is adopting a new definition of “Issuer Director” and “Issuer committee member”. The By-Laws currently provide that the number of “Non-Industry Directors” (
(3) The definition of “Public Director” and “Public committee member” is being restated as follows: “a Director or committee member who (1) Is not an Industry Director or Industry committee member, (2) is not an Issuer Director or Issuer committee member, and (3) has no material business relationship with a member or member organization of a Self-Regulatory Subsidiary, the Corporation or its affiliates, or FINRA.” The definition currently covers a person who “has no material business relationship with a broker or dealer, the Corporation or its affiliates, or FINRA.” Thus, the changes make it clear that any Industry Director or Issuer Director would not be considered a Public Director. As noted above, however, an independent director of an issuer of securities listed on NASDAQ could be considered a Public Director. In addition, in keeping with the change to the definition of Industry Director discussed above, the final clause of the definition is being revised to focus on the existence of a material business relationship with a member or member organization of a Self-Regulatory Subsidiary, rather than any broker or dealer. Thus, for example, a Director that had a material business relationship with a non-U.S. broker or dealer that was not a member or a member organization of a Self-Regulatory
(4) The definition of “Non-Industry Director” or “Non-Industry committee member” is proposed to be amended to cover any “Director (excluding any Staff Director) or committee member who is (1) A Public Director or Public committee member; (2) an Issuer Director or Issuer committee member; or (3) any other individual who would not be an Industry Director or Industry committee member.” The revised definition is generally consistent with the current definition, but reflects the adoption of a definition for “Issuer Director or Issuer committee member”.
(5) NASDAQ OMX is making conforming changes to the letter designations of paragraphs in Article I of the By-Laws.
Qualifications of Directors
NASDAQ OMX is proposing to amend Section 4.3 of the By-Laws, which governs the qualifications and compositional requirements of the Board of Directors, to (i) Increase the required number of Public Directors from one to two, (ii) replace the requirement to include at least one issuer representative (or at least two issuer representatives if the Board consists of ten or more Directors) with a requirement to include at least one, but no more than two, Issuer Directors, and (iii) provide that the number of Staff Directors may not exceed one, unless the Board consists of ten or more Directors, in which case the number may not exceed two. The section will continue to require that the number of Non-Industry Directors equals or exceeds the number of Industry Directors. Although these changes will not significantly modify the Board's compositional requirements, they will continue to ensure a diversity of representation among Industry, Staff, Issuer, and Public Directors, will place more stringent caps on the number of Issuer and Staff Directors, and will increase the requirement for Public Directors. NASDAQ OMX also proposes to make a conforming change to add the term “Issuer Director” to Section 4.8 and Section 4.13(h), which govern the filling of vacancies on the Board and the determination of Directors' qualifications by NASDAQ OMX's Secretary.
The changes to the compositional requirements imposed specifically by the By-Laws do not alter in any respect the compositional requirements imposed by NASDAQ listing standards on NASDAQ OMX as a public company. Specifically, NASDAQ Rule 5605 requires that the board of directors of a company listed on NASDAQ must have a majority of directors that are “independent” within the meaning of that rule. As provided in NASDAQ Rule 5605(a)(2) with respect to a company listed on NASDAQ (a “Company”), ” `Independent Director' means a person other than an Executive Officer
NASDAQ OMX is proposing a minor amendment to the compositional requirements of its Executive Committee. Currently, Section 4.13(d) of the By-Laws provides that the percentage of Public Directors on the Executive Committee must be at least as great as the percentage of Public Directors on the whole Board. As noted above, however, the By-Laws currently require only one Public Director on the whole Board (a requirement that NASDAQ OMX is proposing to raise to two Public Directors). Thus, the By-Laws currently reflect a standard under which voluntary inclusion of additional Public Directors on the full Board translates into a requirement to include ever increasing numbers of Public Directors on the Executive Committee, even though the requirements for the full Board itself may be satisfied with only one Public Director. Accordingly, NASDAQ OMX is proposing to make the requirements consistent by requiring at least two Public Directors on the Executive Committee.
Earlier this year, the Commission approved changes to the provisions of NASDAQ OMX's By-Laws pertaining to the composition of the Management Compensation Committee of its Board of Directors. NASDAQ OMX is now proposing comparable changes to the compositional requirements of its Audit Committee. Specifically, NASDAQ OMX is proposing to amend Section 4.13(g) to replace a requirement that the Audit Committee be composed of a majority of Non-Industry Directors with a requirement that the number of Non-Industry Directors on the committee equal or exceed the number of Industry Directors. Thus, in the case of a committee composed of four Directors, the current By-Law provides that only one Director may be an Industry Director, while the amended By-Law would allow up to two Directors to be Industry Directors. The proposed compositional requirement for the committee with regard to the balance between Industry Directors and Non-Industry Directors would be the same as that already provided for in the By-Laws with respect to the Executive Committee, the Nominating and Governance Committee, the Management Compensation Committee, and the full Board of Directors.
NASDAQ OMX and the Exchange believe that the change will provide greater flexibility to NASDAQ OMX with regard to populating a committee that includes Directors with relevant expertise and that is not excessively large in relation to the size of the full Board of Directors, while continuing to ensure that Directors associated with members and member organizations of the Self-Regulatory Subsidiaries do not exert disproportionate influence of the governance of NASDAQ OMX. As required by Section 10A of the Act,
NASDAQ believes that the proposed rule change is consistent with the provisions of Section 6 of the Act,
In particular, NASDAQ believes that the change to the definition of Industry Director is warranted to ensure that it is appropriately focused on the mitigation of potential conflicts of interest associated with Directors who are currently or were very recently employed by members or member organizations of Self-Regulatory Subsidiaries, or that otherwise have material affiliations with such members or member organizations, without unnecessarily restricting highly qualified individuals with extensive knowledge of the financial services industry from serving on the Board. NASDAQ further believes that the other definitional changes and the changes to the compositional requirements of the NASDAQ OMX Board and the Executive Committee will enhance the clarity of these provisions and promote a diversity of backgrounds and viewpoints on the NASDAQ OMX Board. The Exchange believes that these changes will collectively promote the capacity of the NASDAQ OMX Board to fulfill its responsibilities.
With respect to the proposed changes to the Audit Committee's compositional requirements, NASDAQ believes that the change will provide greater flexibility to NASDAQ OMX with regard to populating a committee that includes Directors with relevant expertise and that is not excessively large in relation to the size of the full Board of Directors, while continuing to ensure that Directors associated with members and member organizations of Self-Regulatory Subsidiaries do not exert disproportionate influence of the governance of NASDAQ OMX. The change would not affect NASDAQ OMX's compliance with Section 10A of the Act,
The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes [sic] the Act. Specifically, the Exchange believes that the By-Laws of its holding company, NASDAQ OMX, do not directly affect competition between the Exchange and others that provide the same goods and services as the Exchange, since they do not affect the availability or pricing of such goods and services. To the extent that the proposed change to the By-Laws may be construed to have any bearing on competition, the Exchange believes that the change will promote competition between the Exchange and the subsidiaries of NYSE Euronext, since the change will allow NASDAQ OMX to have greater flexibility in the selection of its Directors in a manner similar to the flexibility available to NYSE Euronext under its Independence Policy.
Written comments were neither solicited nor received.
Within 45 days of the date of publication of this notice in the
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
The Exchange proposes to amend its Price List to specify pricing that is currently applicable to certain executions on the Exchange, but that is not currently included in the Price List. The text of the proposed rule change is available on the Exchange's Web site at
In its filing with the Commission, the self-regulatory organization included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements.
The Exchange is proposing to amend its Price List to specify pricing that is currently applicable to certain executions on the Exchange, but that is not currently included in the Price List. The Exchange proposes to make the changes immediately effective and operative.
Specifically, the Exchange proposes to amend the Price List, as necessary, to reflect pricing that is currently being assessed for the following intraday transactions:
• For a Floor broker discretionary e-Quote (“d-Quote”) that adds liquidity, a credit of $0.0016 per share for trades in a security priced $1 or above, as well as a credit of $0.0025 for NASDAQ Stock Market-listed securities (“Nasdaq securities”) trading on the Exchange pursuant to a grant of unlisted trading privileges (“UTP”);
• For a d-Quote that adds liquidity, no charge (i.e., free) for a security priced below $1, as well as a credit of 0.10% of total dollar value of the transaction for a Nasdaq security trading pursuant to UTP;
• For a non-electronic agency transaction of a Floor broker that executes against the Book, no charge for a security priced $1 or above, a security priced below $1, or a Nasdaq security trading pursuant to UTP;
• No charge for a non-electronic agency transaction between Floor brokers in the crowd in a security priced below $1;
• No charge for an agency cross trade (i.e., a trade where a member organization has customer orders to buy and sell an equivalent amount of the same security) in a security priced below $1.
The Price List currently provides that d-Quotes are subject to a transaction fee.
Despite the descriptions in the Price List, the fee in the Price List is currently charged only for a d-Quote that removes liquidity from the Book. A d-Quote that provides liquidity to the Book for a security priced $1 or above currently receives a credit of $0.0016 per share, or, for Nasdaq securities trading pursuant to UTP, $0.0025 per share.
The Exchange proposes to amend the descriptions in the Price List related to d-Quotes to specify that the corresponding rates apply only to a d-Quote that removes liquidity from the Book. Providing a credit of $0.0016 per share for a d-Quote for a security priced $1 or above that provides liquidity to the Book would be in accordance with the $0.0016 per share rate for providing liquidity that is currently in the Price List, and therefore the Exchange is not proposing a new or separate line item therein for this type of transaction. This is also true with respect to Nasdaq securities trading pursuant to UTP and the related credit of $0.0025 that is currently in the Price List. Similarly, not charging for a d-Quote for a security priced below $1 that provides liquidity to the Book would be in accordance with the “no charge” rate for providing liquidity that is currently in the Price List, and therefore the Exchange is not proposing a new or separate line item therein for this type of transaction. Again, this is also true with respect to Nasdaq securities trading pursuant to UTP and the related credit of 0.10% of
The Price List currently provides that verbal agency interest by Floor brokers is charged $0.0005 per share for a security priced $1 or above and is charged the lesser of (i) $0.0005 per share and (ii) 0.25% of the total dollar value of the transaction for a security priced less than $1.
The Price List currently specifies that an agency cross trade
The Exchange notes that the proposed change is not otherwise intended to address any other issues surrounding Floor broker charges and that the Exchange is not aware of any problems that Floor brokers would have in complying with the proposed change.
The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Securities Exchange Act of 1934 (the “Act”),
The Exchange believes that the proposed rates for a d-Quote that adds liquidity are reasonable because they may encourage additional liquidity during the trading day and may incentivize Floor brokers to provide additional intra-quote price improved trading, which would contribute to the quality of the Exchange's market. The Exchange also believes that the proposed rates are equitable and not unfairly discriminatory because they may provide opportunities for Floor brokers to attract additional liquidity to the Floor and thereby increase the quality of order execution on the Exchange's market, which benefits all market participants.
Additionally, the Exchange believes that not charging for a non-electronic agency transaction of a Floor broker that executes against the Book, in both securities priced $1 or above as well as securities priced below $1, is reasonable because it would be set at a level that would align the rate with certain other non-electronic agency Floor broker interest that is similarly not charged. In this regard, and as noted above, the Exchange does not charge for executions of non-electronic agency transactions between Floor brokers in the crowd. Additionally, the Exchange believes that this is equitable and not unfairly discriminatory because a non-electronic agency transaction of a Floor broker would be used, for example, at a time of the trading day when a Floor broker is physically present at the point of sale and requires flexibility to represent customer interest, but which may also result in added opportunity cost and uncertainty for the Floor broker when compared to an electronic execution, which is unique to a Floor broker.
The Exchange also believes that it is reasonable to specify that a non-electronic agency transaction between Floor brokers in the crowd is not charged for securities priced below $1 because doing so will add greater specificity to the Price List by reflecting that it is the same as the rate charged for such transactions in securities priced $1 or above. This is also equitable and not unfairly discriminatory because it would provide greater certainty regarding the applicable rates for transactions in securities priced below $1. The Exchange believes that not charging for these transactions is further reasonable because it may incentivize additional liquidity in these low-priced securities, which typically are more thinly-traded and less liquid than securities priced $1 or above. Accordingly, it is also equitable and not unfairly discriminatory to not charge for these transactions because the increased liquidity that may result in these securities would increase the quality of order execution on the Exchange's market, which benefits all market participants. Finally, and as described above for a non-electronic agency transaction of a Floor broker that executes against the Book, the Exchange believes that this is equitable and not unfairly discriminatory because non-electronic agency transactions between Floor brokers in the crowd occur, for example, at a time of the trading day when a Floor broker is physically present at the point of sale and requires flexibility to represent customer interest, which is unique to a Floor broker, but which may also result in added opportunity cost and uncertainty for the Floor broker when compared to an electronic execution.
The Exchange also believes that it is reasonable to specify that an agency cross trade is not charged for securities priced below $1 because doing so will add greater specificity to the Price List by reflecting that it is the same as the rate charged for such transactions in securities priced $1 or above. This is also equitable and not unfairly discriminatory because it would provide greater certainty regarding the applicable rates for transactions in securities priced below $1. The Exchange believes that not charging for these transactions is further reasonable because of the nature of an agency cross trade, in that it is a trade where a
The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act.
No written comments were solicited or received with respect to the proposed rule change.
The foregoing rule change is effective upon filing pursuant to Section 19(b)(3)(A)
At any time within 60 days of the filing of such proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”)
The Exchange is filing with the Commission a proposal to: extend through June 30, 2013, the Penny Pilot Program in options classes in certain issues (“Penny Pilot” or “Pilot”), and to change the date when delisted classes may be replaced in the Penny Pilot.
The Exchange requests that the Commission waive the 30-day operative delay period contained in Exchange Act Rule 19b–4(f)(6)(iii)
Proposed new language is
Rule 1034. Minimum Increments
(a) Except as provided in sub-paragraphs (i)(B) and (iii) below, all options on stocks, index options, and Exchange Traded Fund Shares quoting in decimals at $3.00 or higher shall have a minimum increment of $.10, and all options on stocks and index options quoting in decimals under $3.00 shall have a minimum increment of $.05.
(i)(A) No Change.
(B) For a pilot period scheduled to expire [December 31, 2012]
The Exchange may replace any pilot issues that have been delisted with the next most actively traded multiply listed options classes that are not yet included in the pilot, based on trading activity for the six month period beginning [December]
(C) No Change.
(ii)–(iv) No Change.
The text of the proposed rule change is available on the Exchange's Web site at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of this filing is to amend Phlx Rule 1034 to: extend the Penny Pilot through June 30, 2013, and to change the date when delisted classes may be replaced in the Penny Pilot.
Under the Penny Pilot, the minimum price variation for all participating options classes, except for the Nasdaq-100 Index Tracking Stock (“QQQQ”), the SPDR S&P 500 Exchange Traded Fund (“SPY”) and the iShares Russell 2000 Index Fund (“IWM”), is $0.01 for all quotations in options series that are quoted at less than $3 per contract and $0.05 for all quotations in options series that are quoted at $3 per contract or greater. QQQQ, SPY and IWM are quoted in $0.01 increments for all options series. The Penny Pilot is currently scheduled to expire on December 31, 2012.
The Exchange proposes to extend the time period of the Penny Pilot through June 30, 2013, and to provide revised dates for adding replacement issues to the Penny Pilot. The Exchange proposes that any Penny Pilot Program issues that have been delisted may be replaced on the second trading day following January 1, 2013. The replacement issues will be selected based on trading activity for the six month period beginning June 1, 2012, and ending November 30, 2012.
This filing does not propose any substantive changes to the Penny Pilot Program; all classes currently participating in the Penny Pilot will remain the same and all minimum increments will remain unchanged. The Exchange believes the benefits to public customers and other market participants who will be able to express their true prices to buy and sell options have been demonstrated to outweigh the potential increase in quote traffic.
The Exchange believes that its proposal is consistent with Section 6(b) of the Act
The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. To the contrary, this proposal is pro-competitive because it allows Penny Pilot issues to be traded on the Exchange.
No written comments were either solicited or received.
The Exchange has filed the proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act
A proposed rule change filed under Rule 19b–4(f)(6) normally does not become operative prior to 30 days after the date of the filing.
At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1)
The Exchange filed a proposal for the BATS Options Market (“BATS Options”) to extend through June 30, 2013, the Penny Pilot Program (“Penny Pilot”) in options classes in certain issues (“Pilot Program”) previously approved by the Commission.
The text of the proposed rule change is available at the Exchange's Web site at
In its filing with the Commission, the self-regulatory organization included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements.
The purpose of this filing is to extend the Penny Pilot, which was previously approved by the Commission, through June 30, 2013, and to provide a revised date for adding replacement issues to the Pilot Program. The Exchange proposes that any Pilot Program issues that have been delisted may be replaced on the second trading day following January 1, 2013. The replacement issues will be selected based on trading activity for the six month period beginning June 1, 2012, and ending November 30, 2012.
The Exchange represents that the Exchange has the necessary system capacity to continue to support operation of the Penny Pilot. The Exchange believes the benefits to public customers and other market participants who will be able to express their true prices to buy and sell options have been demonstrated to outweigh the increase in quote traffic.
The Exchange believes that its proposal is consistent with the
The Exchange does not believe that the proposed rule change imposes any burden on competition.
The Exchange has neither solicited nor received written comments on the proposed rule change.
The Exchange has filed the proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act
A proposed rule change filed under Rule 19b–4(f)(6) normally does not become operative prior to 30 days after the date of the filing.
At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Social Security Administration (SSA).
Notice.
We are announcing that the assessment percentage rate under sections 206(d) and 1631(d)(2)(C) of the Social Security Act (Act), 42 U.S.C. 406(d) and 1383(d)(2)(C), is 6.3 percent for 2013.
Jeffrey C. Blair, Associate General Counsel for Program Law, Office of the General Counsel, Social Security Administration, 6401 Security Boulevard, Baltimore, MD 21235–6401. Phone: (410) 965–3157, email
Individuals claiming Social Security benefits or Supplemental Security Income payments may choose to hire representatives to assist them with their claims. If the claim is successful and the individual was represented either by an attorney or by a non-attorney representative who has met certain prerequisites, the Act provides that we may withhold up to 25 percent of the past-due benefits on the claim and use that money to pay the representative's approved fee directly to the representative.
When we pay the representative's fee directly to the representative, we must collect from that fee payment an assessment to recover the costs we incur in determining and paying representatives' fees. The Act provides that the assessment we collect will be the lesser of two amounts: a specified dollar limit; or the amount determined by multiplying the fee we are paying by the assessment percentage rate. (Sections 206(d), 206(e), and 1631(d)(2) of the Act, 42 U.S.C. 406(d), 406(e), and 1383(d)(2).)
The Act initially set the dollar limit at $75 in 2004 and provides that the limit will be adjusted annually based on changes in the cost-of-living. (Sections 206(d)(2)(A) and 1631(d)(2)(C)(ii)(I) of the Act, 42 U.S.C. 406(d)(2)(A) and 1383(d)(2)(C)(ii)(I).) The maximum dollar limit for the assessment currently is $88, as we announced in the
The Act requires us each year to set the assessment percentage rate at the lesser of 6.3 percent or the percentage rate necessary to achieve full recovery of the costs we incur to determine and pay representatives' fees. (Sections 206(d)(2)(B)(ii) and 1631(d)(2)(C)(ii)(II) of the Act, 42 U.S.C. 406(d)(2)(B)(ii) and 1383(d)(2)(C)(ii)(II).)
Based on the best available data, we have determined that the current rate of 6.3 percent will continue for 2013. We will continue to review our costs for these services on a yearly basis.
Notice is hereby given of the following determinations: Pursuant to the authority vested in me by the Act of October 19, 1965 (79 Stat. 985; 22 U.S.C. 2459), Executive Order 12047 of March 27, 1978, the Foreign Affairs Reform and Restructuring Act of 1998 (112 Stat. 2681,
For further information, including a list of the exhibit objects, contact Julie Simpson, Attorney-Adviser, Office of the Legal Adviser, U.S. Department of State (telephone: 202–632–6467). The mailing address is U.S. Department of State, SA–5, L/PD, Fifth Floor (Suite 5H03), Washington, DC 20522–0505.
Office of the United States Trade Representative.
Request for written submissions from the public and announcement of public hearing.
Section 182 of the Trade Act of 1974 (Trade Act) (19 U.S.C. 2242) requires the United States Trade Representative (Trade Representative) to identify countries that deny adequate and effective protection of intellectual property rights (IPR) or deny fair and equitable market access to U.S. persons who rely on intellectual property protection. (The provisions of Section 182 are commonly referred to as the “Special 301” provisions of the Trade Act.) The Trade Act requires the Trade Representative to determine which, if any, of these countries to identify as Priority Foreign Countries. Acts, policies, or practices that are the basis of a country's identification as a Priority Foreign Country can be subject to the procedures set out in sections 301–305 of the Trade Act.
In addition, the Office of the United States Trade Representative (USTR) has created a “Priority Watch List” and “Watch List” to assist the Administration in pursuing the goals of the Special 301 provisions. Placement of a trading partner on the Priority Watch List or Watch List indicates that particular problems exist in that country with respect to IPR protection, enforcement, or market access for persons that rely on intellectual property protection. Trading partners placed on the Priority Watch List are the focus of increased bilateral attention concerning the problem areas.
USTR chairs an interagency team that reviews information from many sources, and that consults with and makes recommendations to the Trade Representative on issues arising under Special 301. Written submissions from interested persons are a key source of information for the Special 301 review process. In 2013, USTR again will conduct a public hearing as part of the review process.
USTR is hereby requesting written submissions from the public concerning foreign countries' acts, policies, or practices that are relevant to deciding whether a particular trading partner should be identified as a priority foreign
The schedule for the 2013 Special 301 review is set forth below.
Friday, February 8, 2013—For interested parties, except for foreign governments: Submit written comments, requests to testify at the Special 301 Public Hearing, and hearing statements.
Friday, February 15, 2013—For foreign governments: Submit written comments, requests to testify at the Special 301 Public Hearing, and hearing statements.
Wednesday, February 20, 2013—Special 301 Committee Public Hearing for interested parties, including representatives of foreign governments, will be held at the offices of USTR, 1724 F Street, NW., Washington, DC 20508. Any change in the date or location of the hearing will be announced on
On or about April 30, 2013—In accordance with statutory requirements, USTR will publish the 2013 Special 301 Report.
All written comments, requests to testify, and hearing statements should be sent electronically via
Paula Karol Pinha, Director for Intellectual Property and Innovation, Office of the United States Trade Representative, at (202) 395–5419. Further information about Special 301 can be found at
USTR requests that interested persons identify those countries that deny adequate and effective protection for intellectual property rights or deny fair and equitable market access to U.S. persons who rely on intellectual property protection. USTR further requests that submissions include specific references to laws, regulations, policy statements, executive, presidential or other orders, administrative, court or other determinations, and any other measures relevant to the issues raised in the written submission or hearing testimony. USTR also requests that, where relevant, submissions mention particular regions, provinces, states, or other subdivisions of a country in which an act, policy, or practice is believed to warrant special attention.
Section 182 contains a special rule regarding actions of Canada affecting U.S. cultural industries. Section 182 requires the Trade Representative to identify any act, policy or practice of Canada that affects cultural industries, is adopted or expanded after December 17, 1992, and is actionable under Article 2106 of the North American Free Trade Agreement (NAFTA). Section 182 requires the Trade Representative to identify any such acts, policies or practices within 30 days after publication of the National Trade Estimate (NTE) report, i.e., approximately April 30, 2013.
The Special 301 Committee invites written submissions from the public concerning foreign countries' acts, policies, or practices that are relevant to deciding whether a particular trading partner should be identified under Section 182 of the Trade Act. As noted above, interested parties, except for foreign governments, must submit any written comments by February 8, 2013. Interested foreign governments must submit any written comments by February 15, 2013.
Written comments should include a description of the problems that the submitter has experienced and the effect of the acts, policies, and practices on U.S. industry. Comments should be as detailed as possible and provide all necessary information for identifying and assessing the effect of the acts, policies, and practices. Any comments that include quantitative loss claims should be accompanied by the methodology used in calculating such estimated losses. Comments must be in English. All comments should be sent electronically via
To submit comments to
The
The Special 301 Committee will hold a public hearing at the offices of USTR, 1724 F Street NW., Washington, DC 20508 for interested parties, including representatives of foreign governments, on February 20, 2013. The hearing will be open to the public, and a transcript of the hearing will be made available on
Oral testimony before the Special 301 Committee must be in person and will be limited to one five-minute presentation in English. Questions from the Special 301 Committee may follow oral testimony.
All interested parties, except foreign governments, wishing to testify at the hearing must submit, by February 8, 2013, a “Notice of Intent to Testify” and “Hearing Statement” to http://www.regulations.gov (following the procedures set forth in “Requirements for Comments” above). The Notice of Intent to Testify must include the name of the witness, name of the organization (if applicable), address, telephone number, fax number, and email address. A short Hearing Statement must accompany the Notice of Intent to Testify.
All interested foreign governments that wish to testify at the hearing must submit, by February 15, 2013, a “Notice of Intent to Testify” to
A person requesting that information contained in a comment submitted by that person be treated as confidential business information must certify that such information is business confidential and would not customarily be released to the public by the submitter. Confidential business information must be clearly designated as such, the submission must be marked “BUSINESS CONFIDENTIAL” at the top and bottom of the cover page and each succeeding page, and the submission should indicate, via brackets, the specific information that is confidential. Additionally, “Business Confidential” should be included in the “Type comment” field. Anyone submitting a comment containing business confidential information must also submit, as a separate submission, a non-confidential version of the confidential submission, indicating where confidential information has been redacted. The non-confidential summary will be placed in the docket and open to public inspection.
USTR will maintain a docket on the 2013 Special 301 Review, accessible to the public. The public file will include non-confidential comments, notices of intent to testify, and hearing statements received by USTR from the public, including foreign governments, with respect to the 2013 Special 301 Review. Comments will be placed in the docket and open to public inspection pursuant to 15 CFR 2006.13, except confidential business information exempt from public inspection in accordance with 15 CFR 2006.15. Comments may be viewed on the
Office of the Secretary, DOT.
Notice.
On April 27, 2012, the Office of Management and Budget (OMB) designated the U.S. Department of Transportation's (DOT) Office of Transportation Services (TRANServe), located within the Office of the Assistant Secretary for Administration, as the lead Federal Agency by to facilitate the timely return of any excess transit benefits accumulating on vanpool companies' accounts to the Treasury and to prevent the future accumulation of excess transit benefits, among other things. As the lead Federal agency, TRANServe is directed to inform commercial vanpool companies of the Federal internal controls that now govern the Transit Benefit Program to prevent future accumulations, and assist in the timely return of the current excess transit benefits. Thus, the following notice sets forth the process for returning excess transit benefits, as well as the minimum internal controls that have been developed for operating a compliant transit benefit program as it relates to van pools.
Ms. Denise P. Wright, Business Office Manager, and for information regarding Funds Recovery contact Ms. Craig Bellet, Working Capital Fund—Office of Financial Management 1200 New Jersey Avenue SE., Washington DC 20590.
On April 21, 2000, Executive Order 13150 directed all federal agencies to develop a transportation fringe benefit program that offered qualified Federal employees the option to exclude from taxable wages and compensation employee commuting costs incurred through the use of mass transportation and vanpools. Since their development, these transit benefit programs have become an important tool in addressing urban roadway congestion. However, they were only designed to subsidize employees' costs for using public transportation to travel between their residence and place of employment. These benefits are calculated on a monthly basis as required under 26 CFR 1.132–9, and as such, employees are not permitted to accumulate benefits in excess of their actual monthly commuting costs or to use accumulated benefits to offset commuting costs in subsequent months. Furthermore, overestimating transit costs, giving or selling transit benefits to others, or purchasing transit benefits from unauthorized sources is prohibited. Employees who misuse transit benefits are subject to appropriate administrative action, including discipline and disqualification from the Federal Transit Benefit Program.
In 2011, the Office of Management and Budget (OMB) was advised that excess transit benefits may have been accumulating in programs that allow transit benefits to be used for vanpool services between employees' residences and their places of employments. On April 27, 2012, OMB directed that these excess funds be returned to the U.S. Department of the Treasury and that federal agencies strengthen internal controls to ensure compliance with the Federal Transit Benefit Program. To accomplish these directives, OMB designated the DOT, Office of Assistant Secretary for Administration, as the lead Federal agency to inform commercial vanpool companies of the Federal internal controls that govern the Transit Benefit Program and to assist in the timely return of the Federal funds. Pursuant to the OMB direction, TRANServe is responsible for the recovery of the excess transit benefit provided to van pool riders including both customers of TRANServe and those riders who received the transit benefit through other channels. TRANServe has also worked with senior leadership of the relevant Federal agencies to further define the necessary controls that should be in place to operate a compliant transit benefit program. The process for recovering the existing excess funds, as well as the controls that have been developed to prevent future excess accumulations, is described below.
This section presents the process for the timely return of the Federal funds. Pursuant to 26 CFR 1.132–9, qualified transportation fringe benefits are calculated on a monthly basis. Therefore, employees are not permitted to accumulate fare media in excess of their actual monthly commuting costs or to use accumulated fare media (acquired with tax-exempt subsidies) to offset commuting costs in the future. In this instance, accumulated fare media in excess of the actual monthly commuting
i. Name and location of vanpool operator
ii. Funds origin, to include agency and location
iii. Dollars segregated by agency
The email subject line should state “Pay.gov Van Pool Funds Remittance.” Also include a copy of the emailed receipt you receive from
To ensure that funds are not accumulated in excess of the allotted monthly amount, we have also worked with other federal agencies to develop the following internal controls for the management of the Federal Transit Benefit Program. These controls will ensure effective and efficient operations, reliability of financial reporting, and compliance with applicable laws and regulations. The controls are provided as tools to help federal transit benefit program and financial managers achieve results and safeguard the integrity of their programs. Federal agency program administration should be built around these core principles and monitored accordingly. The internal controls listed are general controls and agency policy and procedure may be more prescriptive with the following internal controls serving as the minimum standard. For the purposes of this notice with respect to the minimum internal controls, the following definitions are applicable:
The minimum internal controls include the following:
1. The agency transit benefit program must provide the ability for all participants to adjust the monthly transit benefit amount.
2. With respect to van pools, the agency transit benefit program manager should verify that the van pool is registered or certified by the local transit authority, where applicable. While agency transit benefit program managers have no authority to require van pool registration or certification by local transit authorities, some State and local transit authorities require van pool registration and certification. This administrative process should be leveraged to ensure statutory and regulatory compliance as well as transit authority compliance.
3. The agency transit benefit program manager should maintain a list of van pool vendors utilized by agency participants, to include the name of the driver or operator, van pool business name, address, and phone number. The list of van pool vendors, with driver and operator identified, should be cross referenced and validated to ensure consistency and accuracy with the agency van pool participants receiving the transit benefit. Van pool operators or drivers are to provide this information directly to the agency transit benefit program manager.
4. Van pool drivers and operators who use qualified parking consistent with 26 CFR 1.132–9, or are named on a workplace parking permit, are not eligible to receive the transit benefit. However, the allowable cost for the driver and/or operator may be covered as part of the operating expenses attributed to the van pool.
5. The transit benefit cannot be used to hold a seat on the van pool in the event of participant absence. All participants must utilize the van pool for commuting to and from work at least 50% of eligible work days.
6. The van pool must seat a minimum of 6 passengers (not including the driver), and must have at least 50% of the adult seating capacity of the vehicle (not including the driver) used for the transportation of employees to and from work representing 80% of the usage of the van.
7. The agency transit benefit program manager must be provided a published price list by the Federal van pool driver or operator, which is applicable to all riders (federal and non-federal). As established by the Federal van pool driver or operator, the published costs should include all necessary fees. Updated price lists should be provided to the agency transit benefit program manager as prices are changed or modified.
8. In the event a transit program receives a rider subsidy from a transit authority, the appropriate participant offset must be applied to the individual monthly benefit amount.
9. A van pool invoice or receipt is required to document the actual commuting cost for individual van pool participants.
The internal controls described above should prevent individuals from accruing transit benefits in excess of the allotted monthly amount, as required by 26 CFR 1.132–9.
Federal Railroad Administration (FRA), Department of Transportation.
Notice and request for comments.
In accordance with the Paperwork Reduction Act of 1995 and its implementing regulations, the Federal Railroad Administration (FRA) hereby announces that it is seeking approval of the following proposed information collection activities. Before submitting this proposed information collection request (ICR) for clearance by the Office of Management and Budget (OMB), FRA is soliciting public comment on specific aspects of the activities identified below.
Comments must be received no later than March 1, 2013.
Submit written comments on any or all of the following proposed activities by mail to either: Mr. Robert Brogan, Office of Safety, Planning and Evaluation Division, RRS–21, Federal Railroad Administration, 1200 New Jersey Ave. SE., Mail Stop 25, Washington, DC 20590, or Ms. Kimberly Toone, Office of Information Technology, RAD–20, Federal Railroad Administration, 1200 New Jersey Ave. SE., Mail Stop 35, Washington, DC 20590. Commenters requesting FRA to acknowledge receipt of their respective comments must include a self-addressed stamped postcard stating, “Comments on OMB control number 2130-New” and should also include the title of the collection of information. Alternatively, comments may be transmitted via facsimile to (202) 493–6216 or (202) 493–6497, or via email to Mr. Brogan at
Mr. Robert Brogan, Office of Planning and Evaluation Division, RRS–21, Federal Railroad Administration, 1200 New Jersey Ave. SE., Mail Stop 25, Washington, DC 20590 (telephone: (202) 493–6292) or Ms. Kimberly Toone, Office of Information Technology, RAD–20, Federal Railroad Administration, 1200 New Jersey Ave. SE., Mail Stop 35, Washington, DC 20590 (telephone: (202) 493–6132). (These telephone numbers are not toll-free.)
The Paperwork Reduction Act of 1995 (PRA), Public Law 104–13, § 2, 109 Stat. 163 (1995) (codified as revised at 44 U.S.C. 3501–3520), and its implementing regulations, 5 CFR part 1320, require Federal agencies to provide 60-days notice to the public for comment on information collection activities before seeking approval for reinstatement or renewal by OMB. 44 U.S.C. 3506(c)(2)(A); 5 CFR 1320.8(d)(1), 1320.10(e)(1), 1320.12(a). Specifically, FRA invites interested respondents to comment on the following summary of proposed information collection activities regarding (i) whether the information collection activities are necessary for FRA to properly execute its functions, including whether the activities will have practical utility; (ii) the accuracy of FRA's estimates of the burden of the information collection activities, including the validity of the methodology and assumptions used to determine the estimates; (iii) ways for FRA to enhance the quality, utility, and clarity of the information being collected; and (iv) ways for FRA to minimize the burden of information collection activities on the public by automated, electronic, mechanical, or other technological collection techniques or other forms of information technology (
Below is a brief summary of the proposed Information Collection Request (ICR) that FRA will submit for clearance by OMB as required under the PRA:
Reporting Burden:
Pursuant to 44 U.S.C. 3507(a) and 5 CFR 1320.5(b), 1320.8(b)(3)(vi), FRA informs all interested parties that it may not conduct or sponsor, and a respondent is not required to respond to, a collection of information unless it displays a currently valid OMB control number.
44 U.S.C. §§ 3501–3520.
Federal Railroad Administration (FRA), Department of Transportation (DOT).
Notice of Railroad Safety Advisory Committee (RSAC) Meeting Postponement.
FRA recently announced the forty-eighth meeting of the RSAC, a Federal Advisory Committee that develops railroad safety regulations through a consensus process (77 FR 73734). This meeting has been postponed until further notice and will be rescheduled at a future date.
The RSAC meeting scheduled to commence at 9:30 a.m. on Wednesday, January 9, 2013, is hereby postponed and will be rescheduled at a future date.
To be rescheduled at a future date and location.
Larry Woolverton, RSAC Administrative Officer/Coordinator, FRA, 1200 New Jersey Avenue SE., Mailstop 25, Washington, DC 20590, (202) 493–6212; or Robert Lauby, Deputy Associate Administrator for Regulatory and Legislative Operations, FRA, 1200 New Jersey Avenue SE., Mailstop 25, Washington, DC 20590, (202) 493–6474.
The RSAC was established to provide advice and recommendations to FRA on railroad safety matters. The RSAC is composed of 54 voting representatives from 32 member organizations, representing various rail industry perspectives. In addition, there are non-voting advisory representatives from the agencies with railroad safety regulatory responsibility in Canada and Mexico, the National Transportation Safety Board, and the Federal Transit Administration. The diversity of the Committee ensures the requisite range of views and expertise necessary to discharge its responsibilities. See the RSAC Web site for details on prior RSAC activities and pending tasks at:
On December 12, 2012, Union Pacific Railroad Company (UP) and Santa Clara Valley Transportation Authority (SCVTA) jointly filed with the Surface Transportation Board (Board) a petition under 49 U.S.C. 10502 for exemption from the provisions of 49 U.S.C. 10903 for UP to abandon its freight operating easement on, and for SCVTA, the owner of the line, to abandon its residual common carrier obligation for, a portion of the San Jose Industrial Lead between mileposts 5.38 and 7.35 near the Warm Springs freight rail station in the City of Fremont, a distance of 1.97 miles, in Alameda County, Cal. Petitioners state that the involved segment of rail line is contiguous to the segment between mileposts 7.35 and 16.30 in Alameda and Santa Clara Counties, Cal., for which the Board granted abandonment authority in July 2012.
In addition to an exemption from the provisions of 49 U.S.C. 10903, petitioners seek an exemption from 49 U.S.C. 10904 (offer of financial assistance (OFA) provisions) and 49 U.S.C. 10905 (public use provisions). In support, petitioners state that the line is to be abandoned for freight rail service, but will be retained and rebuilt for future inclusion in the Bay Area Rapid Transit System. Petitioners assert that the right-of-way is thus needed for a valid public purpose and that there is no overriding public need for continued freight rail service. These requests will be addressed in the final decision.
According to petitioners, the line does not contain Federally granted rights-of-way. Any documentation in petitioners' possession will be made available promptly to those requesting it.
The interest of railroad employees will be protected by the conditions set forth in
By issuance of this notice, the Board is instituting an exemption proceeding pursuant to 49 U.S.C. 10502(b). A final decision will be issued by April 1, 2013.
Any OFA under 49 CFR 1152.27(b)(2) will be due no later than 10 days after service of a decision granting the petition for exemption. Each OFA must be accompanied by a $1,600 filing fee.
All interested persons should be aware that, following abandonment of rail service and salvage of the line, the line may be suitable for other public use, including interim trail use. Any request for a public use condition under 49 CFR 1152.28 or for trail use/rail banking under 49 CFR 1152.29 will be due no later than January 22, 2013. Each trail use request must be accompanied by a $250 filing fee.
All filings in response to this notice must refer to Docket Nos. AB 33 (Sub-No. 309X) and AB 980 (Sub-No. 2X) and must be sent to: (1) Surface Transportation Board, 395 E Street SW., Washington, DC 20423–0001; and (2) petitioners' representatives, Mack H. Shumate, Jr., 101 North Wacker Drive, Suite 1920, Chicago, IL 60606 (UP), and Allison I. Fultz, 1001 Connecticut Ave. NW., Suite 800, Washington, DC 20036 (SCVTA). Replies to the petition are due on or before January 22, 2013.
Persons seeking further information concerning abandonment procedures may contact the Board's Office of Public Assistance, Governmental Affairs, and Compliance at (202) 245–0238 or refer to the full abandonment or discontinuance regulations at 49 CFR part 1152. Questions concerning environmental issues may be directed to the Board's Office of Environmental Analysis (OEA) at (202) 245–0305. Assistance for the hearing impaired is available through the Federal Information Relay Service (FIRS) at 1–800–877–8339.
An environmental assessment (EA) (or environmental impact statement (EIS), if necessary) prepared by OEA will be served upon all parties of record and upon any agencies or other persons who commented during its preparation. Other interested persons may contact OEA to obtain a copy of the EA (or EIS). EAs in these abandonment proceedings normally will be made available within 60 days of the filing of the petition. The deadline for submission of comments on the EA generally will be within 30 days of its service.
Board decisions and notices are available on our Web site at “www.stb.dot.gov.”
By the Board, Rachel D. Campbell, Director, Office of Proceedings.
Hotard
The transaction is intended to simplify the corporate structure of the corporate family by consolidating all of the assets and liabilities of Hotard and Calco into a single surviving entity. Hotard and Calco state that the elimination of Calco as a separate corporate entity will streamline the corporate structure and management, reduce administrative expenses, and improve the overall efficiency of Hotard.
This is a transaction within a corporate family of the type specifically exempted from prior review and approval under 49 CFR 1182.9. Hotard and Calco state that the transaction will not result in any change in service levels, significant operational changes, or any change in competitive balance with carriers outside the corporate family. Hotard and Calco also state that (1) they will consummate the proposed transaction through an Agreement and Plan of Merger approved by the Board of Directors of each party in accordance with Louisiana law, and (2) the transaction will not have an adverse impact on the employees of either party to the subject transaction.
The transaction is scheduled to be consummated on or after January 1, 2013.
If the verified notice contains false or misleading information, the Board shall summarily revoke the exemption and require divestiture. Petitions to revoke the exemption under 49 U.S.C. 13541(d) may be filed at any time.
An original and 10 copies of all pleadings, referring to Docket No. MCF 21051, must be filed with the Surface Transportation Board, 395 E Street SW., Washington, DC 20423–0001. In addition, a copy of each pleading must be served on Daniel A. Ranson, Gaudry, Ranson, Higgins & Gremillion, LLC, 401 Whitney Ave., Suite 500, Gretna, LA 70056.
Board decisions and notices are available on our Web site at
By the Board.
The Department of the Treasury will submit the following information collection request to the Office of Management and Budget (OMB) for review and clearance in accordance with the Paperwork Reduction Act of 1995, Public Law 104–13, on or after the date of publication of this notice.
Comments should be received on or before January 30, 2013 to be assured of consideration.
Send comments regarding the burden estimate, or any other aspect of the information collection, including suggestion for reducing the burden, to (1) Office of Information and Regulatory Affairs, Office of Management and Budget, Attention: Desk Officer for Treasury, New Executive Office Building, Room 10235, Washington, DC 20503, or email at
Copies of the submission(s) may be obtained by calling (202) 927–5331, email at
Departmental Offices, Department of Treasury.
Notice and request for comments.
The Department of the Treasury, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on proposed and/or continuing information collections, as required by the Paperwork Reduction Act of 1995, Public Law 104–13 (44 U.S.C. 3506(c)(2)(A)). Currently, the Departmental Offices, OSDBU within the Department of the Treasury is soliciting comments concerning the Electronic Capability Statement (ECS).
Written comments must be received on or before March 1, 2013 to be assured of consideration.
Direct all written comments to the Department of the Treasury, Departmental Offices, OSDBU, ATTN: Robin Byrd, 1500 Pennsylvania Avenue NW., Washington, DC 20220, MS: Metropolitan Square, Room 6N403, (202) 622–8213;
Requests for additional information or copies of the form(s) and instructions should be directed to the Department of the Treasury, Departmental Offices, OSDBU, ATTN: Robin Byrd, 1500 Pennsylvania Avenue NW., Washington, DC 20220, MS: Metropolitan Square, Room 6N403, (202) 622–8213;
The Department of the Treasury is planning to submit the following information collection request to the Office of Management and Budget (OMB) for review and clearance in accordance with the Paperwork Reduction Act of 1995, Public Law 104–13.
Comments should be received on or before March 1, 2013 to be assured of consideration.
Send comments regarding the burden estimate, or any other aspect of the information collection, including suggestion for reducing the burden, to James Gatz, Senior Program and Policy Advisor, Office of Consumer Policy, U.S. Department of the Treasury, 1500 Pennsylvania Ave., NW., Washington, DC 20220. (202) 622–3946.
Copies of the submission(s) may be obtained by calling (202) 927–5331, email at
The Department of Veterans Affairs (VA) gives notice under the Federal Advisory Committee Act, 5 U.S.C. Appt. 2, that the Veterans' Rural Health Advisory Committee will conduct a telephone conference call meeting from 2 p.m. to 3:30 p.m. on Tuesday, January
The purpose of the Committee is to advise the Secretary of Veterans Affairs on health care issues affecting enrolled Veterans residing in rural areas. The Committee examines programs and policies that impact the provision of VA health care to enrolled Veterans residing in rural areas and discusses ways to improve and enhance VA services for these Veterans.
The Committee will receive an update from the ORH Director; discuss VA's response to the 2011 Annual Report; and the agenda and planning for the Committee's upcoming May 2013 meeting in Washington, DC.
A 15-minute period will be reserved at 3:15 p.m. for public comments. Individuals who wish to address the Committee are invited to submit a 1–2 page summary of their comments for inclusion in the official meeting record. Members of the public may also submit written statements for the Committee's review to Ms. Judy Bowie, Designated Federal Officer, ORH (10P1R), Department of Veterans Affairs, 810 Vermont Avenue NW, Washington, DC 20420, or email at rural.health.inquiry@va.gov. Any member of the public seeking additional information should contact Ms. Bowie at (202) 461–7100.
By Direction of the Secretary.
The Department of Veterans Affairs (VA) gives notice under the Federal Advisory Committee Act, 5 U.S.C. App. 2, that the Advisory Committee on Disability Compensation will meet on January 28–29, 2013, at the Veterans Health Administration National Conference Center, 2011 Crystal Drive, Suite 150A, Arlington, Virginia. The sessions will begin at 8:30 a.m. each day and end at 4 p.m. on January 28 and at 2 p.m. on January 29. The meeting is open to the public.
The purpose of the Committee is to advise the Secretary of Veterans Affairs on the maintenance and periodic readjustment of the VA Schedule for Rating Disabilities. The Committee is to assemble and review relevant information relating to the nature and character of disabilities arising during service in the Armed Forces, provide an ongoing assessment of the effectiveness of the rating schedule, and give advice on the most appropriate means of responding to the needs of Veterans relating to disability compensation.
The Committee will receive briefings on issues related to compensation for Veterans with service-connected disabilities and other VA benefits programs. Time will be allocated for receiving public comments in the afternoon. Public comments will be limited to three minutes each. Individuals wishing to make oral statements before the Committee will be accommodated on a first-come, first-served basis. Individuals who speak are invited to submit 1–2 page summaries of their comments at the time of the meeting for inclusion in the official meeting record.
The public may submit written statements for the Committee's review to Nancy Copeland, Acting Designated Federal Officer, Department of Veterans Affairs, Veterans Benefits Administration, Compensation Service, Regulation Staff (211D), 810 Vermont Avenue NW, Washington, DC 20420 or email at nancy.copeland@va.gov. Any member of the public wishing to attend the meeting or seeking additional information should contact Mrs. Copeland at (202) 461–9685.
By Direction of the Secretary.
Bureau of Consumer Financial Protection.
Proposed rule; request for public comment.
The Bureau of Consumer Financial Protection (Bureau) is proposing to amend subpart B of Regulation E, which implements the Electronic Fund Transfer Act, and the official interpretation to the regulation. The proposal would refine a final rule issued by the Bureau earlier in 2012 that implements section 1073 of the Dodd-Frank Wall Street Reform and Consumer Protection Act regarding remittance transfers. The proposal addresses three narrow issues. First, the proposal would provide additional flexibility regarding the disclosure of foreign taxes, as well as fees imposed by a designated recipient's institution for receiving a remittance transfer in an account. Second, the proposal would limit a remittance transfer provider's obligation to disclose foreign taxes to those imposed by a country's central government. Third, the proposal would revise the error resolution provisions that apply when a remittance transfer is not delivered to a designated recipient because the sender provided incorrect or insufficient information, and, in particular, when a sender provides an incorrect account number and that incorrect account number results in the funds being deposited in the wrong account. The Bureau is also proposing to temporarily delay and extend the effective date of the rule.
Comments on the proposed temporary delay of the February 7, 2013 effective date of the rules published February 7, 2012 (77 FR 6194) and August 20, 2012 (77 FR 50244) must be received by January 15, 2013. Comments on the remainder of the proposal must be received by January 30, 2013.
You may submit comments, identified by Docket No. CFPB–2012–0050 or RIN 3170–AA33, by any of the following methods:
•
•
All comments, including attachments and other supporting materials, will become part of the public record and subject to public disclosure. Sensitive personal information, such as account numbers or social security numbers, should not be included. Comments will not be edited to remove any identifying or contact information.
Eric Goldberg or Lauren Weldon, Counsel, or Dana Miller, Senior Counsel, Division of Research, Markets, and Regulations, Bureau of Consumer Financial Protection, 1700 G Street NW., Washington, DC 20552, at (202) 435–7700.
Section 1073 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act)
On February 7, 2012, the Bureau of Consumer Financial Protection (Bureau) published a final rule to implement section 1073 of the Dodd-Frank Act. 77 FR 6194 (February Final Rule).
The Final Rule governs certain electronic transfers of funds sent by consumers in the United States to designated recipients in other countries and, for covered transactions, imposes a number of requirements on remittance transfer providers. In particular, the Final Rule implements EFTA sections 919(a)(2)(A) and (B), which require a provider to disclose, among other things, the amount to be received by the designated recipient in the currency to be received. The Final Rule requires a provider to provide a written pre-payment disclosure to a sender containing detailed information about the transfer requested by the sender, specifically including the exchange rate, applicable fees and taxes, and the amount to be received by the designated recipient. In addition to the pre-payment disclosure, the provider also must provide a written receipt when payment is made for the transfer. The receipt must include the information provided on the pre-payment disclosure, as well as additional information such as the date of availability of the funds, the designated recipient's contact information, and information regarding the sender's error resolution and cancellation rights. Though the final rule permits providers to provide estimates in three narrow circumstances, the Final Rule generally requires that disclosures state the actual exchange rate that will apply to a remittance transfer and the actual amount that will be received by the designated recipient of a remittance transfer.
As noted above, the statute requires the disclosure of the amount to be received by the designated recipient. Because fees and taxes imposed on the remittance transfer by persons other than the provider can affect the amount received by the designated recipient, the Final Rule requires that remittance transfer providers take such fees and taxes into account when calculating the disclosure of the amount to be received under § 1005.31(b)(1)(vii), and that such fees and taxes be disclosed under
In the February Final Rule, the Bureau recognized the challenges for remittance transfer providers in determining fees and taxes imposed by third parties, but believed that the statute specifically required providers to disclose the amount to be received and authorized estimates only in narrow circumstances. The Bureau also noted the significant consumer benefits afforded by these disclosures. The Bureau further stated its belief that it was necessary and proper to exercise its authority under EFTA sections 904(a) and (c) to adopt § 1005.31(b)(1)(vi) to require the itemized disclosure of these fees and taxes in order to effectuate the purposes of the EFTA.
The Final Rule also implements EFTA sections 919(d) and (f), which direct the Bureau to promulgate error resolution standards and rules regarding appropriate cancellation and refund policies, as well as standards of liability for remittance transfer providers. The Final Rule thus defines in § 1005.33 what constitutes an error with respect to a remittance transfer, as well as the remedies when an error occurs. Of relevance to this proposal, the Final Rule provides that, subject to specified exceptions, an error includes the failure to make available to a designated recipient the amount of currency promised in the disclosure provided to the sender, as well as the failure to make funds available to a designated recipient by the date of availability stated in the disclosure. §§ 1005.33(a)(1)(iii) and (a)(1)(iv). Where the error is the result of the sender providing insufficient or incorrect information, § 1005.33(c)(2)(ii) specifies the two remedies available: The provider must either refund the funds provided by the sender in connection with the remittance transfer (or the amount appropriate to correct the error) or resend the transfer at no cost to the sender, except that the provider may collect third party fees imposed for resending the transfer. If the transfer is resent, comment 33(c)–2 explains that a request to resend is a request for a remittance transfer, and thus the provider must provide the disclosures required by § 1005.31. Under § 1005.33(c)(2), even if the provider cannot retrieve the funds once they are sent, the provider still must provide the stated remedies if an error occurred.
Consistent with the statute, the Final Rule applies to all remittance transfer providers, whether transfers are sent through closed network or open network systems, or some hybrid of the two. Generally, in closed networks, a principal provider offers a service through a network of agents or other partners that help collect funds in the United States and disburse the funds abroad. Through the provider's own contractual arrangements with those agents or other partners, or through the contractual relationships owned by the provider's business partner, the principal provider can exercise some control over the transfer from end-to-end. In general, closed networks can be used to send transfers that can be received in a variety of forms, but they are most frequently used to send transfers that are not received in accounts. In contrast, in an open network, no single provider has control over or relationships with all of the participants that may collect funds in the United States or disburse funds abroad. Under current practice, in open networks, there is generally no global practice of communications by intermediary and recipient institutions with originating entities regarding fees and exchange rates applied to transfers. Unlike closed networks, open networks are typically used to send funds to accounts. Though they are primarily used by depository institutions and credit unions, open networks also may be used by non-depository institutions.
In the February Final Rule, the Bureau stated that it would continue to monitor implementation of the new statutory and regulatory requirements. The Bureau has subsequently engaged in dialogue with both industry and consumer groups regarding implementation efforts and compliance concerns. Most frequently, and as discussed in more detail below in the Section-by-Section Analysis, industry has expressed concern about the costs and challenges to remittance transfer providers of: (1) The requirement to disclose certain fees imposed by recipient institutions on remittance transfers; (2) the requirement to disclose foreign taxes, including taxes charged by foreign regional, provincial, state, or other local governments; and (3) the inclusion as an error a failure to deliver a transfer where the error occurs because the sender provided an incorrect account number to the provider and funds are deposited into the wrong account.
With respect to both recipient institution fees and foreign taxes, industry has stated that, to determine the appropriate disclosure, remittance transfer providers may have to ask numerous questions of senders that senders may not understand, and to which both senders and providers may not reasonably be expected to know the answer. For example, industry has noted that certain recipient institution fees can vary based on the recipient's status with the institution (
Further, since the issuance of the February Final Rule, industry has expressed concerns about the remedies that apply with respect to errors that occur because the sender of a remittance transfer provided incorrect or insufficient information to the remittance transfer provider. Providers have stated that, while generally rare, in some cases when a sender provides an incorrect account number, the remittance transfer may be deposited into the wrong account and, despite reasonable efforts by the provider, cannot be recovered, thus requiring providers to bear the cost of the lost principal transfer amount. In addition, providers have expressed concern about the risks of fraudulent activity by senders attempting to take advantage of this part of the rule. With regard to cases in which there are errors, providers have also asked technical questions about how disclosures should be provided in certain circumstances where a sender designates a resend remedy when reporting an error, or never designates a remedy at all, particularly in situations where the provider is unable to make direct contact with the sender upon completing its investigation.
Concerns about recipient institution fees and remedies for account number errors stem in large part from the nature of the open networks used to transfer funds, as described above. However, while depository institutions and credit
Upon further review and analysis, the Bureau believes it is appropriate to propose narrow adjustments to the Final Rule regarding these three issues. Due in part to the concerns expressed above, some remittance transfer providers and industry associations have indicated that some providers are considering exiting the market or reducing their offerings, such as by not sending transfers to corridors where tax or fee information is particularly difficult to obtain, or by limiting the size or type of transfers sent in order to reduce any risk associated with mis-deposited transfers. The Bureau is concerned that this would be detrimental to consumers, both in decreasing market competition and consumers' access to remittance transfer products. The Bureau believes that the proposed revisions may help to reduce or mitigate these risks. In each case, the Bureau believes that the proposed adjustments to the Final Rule would facilitate compliance, while maintaining the Final Rule's valuable new consumer protections and ensuring that these protections can be effectively delivered to consumers.
The proposal would refine three narrow aspects of the Final Rule. First, the proposal would provide additional flexibility and guidance on how foreign taxes and recipient institution fees may be disclosed. If a remittance transfer provider does not have specific knowledge regarding variables that affect the amount of foreign taxes imposed on the transfer, the proposal would continue to permit a provider to rely on a sender's representations regarding these variables. However, the proposal would separately permit providers to estimate by disclosing the highest possible foreign tax that could be imposed with respect to any unknown variable. Similarly, if a provider does not have specific knowledge regarding variables that affect the amount of fees imposed by a recipient's institution for receiving a remittance transfer in an account, the proposal would permit a provider to rely on a sender's representations regarding these variables. Separately, the proposal would also permit the provider to estimate by disclosing the highest possible recipient institution fees that could be imposed on the remittance transfer with respect to any unknown variable, as determined based on either fee schedules made available by the recipient institution or information ascertained from prior transfers to the same recipient institution. If the provider cannot obtain such fee schedules or information from prior transfers, the proposal would allow a provider to rely on other reasonable sources of information.
Second, the Bureau proposes to exercise its exception authority under section 904(c) of the EFTA to eliminate the requirement to disclose foreign taxes at the regional, state, provincial or local level. Thus, under the proposal, a remittance transfer provider's disclosure obligation would be limited to foreign taxes imposed on the remittance transfer by a country's central government. Because the proposed changes regarding recipient institution fees and taxes, taken together, could mean that a provider could be making disclosures that are not exact, the proposal also solicits comment on whether the existing requirement in the Final Rule to state that a disclosure is “Estimated” when estimates are provided under § 1005.32 should be extended to scenarios where disclosures are not exact, to the extent permitted by the proposed revisions.
Third, the proposal also would revise the error resolution provisions that apply when a sender provides incorrect or insufficient information and, in particular, when a remittance transfer is not delivered to a designated recipient because the sender provided an incorrect account number to the remittance transfer provider and the incorrect account number results in the funds being deposited in the wrong account. Under the proposal, where the provider can demonstrate that the sender provided the incorrect account number and that the sender had notice that the sender could lose the transfer amount, the provider would be required to attempt to recover the funds but would not be liable for the funds if those efforts were unsuccessful. The Bureau also proposes to revise the existing remedy procedures in situations where a sender provides incorrect or insufficient information other than an incorrect account number to allow providers additional flexibility when resending funds at a new exchange rate. Under the proposed rule, providers would be able to provide oral, streamlined disclosures and need not treat the resend as an entirely new remittance transfer. The Bureau also proposes to make conforming revisions in light of the proposed revisions regarding recipient institution fees and foreign taxes.
Finally, the Bureau proposes to temporarily delay the effective date of the Final Rule. The Bureau further proposes to extend the Final Rule's effective date until 90 days after this proposal is finalized.
The Bureau solicits comment on all aspects of this proposal. In particular, the Bureau seeks for commenters to provide, in conjunction with any opinions expressed, specific detail and any available data regarding current and planned practices, as well as relevant knowledge and specific facts about any benefits, costs, or other impacts on both industry and consumers of either the Final Rule, this proposal, or alternatives suggested by the commenter. The Bureau emphasizes that the purpose of this rulemaking is to clarify and facilitate compliance with the Final Rule on these narrow issues, not to reconsider the general need for—or the extent of—the protections that the general rule affords consumers. The Bureau also believes the market would benefit from quicker resolution of these issues. Thus, commenters are encouraged to frame their submissions accordingly.
The proposed adjustments are intended to facilitate compliance in part due to concerns about the practicability of the Final Rule given market models and available information today. After any changes are finalized, and consistent with the Bureau's approach to the Final Rule, the Bureau will continue to monitor implementation efforts and market developments, including whether better information about recipient institution fees or foreign taxes becomes more available over time, whether communication mechanisms in open network systems improve, and whether there are developments in security and verification procedures and practices.
Section 1073 of the Dodd-Frank Act created a new section 919 of the EFTA and requires remittance transfer providers to provide disclosures to senders of remittance transfers, pursuant to rules prescribed by the Bureau. In particular, providers must give a sender a written pre-payment disclosure containing specified information applicable to the sender's remittance transfer, including the amount to be received by the designated recipient. The provider must also provide a written receipt that includes the information provided on the pre-payment disclosure, as well as additional specified information. EFTA section 919(a).
In addition, EFTA section 919(d) provides for specific error resolution procedures and directs the Bureau to promulgate rules regarding appropriate cancellation and refund policies. Except as described below, the proposed rule is proposed under the authority provided to the Bureau in EFTA section 919, and as more specifically described in this
In addition to the Dodd-Frank Act's statutory mandates, EFTA section 904(a) authorizes the Bureau to prescribe regulations necessary to carry out the purposes of the title. The express purposes of the EFTA, as amended by the Dodd-Frank Act, are to establish “the rights, liabilities, and responsibilities of participants in electronic fund and remittance transfer systems” and to provide “individual consumer rights.” EFTA section 902(b). EFTA section 904(c) further provides that regulations prescribed by the Bureau may contain any classifications, differentiations, or other provisions, and may provide for such adjustments or exceptions for any class of electronic fund transfers or remittance transfers that the Bureau deems necessary or proper to effectuate the purposes of the title, to prevent circumvention or evasion, or to facilitate compliance. As described in more detail below, § 1005.31(b)(1)(vi), 1005.32(b)(3) and (b)(4) are proposed pursuant to the Bureau's authority in EFTA section 904(c).
EFTA sections 919(a)(2)(A) and (B) require a remittance transfer provider to disclose, among other things, the amount to be received by the designated recipient in the currency to be received. Because fees and taxes imposed on the remittance transfer by foreign institutions and governments can affect the amount ultimately received by the designated recipient, the Final Rule requires that providers take fees and taxes imposed by persons other than the provider into account when calculating the disclosure of the amount to be received under § 1005.31(b)(1)(vii), and that such fees and taxes be separately disclosed under § 1005.31(b)(1)(vi).
Since the rule was finalized, industry has continued to express concern that, where a designated recipient's institution charges the recipient fees for receiving a transfer in an account, the remittance transfer provider would not reasonably know whether the recipient has agreed to pay such fees or how much the recipient has agreed to pay. Industry has also requested guidance on whether and how to disclose recipient institution fees that can vary based on the recipient's status with the institution, quantity of transfers received, or other variables that are not easily knowable by the sender or the provider.
Separately, industry has expressed concern about the disclosure of foreign taxes, in two respects. First, industry has argued that it is significantly more burdensome to research and disclose subnational taxes than foreign taxes imposed by a country's central government, with little commensurate benefit to consumers. Second, industry has suggested that the existing guidance on the disclosure of foreign taxes is insufficient where variables that influence the applicability of foreign taxes are not easily knowable by the sender or the provider.
With respect to both recipient institution fees and foreign taxes, industry has stated that, to determine the appropriate disclosure, remittance transfer providers may have to ask numerous questions of senders that senders may not understand; to which senders may not know the answer; and (with respect to fees) which may be unique to each recipient institution.
The Bureau has considered these concerns. Upon further review and analysis, the Bureau believes it is appropriate to provide additional flexibility and guidance on how fees and taxes imposed by a person other than the remittance transfer provider may be disclosed. The Bureau also believes it is appropriate to exercise its exception authority under section 904(c) of the EFTA to eliminate the requirement to disclose regional, provincial, state, and other local foreign taxes. Accordingly, the proposed rule would revise § 1005.31(b)(1)(vi) and the related commentary, and would add two new provisions to § 1005.32 (as discussed in more detail below). Given this additional flexibility, the proposed rule also would extend § 1005.31(d) to require providers to disclose to senders that amounts are estimated in these circumstances, and would make other conforming revisions to the Final Rule.
In each case, the Bureau believes that the proposed adjustments to the Final Rule would facilitate compliance, while maintaining the rule's valuable, new consumer protections and ensuring that they can be effectively delivered to consumers. Under the proposal, senders would continue to receive disclosures with important information about fees and taxes that may be imposed by the foreign country's central government. Although not quite as precise, this information is still useful to help consumers determine the minimum necessary to pay bills and to provide the intended funds to a recipient.
As noted above, the proposed adjustments to the required fee and tax disclosures are intended to facilitate compliance in part due to concerns about the practicability of the Final Rule. The Bureau solicits comment on whether additional guidance is necessary to address similar practical or operational questions as those described here. After any changes are finalized, and consistent with the Bureau's prior approach, the Bureau will continue to monitor implementation efforts and market developments, including whether better information about recipient institution fees or foreign taxes becomes more readily available over time.
Comment 31(b)(1)–1 provides guidance on the disclosure of all fees and taxes, both foreign and domestic. Comment 31(b)(1)–1.ii focuses more specifically on how to disclose fees and taxes imposed on the remittance transfer
Since the issuance of the Final Rule, industry has requested guidance on whether and how to disclose various recipient institution fees, including those that can vary based on the recipient's status with the institution, the quantity of transfers received, or other variables that are unlikely to be known by the sender or the provider. As stated in existing comment 31(b)(1)–1.ii, fees that are specifically related to the remittance transfer must be disclosed, including fees that are imposed by a recipient's institution for receiving a wire transfer. For example, flat per-transfer incoming wire transfer fees must be disclosed, including flat fees that are tied to a particular transfer but charged at a later date (such as a “November 4 wire” fee that is not assessed until the end of the November billing cycle), as these fees are clearly linked to a particular remittance transfer.
While the proposal would generally provide further flexibility on how these fees may be determined, as discussed below with respect to proposed comment 31(b)(1)(vi)–4, the Bureau believes it would facilitate compliance to provide additional clarification in comment 31(b)(1)–1.ii on other types of recipient institution fees that are or are not specifically related to a remittance transfer. As the proposed guidance would significantly lengthen the existing comment, the proposal divides comment 31(b)(1)–1.ii into new subsections 31(b)(1)–1.ii through –1.v. The Bureau also proposes minor wording adjustments to ensure consistency with other comments in the Final Rule.
Proposed comment 31(b)(1)–1.iii first revises the reference to taxes imposed by a foreign government to taxes imposed by a foreign country's central government, to conform to the proposal to eliminate the requirement to disclose subnational taxes, discussed below. The proposed comment also builds on the guidance described above, and clarifies that account fees are not specifically related to a remittance transfer if such fees are merely assessed based on general account activity and not for receiving transfers. Thus, where an incoming remittance transfer results in a balance increase that triggers a monthly maintenance fee, that fee is not specifically related to a remittance transfer.
Proposed comment 31(b)(1)–1.iv then explains that a fee that specifically relates to a remittance transfer may be structured on a flat per-transaction basis, or may be conditioned on other factors (such as account status or the quantity of remittance transfers received) in addition to the remittance transfer itself. For example, where an institution charges an incoming wire fee on most customers' accounts, but not on preferred accounts, the Bureau believes such a fee is nonetheless specifically related to a remittance transfer. Similarly, if the institution assesses a fee for every transfer beyond the fifth received each month, the Bureau believes such a fee would be specifically related to the remittance transfer regardless of how many remittance transfers preceded it that month. In both situations, while additional variables may determine whether a fee is imposed or waived in a particular case, the fee itself is assessed specifically for receiving a particular transfer. In either case, the fee would be subject to disclosure under § 1005.31(b)(1)(vi), but as discussed below, § 1005.32(b)(4) would offer providers some flexibility in how to disclose the fee.
Section 1005.31(b)(1)(vi) contains the Final Rule's requirement to disclose any fees and taxes imposed on the remittance transfer by a person other than the remittance transfer provider, in the currency in which the funds will be received by the designated recipient. Specifically with respect to taxes, the Final Rule currently requires the disclosure of any applicable foreign taxes, including regional, provincial, state, or other local taxes as well as taxes imposed by a country's central government.
After further consideration, and for the reasons discussed below, the Bureau believes that it is appropriate to propose revising the Final Rule regarding foreign tax disclosures. The proposal would revise § 1005.31(b)(1)(vi) to state that only foreign taxes imposed by a country's central government on the remittance transfer need be disclosed. New proposed comment 31(b)(1)(vi)–3 would further clarify that regional, provincial, state, or other local foreign taxes need not be disclosed, although the provider could choose to disclose them.
Since the adoption of the Final Rule, the Bureau has continued to monitor the availability to remittance transfer providers of pertinent foreign tax information. The Bureau believes that, while significant efforts are likely to permit industry members in general to access reliable and current information on the relevant foreign taxes imposed by a country's central government, there does not appear to be a reasonable prospect that comparable resources will soon exist across the market to permit access to reliable and current information on foreign taxes imposed at the subnational level (including confirmation of the absence of such taxes in most jurisdictions). Industry has suggested that subnational taxes on remittance transfers are comparatively infrequent as compared with such taxes at the national level, and that when they do exist, the tax rates at the subnational level are typically lower. Moreover, the number of potential taxing jurisdictions is exponentially larger at the subnational level, and the Final Rule would imply compliance obligations to assess tax incidence and rates relating to all such subnational jurisdictions to which a provider sends remittance transfers.
The Bureau is concerned that if disclosure of foreign subnational taxes is required, a number of remittance transfer providers could exit the market or significantly reduce their offerings because of the current lack of ongoing reliable and complete information sources. The Bureau also believes that the loss of these market participants would be detrimental to consumers, in decreasing market competition and the convenient availability of remittance transfer services.
Accordingly, the Bureau believes the proposed elimination of the requirement to disclose subnational taxes is an exception that is necessary and proper under EFTA section 904(c) both to effectuate the purposes of the EFTA and to facilitate compliance. Under the proposed revision, remittance transfer providers would remain required to disclose only those foreign taxes imposed by a country's central
While the revised § 1005.31(b)(1)(vi) would provide that only the amount of foreign taxes imposed by a country's central government on the remittance transfer needs to be disclosed, a remittance transfer provider would remain free to disclose an amount that includes subnational taxes of which it is aware.
The Bureau seeks comment on whether limiting the required disclosures of foreign taxes to taxes imposed by a country's central government strikes the appropriate balance between easing compliance burden and protecting consumers, or whether there are circumstances in which a provider should be required to disclose additional foreign tax information. In particular, the Bureau seeks comment on whether resources have developed or are developing (and if so, how quickly) for remittance transfer providers to obtain reliable foreign subnational tax rate information. The Bureau also seeks comment on the practical significance to consumers if remittance service providers are not required to disclose such information under the rule, including any information on the incidence and magnitude of foreign subnational taxes, particularly in countries that receive substantial flows of remittance transfers.
Comment 31(b)(1)(vi)–2 of the Final Rule provides guidance on how to determine taxes for purposes of the disclosure required by § 1005.31(b)(1)(vi). In particular, the existing comment states that if a remittance transfer provider does not have specific knowledge regarding variables that affect the amount of taxes imposed by a person other than the provider for purposes of determining these taxes, the provider may rely on a sender's representations regarding these variables. Further, the comment states that if a sender does not know the information relating to the variables that affect the amount of taxes imposed by a person other than the provider, the provider may disclose the highest possible tax that could be imposed for the remittance transfer with respect to any unknown variable. The Bureau adopted this comment in the Final Rule in response to industry comments that taxes can vary depending on a number of variables, such as the tax status of the sender or recipient, or the type of accounts or financial institutions involved in the transfer. In adopting comment 31(b)(1)(vi)–2, the Bureau stated its belief that it is necessary to provide a reasonable mechanism by which the provider may disclose the foreign tax where information may not be known by the sender or the provider.
As discussed in more detail below, the Bureau is proposing to provide additional flexibility regarding the determination of foreign taxes where applicability may be impacted by certain variables in a new § 1005.32(b)(3). Accordingly, the Bureau is proposing to delete portions of the guidance in existing comment 31(b)(1)(vi)–2 as being superseded by the new proposed provision and related guidance.
Comment 31(b)(1)(vi)–2 would continue to state that if a remittance transfer provider does not have specific knowledge regarding variables that affect the amount of taxes imposed by a person other than the provider for purposes of determining these taxes, the provider may rely on a sender's representations regarding these variables. The Bureau believes providers should continue to be permitted to rely on senders' representations regarding variables that affect foreign taxes, because providers should be permitted to take senders' representations as true, and because such representations could result in a more accurate approximation of the applicable taxes. Accordingly, as discussed below regarding the error resolution requirements in proposed § 1005.33(a)(2)(iv) and comment 33(a)(2)(iv)–9, to the extent a provider relies on a sender's representations in this manner, any resulting discrepancy between the amount disclosed and the amount actually received would not constitute an error. Thus, for example, it would not be an error if reliance on a sender's representations results in a disclosed foreign tax amount that is less than what is actually imposed on the transfer. As discussed below, the proposed revisions would provide the same result with regard to situations in which providers rely on a sender's representations regarding possible recipient institution fees in accordance with proposed comment 31(b)(1)(vi)–4.
New proposed comment 31(b)(1)(vi)–3 is described above in the discussion of the proposed revisions to § 1005.31(b)(1)(vi) concerning disclosure of foreign taxes imposed by a country's central government.
While the Final Rule provided guidance in comment 31(b)(1)(vi)–2 on how to determine foreign taxes where variables could affect the amount to be disclosed, the rule did not provide guidance with respect to variables that could affect the fees imposed on the designated recipient by the recipient's institution for receiving the transfer in an account. For the reasons discussed below, the Bureau is proposing to provide additional flexibility in a new proposed § 1005.32(b)(4) regarding the determination of such fees.
In addition, the Bureau believes it is appropriate to provide similar guidance regarding reliance on a sender's representations with respect to recipient institution fees, as exists addressing foreign taxes. New proposed comment 31(b)(1)(vi)–4 is structured similarly to proposed comment 31(b)(1)(vi)–2. The proposed comment explains that in some cases, where a remittance transfer is sent to a designated recipient at an account at a financial institution, the institution imposes a fee on the remittance transfer pursuant to an agreement with the recipient. The amount of the fee imposed by the institution may vary based on whether the designated recipient holds a preferred status account with a financial institution, the quantity of transfers received, or other variables. In this scenario, if a remittance transfer provider does not have specific knowledge regarding variables that affect the amount of fees imposed by the recipient's institution for receiving a transfer in an account, the proposed comment would allow the provider to rely on a sender's representations regarding these variables.
Under the Final Rule, remittance transfer providers generally must disclose exact amounts, except under the limited circumstances permitted by § 1005.32. Therefore, under § 1005.31(d) of the Final Rule, where providers estimate disclosures under § 1005.32, the estimated disclosure must be described using the term “Estimated” or a substantially similar term, which appears in close proximity to the disclosure.
Due to the proposed revisions to § 1005.31(b)(1)(vi) and the related
The proposed comment would further explain that, if the provider is relying on the sender's representations or has specific knowledge regarding variables that affect the amount of fees disclosed under § 1005.31(b)(1)(vi), and is not otherwise providing estimated disclosures, § 1005.31(d) does not apply and therefore no “Estimated” label is required. The Bureau believes that providers that rely on sender's representations regarding variables should be able to take the information provided as representations that lead to exact disclosures, even if the representations later turn out to be incorrect. For similar reasons, the proposed comment also explains that § 1005.31(d) does not apply to foreign tax disclosures if the provider discloses all applicable taxes (including applicable regional, provincial, state, or other local foreign taxes), if the provider is relying on the sender's representations or has specific knowledge regarding variables that affect the amount of foreign taxes imposed by a country's central government, and if the provider is not otherwise providing estimated disclosures.
The Bureau believes that the use of the term “Estimated,” either when subnational taxes are not disclosed or when foreign tax and recipient institution fee estimates are provided in accordance with proposed §§ 1005.32(b)(3) and (b)(4), would provide sufficient disclosure to the sender to warn that disclosed amounts may not be precise, without requiring substantial changes to the disclosure form that could delay implementation of the statutory scheme. Further, the Bureau anticipates that compared to other mechanisms for giving senders notice, this proposed mechanism for alerting senders that amounts received may not be exact will minimize the systems changes that could be required, because the Final Rule already sets forth circumstances in which the term “Estimated” (or a substantially similar term) must be used.
At the same time, the Bureau is concerned that, particularly where subnational taxes are not disclosed, senders may receive disclosures that use the term “Estimated” the vast majority of the time, which could impair their ability to compare disclosures among remittance transfer providers, and could have an adverse impact on the exercise of error resolution rights. An alternative approach would be to require that a more specific statement be added to the disclosure to note, for instance, that “Additional taxes by regional or local governments may apply” rather than to require use of the “Estimated” label for every case in which a provider has decided not to disclose any subnational taxes. However, it is unclear whether such a disclosure would substantially benefit consumers over the simpler label, whether it would be understandable to consumers, and how much additional time and expense would be required for providers to modify their forms in this way.
Thus, the Bureau solicits comment on whether remittance transfer providers should be required to indicate those circumstances in which subnational taxes are not disclosed or in which fees and taxes are estimated in accordance with proposed § 1005.32(b)(3) or (4) with an “Estimated” label, and in particular, whether such labeling should be required in circumstances where amounts disclosed would be exact, but for the non-disclosure of foreign subnational taxes. To the extent foreign subnational taxes apply less frequently than foreign taxes imposed by a central government, or if such taxes tend to be lower than taxes imposed by central governments in the same country, the Bureau seeks comment on whether disclosures may be clearer without much detriment to accuracy if providers do not use the term “Estimated.” The Bureau solicits comment on the extent to which either circumstance is true, and also solicits comment on alternative disclosures that could be provided, and on the time and expense to implement either the “Estimated” label or a more detailed disclosure.
For the reasons described above, comment 31(b)(1)(vi)–2 of the Final Rule provides guidance on how to determine taxes for purposes of the disclosure required by § 1005.31(b)(1)(vi). Industry has requested further guidance on how to disclose foreign taxes where variables that influence the applicability of taxes are not easily knowable by the sender or the remittance transfer provider. Industry has expressed concern that under the current guidance, to determine the appropriate disclosure, providers may have to ask numerous questions of senders that senders may not understand, and to which senders may not know the answer.
The Bureau agrees that there may be certain variables that a sender and a remittance transfer provider may not reasonably be expected to know, and that further guidance is appropriate. The Bureau believes that providing an additional mechanism for disclosing foreign taxes will facilitate compliance with the rule. Thus, the Bureau believes it is appropriate to exercise its exception authority under section 904(c) of the EFTA to propose a new permanent exception in § 1005.32(b)(3). Proposed § 1005.32(b)(3) states that, for purposes of determining the taxes to be disclosed under § 1005.31(b)(1)(vi), if a provider does not have specific knowledge regarding variables that affect the amount of taxes imposed by a person other than the provider, the provider may disclose the highest possible tax that could be imposed on the remittance transfer with respect to any unknown variable.
Proposed comment 32(b)(3)–1 clarifies the exception. The proposed comment explains that the amount of taxes imposed by a person other than the provider may depend on certain variables. Under proposed § 1005.32(b)(3), a provider may disclose the highest possible tax that could be imposed on the remittance transfer with respect to any unknown variable. For example, if a tax may vary based upon whether a recipient's institution is grandfathered under existing law, or whether the recipient has reached a transaction threshold above which taxes are assessed, the provider may simply assume that the tax applies without having to ask the sender first. In such a case, the proposed comment explains that the provider should disclose the
The Bureau believes that permitting remittance transfer providers to make assumptions about variables as a distinct alternative to asking senders for information (as discussed in comment 31(b)(1)(vi)–2) would provide additional flexibility and would resolve concerns about senders not understanding or knowing the answer to questions about the variables. Permitting providers to disclose the highest possible tax that could be imposed also would allow providers to make assumptions about variables that providers themselves do not know, such as those discussed in the proposed examples. As a result, the Bureau believes that proposed § 1005.32(b)(3) would provide a more practicable mechanism for disclosing foreign taxes than current comment 31(b)(1)(vi)–2, discussed above.
Even with these proposed changes, senders would continue to receive tax disclosures. The Bureau believes it is appropriate to continue to focus the guidance on providing the highest possible tax that could be imposed, so that the sender is not surprised by a deduction for taxes that is larger than the amount disclosed (except in cases in which taxes other than those imposed by central governments may apply).
In addition to factual questions regarding variables, industry has also expressed concern about remittance transfer providers' ability to determine the applicable foreign tax given variations in the application of foreign tax requirements. For example, industry has suggested that foreign payout agents or recipient institutions may interpret and apply foreign tax requirements differently from one another, which may result in some uncertainty around whether a tax will be assessed, and if so, what precisely it will be. Thus, proposed comment 32(b)(3)–1 states that if the provider expects that variations may result from differing interpretations of law or regulation by the paying agent or recipient institution, the provider may assume that the highest possible tax that could be imposed applies. Under this proposed revision, providers would continue to be responsible for researching and identifying applicable foreign tax laws assessed by a country's central government. However, the proposed revision would provide flexibility by allowing providers to disclose the highest amount revealed by their research.
Under the Final Rule and this proposal, providers generally must provide accurate tax information. While the Bureau expects that changes in foreign tax law are generally announced in advance of their effective date, thus affording providers time to update their disclosures, the Bureau is concerned that this may not always be the case. The Bureau therefore requests comment on whether the Final Rule should be revised to incorporate a grace period for implementing changes in foreign tax law, and if so, how long.
As noted above, the Final Rule did not provide guidance on how to determine fees imposed by the designated recipient's institution for receiving the transfer in an account. As with foreign taxes, industry has expressed concern that in some cases, a remittance transfer provider would not know whether the recipient has agreed to pay such fees or how much the recipient may have agreed to pay. Industry has also requested clarification on whether and how to disclose recipient institution fees that can vary based on the recipient's status with the institution, the quantity of transfers received, or other variables that are not easily knowable by the sender or the provider. Without further guidance and flexibility, industry has argued that the requirement to disclose recipient institution fees is impracticable, which could drive providers to exit the market or significantly reduce their offerings.
The Bureau acknowledges these concerns and agrees that, for recipient institution fees that are specifically related to a remittance transfer and therefore required to be disclosed, additional flexibility in determining how to disclose these fees would facilitate compliance with the rule without significantly undermining its benefits. Accordingly, the Bureau believes it is appropriate to exercise its exception authority under section 904(c) of the EFTA to propose a new § 1005.32(b)(4). Proposed § 1005.32(b)(4)(i) would state that, for purposes of determining the fees to be disclosed under § 1005.31(b)(1)(vi), if a remittance transfer provider does not have specific knowledge regarding variables that affect the amount of fees imposed by a designated recipient's institution for receiving a transfer in an account, the provider may disclose the highest possible recipient institution fees that could be imposed on the remittance transfer with respect to any unknown variable, as determined based on either fee schedules made available by the recipient institution or information ascertained from prior transfers to the same recipient institution. Proposed comment 32(b)(4)–1 explains proposed § 1005.32(b)(4)(i) and adds as an example that if a provider relies on an institution's fee schedules, and the institution offers three accounts with different incoming wire fees, the provider should take the highest fee and use that as the basis for disclosure.
Proposed § 1005.32(b)(4)(ii) states that, if the provider cannot obtain such fee schedules or does not have such information, a provider may rely on other reasonable sources of information, if the provider discloses the highest fees identified through the relied-upon source. Proposed comment 32(b)(4)–2 states that reasonable sources of information include: Fee schedules published by competitor institutions; surveys of financial institution fees; or information provided by the recipient institution's regulator or central bank.
Proposed § 1005.32(b)(4) would only address fees for receiving transfers in an account that are based on an agreement between the recipient institution and the recipient. Currently, determination of these fees by originating providers (whether depository or non-depository) is particularly difficult or impracticable due to the nature of open networks. In contrast, providers using closed networks can generally exercise some control over transfers from end-to-end and are often not making transfers into accounts, making determination of fees assessed by payout agents more practicable.
The proposed mechanism for determining these fees differs from the mechanism in proposed § 1005.32(b)(3) for determining foreign taxes in recognition of the fact that, while identifying applicable foreign taxes presents challenges, these taxes are based on laws or regulations that are generally publicly available in some form, even if information may be
The Bureau further believes that a recipient institution's fee schedule, and information ascertained from prior transfers to the same recipient institution, are likely the best resources for estimating the fees that would be applicable to a remittance transfer, and thus providers should rely upon those sources, if available. However, in some cases, foreign institutions may not be willing to share institution-level fee schedules, or such schedules may not be easily obtainable. Accordingly, the proposed rule provides for alternative reasonable sources of information upon which providers can rely.
The Bureau acknowledges that permitting providers to base disclosures on sources other than institution-specific sources may result in a provider disclosing fees that underestimate those charged by an individual recipient institution. Nonetheless, the Bureau believes that the sources of information set out in the proposed comment should result in a reasonable approximation of the amount of fees that could be assessed, and provide the sender sufficient information about the amount to be received. For example, competitor institutions likely charge fees within a similar range as the recipient institution, and thus their fee schedules may provide an indication as to market practice. Further, the Bureau believes that the flexibility provided by the proposed rule and related comment should encourage providers to remain in the market. The Bureau solicits comment on whether the sources of information set forth in proposed § 1005.32(b)(4) and proposed comment 32(b)(4)–1 should be included, and whether additional reasonable sources of information should be added. In any case, for similar reasons, as discussed above with respect to proposed § 1005.32(b)(3), the Bureau believes that it is appropriate to focus the guidance on providing the highest possible fees that could be imposed.
As proposed, the sources of information set forth in proposed § 1005.32(b)(4) and the related commentary are not time-limited. The Bureau believes that reliance on the most updated source would provide the sender with the best information. However, the Bureau is concerned that imposing a duty to update relied-upon sources on a frequent basis could become unduly burdensome, particularly as providers are working to implement the rule, and because resources collecting this information have not yet fully developed or become widely available to providers. The Bureau solicits comment on whether reasonable sources of information should be time-limited. For example, should the rule require relied-upon fee schedules to have been published or confirmed as valid within the last year?
Even if proposed § 1005.32(b)(4) is adopted, senders will continue to receive fee disclosures. Some remittance transfer providers have suggested that the Bureau exercise its exception authority under the EFTA to eliminate the requirement to disclose recipient institution fees mandated by the statute. As stated in the February Final Rule, the Bureau believes that this fee information provides valuable consumer benefits by ensuring that senders are aware of the impact of back-end fees, including knowing whether the amount received will be sufficient to pay important expenses. These disclosures also provide senders with greater transparency regarding the costs of remittance transfers, and assist senders in comparing costs among providers, for example, where such fees may impact a sender's decision whether to send funds for cash pick-up or to an account, or where a recipient may have accounts at different institutions and the sender is deciding to which account to send funds.
Further, eliminating the requirement to disclose recipient institution fees would create inconsistency between the disclosures provided for transfers where fees are imposed by a designated recipient's institution for receiving a transfer in an account, and those provided for other types of transfers, such as where fees are charged by paying agents, regarding which the Bureau does not think it is appropriate to adjust the requirement under the Final Rule. Notably, during the Federal Reserve Board's consumer testing on remittances, consumer participants cited unexpected third-party fees as a source of concern.
EFTA section 919(d) provides that remittance transfer providers shall investigate and resolve errors where a sender provides a notice of an error within 180 days of the promised date of delivery of a remittance transfer. The statute generally does not define what types of transfers and inquiries constitute errors, but rather gives the Bureau the authority to define “error” and to prescribe standards for the error resolution process. In the Final Rule, the Bureau adopted § 1005.33 to implement new error resolution requirements for remittance transfers.
Since the issuance of the Final Rule, industry has expressed concerns about the remedies available when a sender of a remittance transfer provides an incorrect account number to the remittance transfer provider. Providers have stated that in some cases, a remittance transfer may be deposited into the wrong account and, despite reasonable efforts, cannot be recovered. Under the Final Rule, a provider is obligated to resend or refund the total amount of the remittance transfer regardless of whether it can recover the funds. Industry has noted that this problem is of particular concern with respect to transfers of large sums, particularly for smaller institutions that might have more difficulty bearing the cost of the entire transfer amount. In addition, providers have expressed concern that the Final Rule creates a potential for fraud, despite an exception in the Final Rule for fraud.
The Bureau is also proposing several other changes to the error resolution procedures in § 1005.33 to address questions about how remittance transfer providers should provide remedies to senders under the Final Rule's error resolution provisions, and to streamline providers' provision of remedies. In addition, the Bureau is proposing conforming changes to the error resolution procedures in light of proposed revisions regarding the disclosure of foreign taxes and recipient
Section 1005.33(a)(1) lists the type of transfers or inquiries that constitute “errors” under the Final Rule. The types of errors relevant to this proposal are discussed in detail below.
The Bureau proposes to revise comment 33(a)–4 to make technical corrections to the comment. Comment 33(a)–4, which addresses the extraordinary circumstances exception to the error defined in § 1005.33(a)(1)(iii), improperly cites to § 1005.33(a)(1)(iv) instead of § 1005.33(a)(1)(iii)(B). The proposed revisions to comment 33(a)–4 correct this error and a related error regarding the description of the exception.
Section 1005.33(a)(1)(iv) defines “error” to include a remittance transfer provider's failure to make funds available to the designated recipient by the date of availability stated on the receipt or combined disclosure, subject to three listed exceptions, including an exception for remittance transfers made with fraudulent intent by the sender or any person acting in concert with the sender.
Although several industry commenters had objected that remittance transfer providers should not have to bear the cost of mistakes caused by parties outside the provider's control, the Bureau noted in the February Final Rule that a number of other federal consumer financial protection regimes require financial service providers to investigate and correct errors for which they may not be at fault. The Bureau also noted that providers are generally in a better position than consumers to identify errors and to seek recovery from downstream institutions. Furthermore, the Bureau noted that placing responsibility on providers to resolve errors strengthens their incentives to develop policies, procedures, and controls to reduce and minimize errors in the first instance and similarly to work with downstream institutions and business partners to improve controls and to develop contractual solutions to address errors.
In particular, however, with regard to situations in which the sender provides incorrect or insufficient information, the Bureau acknowledged that there were unique equities. Specifically, the Bureau concluded that it was important that error resolution procedures apply to such cases, but also agreed with commenters that a sender's mistake should not obligate a remittance transfer provider to bear all of the costs for resending a transfer, including the principal transfer amount. Accordingly, the Final Rule sets forth special remedy provisions that allow providers to collect third-party fees a second time when resending a remittance transfer that had previously not been delivered due to incorrect or insufficient information provided by the sender.
The Final Rule does not differentiate, however, between those situations where the sender's mistake regarding the account number results in a deposit to the wrong account and those situations in which the remittance transfer simply does not go through. In the former situation, where the transfer results in a deposit into the wrong account, if a remittance transfer provider is unable to recover the money from the account after working with the recipient institution, the Final Rule requires that the provider, at its own expense, resend or refund the funds, depending on which remedy was selected by the sender. The Bureau noted that situations in which funds cannot be recovered after a deposit to the wrong account appear to be quite rare, and explained that it believed that the approach adopted with respect to errors by senders would encourage providers and other involved parties to develop security procedures to limit further the risk of funds being deposited in an account when the designated recipient named in the receipt does not match the name associated with the account number. In addition, the Bureau expected that the exception for transfers made with fraudulent intent by the sender or those working in concert with the sender in § 1005.33(a)(1)(iv)(C) of the Final Rule would address industry's concerns about the risk of fraud created by the error rules.
Nevertheless, upon further analysis, and for the reasons discussed below, the Bureau is proposing to revise the definition of error in § 1005.33(a)(1)(iv) by adding a fourth, conditional exception. Proposed § 1005.33(a)(1)(iv)(D) would exclude from the definition of error a failure to make funds available to the designated recipient by the disclosed date of availability, where such failure results from the sender having given the remittance transfer provider an incorrect account number, provided that the provider meets the conditions set forth in proposed § 1005.33(h). These conditions, discussed in detail below, would require providers to notify senders of the risk that their funds could be lost, to investigate reported errors, and to attempt to recover funds that are deposited in the wrong account. However, if the proposed exception applies, providers would not be required to bear the cost of refunding or resending transfers if funds ultimately could not be recovered.
Since the Bureau published the February Final Rule, it has monitored industry's efforts towards implementing the rule. Industry has elaborated on its concerns expressed during the initial comment period that the systems used to send remittance transfers to foreign accounts do not allow remittance transfer providers to verify designated recipients' account numbers before remittance transfers are sent. More generally, many providers have also reported that they have not yet developed security procedures that enable them to be able to confirm the accuracy of account numbers provided by senders before sending a transfer.
Remittance transfer providers have explained that they send remittance transfers to accounts through a number of different systems. In many of these systems, intermediary and receiving institutions are permitted to rely on the account number provided by the sender of the remittance transfer to route the transfer. In using these systems, providers, as well as intermediary and recipient institutions, often do not cross-check account numbers with the name of the accountholder or other identifier in the remittance transfer to confirm that they match before transmitting or crediting the transfer to an account. Furthermore, providers and intermediary institutions' systems are designed to allow straight-through processing, whereby they process incoming transfers using automated systems that rely on account numbers and not the name of the recipient. Even where straight-through processing is not used, it may be common for providers and intermediary and recipient institutions to rely, as a matter of practice, on account numbers because it may be challenging for a foreign institution to verify a name on a payment order from the United States due to spelling and language variances,
The Bureau, therefore, believes that the proposed changes will more closely match existing practice. To the extent remittance transfer providers' existing methods for sending transfers do not allow or facilitate verification of account numbers before sending the remittance transfer, the Bureau is aware that individual providers, particularly smaller providers, sending transfers through an open network have limited ability to influence these global systems in the short term. The Bureau continues to believe it is important for industry to develop improved security procedures and expects to engage in a dialogue with industry about how to encourage the growth of improved controls and communication mechanisms, but the Bureau understands that such changes are unlikely to be implemented in the near future. The Bureau believes an interim disruption would not be in consumers' best interests and will instead continue to evaluate the development of procedures as it monitors providers' implementation of the rule.
Where there is a deposit into the wrong account, the Bureau believes that many, if not most, remittance transfer providers already attempt to recover the principal amount of the transfer. However, because providers have reported that they often do not have direct relationships with receiving institutions and that in some instances those institutions may be unresponsive, providers may face difficulties in recovering funds from the wrong account. The Bureau believes that, in many instances, to reverse these transactions requires the accountholder to authorize a debit from the account and, thus, the lack of this authority may prohibit a recipient institution from debiting the account in the amount of the incorrect deposit absent an authorization. Relatedly, a provider in the United States may be able to do little to assist the foreign institution in its attempt to persuade its accountholder to provide debit authorization due to the lack of privity between the provider and the recipient institution or the accountholder.
In addition to these concerns, the Bureau also believes that the proposed changes will adhere more closely state law as it existed prior to EFTA § 919. In particular, Uniform Commercial Code (UCC) Article 4A covers the transfer of money between banks, including transfers by banks on behalf of customers, and into institutions have incorporated many of its provisions into existing policies and disclosures to customers.
Remittance transfer providers have also stated that the Final Rule's fraud exception in § 1005.33(a)(1)(iv)(C) is difficult to apply in practice because, due to their limited ability to know what occurs at a recipient's institution, a provider may have difficulty determining whether the holder of an account into which a transfer was mis-deposited is attempting to commit a fraud, including by working in concert with the sender. Although providers do not believe such fraud is widespread today, they have expressed concerns that the Final Rule will enable fraudulent activity to flourish because providers may have to send the transfer amount again without first recovering it from the foreign institution, which is a departure from current practice.
To the extent remittance transfer providers believe they can neither verify account numbers nor prevent fraud, many have indicated that they may limit which of their customers can send remittance transfers and/or the value of those transfers or even withdraw from the market altogether. Absent such limitations (or even despite them), some providers have indicated to the Bureau that they may have difficulties managing the risk posed by this part of the Final Rule. Particularly for smaller institutions, the impact of even one large transaction where the provider would have to resend or refund funds it did not recover, could be substantial.
That said, the Bureau does harbor some doubts about the extent of the fraud risk posed by the Final Rule. To be successful, a sender with fraudulent intent would first need to supply funds for the initial transfer and then report an error. If the provider claimed that the sender acted with fraudulent intent, the fraudulent sender would need to pursue his or her claim in court, something the Bureau believes many criminals are unlikely to do.
Additionally, the Bureau believes that deposits into the wrong account resulting from a sender's error that cannot be recovered occur relatively infrequently today, largely due to three factors. First, remittance transfer providers typically take steps to ensure that senders carefully enter and review account numbers. Second, most incorrect account numbers do not correspond to an actual account at the recipient's institution. In those situations, the Bureau understands that the transactions are typically reversed and the funds returned. Third, the Bureau understands that some recipient institutions take further measures to limit transfers being deposited into the wrong account, such as by developing systems that allow for additional verification of account numbers or by working with senders to improve accuracy at the time transfers are requested.
Nevertheless, the Bureau understands that the uncertainty created by existing § 1005.33(a)(1)(iv), if left unchanged, could decrease consumers' access to remittance transfers if a number of remittance transfer providers exit the market rather than risk liability, or limit their service offerings in order to minimize their exposure. Overall, the Bureau intends for proposed revisions to create appropriate incentives for providers to prevent these errors from occurring and to assist senders as much as practicable if an incorrect deposit occurs, while relieving tension with other laws and existing practice and reducing risk to providers. The Bureau thus seeks comment on whether proposed § 1005.33(a)(1)(iv)(D) achieves these goals, or whether the existing rules or another alternative is preferable.
To clarify the application of this new exception, the Bureau is also proposing new comment 33(a)–7. Proposed comment 33(a)–7 provides that the exception in proposed § 1005.33(a)(1)(iv)(D) applies where a sender gives the remittance transfer provider an incorrect account number that results in the deposit of the remittance transfer into a customer's account at the recipient institution other than the designated recipient's account. The proposed comment further provides that this exception does not apply
The Bureau is limiting the scope of proposed § 1005.33(a)(1)(iv)(D) because the Bureau believes that, compared to other types of sender mistakes, the provision of an incorrect account number poses unique problems for remittance transfer providers, in that such incorrect information may result in remittance transfers being deposited into the wrong account. In particular, the proposed exception does not include a sender's provision of an incorrect routing number designating the recipient institution. The Bureau believes that in many instances, providers either already verify routing numbers or are in a position to do so when sending transfers to accounts. However, the Bureau seeks comment on whether the concerns identified above regarding incorrect account numbers apply equally to incorrect routing numbers, and if so, whether the proposed exception should be expanded to include a sender's provision of an incorrect routing number.
Similarly, the Bureau believes that other types of sender mistakes in connection with transfers to accounts also do not pose the same risks as incorrect account numbers, because remittance transfers with other types of mistakes are unlikely to result in a deposit in the wrong account. Thus, it should be significantly easier for a remittance transfer provider to unwind the transfer under the existing error resolution procedures. For example, where a sender misidentifies the designated recipient or the designated recipient's institution but provides a correct account number, the Bureau believes that the remittance transfer is still likely to be deposited into the designated recipient's account, due to the practice of relying on account numbers rather than this other information, as described above. Accordingly, the Bureau does not believe such mistakes by a sender are likely to result in a deposit into the wrong account or other “error” as defined under the regulation. Nor does the Bureau think that mistakes by senders in connection with transfers that are not deposited into accounts pose these problems, because these transfers generally do not involve unverified information, such as account numbers. Nevertheless, the Bureau also seeks comment on whether other types of mistakes by senders pose a similar risk to providers as a mistake in providing an incorrect account number and whether modified remedies would be appropriate.
Section 1005.33(a)(2) and the accompanying commentary address circumstances that do not constitute errors in the Final Rule. Section 1005.33(a)(2)(iv) of the Final Rule provides that an error does not include a change in the amount or type of currency received by the designated recipient from the amount or type of currency stated in the disclosure provided to the sender under § 1005.31(b)(2) or (3), if the remittance transfer provider relied on information provided by the sender as permitted by the commentary accompanying § 1005.31 in making such disclosure. Comment 33(a)–8 of the Final Rule provides two illustrative examples, including that, where a provider relies on the sender's representations regarding variables that affect the amount of taxes imposed by a person other than the provider for purposes of determining these taxes, the change in the amount of currency the designated recipient actually receives due to the taxes actually imposed does not constitute an error.
Given the proposed revisions to § 1005.31(b)(1)(vi) and the accompanying commentary, the proposed rule would make consistent revisions to § 1005.33(a)(2)(iv) and comment 33(a)–8 (redesignated as comment 33(a)–9) and other non-substantive revisions for clarity.
Revised comment 33(a)–9 would explain that under § 1005.31(b)(1)(vi), providers need not disclose regional, provincial, state, or other local foreign taxes. Further, under the commentary accompanying § 1005.31, the remittance transfer provider may rely on the sender's representations in making certain disclosures. The revised comment would explain that any discrepancy between the amount disclosed and the actual amount received resulting from the provider's reliance upon these provisions does not constitute an error under § 1005.33(a)(2)(iv). The proposed comment would revise the illustrative example to explain that, if the provider relies on the sender's representations regarding variables that affect the amount of recipient institution fees or taxes imposed by a person other than the provider for purposes of determining fees or taxes required to be disclosed under § 1005.31(b)(1)(vi), or does not disclose regional, provincial, state, or other local foreign taxes, as permitted by § 1005.31(b)(1)(vi), the change in the amount of currency the designated recipient actually receives due to the recipient institution fees or foreign taxes actually imposed does not constitute an error. The proposed revision to the comment also makes conforming changes to internal cross-references and other minor, non-substantive edits for clarity.
Section 1005.33(c)(2) implements EFTA section 919(d)(1)(B) and establishes procedures and remedies for correcting an error under the rule. In particular, where there has been an error under § 1005.31(a)(1)(iv) for failure to make funds available to a designated recipient by the disclosed date of availability, § 1005.33(c)(2)(ii) permits a sender to choose either: (1) to obtain a refund of the amount tendered in connection with the remittance transfer that was not properly transmitted, or an amount appropriate to resolve the error, or (2) to have the remittance transfer provider resend to the designated recipient the amount appropriate to resolve the error, at no additional cost to the sender or designated recipient.
Comment 33(c)–2 in the Final Rule provides additional guidance regarding remedies in circumstances where a remittance transfer provider's failure to make funds available to a designated recipient by the disclosed date of availability occurred because the sender provided incorrect or insufficient information in connection with the transfer. The comment then gives, as one example of incorrect or insufficient information provided by a sender, a sender erroneously identifying the recipient's account number. In light of
In addition, existing comment 33(c)–2 also explains the procedure for resending funds when an error occurred due to incorrect or insufficient information provided by the sender. The procedure explained in comment 33(c)–2 is distinct from the procedure used for all other situations in which funds are to be resent to resolve an error. For most of these other errors, comment 33(c)–3 explains that the resend is to occur at no additional cost to the sender and that the provider is to apply the same exchange rate, fees and taxes stated in the disclosure provided under § 1005.31(b)(2) or (3). By contrast, existing comment 33(c)–2 explains that for errors under § 1005.33(a)(1)(iv), where the error occurred due to incorrect or insufficient information provided by the sender, a request to resend is a request for a remittance transfer, that the provider must provide the disclosures required by § 1005.31 for a resend, and that the provider must use the exchange rate it is using for such transfers on the date of the resend if funds were not already exchanged in the first unsuccessful remittance transfer attempt.
Since the Bureau issued the Final Rule, industry has requested more guidance as to the timing and content of the disclosures that must be provided for resends following errors that occurred because a sender provided incorrect or insufficient information. Specifically, industry has asked how to provide disclosures where a sender either designates a remedy at the time that the sender reports the error or never designates a remedy, particularly in situations where the provider does not make direct contact with the sender when providing a § 1005.33(c)(1) report.
In addition, as originally adopted, comment 33(c)–2 has created uncertainty for remittance transfer providers, as it does not provide guidance on how or when to provide the § 1005.31 disclosures to senders, how providers can reasonably ensure the accuracy of the disclosures to the extent providers must disclose and guarantee an exchange rate for the resend, and how providers should administer senders' cancellation rights. Specifically, the Final Rule may not have adequately addressed potential operational tensions between the timing and accuracy provisions in §§ 1005.31(e) and (f), as referenced in comment 33(c)–2, and comments 33(c)–3 and 33(c)–4. Comment 33(c)–3 explains that a sender may designate a remedy when first reporting an error, while comment 33(c)–4 explains that a provider may implement a default remedy if a sender does not select one. To address these issues, the proposed rule proposes additional revisions to comment 33(c)–2, adds proposed § 1005.33(c)(3), which provides for streamlined disclosures, and adds new comment 33(c)–11 explaining the proposed provision.
First, the Bureau proposes to make additional revisions to comment 33(c)–2. As noted, the existing comment states that a request to resend is a request for a remittance transfer and, therefore, that a remittance transfer provider must provide the disclosures required by § 1005.31 for a resend of a remittance transfer. Further, the comment states that the provider must use the exchange rate it is using for such transfers on the date of the resend if funds were not already exchanged in the first unsuccessful remittance transfer attempt. The proposed revision deletes the bulk of these references, retaining only the language stating that a provider should use the exchange rate on the date of the resend when resending the funds and clarifies that this is only necessary to the extent currency must be exchanged when resending the funds. The Bureau also proposes to revise a corresponding reference in § 1005.33(c)(2)(ii)(A)(
Second, in lieu of the above-referenced language in comment 33(c)–2 that states that a request to resend is a request for a remittance transfer, the Bureau proposes to add new § 1005.33(c)(3). Proposed § 1005.33(c)(3) provides that if an error under § 1005.33(a)(1)(iv) occurred because the sender provided incorrect or insufficient information, and if the sender has not previously designated a refund remedy pursuant to § 1005.33(c)(2)(ii)(A)(
Proposed § 1005.33(c)(3)(i) provides that if the remittance transfer provider does not make direct contact with the sender when providing the report required by § 1005.33(c)(1), the provider shall provide, orally or in writing, as applicable, the following disclosures: (A) The disclosures required by §§ 1005.31(b)(2)(i) through (iii) for remittance transfers and the date the provider will complete the resend, using the term “Transfer Date” or a substantially similar term.
The Bureau expects that proposed § 1005.33(c)(3) and the proposed changes to the commentary would facilitate compliance in a number of ways. First, if remittance transfer providers are unable to directly contact the sender when providing the error report, the transfer date would generally be set in the future and the provider
At the same time, the proposed changes would ensure that senders receive notice and an ability to cancel in cases in which the exchange rate that would be applied to the resent remittance transfer is not the rate that was initially disclosed to the sender (even if the sender has already chosen to have the funds resent).
Proposed § 1005.33(c)(3)(i) will allow remittance transfer providers to set a future date of transfer, and to disclose estimates pursuant to § 1005.32(b)(2) if the provider does not make direct contact with the sender.
The Bureau is not proposing to require the disclosures in proposed § 1005.33(c)(3) every time a remittance transfer provider resends funds when remedying an error. Rather, the Bureau intends that disclosures pursuant to proposed § 1005.33(c)(3) are only required if the exchange rate used for the resent remittance transfer is not the exchange rate originally disclosed and currency must be exchanged to complete the resend. Moreover, a resend under this proposed provision can only occur when the error occurred due to incorrect or insufficient information provided by the sender.
The Bureau is also proposing a conforming change to § 1005.33(c)(2), to allow for situations in which proposed § 1005.33(c)(3)(i) permits resends to occur later than one business day after, or as soon as reasonably practicable, after receiving the sender's instructions or the provider determines an error had occurred. Separately, the Bureau notes that in the Final Rule, § 1005.33(c)(2)(ii)(A)(2) allows a provider to impose third party fees for resending the remittance transfer when an error occurred because the sender provided incorrect or insufficient information. The Bureau seeks comment on whether the provider should also be permitted to also impose taxes incurred when resending funds for the same reason.
Finally, proposed comment 33(c)–11 explains that the disclosures in proposed § 1005.33(c)(3) need not be provided either if the sender has elected a refund remedy or if the remittance transfer provider's default remedy is a refund and the sender has not selected a remedy prior to the time the provider is providing the § 1005.33(c)(1) report. Furthermore, to the extent that the resend is not properly transmitted, the initial error has not been resolved and the provider's duty to resolve it remains not fully satisfied. Proposed comment 33(c)–11.i further clarifies that, for purposes of determining the date of transfer for disclosures made in accordance with proposed § 1005.33(c)(3)(i), if the provider is unable to speak to or otherwise make direct contact with the sender, the provider may use the same date on which it would provide a default remedy (
To illustrate, assume that when an error is first reported, a sender elects to have the remittance transfer provider resend the funds should an error be found to have occurred. Upon completion of the investigation, the provider provides an oral or written report on February 1, in accordance with § 1005.33(c)(1), informing the sender that an error occurred and that it was a result of incorrect information provided by the sender, that currency must be exchanged on the resend, and thus the exchange rate may change. At the same time and if no direct contact is made, pursuant to proposed § 1005.33(c)(3)(i), the provider will also deliver notice that it will resend the remittance transfer on February 12 (assuming that is a business day) and that a sender's request to cancel must be received by three business days prior to the date of transfer. If necessary, the provider also would disclose the estimated exchange rate pursuant to § 1005.32(b)(2), among other required items. Any time before February 9 (the deadline to exercise cancellation rights), the sender may contact the provider and request that the remittance transfer be completed within one business day, if reasonably possible. If earlier resend occurs, the provider will then provide the disclosures required by proposed § 1005.33(c)(ii). If the sender does not contact the provider, the funds will be resent, as disclosed, on February 12.
The Bureau seeks comment on whether, in lieu of the proposed regime outlined above, the Bureau should adjust the procedure for resending funds
The Bureau proposes to add a new § 1005.33(h), which would contain the conditions a remittance transfer provider must satisfy before the new exception to the definition of error in proposed § 1005.33(a)(1)(iv)(D) could apply to situations in which a sender provides a wrong account number, which results in a mis-deposit. Proposed § 1005.33(h) provides that no error has occurred pursuant to § 1005.33(a)(1)(iv) for the failure to make funds available to a designated recipient by the date of availability stated in the disclosure provided pursuant to § 1005.31(b)(2) or (3) if the provider can satisfy each of the conditions in proposed §§ 1005.33(h)(1) through (4).
Proposed § 1005.33(h)(1) provides the first condition that must be met for no error to have occurred pursuant to proposed § 1005.33(a)(1)(iv)(D). Specifically, this condition could be satisfied if the remittance transfer provider can demonstrate that the sender provided an incorrect account number to the provider in connection with the remittance transfer. Under proposed § 1005.33(h)(1), if the provider did not know or could not demonstrate that the sender provided an improper account number, then the failure to deliver the transfer by the promised date of availability because of an incorrect account number would continue to be an error to which existing error procedures and remedies would apply. The Bureau does not believe that this is a substantial change from the existing rule, which already provides an incentive for providers to document whether the sender has provided inaccurate information in order to invoke the ability to charge certain related fees in connection with the resent transaction.
Proposed § 1005.33(h)(2) contains the second condition, which is that the remittance transfer provider be able to demonstrate that the sender had notice that, in the event the sender provided an incorrect account number, that the sender could lose the transfer amount. The Bureau believes it is important for senders to be notified that they could potentially be required to bear the cost of providing an incorrect account number. The Bureau understands that many providers' current practices incorporate such a notice to senders in their disclosures in connection with their obligation under UCC Article 4A. In particular, under UCC 4A–207, a sender cannot bear the cost of a mistake if the provider did not notify the sender that the payment on the transfer order might be made even if the sender's account number specifies a person different from the named beneficiary. The UCC does not specify the form of the notice.
Proposed § 1005.33(h)(3) provides the third condition for the exception in proposed § 1005.33(a)(1)(iv)(D) to apply. It provides that the incorrect account number resulted in the deposit of the remittance transfer into a customer's account at the recipient institution other than the designated recipient's account. The Bureau believes that once a remittance transfer is deposited into the wrong account, a remittance transfer provider is much less likely to be able to recover the funds. The Bureau does not believe that similar concerns exist for transfers that are sent to accounts and are either rejected by the recipient institution or otherwise reversed before deposit. In such cases, the Bureau believes that the provider would be much more likely to be able to recover the funds and either refund or resend the transfer and the proposed exception in proposed § 1005.33(a)(1)(iv)(D) would be unnecessary.
Proposed § 1005.33(h)(4) provides the fourth condition for the exception in proposed § 1005.33(a)(1)(iv)(D) to apply. It states that a remittance transfer provider to promptly use reasonable efforts to recover the amount that was to be received by the designated recipient. Currently, the Bureau believes that as a customer service, many providers attempt to recover transfers even when they are not transfer deposited into the correct account. Thus, the Bureau does not believe proposed § 1005.33(h)(4) constitutes a significant departure from market practice in many cases today.
Proposed comment 33(h)–1 explains that proposed § 1005.33(h)(4) requires a remittance transfer provider to use reasonable efforts to recover the amount that was to be received by the designated recipient. Whether a provider has used reasonable efforts does not depend on whether the provider is ultimately successful in recovering the amount that was to be received by the designated recipient. The proposed comment accounts for the fact that the options available to a provider to recover funds may vary depending on the method used to send the remittance transfer, the destination of the remittance transfer, the provider's relationship with the receiving institution, and when and by whom the error was discovered. The proposed comment also provides examples of how a provider might use reasonable efforts: (i) The provider promptly calls or otherwise contacts the recipient's institution, either directly or indirectly through any correspondent(s) or other intermediaries or service providers used for the particular transfer, to request that the amount that was to be received by the designated recipient be returned, and if required by law or contract, by requesting that the recipient institution obtain a debit authorization from the incorrectly credited accountholder; (ii) the provider promptly uses a messaging service through a funds transfer system to contact the recipient's institution, either directly or indirectly through any correspondent(s) or other intermediaries or service providers used for the particular transfer, to request that the amount that was to be received by the designated recipient be returned, in accordance with the messaging service's rules and protocol, and if required by law or contract, by requesting that the recipient institution obtain a debit authorization from the holder of the incorrectly credited account; and (iii) in addition to the methods outlined above, to the extent that a correspondent institution, other service providers to
The Bureau does not believe it is appropriate to propose specific methods that a remittance transfer provider must use to recover the funds due to the varying ways in which providers and other institutions communicate. For example, in many instances, financial institutions might use correspondent networks to send remittance transfers to designated recipients' accounts abroad. In these instances, the provider, its correspondent institution, other intermediary institutions, and possibly the recipient institution may communicate through a shared messaging system. It is through this system that a provider might attempt to recover a mis-deposited remittance transfer. In this circumstance, mandating other efforts—such as directly contacting the recipient's institution—might not be as feasible or productive, although in some instances, a provider might determine it to be reasonable to contact the foreign institution directly. The Bureau solicits comment on the proposed examples and whether there are additional examples of how a provider might use reasonable efforts to recover funds.
Finally, proposed comment 33(h)–2 explains that § 1005.33(c)(1) requires a remittance transfer provider to act promptly in using reasonable efforts to recover the amount that was to be received by the designated recipient. While promptness may depend on the circumstances, generally a provider acts promptly when it does not delay in seeking recovery of the mis-deposited funds. For example, if the sender informs the provider of the error before the date of availability disclosed pursuant to § 1005.31(b)(2)(ii), the provider should act to contact the recipient's institution before the date of delivery, if possible, as doing so may prevent the funds from being mis-deposited. In other circumstances as well, prompt reasonable efforts will increase the chances that the funds remain in the incorrect account. Generally, the Bureau believes that providers will be more successful in securing the return of mis-deposited funds if providers act quickly.
Given the proposed revisions to § 1005.31(b)(1)(vi) and new proposed §§ 1005.32(b)(3) and (4), conforming revisions are proposed in the following provisions of the Final Rule as necessary: § 1005.36(b)(3); comment 32–1; comment 32(d)–1; comment 33(a)–3.ii; and comment 36(b)–3.
The Final Rule is scheduled to be effective on February 7, 2013, which is one year after publication of the February Final Rule in the
First, the Bureau is proposing to temporarily delay the effective date of the Final Rule until the Bureau finalizes this proposal. The Bureau realizes that regardless of how or whether the Final Rule is changed, remittance transfer providers' preparations for its implementation may be affected until the Bureau finalizes the rule. The Bureau seeks comment on the proposal to temporarily delay the effective date of the Final Rule, by issuing a temporary extension before February 7, 2013. The Bureau requests comment on this aspect of the proposed rule only by January 15, 2013.
Second, the Bureau is also proposing that the Final Rule, and any revisions thereto resulting from this proposal, would become effective 90 days after the Bureau finalizes this proposal. Given the limited scope of the proposed revisions, the Bureau believes that this 90-day period will be sufficient for providers to implement any necessary changes to their systems. The Bureau also believes that providers should be working toward implementing those portions of the Final Rule unaffected by this proposal during the interim period, for instance by continuing to research foreign central governments' taxes. Thus, the Bureau believes that, apart from the temporary delay, this proposed 90-day extension period would balance the need for consumers to receive the protections afforded by the rule as quickly as possible with industry's need to make adjustments to comply with the provisions of the rule. The Bureau seeks comment on whether the rule should be effective 90 days after the Bureau finalizes this proposal.
In developing the proposed rule, the Bureau has considered potential benefits, costs, and impacts
The analysis below considers the benefits, costs, and impacts of the key provisions of the proposal against the baseline provided by the Final Rule. Those provisions regard: Recipient institution fees and foreign taxes, incorrect or insufficient information regarding transfers, and the effective date. With respect to these provisions, the analysis considers the benefits and costs to senders (consumers) and remittance transfer providers (covered persons).
The Bureau notes at the outset that quantification of the potential benefits, costs, and impacts of the proposal is not possible due to the lack of available data. As discussed in the February Final Rule, there is a limited amount of data about remittance transfers and remittance transfer providers that are publicly available and representative of the full market. Similarly, there are limited data on consumer behavior, which would be essential for quantifying the benefits or costs to consumers. Furthermore, the Final Rule is not yet effective and providers are still in the process of implementing its requirements. Therefore, the analysis generally provides a qualitative discussion of the benefits, costs, and impacts of the proposed rule. As discussed in more detail below, the Bureau expects that the proposed provisions will generally benefit providers by facilitating compliance, while maintaining the Final Rule's valuable new consumer protections and ensuring that these protections can be effectively delivered to consumers.
Compared to the Final Rule, the proposal would benefit remittance transfer providers by giving them options that could reduce the cost of providing required disclosures. Allowing providers to rely on senders' representations regarding certain recipient institution fees, or to estimate such fees and foreign taxes based on certain assumptions or sources of information would reduce the cost of preparing required disclosures. The proposal would further reduce the cost of gathering information by limiting providers' obligation to disclose foreign taxes to those imposed by a country's central government.
The proposed changes regarding fee and tax disclosures might additionally benefit remittance transfer providers by facilitating their continued participation in the market. Industry has suggested that due in part to the Final Rule's third party fee and foreign tax disclosure requirements, some providers might eliminate or reduce their remittance transfer offerings, such as by not sending transfers to countries where tax or fee information is particularly difficult to obtain, due to the lack of ongoing reliable and complete information sources. By reducing the amount of information needed to provide disclosures, the proposal could encourage more providers to retain their current services (and thus any associated profit, revenue and customers).
To take advantage of the new flexibility that would be provided by the proposed rule, some remittance transfer providers might choose to bear some modest cost to modify their systems to calculate disclosures using the new methods permitted by the proposal, or to describe certain disclosures using the term “Estimated” or a substantially similar term. However, the Bureau believes that any such cost would generally be small. Any modification would be to existing forms and systems changes would be particularly minimal for many providers, because the Final Rule already sets forth certain circumstances in which the term “Estimated” or a substantially similar term must be used. Furthermore, the Bureau expects that some providers may not have finished any systems modifications necessary to comply with the Final Rule, and thus may be able to incorporate any changes into previously planned work.
Any alternative disclosures could also impose costs on any providers that chose to take advantage of the flexibility permitted by the proposal. The relative magnitude would depend on the type of disclosure required. But in any case, these costs would be optional; providers could disclose fees and taxes as required by the Final Rule.
The Bureau expects that the proposed provisions regarding fee and tax disclosures would mostly affect depository institutions, credit unions, and broker-dealers that are remittance transfer providers. These types of providers tend to send most or all of their remittances transfers to foreign accounts, for which recipient institution fees may be charged. Furthermore, due to the mechanisms they use to send money, they generally have the ability to send transfers to virtually any destination country (for which tax research might be required). By contrast, money transmitters that are providers are more likely to send remittance transfers to be received in cash, for which recipient institution fees would not be relevant. Furthermore, most money transmitters, and particularly small ones, generally send transfers to a limited number of countries and institutions.
The proposed changes regarding recipient institution fees and foreign taxes would benefit senders to the extent that remittance transfer providers pass along any cost savings in the form of lower prices. Also, if the proposal facilitates providers' continued participation in the market, it would facilitate senders' access to remittance transfers, by giving them a wider set of options for sending transfers, preserving competition, and thus possibly avoiding increased prices.
The proposal might impose costs on senders to the extent that it makes disclosures less accurate, or if different remittance transfer providers were to use substantially different approaches to identifying the recipient institution fees or foreign taxes that would apply. Different approaches might make comparison shopping more difficult. Less accurate information could make it more difficult for a sender to know whether a designated recipient is going to receive an intended sum of money, or how much the sender must spend to deliver a specific amount of foreign currency to a recipient.
However, the Bureau expects that costs associated with reduced accuracy could be mitigated. First, the Bureau expects that competition might give providers incentives to disclose exact recipient institution fees and foreign taxes (at least those assessed by central governments) when reasonably possible, as in some cases this would allow providers to disclose lower fees and taxes than they would if they relied on the proposal's provisions. Second, in circumstances where providers did take advantage of the flexibility permitted by the proposal, senders might still be able to engage in comparison shopping. To the extent that different providers used similar information and assumptions to estimate foreign taxes and recipient institution fees, the disclosures that senders received would generally remain useful for determining which provider is cheapest or for making decisions that trade off cost for other considerations. Finally, if foreign subnational taxes are imposed less frequently and in smaller amounts than foreign taxes assessed by central governments, then the Bureau believes that even with the proposed changes to the Final Rule, senders generally would have the most important information about the prices of remittance transfers. Even though the proposal would allow providers to rely on fee information that may not be specific to a recipient institution, the proposal's focus on informing senders of the highest possible amount of foreign taxes or recipient institution fees that could be imposed would limit the circumstances in which senders might be surprised by deductions that are larger than what is disclosed. Senders would still generally receive a reasonable approximation of the foreign taxes and recipient institution fees that might be charged, and sufficient information to help them know whether they are sending enough money to cover recipients' needs.
The use of the term “Estimated” (or a substantially similar term) in cases in which subnational taxes were not disclosed or the new estimate provisions are used could aid senders, by indicating that disclosed amounts may differ from the amount received. But the use of the term “Estimated” in the vast majority of cases could impair senders' ability to compare disclosures and have an adverse impact on the exercise of error resolution rights because it is difficult to know the reasons why two disclosures with estimates differ. In instances in which subnational taxes were not disclosed, alternative methods of alerting senders that figures are not exact (or not requiring any such notice) might impose fewer costs on senders.
The proposal includes two sets of proposed changes related to errors caused by the provision of incorrect or insufficient information. It would create a new exception to the definition of error. It would also adjust the requirements for resending remittance transfers in certain situations in which funds may be resent to correct errors.
The exception to the definition of error would benefit remittance transfer providers in instances in which senders' account number mistakes, which would have resulted in errors under the Final Rule, would not constitute errors, provided that providers could satisfy the conditions enumerated in proposed § 1005.33(h). To the extent that the new exception applied, providers would no longer bear the costs of funds that they could not recover. The magnitude of the benefit would depend on the frequency of senders' account number mistakes that result in funds being deposited in the wrong account with the provider unable to recover funds, and the sizes of those lost transfers.
Remittance transfer providers might further benefit if the proposal reduced the potential for fraudulent account number mistakes made by unscrupulous senders, which providers have cited as a risk under the Final Rule. By reducing the remedies available in such cases, the proposal would reduce the direct costs of fraud and the indirect costs of fraud prevention and facilitate providers' continued participation in the remittance transfer market, without (or with fewer) new limitations on service. Industry has indicated that, at least in part, due to the risk of such fraud under the Final Rule, providers might exit the market or limit the size or type of transfers sent. The magnitude of these benefits would depend on the magnitude of the actual and perceived risk of account number-related fraud under the Final Rule.
The new exception to the definition of error would not impose any new requirements on remittance transfer providers and therefore would not directly impose costs on providers. But, to ensure that they can satisfy the conditions enumerated in proposed § 1005.33(h) and thus trigger the new exception, providers may choose to bear some costs. For instance, providers might change their customer contracts or other communications to provide to senders the notice contemplated by proposed § 1005.33(h)(2). However, the Bureau expects that the cost of doing so would be modest, particularly because the proposed rule does not mandate any particular notice wording, form, or format, and the Bureau expects that many providers would integrate any such notice into existing communications.
The Bureau expects that providers would generally not experience any other costs if they chose to satisfy the remainder of the conditions in proposed § 1005.33(h), because their existing practices generally would already satisfy those conditions. In particular, based on outreach, the Bureau believes that keeping records or other documents that could demonstrate the conditions described in § 1005.33(h) would generally match providers' usual and customary practices to serve their customers, to manage their risk, and to satisfy the requirements under the Final Rule to retain records of the findings of investigations of alleged errors.
The extent to which remittance transfer providers would choose to bear any costs related to proposed § 1005.33(h) and the magnitude of such costs would depend on providers' individual business practices, their expectations about the frequency and size of transfers that are deposited into the wrong accounts and not recovered because of account number mistakes by senders, their expectations about the risk of fraud, as well as the extent to which providers have already begun adapting their practices to the Final Rule. The Bureau expects that providers would only develop their practices to comply with § 1005.33(h) if doing so would benefit the providers by more than the costs of implementing these practices. The Bureau believes that this could be the case for most providers that make transfers to accounts, particularly because the practices described in § 1005.33(h) closely match existing practice, as well as, for the most part, the practices that providers would develop to comply with the Final Rule.
The proposed changes regarding requests to resend for certain errors would also benefit remittance transfer providers. In instances in which they are applicable, as discussed above, the proposed changes would, in many cases, allow a provider to resend a transfer with less uncertainty about when and how to resend it and possibly to do so using an estimated exchange rate. The proposed changes also could mean that in the narrow circumstances in which they would apply, providers would not need to provide as many written disclosures as under the Final Rule. Providers could also benefit from the alternative on which the Bureau is seeking comment, to adjust the Final Rule's remedy provisions so that anytime a remittance transfer is resent to resolve an error, the exchange rate would remain the rate stated in the original disclosure. This alternative would eliminate any cost of additional disclosures related to the covered resends. Unlike the Final Rule, however, the alternative would not permit a provider to charge the sender again for third party fees incurred when the transfer was sent the first time. Furthermore, the alternative could expose providers to additional exchange rate risk. When funds are resent, a provider might either gain or lose money related to the change in market exchange rates between the time of the original transfer and the time of the resend.
Either the proposed changes regarding resend remedies, or the alternative on which the Bureau seeks comment, could impose a cost on remittance transfer providers to revise their procedures. Providers might also change their systems to generate the proposed streamlined disclosures, which could include the date of transfer, an element that is currently required on disclosures only for some remittance transfers.
The new exception to the definition of error would benefit senders to the extent that remittance transfer providers pass along any cost savings in the form of lower prices. The new exception would also benefit senders, to the extent it would enable more providers to stay in the market or preserve the breadth of their current offerings, thus preserving competition.
Under certain conditions, a sender who provided an incorrect account number resulting in funds being delivered to the wrong account would
The Bureau expects that the proposed changes regarding remittance transfers that are resent would have very small impacts on senders. As described above, the Bureau expects that the circumstances in which the proposed changes would apply will arise infrequently. In instances in which the proposed changes would apply, the Bureau believes that senders, like remittance transfer providers, would benefit from the reduced uncertainty. However, the proposed changes would impose a modest cost on senders because they would reduce the disclosure requirements for the covered resends, including by allowing providers to give senders estimated rather than actual exchange rates under certain circumstances. Senders might experience some additional modest benefits or costs under the alternative on which comment is sought, to resend transfers at the original exchange rate. Unlike the Final Rule, the alternative would not permit a provider to charge the sender again for any third party fees that were incurred when the transfer was sent originally. But this alternative would eliminate the requirement for additional disclosures related to the resend of the transaction.
The proposed temporary delay and extension of the Final Rule's effective date would generally benefit remittance transfer providers by delaying the start of any ongoing compliance costs. The additional time might also enable providers (and their vendors) to build solutions that cost less than those that might otherwise have been possible. Senders would benefit to the extent that the changes eliminated any disruptions in the provision of remittance transfer services. But the proposed changes would impose costs on senders by delaying the time when they would receive the benefits of the Final Rule.
As discussed above, the Bureau expects that the proposal would not decrease and could increase consumers' (senders') access to consumer financial products and services. By reducing the costs that remittance transfer providers must bear to provide disclosures and resolve errors, the proposal could lead providers to reduce their prices, compared to what they might have charged under the Final Rule. By facilitating providers' participation in the market, the proposal could give senders a wider set of options for sending transfers, as well as preserve competition.
Given the lack of data on the characteristics of remittance transfers, the ability of the Bureau to distinguish the impact of the proposal on depository institutions and credit unions with $10 billion or less in total assets (as described in section 1026 of the Dodd-Frank Act) from the impact on depository institutions and credit unions in general is quite limited. Overall, the impact of the proposal on depository institutions and credit unions would depend on a number of factors, including whether they are remittance transfer providers, the importance of remittance transfers for the institutions, how many institutions or countries they send to, the cost of complying with the Final Rule, and the progress made toward compliance with the Final Rule.
However, information that the Bureau obtained prior to finalizing the August Final Rule suggests that among depository institutions and credit unions that provide any remittance transfers, an institution's asset size and the number of remittance transfers sent by the institution are positively, though imperfectly, related. There are several inferences that can be drawn from this relationship. First, the Bureau expects that among depository institutions and credit unions with $10 billion or less in total assets that provide any remittance transfers, compared to larger such institutions, a greater share will qualify for the safe harbor related to the definition of “remittance transfer provider” and therefore would be entirely unaffected by this proposal because they are not subject to the requirements of the Final Rule.
Additionally, the Bureau believes that the magnitude of the proposal's impact on smaller depository institutions and credit unions would be affected by these institutions' likely tendency to rely on correspondents or other service providers to obtain third party fee and foreign tax information, as well as provide standard disclosure forms. In some cases, this reliance would mitigate the impact on these providers of the proposal's provisions regarding such information.
Senders in rural areas may experience different impacts from the proposal than other senders. The Bureau does not have data with which to analyze these impacts in detail. However, to the extent that the proposal leads to more remittance transfer providers to continue to provide remittance transfers, the proposal may disproportionately benefit senders living in rural areas. Senders in rural areas may have fewer options for sending remittance transfers, and therefore may benefit more than other senders from a change that keeps more providers in the market.
The Bureau will further consider the benefits, costs and impacts of the proposal before finalizing the proposal. The Bureau asks interested parties to provide comment or data on various aspects of the proposed rule, as detailed in the section-by-section analysis. This includes comment or data regarding the number and characteristics of affected entities and consumers; providers' current practices, their plans to implement the Final Rule; how this proposal might change their current practices or their planned practices
The Bureau requests commenters to submit data and to provide suggestions for additional data to assess the issues discussed above and other potential benefits, costs, and impacts of the proposed rule. Further, the Bureau seeks information or data on the proposed rule's potential impact on consumers in rural areas as compared to consumers in urban areas. The Bureau also seeks information or data on the potential impact of the proposed rule on depository institutions and credit unions with total assets of $10 billion or less as described in Dodd-Frank Act section 1026 as compared to depository institutions and credit unions with assets that exceed this threshold and their affiliates.
The Regulatory Flexibility Act (RFA) generally requires an agency to conduct an initial regulatory flexibility analysis (IRFA) and a final regulatory flexibility analysis (FRFA) of any rule subject to notice-and-comment rulemaking requirements, unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. The Bureau also is subject to certain additional procedures under the RFA involving the convening of a panel to consult with small business representatives prior to proposing a rule for which an IRFA is required. 5 U.S.C. 609.
An IRFA is not required for this proposal because the proposal, if adopted, would not have a significant economic impact on a substantial number of small entities.
The analysis below evaluates the potential economic impact of the proposed rule on small entities as defined by the RFA.
This analysis examines the benefits, costs, and impacts of the key provisions of the proposal relative to the baseline provided by the Final Rule. The Bureau has discretion in future rulemakings to choose the most appropriate baseline for that particular rulemaking.
The proposal would provide remittance transfer providers additional flexibility regarding the disclosure of certain recipient institution fees and foreign taxes. It would allow providers to rely on senders' representations regarding such fees, and to estimate such fees and foreign taxes based on certain assumptions and information. The proposal would also limit a provider's obligation to disclose foreign taxes to those imposed by a country's central government. Under the proposal, if providers chose not to disclose subnational taxes, or to take advantage of the new estimation provisions, they would be required to describe the relevant disclosures using the term “Estimated” or a substantially similar term.
The proposed provisions would not require small entities to make any changes in practice. Remittance transfer providers would still be in compliance if they disclosed foreign taxes and recipient institution fees in accordance with the Final Rule. If small providers decided to take advantage of the proposed provisions, they might bear some cost to modify their systems to calculate disclosures using the new methods permitted by the proposal, or to describe certain disclosures using the term “Estimated” or a substantially similar term. However, the Bureau believes that any cost would generally be small. Any modification would be to existing forms and systems changes would be particularly minimal because the Final Rule already sets forth certain circumstances in which the term “Estimated” (or a substantially similar term) must be used. Also, the Bureau expects that many small depository institutions and credit unions will rely on correspondent institutions or other service providers to provide recipient institution fees and foreign tax information, as well as standard disclosure forms; as a result, related costs would often be spread across multiple institutions. Furthermore, the Bureau expects that some providers may not have finished any systems modifications necessary to comply with the Final Rule, and thus may be able to incorporate any changes into previously planned work.
Any alternative disclosures could also impose cost on any providers that chose to take advantage of the flexibility permitted by the proposal. The relative magnitude would depend on the type of disclosure required. If no disclosure were required in instances in which foreign subnational taxes were not disclosed, the cost could be less for some entities. If some alternative form of disclosure were required for providers that chose to take advantage of the new flexibility that the proposal would permit, the cost might be higher.
In either case, the proposed changes regarding the disclosure of recipient institution fees and foreign taxes may provide meaningful benefits to remittance transfer providers that decide to take advantage of them. The Bureau expects that small entities generally would choose to incur the costs associated with the proposed provisions only if they concluded that the benefits of doing so were greater than the costs. The potential benefits include a reduced cost to prepare required disclosures. Furthermore, industry has suggested that due in part
The Bureau expects that the proposed provisions would mostly affect depository institutions, credit unions, and broker-dealers that are remittance transfer providers. These types of providers tend to send most or all of their remittances transfers to foreign accounts, for which recipient institution fees may be charged. Furthermore, due to the mechanisms they use to send money, they generally have the ability to send transfers to virtually any destination country (for which tax research might be required). By contrast, money transmitters that are providers are more likely to send remittance transfers to be received in cash, for which recipient institution fees would not be relevant. Furthermore, most money transmitters, and particularly small ones, generally send transfers to a limited number of countries and institutions.
The proposal includes two sets of proposed changes related to errors caused by the provision of incorrect or insufficient information. It would create a new exception to the definition of the error. It would also streamline the requirements for resending remittance transfers in certain situations in which funds may be resent to correct errors.
The Bureau expects that a number of small remittance transfer providers would be unaffected by the proposed changes regarding the definition of error; they would only apply to remittance transfers that are received in accounts. Though some money transmitters send money to be deposited into bank accounts, the Bureau's outreach suggests that, unlike most small depository institutions, credit unions, and broker-dealers, many small money transmitters only send money to be received in cash.
With regard to small remittance transfer providers that do send money to accounts, the proposed new exception to the definition of error would not impose any mandatory costs. Under the proposal, certain account number mistakes would no longer generate “errors” if the provider satisfied certain conditions enumerated in proposed § 1005.33(h). Instead of satisfying these conditions, providers could continue under the Final Rule's definition of error.
If remittance transfer providers did choose to satisfy the conditions enumerated in proposed § 1005.33(h), they might incur some costs, such as changing the terms of their consumer contracts or other communications to provide senders the notice contemplated by proposed § 1005.33(h)(2). However, the Bureau expects that the cost of doing so would be modest, particularly because the proposed rule does not mandate any particular notice wording, form, or format, and the Bureau expects that many providers would integrate any such notice into existing communications.
The Bureau believes that satisfying the remainder of the conditions in proposed § 1005.33(h) would not impose new costs on providers because their existing practices generally would already satisfy those conditions. In particular, based on outreach, the Bureau believes that that keeping records or other documents that could demonstrate the conditions described in § 1005.33(h) would generally match providers' usual and customary practices to serve their customers, to manage their risk, and to satisfy the requirements under the Final Rule to retain records of the findings of investigations of alleged errors.
In any case, the Bureau expects that remittance transfer providers would only develop their practices to comply with § 1005.33(h), and thus take advantage of the proposed new exception to the definition of error, if doing so would reduce the costs of losses due to account number mistakes by senders or account number fraud by more than the costs of implementing these practices. The Bureau believes that for most providers, including small ones, the proposed changes to the definition of error likely would provide benefits that outweigh implementation costs. If the new exception applied, providers would no longer bear the cost of funds that they could not recover. Providers would further benefit if the proposal reduced the potential for fraudulent account number mistakes made by unscrupulous senders, which providers have cited as a risk under the Final Rule. By reducing the remedies available in such cases, the proposal would reduce the direct costs of fraud and the indirect costs of fraud prevention and facilitate providers' continued participation in the remittance transfer market, without (or with fewer) new limitations on service. Industry has indicated that, at least in part, due to the risk of such fraud under the Final Rule, providers might exit the market or limit the size or type of transfers sent.
The proposed change regarding requests to resend for certain errors would also benefit small remittance transfer providers, though the Bureau expects that the benefits would be small because the circumstances covered by the proposed change will arise very infrequently.
Either the proposed changes regarding certain instances in which remittance transfer providers resend transactions to correct errors, or the alternative on which the Bureau seeks comment, could impose a cost on providers to revise their procedures. Providers might also change their systems to generate the proposed streamlined disclosures, which could include the date of transfer, an element that is required on disclosures only for some remittance transfers.
The proposal would temporarily delay the February 7, 2013 effective date of the Final Rule and extend it to 90 days after this proposal is finalized. This change would generally benefit small remittance transfer providers, by delaying the start of any ongoing compliance costs. The additional time might also enable providers (and their vendors) to build solutions that cost less than those that might otherwise have been possible.
Accordingly, the undersigned hereby certifies that if promulgated, this rule would not have a significant economic impact on a substantial number of small entities. The Bureau requests comment on the analysis above and requests any relevant data.
The Bureau's collection of information requirements contained in this proposal, and identified as such, will be submitted to the Office of Management and Budget (OMB) for review under section 3507(d) of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
The title of these information collections is Electronic Fund Transfer Act (Regulation E) 12 CFR 1005. The frequency of collection is on occasion. As described below, the proposed rule would amend portions of the collections of information currently in Regulation E. Some portions of these information collections are required to provide benefits for consumers and are mandatory. However, some portions are voluntary because certain information collections under this proposal would simply give remittance transfer providers optional methods of compliance. Because the Bureau does not collect any information under the proposed rule, no issue of confidentiality arises. The likely respondents are remittance transfer providers, including small businesses. Respondents are required to retain records for 24 months, but this proposed regulation does not specify the types of records that must be maintained.
Under the proposed rule, the Bureau generally would account for the paperwork burden associated with Regulation E for the following respondents pursuant to its administrative enforcement authority: insured depository institutions and insured credit unions with more than $10 billion in total assets, and their depository institution and credit union affiliates (together, “the Bureau depository respondents”), and certain non-depository remittance transfer providers, such as certain state-licensed money transmitters (“the Bureau non-depository respondents”).
Using the Bureau's burden estimation methodology, the Bureau estimates that the total one-time burden for the estimated 5,753 respondents potentially affected by the proposal would be approximately 420,000 hours.
For the 153 Bureau depository respondents, the Bureau estimates for the purpose of this PRA analysis that the proposal would increase one-time burden by approximately 11,000 hours and reduce ongoing burden by approximately 7,300 hours per year. For the estimated 300 Bureau non-depository respondents, the Bureau estimates that the proposal would increase one-time burden by 21,900 hours and reduce ongoing burden by 6,300 hours per year.
As described in parts V and VI above, to take advantage of the new flexibility that would be provided by the proposal with regard to the disclosure of recipient institution fees and foreign taxes, remittance transfer providers might choose to bear some cost of modifying their systems to calculate disclosures using the new methods permitted by the proposal, or to describe certain disclosures using the term “Estimated” or a substantially similar term. Though the proposal would not require such modification, for purposes of this analysis, the Bureau assumes that all remittance transfer providers would decide to take advantage of the new flexibility permitted due to the related benefits. The Bureau believes that in many instances providers would have already modified their systems to use the term “Estimated” or a substantially similar term in other cases, in order to comply with the Final Rule. The Bureau also expects that many depository institutions and credit unions will rely on correspondent institutions or other service providers to provide recipient institution fee and foreign tax information, as well as standard disclosure forms; as a result, any development cost associated with the proposal would be spread across multiple institutions. Furthermore, the Bureau expects that some providers may not have finished any systems modifications necessary to comply with the Final Rule, and thus may be able to incorporate any changes into previously accounted-for work. In the interest of providing a conservative estimate, however, the Bureau assumes that all providers would need to modify their systems to calculate disclosures and to add the term “Estimated” or a substantially similar term to a pre-payment disclosure form and a receipt. The Bureau estimates that making revisions to systems to calculate disclosures would take 40 hours per provider. Because the forms to be modified are existing forms, the Bureau estimates that adding the term “Estimated” or a substantially similar term would require eight hours per form per provider.
On the other hand, the proposal would give remittance transfer providers options that may reduce the ongoing cost of obtaining and updating information on taxes and fees. By taking advantage of the new flexibility permitted by the proposal, the Bureau estimates that insured depository institutions and credit unions would save, on average, 48 hours per year and non-depository institutions would save, on average, 21 hours per year.
The Bureau is particularly seeking comment on whether or not to adopt an alternative to the term “Estimated,” or to require no disclosure, in instances in which foreign subnational taxes were not disclosed. The relative cost of any such alternative would depend on the form of the requirement; if no disclosure were required, the above calculated burden could be less, but if some alternative form of disclosure were required for providers that chose to take advantage of the new flexibility that the proposal would permit, the cost might be higher.
As described in parts V and VI above, the Bureau expects that remittance transfer providers that send money to accounts, in order to benefit from the proposed changes to the definition of the term error, may choose to provide senders with notice that if they provide incorrect account numbers, they could lose the transfer amount, and providers may also choose to maintain sufficient records to satisfy, wherever possible, the conditions enumerated in proposed § 1005.33(h) (though no such recordkeeping is required). These enumerated conditions regard being able to demonstrate facts regarding senders' responsibility for any account number mistake; the above-referenced notice; the results of an incorrect account number; and the provider's effort to recover funds.
Because this will likely involve modifications to existing communications, the Bureau estimates that providing senders with the notice described above would require a one-time burden of eight hours per provider and would not generate any ongoing burden. With regard to demonstrating facts related to the conditions enumerated in proposed § 1005.33(h), the Bureau believes that any related record retention would be a usual and customary practice by providers under the Final Rule, and that therefore there would be no additional burden associated with these aspects of the proposal.
In certain circumstances when a remittance transfer provider resends a remittance transfer to correct an error caused by incorrect or insufficient information provided by a sender, the proposal would require that the provider give the sender a single simplified set of disclosures rather than the pre-payment disclosures and receipt generally required by the Final Rule. In some cases, the proposal would permit providers to rely solely on information that is already required to be included on pre-payment disclosures and receipts; under other circumstances, the proposal would require the simplified disclosures to include one additional piece of information that is not required on existing disclosures: The date that the provider will make the remittance transfer. Though the Bureau expects that some providers may avoid these circumstances altogether or incorporate modifications into those they would carry out to comply with the Final Rule, in the interest of providing a conservative estimate, the Bureau estimates that the modified disclosure requirement would require a one-time change to an existing form that would take each provider eight hours to make.
The Bureau also estimates that to reflect the proposed changes regarding certain errors, remittance transfer providers would spend, on average, one hour, to update written policies and procedures designed to ensure compliance with respect to the error resolution requirements applicable to providers, pursuant to § 1005.33(g).
The Bureau expects that the proposed requirement for a simplified set of disclosures would also reduce providers' ongoing burden, by eliminating the need to provide both a pre-payment disclosure and a receipt under covered circumstances. However, because the Bureau expects that the covered circumstances would arise very infrequently, the Bureau expects that this burden reduction would be minimal.
Alternatively, the Bureau seeks comment on whether to change the error resolution procedures such that, among other things, no additional disclosures would be required when remittance transfers providers resend transfers in order to correct errors. Under that alternative scenario, the Bureau expects that a similar analysis would apply. Providers would need to make small
Comments on this analysis must be received by January 30, 2013. With regard to this PRA analysis, comments are specifically requested concerning:
(i) Whether the proposed collections of information are necessary for the proper performance of the functions of the Bureau, including whether the information will have practical utility;
(ii) The accuracy of the estimated burden associated with the proposed collections of information;
(iii) How to enhance the quality, utility, and clarity of the information to be collected; and
(iv) How to minimize the burden of complying with the proposed collections of information, including the application of automated collection techniques or other forms of information technology.
All comments will become a matter of public record.
Comments on the collection of information requirements should be sent to the Office of Management and Budget (OMB), Attention: Desk Officer for the Consumer Financial Protection Bureau, Office of Information and Regulatory Affairs, Washington, DC 20503, or by the internet to
Certain conventions have been used to highlight the proposed revisions. New language is shown inside bold arrows, and language that would be deleted is shown inside bold brackets.
Banking, Banks, Consumer protection, Credit unions, Electronic fund transfers, National banks, Remittance transfers, Reporting and recordkeeping requirements, Savings associations.
For the reasons stated in the preamble, the Bureau proposes to amend 12 CFR part 1005, as added February 7, 2012 (77 FR 6285), and amended August 20, 2012 (77 FR 5028) as set forth below:
1. The authority citation for part 1005 continues to read as follows:
12 U.S.C. 5512, 5581; 15 U.S.C. 1693b. Subpart B is also issued under 12 U.S.C. 5601.
2. Amend § 1005.31 to revise paragraphs (b)(1)(vi) and (d) to read as follows:
(b)
(1) * * *
(vi) ▸Except as set forth in this paragraph, any◂[Any] fees and taxes imposed on the remittance transfer by a person other than the provider, in the currency in which the funds will be received by the designated recipient, using the terms “Other Fees” for fees and “Other Taxes” for taxes, or substantially similar terms. ▸With respect to tax disclosures, only taxes imposed on the remittance transfer by a foreign country's central government need be disclosed. ◂The exchange rate used to calculate these fees and taxes is the exchange rate in paragraph (b)(1)(iv) of this section, including an estimated exchange rate to the extent permitted by § 1005.32, prior to any rounding of the exchange rate; and
(d)
3. Amend § 1005.32 to add paragraphs (b)(3) and (b)(4) to read as follows:
(b)
▸(3)
(4)
(ii) If the provider cannot obtain such fee schedules or does not have such information, a provider may rely on other reasonable sources of information, if the provider discloses the highest fees identified through the relied-upon source.◂
4. Amend § 1005.33 to revise paragraphs (a)(2)(iv), (c)(2) introductory text, (c)(2)(ii)(A)(
(a)
(iv) * * *
▸(D) The sender having given the remittance transfer provider an incorrect account number, provided that the remittance transfer provider meets the conditions set forth in paragraph (h) of this section; or ◂
(2)
(iv) A change in the amount or type of currency received by the designated recipient from the amount or type of currency stated in the disclosure provided to the sender under § 1005.31(b)(2) or (3) ▸because◂[if] the remittance transfer provider ▸did not disclose foreign taxes other than those imposed by a country's central government, or◂ relied on information provided by the sender as permitted under § 1005.31 in making such disclosure.
(c) * * *
(2)
(ii) * * *
(A) * * *
(
▸(3)
(i) If the remittance transfer provider does not make direct contact with the sender when providing the report required by paragraph (c)(1) of this section, the provider shall provide, orally or in writing, as applicable, the following disclosures:
(A) The disclosures required by § 1005.31(b)(2)(i) through (iii) for remittance transfers and the date the remittance transfer provider will complete the resend, using the term “Transfer Date” or a substantially similar term. These disclosures must be accurate when the resend is made except that the disclosures may contain estimates to the extent permitted by § 1005.32(a) or (b) for remittance transfers; and
(B) If the transfer is scheduled three or more business days before the date of transfer, a statement about the rights of the sender regarding cancellation reflecting the requirements of § 1005.36(c), the requirements of which shall apply to the resend; or
(ii) If the remittance transfer provider makes direct contact with the sender at the same time or after providing the report required by paragraph (c)(1) of this section, the provider shall provide, orally or in writing, as applicable, the disclosures required by § 1005.31(b)(2)(i) through (iii) for remittance transfers. These disclosures must be accurate when the resend is made except that the disclosures may contain estimates to the extent permitted by § 1005.32(a), (b)(1), (b)(3) or (b)(4) for remittance transfers.◂
▸(h)
(1) The sender provided an incorrect account number to the remittance transfer provider in connection with the remittance transfer;
(2) The sender had notice that, in the event the sender provided an incorrect account number, that the sender could lose the transfer amount;
(3) The incorrect account number resulted in the deposit of the remittance transfer into a customer's account at the recipient institution other than the designated recipient's account; and
(4) The provider promptly used reasonable efforts to recover the amount that was to be received by the designated recipient.◂
5. Amend § 1005.36 to revise paragraph (b)(3) to read as follows:
(b) * * *
(3) Disclosures provided pursuant to paragraph (a)(1)(ii) or (a)(2)(ii) of this section must be accurate as of when the remittance transfer to which it pertains is made, except to the extent estimates are permitted by § 1005.32(a)[ or] ▸,◂ (b)(1)▸, (b)(3) or (b)(4)◂.
6. In Supplement I to part 1005:
a. Under
i. Under subheading
ii. Under subheading
iii. Under subheading 31(d)
b. Under
i. Revise comment 32–1.
ii. Under subheading
iii. Under subheading
iv. Under subheading
c. Under Section 1005.33,
i. Under subheading
ii. Under subheading
iii. Add new subheading
d. Under Section 1005.36, under subheading
The additions and revisions read as follows:
1.
ii. The fees and taxes required to be disclosed by § 1005.31(b)(1)(ii) include all fees and taxes imposed on the remittance transfer by the provider. For example, a provider must disclose a service fee and any State taxes imposed on the remittance transfer. In contrast, the fees and taxes required to be disclosed by § 1005.31(b)(1)(vi) include fees and taxes imposed on the remittance transfer by a person other than the provider.
▸iii.◂ Fees and taxes imposed on the remittance transfer include only those fees and taxes that are charged to the sender or designated recipient and are specifically related to the remittance transfer. For example, a provider must disclose fees imposed on a remittance transfer by the [receiving] ▸recipient's◂ institution or agent at pick-up for receiving the transfer, fees imposed on a remittance transfer by intermediary institutions in connection with an international wire transfer, and taxes imposed on a remittance transfer by a foreign ▸country's central◂ government. However, a provider need not disclose, for example, overdraft fees that are imposed by a recipient's bank or funds that are garnished from the proceeds of a remittance transfer to satisfy an unrelated debt, because these charges are not specifically related to the remittance transfer.
v.
2.
4.
1.
1.
1.
1.
2.
1.
3.
ii. * * *. The remittance transfer provider provides the sender a receipt stating an amount of currency that will be received by
4.
7. ▸
▸8.◂ [7]
▸9.◂ [8]
2.
▸11.
i. For purposes of determining the date of transfer for disclosures made in accordance with § 1005.33(c)(3)(i), if the remittance transfer provider is unable to speak to or otherwise make direct contact with the sender, the provider may use the same date on which it would provide a default remedy (
ii. If the remittance transfer provider makes direct contact with the sender at the same time or after providing the report required by § 1005.33(c)(1), and if the time to cancel a resend disclosed pursuant to § 1005.33(c)(3)(i)(B) has not passed, § 1005.33(c)(2) requires the provider to resend the funds the next business day or as soon as reasonably practicable thereafter if the sender elects a resend remedy. For such a resend, the provider must provide the disclosures required by § 1005.33(c)(3)(ii) to use the exchange rate it is using for such transfers on the date of resend to the extent that currency must be exchanged when resending funds. When providing disclosures pursuant to § 1005.33(c)(3)(ii), the provider need not allow the sender to cancel the resend.◂
1.
i. The remittance transfer provider promptly calls or otherwise contacts the recipient's institution, either directly or indirectly through any correspondent(s) or other intermediaries or service providers used for the particular transfer, to request that the amount that was to be received by the designated recipient be returned, and if required by law or contract, by requesting
ii. The remittance transfer provider promptly uses a messaging service through a funds transfer system to contact the recipient's institution, either directly or indirectly through any correspondent(s) or other intermediaries or service providers used for the particular transfer, to request that the amount that was to be received by the designated recipient be returned, in accordance with the messaging service's rules and protocol, and if required by law or contract, by requesting that the recipient institution obtain a debit authorization from the holder of the incorrectly credited account.
iii. In addition to using the methods outlined above, to the extent that a correspondent institution, other service providers to the recipient institution, or the recipient institution requests documentation or other supporting information, the remittance transfer provider promptly provides such documentation or other supporting information to the extent available.
2.
3.
Economic Development Administration, Department of Commerce.
Notice .
Pursuant to 255A of chapter 3 of title II of the Trade Act of 1974, as amended (19 U.S.C. 2341 et seq.), the Economic Development Administration (EDA) publishes the Fiscal Year 2012 Annual Report to Congress on the Trade Adjustment Assistance for Firms program.
In September 2012, the U.S. Government Accountability Office (GAO) reported to Congress that the effect of participation by import-impacted U.S. firms in the Trade Adjustment Assistance for Firms (TAAF) program was an increase in firm sales ranging from 5 to 6 percent on average,” and that “the effect of the program on productivity was about a 4 percent increase.”
Meanwhile, this report—EDA's Annual Report to Congress on the TAAF program—finds that, two years after completing the program in FY 2010, participating firms experienced an average employment increase of 13.2 percent, an average sales increase of 26.8 percent, and an average productivity increase of 11.9 percent. For the sake of comparing TAAF-assisted firms to non-assisted similar firms, the Department of Labor's Bureau of Labor Statistics (BLS) reported that, in FY 2012, the manufacturing industry as a whole experienced an average employment increase of only 3.5 percent and an average productivity increase of 4.1 percent from FY 2010.
Therefore, both GAO and EDA find that the TAAF program has a significant positive impact in helping import-impacted U.S. firms compete in the global marketplace. Additionally, all firms that completed the TAAF program in FY 2010 were in operation at the end of FY 2012, indicating strong survival rates for TAAF-assisted firms.
Furthermore, on May 11, 2012, the Department of Commerce Office of Inspector General (OIG) presented EDA with a copy of their letter to the House and Senate Committees on Appropriations reporting their findings related to an examination of the TAAC administrative costs.
This annual report is submitted in accordance with Section 255A of chapter 3 of title II of the Trade Act of 1974, as amended (19 U.S.C. 2341 et seq.) (commonly referred to as the Trade Act). Section 255A of the Trade Act directs the Secretary of Commerce to submit an annual report on the Trade Adjustment Assistance for Firms (TAAF) program to Congress no later than December 15, 2012 and each year thereafter. The TAAF program is authorized by chapters 3 and 5 of title II of the Trade Act.
Administered by the U.S. Department of Commerce's Economic Development Administration (EDA), the goal of the TAAF program is to help economically distressed U.S. businesses develop strategies to compete in the global economy. Through a partnership with a national network of 11 EDA-funded Trade Adjustment Assistance Centers (TAACs), the program provides cost-sharing technical assistance to help eligible businesses create and implement targeted business recovery plans (referred to as “Adjustment Proposals” or “APs”) aimed at boosting global competitiveness, increasing sales and retaining and creating jobs. The TAACs, which are either independent or university-affiliated entities, provide support to import-impacted firms in a public-private collaborative framework. The TAAF program provides a portion of the assistance while participating firms contribute a matching share to create and implement their recovery plans.
EDA's partnership with the TAAC network across the country allows firms to receive customized assistance from highly qualified experts who are knowledgeable about the needs, challenges and opportunities facing the industries in their region. The most common types of assistance provided in FY 2012 were marketing/sales improvement and production/engineering projects, which comprised over half of all projects supported throughout the year.
In January 2011, as authorization of the Trade Adjustment Assistance (TAA) programs at the U.S. Department of Labor (DOL), U.S. Department of Agriculture (USDA) and EDA was about to expire, Congress passed the Omnibus Trade Act of 2010 (Pub. L. 111–344). This Act extended the TAAF program through February 12, 2012, but allowed some provisions—such as eligibility for service firms and expanded time periods for qualifying firm eligibility—provided under the Trade and Globalization Adjustment Assistance Act of 2009 (TGAAA) to expire on February 13, 2011.
On October 21, 2011, the President signed into law the Trade Adjustment Assistance Extension Act of 2011 (Pub. L. 112–40). This Act retroactively extended the provisions of the TAA programs that were enacted as part of the TGAAA.
The expiration of the TGAAA provisions did, however, limit the number of firms entering the program as TAACs were unable to assist service firms or use extended “look-back periods” to certify firms. In addition, uncertainty regarding the TAAF program's future caused TAACs to focus on existing clients instead of recruiting new firms.
As part of its overall commitment to performance evaluation and continuous improvement, EDA assesses the performance of the TAAF program both in terms of “inputs” (e.g., types of firms assisted, petition, and AP submissions) and “outputs” (changes in sales, employment levels, and productivity of client firms).
In terms of inputs, the TAAF program effectively targeted small and medium-sized firms in FY 2012. TAACs provided technical assistance to 341 firms in preparing petitions, 206 firms in preparing APs, and 935 firms in implementing projects within their APs. Meanwhile, EDA certified 79 petitions and approved 102 APs.
EDA successfully met both the 40-day processing deadline (to make a final determination for petitions accepted for filing) and the 60-day processing deadline for approval of APs, as required in the TGAAA. In FY 2012, the average processing time for petitions was 29 business days, and the average processing time for APs was 21 business days.
In order to assess the effectiveness of the TAAF program in terms of outputs, EDA assesses the extent to which client firms increased their sales, employment levels, and productivity following the implementation of TAAF-supported
Firms that completed the TAAF program in FY 2010 report that, at completion, average sales were $10.1 million, average employment was 53 and average sales per employee (productivity) was $191,328. One year after completing the program (FY 2011), these same firms reported that average sales increased by 11.4 percent, average employment increased by 13.2 percent, and average productivity decreased by 1.6 percent. For the sake of comparison to the universe of U.S. manufacturers, the U.S. Bureau of Labor Statistics (BLS) reports that, in FY 2011, the national manufacturing industry in aggregate experienced an average employment increase of only 1.9 percent.
Two years after completing the program (FY 2012), these same firms reported that average sales increased by 26.8 percent, average employment increased by 13.2 percent, and average productivity increased by 11.9 percent. Meanwhile, BLS reported that the manufacturing industry in FY 2012 experienced an average employment increase of 3.5 percent and average productivity increase of 4.1 percent from FY 2010. Therefore, firms assisted by the TAAF program performed more successfully than the manufacturing industry as a whole. Additionally, all firms that completed the TAAF program in FY 2010 were in operation as of the end of FY 2012, indicating strong survival rates for TAAF-assisted firms. It should be noted that TAAF clients are operating in the same economic environment as other firms, but are also attempting to adjust to import pressures that may not impact other firms as severely, making the success of TAAF-assisted firms even more notable.
(1) The number of firms that inquired about the program.
(2) The number of petitions filed under section 251.
(3) The number of petitions certified and denied by the Secretary.
(4) The average time for processing petitions after the petitions are filed.
(5) The number of petitions filed and firms certified for each Congressional District in the United States.
(6) Of the number of petitions filed, the number of firms that entered the program and received benefits.
(7) The number of firms that received assistance in preparing their petitions.
(8) The number of firms that received assistance developing business recovery plans.
(9) The number of business recovery plans approved and denied by the Secretary.
(10) Average duration of benefits received under the program nationally and in each region served by an intermediary organization (the TAAC) referred to in section 253(b)(1) of the Trade Act.
(11) Sales, employment, and productivity at each firm participating in the TAAF program at the time of certification.
(12) Sales, employment, and productivity at each firm upon completion of the program and each year for the two-year period following completion.
(13) The number of firms in operation as of the date of this report and the number of firms that ceased operations after completing the program in each year during the two-year period following completion of the program.
(14) The financial assistance received by each firm participating in the program.
(15) The financial contribution made by each firm participating in the program.
(16) The types of technical assistance included in the business recovery plans of firms participating in the program.
(17) The number of firms leaving the program before completing the project or projects in their business recovery plans and the reason the project or projects were not completed.
(18) The total amount expended by all intermediary organizations referred to in Section 253(b)(1)and by each organization to administer the program.
(19) The total amount expended by intermediary organizations to provide technical assistance to firms under the program nationally and in each region served by such an organization.
This report is provided in compliance with Section 255A of chapter 3 of title II of the Trade Act. Section 255A of the Trade Act directs the Secretary of Commerce to provide an annual report on the Trade Adjustment Assistance for Firms (TAAF) program by the 15th of December. Section 255 of the Trade Act states:
IN GENERAL.—Not later than December 15, 2012, and annually thereafter, the Secretary shall prepare a report containing data regarding the trade adjustment assistance for firms program under this chapter for the preceding fiscal year. The data shall include the following:
This report will provide findings and results classified by intermediary organization,
1. The number of firms that inquired about the program.
2. The number of petitions filed under section 251.
3. The number of petitions certified and denied by the Secretary.
4. The average time for processing petitions after the petitions are filed.
5. The number of petitions filed and firms certified for each Congressional district of the United States.
6. Of the number of petitions filed, the number of firms that entered the program and received benefits.
7. The number of firms that received assistance in preparing their petitions.
8. The number of firms that received assistance developing business recovery plans.
9. The number of business recovery plans approved and denied by the Secretary.
10. The average duration of benefits received under the program nationally and in each region served by an intermediary organization referred to in section 253(b)(1) of the Trade Act.
11. Sales, employment, and productivity at each firm participating in the TAAF program at the time of certification.
12. Sales, employment, and productivity at each firm upon completion of the program and each year for the two-year period following completion.
13. The number of firms in operation as the date of the report and the number of firms that ceased operations after completing the program and in each year during the two-year period following completion of the program.
14. The financial assistance received by each firm participating in the program.
15. The financial contribution made by each firm participating in the program.
16. The types of technical assistance included in the business recovery plans of firms participating in the program.
17. The number of firms leaving the program before completing the project or projects in their business recovery plans and the reason the project was not completed.
18. The total amount expended by all intermediary organizations referred to in
19. The total amount expended by intermediary organizations to provide technical assistance to firms under the program nationally and in each region served by such an organization.
The TAAF program is authorized by chapters 3 and 5 of title II of the Trade Act. The responsibility for administering the TAAF program is delegated to EDA by the Secretary of Commerce. The TAAF program provides technical assistance to manufacturers and service firms affected by import competition in order to help them develop and implement projects to regain global competitiveness, increase profitability and create jobs.
The mission of the TAAF program is to help U.S. firms regain competitiveness in the global economy. Import-impacted U.S. manufacturing, production and service firms can receive matching funds for projects that expand markets, strengthen operations and increase competitiveness through the TAAF program. The program provides assistance to support the development of business recovery plans (commonly referred to as “Adjustment Proposals or “APs”), under Section 252 of the Trade Act, and matching funds to implement projects outlined in the APs.
The TAAF program supports a national network of 11 independent non-profit or university-affiliated TAACs to help U.S. manufacturing, production, and service firms in all 50 States, the District of Columbia and the Commonwealth of Puerto Rico. Firms work with the TAACs to apply for certification of eligibility for TAAF assistance, and prepare and implement strategies to guide their economic recovery.
The TAAF program is one of four distinct programs authorized under the Trade Act. The other TAA programs are TAA for Workers and TAA for Community Colleges, which are both administered by DOL, and TAA for Farmers, which is administered by USDA.
As noted above, the TAAF program provides technical assistance to help firms develop and implement business recovery plans, or APs. Projects identified in the AP are designed to improve a firm's competitive position. Specifically, under the TAAF program, funds are applied toward helping firms access consultants, engineers, designers or industry experts to implement business improvement projects. These projects may cover a range of functional areas to improve a firm's market position and increase its overall competitiveness, including engineering, information technology, management, market development, marketing, new product development, quality improvement and sales. Funds are not provided directly to firms; instead, EDA funds TAACs and TAACs use funds to pay a cost-shared proportion of the cost to secure specialized business consultants.
There are three main phases to receiving technical assistance under the TAAF program: (1) petitioning for certification, (2) recovery planning and (3) AP implementation.
The first step to receiving assistance is the submission of a petition to EDA to be certified as a trade-impacted firm. A petition is comprised of Form ED–840P, titled “
Upon receipt of the petition, EDA performs an analysis of the petition and supporting documents to determine if the petition is complete and may be accepted. EDA is required to make a final determination on the petition within 40 days of accepting a petition.
To certify a firm as eligible to apply for adjustment assistance, the Secretary must determine that the following three conditions are met:
1. A significant number or proportion of the workers in the firm have been or are threatened to be totally or partially separated;
2. Sales and/or production of the firm have decreased absolutely, or sales and/or production of an article or service that accounted for at least 25 percent of total production or sales of the firm during the 12, 24, or 36 months preceding the most recent 12-, 24-, or 36-month period for which data are available have decreased absolutely; and
3. Increased imports of articles like or directly competitive with articles produced or services provided by the firm have “contributed importantly” to both the layoffs and the decline in sales and/or production.
Certified firms then work with TAAC staff to develop a customized AP for submission to EDA for approval. Once an AP has been submitted, EDA is required to make a final determination within 60 days.
The firm works with consultants to implement projects in an approved AP. As projects are implemented and if the firm is satisfied with the work, the firm will first pay their match to the consultant, and then send a notice to the TAAC stating that they are satisfied with the work and that they have paid their matching share. The TAAC will then pay the Federal matching share. Firms have up to five years from the date of an AP's approval to implement the approved business recovery strategy contained therein, unless they receive approval for an extension. Generally, firms complete the implementation of their respective APs over a two-year period.
In general, the TAACs provide an array of services to assist import-impacted firms throughout this process, including:
• Assisting firms in preparing their petitions for TAAF. Firms are not charged for any assistance related to the preparation of a petition.
• Once a petition has been approved, TAACs work closely with a firm's management to identify the firm's strengths and weaknesses and develop a customized business strategy (AP) designed to foster competitiveness. The program pays up to 75% of the cost of developing an AP and the firm must pay the rest. EDA must approve all APs to ensure they conform to statutory and regulatory requirements.
• After an AP has been approved, company management and TAAC staff jointly identify consultants with the specific expertise required to assist the firm in implementing their competitiveness strategy.
• Under the TAAF program, EDA shares the cost of implementing tasks under an approved AP to support competitiveness. For an AP in which proposed tasks total $30,000 or less, EDA provides up to 75 percent of the cost and the firm is responsible for the balance. For an AP in which proposed tasks total over $30,000, EDA pays 50 percent of the total cost and the firm pays the remaining 50 percent. In order to most efficiently and effectively utilize limited program funds, EDA limits its share of technical assistance to a certified firm to no more than $75,000. After a competitive procurement process, the TAAC and the firm generally contract with private consultants to implement the AP.
The data used in this report were collected from the TAACs as part of their reporting requirements, petitions for certification, and the APs submitted by the TAACs on behalf of firms. Eligibility Reviewers at EDA recorded data from these sources into a central database. The data presented in this report has been verified by the TAACs. Results for average processing times were derived by EDA. Data in this report reflect data as of the end of FY 2012. Therefore, data in this Annual Report may differ from previously published data that were based on different periods.
In FY 2012, the TAACs received 1,849 inquiries about the program.
(2) The number of petitions filed under section 251
(3) The number of petitions certified and denied by the Secretary
(4) The average time for processing petitions after the petitions are filed
As part of its overall commitment to performance evaluation and continuous improvement, EDA assesses the performance of the TAAF program both in terms of “inputs” (e.g., types of firms assisted, petition, and AP submissions) and “outputs” (changes in sales, employment levels, and productivity of client firms).
In terms of inputs, the TAAF program effectively targeted small and medium-sized firms in FY 2012. EDA received 85 petitions, of which 83 were filed (accepted for investigation) under section 251 of the Trade Act, down by 46 petitions, a 36 percent decrease, compared to the number of petitions filed in FY 2011. EDA certified 79 petitions, down by 70 petitions, a 47 percent decrease compared to the number of certifications in FY 2011.
EDA met the 40-day processing deadline (to make a final determination for petitions accepted for filing) in FY 2012. In fact, the average
The majority of petitions certified under the TAAF program were submitted by firms in the manufacturing industry. Firms in technical services, transportation, and wholesale trade rounded out the remaining industries
In FY 2012, 6 percent of firms certified for TAAF were identified by the TAACs as service sector firms.
(5) The number of petitions filed and firms certified for each Congressional District in the United States
(6) Of the number of petitions filed, the number of firms that entered the program and received benefits
In FY 2012, 83 petitions were accepted (filed) for certification, of which 79 were certified. Of the 79 firms certified in FY 2012, 57 firms submitted and were approved for an AP in the same fiscal year
(7) The number of firms that received assistance in preparing their petitions
In FY 2012, 341 firms received assistance in preparing petitions. Firms may receive assistance in all phases of preparing petitions more than once in a single year. Petition assistance rendered may not result in the submission of a petition in the fiscal year.
Exhibit 16: Petition Assistance Activity: FY 2012
(8) The number of firms that received assistance developing business recovery plans
In FY 2012, 206 firms received assistance in developing APs and 935 firms received assistance in implementing projects in these plans. Firms may receive assistance in developing and implementing APs more than once in a single year. AP assistance rendered may not result in the submission or implementation of an AP in the current fiscal year.
(9) The number of business recovery plans approved and denied by the Secretary
In FY 2012, EDA approved 102 APs, down by 81 compared to FY 2011, a 44 percent decrease over this period
Exhibit 21: APs Approved by TAAC/State: FY 2012
(10) Average duration of benefits received under the program nationally and in each region served by an intermediary organization (the TAAC) referred to in section 253(b)(1) of the Trade Act
In FY 2012, 145 firms exited the TAAF program after being approved for an AP. Nationally, firms receive on average 57 months
(11) Sales, employment, and productivity at each firm participating in the TAAF program at the time of certification
In FY 2012, 889 active firms participated in the TAAF program. A firm that has been certified for TAAF, and/or has an approved AP, has not completed all projects in their AP, and is still engaged in the TAAF program is considered “active.” For the purposes of this report, productivity is defined as net sales per employee. Since the certified firms are in various industries, which have a variety of ways to measure productivity, sales per employee is utilized as a standardized measure for assessing productivity across all firms assisted.
(12) Sales,
(13) The number of firms in operation as of the date of this report and the number of firms that ceased operations after completing the program in each year during the two-year period following completion of the program
In order to assess the effectiveness of the TAAF program in terms of outputs, EDA assesses the extent to which client firms increased their sales, employment levels, and productivity following the implementation of TAAF-supported projects (program completion). To measure these outputs, EDA compares average sales, average employment and average productivity of all firms completing the program in a particular year (the most recent “base year”) to these same measures for the same firms one and two years following program completion. The base year used for this report is FY 2010, as this allows EDA to compare these measures looking back both one and two years from the date of this report.
Firms that completed the TAAF program in FY 2010 reported that, at completion, average sales were $10.1 million, average employment was 53 and average sales per employee (productivity) was $191,328. One year after completing the program (FY 2011), these same firms reported that average sales increased by 11.4 percent, average employment increased by 13.2 percent, and average productivity decreased by 1.6 percent. For the sake of comparison to the universe of U.S. manufacturers, BLS reported that, in FY 2011, the national manufacturing industry in aggregate experienced an average employment increase of only 1.9 percent.
Two years after completing the program (FY 2012), these same firms reported that average sales increased by 26.8 percent, average employment increased by 13.2 percent, and average productivity
For the purposes of this report, data are reported only for firms where all data were available. Since the certified firms are in various industries, which have a variety of ways to measure productivity, sales per employee was chosen as the productivity measure. This measure is used because it can be generally applied to all certified firms.
(14) The financial assistance received by each firm participating in the program
(15) The financial contribution made by each firm participating in the program
In FY 2012, firms received $9.8 million in technical assistance provided by the TAACs to prepare petitions and to develop and implement APs (often through business consultants and other experts). Firms participating in the program contributed $6.3 million towards the development and implementation of APs. Funds are not provided directly to firms; instead, EDA funds the TAACs and TAACs pay a proportion of the cost to secure specialized business consultants.
(16) The types
In FY 2012, firms proposed various types of projects in their APs. Marketing/sales projects are geared toward increasing revenue, whereas production/manufacturing projects tend to be geared toward cutting costs. Support system projects can provide a competitive advantage by either cutting costs or creating new sales channels. Management and financial projects are designed to improve management's decision making ability and business control. Over half of all firms proposed to implement a marketing/sales project or production/engineering project in their APs. Sample projects are listed below in Exhibit 28.
(17) The number of firms leaving the program before completing the project or projects in their business recovery plans and the reason the project or projects were not completed
In FY 2012, of the 145 firms that left the TAAF program, 84 completed the program, 34 did not complete approved projects in the time allotted, and the remaining 27 firms left for the reasons listed below in Exhibit 30.
(18) The total amount expended by all intermediary organizations referred to in Section 253(b)(1) and by each organization to administer the program
On May 11, 2012, the Department of Commerce Office of Inspector General (OIG) presented EDA with a copy of their letter to the House and Senate Committees on Appropriations reporting their findings related to an examination of the TAAC administrative costs.
Indirect Costs, referred to as facilities and administrative (F&A) costs, include space rent and utilities, telephone, postage, printing, and other administrative costs. University-affiliated TAACs have indirect cost rate (ICR) agreements that cannot exceed the current rate negotiated with their cognizant Federal agency (non EDA/DOC). These costs are captured on the indirect cost line item on the Application for Federal Assistance, SF–424 (Form SF–424). Non-profit TAACs do not have ICR agreements; instead, they categorize similar expenditures in their “Other” line item of their Form SF–424.
(19) The total amount expended by intermediary organizations to provide technical assistance to firms under the program nationally and in each region served by such an organization
In FY 2012, TAACs expended $10.7 million in technical assistance provided to the firms in outreach to firms, to prepare petitions, and to develop and implement APs (often through business consultants and other experts). Funds
Through TAAF program, EDA effectively assisted many small and medium-sized firms in becoming more competitive and successful in the global economy. EDA considers the most significant finding in this report to be that following completion of assistance from EDA's TAAF program, firms reported that, on average, sales increased by 26.8 percent, employment increased by 13.2 percent, and productivity increased by 11.9 percent.
The TAAF program effectively assisted small and medium-sized firms in FY 2012. TAACs provided technical assistance to 341 firms in preparing petitions, 206 firms in preparing APs, and 935 firms in implementing projects for an approved AP. Meanwhile, EDA certified 79 petitions and approved 102 APs. As of the end of FY 2012 (September 30, 2012), there are 889 active
EDA successfully met both the 40-day processing deadline (to make a final determination for petitions accepted for filing) and the 60-day processing deadline for approval of APs, as required in the TGAAA. In FY 2012, the average processing time for petitions was 29 business days, and the average processing time for APs was 21 business days.
Firms that completed the TAAF program in FY 2010 report that average sales were $10.1 million, average employment was 53, and average sales per employee (productivity) was $191,328. One year after completing the program (FY 2011), these same firms reported that average sales increased by 11.4 percent, average employment increased by 13.2 percent, and average productivity decreased by 1.6 percent. For the sake of comparison to the universe of U.S. manufacturers, the U.S. Bureau of Labor Statistics (BLS) reported that, in FY 2011, the national manufacturing industry in aggregate experienced an average employment increase of only 1.9 percent meaning that firms who complete the program
Two years after completing the program (FY 2012), these same firms reported that average sales increased by 26.8 percent, average employment increased by 13.2 percent, and average productivity increased by 11.9 percent. Meanwhile, BLS reported that the manufacturing industry in FY 2012 experienced an average employment increase of 3.5 percent and average productivity increase of 4.1 percent from FY 2010. Therefore, firms assisted by the TAAF program performed more successfully than the manufacturing industry as a whole. Additionally, all firms that completed the TAAF program in FY 2010 were in operation as of the end of FY 2012, indicating strong “survival rates” for TAAF-assisted firms. It should be noted that TAAF clients are operating in the same economic environment as other firms, but are also attempting to adjust to import pressures that may not impact other firms as severely, making the success of TAAF-assisted firms even more notable.
On May 11, 2012, the Department of Commerce Office of Inspector General (OIG) presented EDA with a copy of their letter to the House and Senate Committees on Appropriations reporting their findings related to an examination of the TAAC administrative costs
On September 13, 2012, the U.S. Government Accountability Office (GAO) published the report,
EDA is currently implementing a performance measurement improvement process for all its programs, including TAAF, which began in late 2011 and consists of two phases: planning and development, and implementation. The one-year planning and development stage is expected to be completed in FY 2013. The first phase includes the following activities: researching and identifying improved metrics and indicators, testing the metrics and indicators across the full portfolio of EDA investments, and developing a work plan for implementing measures that are adopted. To assist with this effort, EDA has partnered with the University of North Carolina and George Washington University to develop draft performance measures utilizing state-of-the-art performance measurement and program evaluation techniques.
The subsequent implementation phase of the performance measurement improvement process will include the following activities: obtaining Office of Management and Budget approval of data collection forms, developing a database to store collected data, updating programmatic guidance and regulations, and examining the allocation formula used to distribute program funds to the TAACs in collaboration with both TAACs and Congressional stakeholders. The entire process is expected to be completed by the end of 2014.
The performance measurement improvement process will help EDA be even a stronger partner to its clients and grantees. Through more effective program management and performance assessment, EDA will be in a better position to achieve the desired results for each of its programs.
On September 13, 2012, the U.S. Government Accountability Office (GAO) published the report,
This Michigan firm manufactures self-adhesive strip and sheet products for the automotive industry. The firm lost 38 percent of its sales in 2009 as demand disappeared and customers frantically switched to low cost foreign suppliers. It entered the TAAF program in 2010. The firm needed to improve its productivity and streamline its business processes. To accomplish this, replacing the firm's antiquated Enterprise Resource Planning (ERP) system was paramount. After much research, the firm licensed a new system and used TAAF assistance to train the workforce in its use. The new ERP went live in January 2011, and the impact was immediate. Not only has it cut hardware costs and annual fees by 50 percent, it has also greatly reduced data input and handling time. The firm has been able to go virtually paperless, as documents are seamlessly handled and hardcopies are rarely required. Further, the new system is connected to its automotive forecasting service so that high-level sales forecasts are made automatically as customers release their model plans. Results of this ERP implementation have been truly transformative for the
An Ohio packaging firm was hit hard by rising import competition from China and other East Asian countries. Its customers were increasingly looking to cut costs by sourcing their packaging from abroad. This forced serious production cuts at the firm, which ultimately necessitated employee layoffs. The firm entered the TAAF program in early 2008. Its Adjustment Plan was approved in June of that year and included a wide range of needed improvements. The firm's first projects included a detailed evaluation and restructuring of its sales team, as well as the development of much needed marketing materials. Improvements to its costing and quoting system were next, followed by a revamping of its Web site. The firm's most recent TAAF project, completed in June 2012, was part of a major lean manufacturing initiative. Following classroom training financed in part by the State of Ohio, the TAAF program helped provide on-site employee training and hands-on coaching to jumpstart the firm's productivity improvement efforts. This “last mile” project—the customized on-site lean training—had a huge impact on the overall success of the effort. The firm has made great progress to date—sales have rebounded significantly (up 50 percent from their low), and productivity is much improved. However, considerable work remains to be done. The firm is about to begin a project that will dramatically strengthen its finance function. By the time this firm completes the program, it will be positioned to thrive, not just survive.
A Missouri fabric-based products manufacturer has been receiving technical assistance funded by the TAAF program since December 2010. The first project included a comprehensive review of their pay scale compared with market salaries and wages. The intent of this project included addressing personnel issues and forming a strong cohesive team to bring the business out of the recession. The next project involved employee training in the use of their Computer Aided Design software, which supported high investment equipment that enabled them to keep work in-house and support additional employees to be added. A portion of the TAAF assistance enabled the firm to implement an International Organization for Standardization (ISO) compliant quality system and to subsequently become certified to ISO 9001:2008. The ISO certification has enabled the firm to increase sales to a major defense contractor by over 50 percent. This sales increase and business from new market segments have necessitated increasing employees by 15 percent. With the help of MamTAAC and TAAF-funded technical assistance, the firm has been able to build a manufacturing organization that can continue to effectively compete and grow.
A Missouri wood products manufacturer has been enrolled in the program since 2004. In 2004, the firm had 16 employees and average revenue of $3 million and faced fierce competition with Chinese imports. TAAF funding allowed the firm to upgrade its management information systems, upgrade their ERP system, and purchase a production module to help with manufacturing data capture and tracking. Later, with technical assistance from MamTAAC, the firm leveraged TAAF program funds to provide human resources, employee, and executive training, which in addition to educating the firm's leadership on sound business practices, allowed the owner to take actual business problems that were especially related to growth to a group of business owner peers for feedback. Today the firm has 36 employees with 6 more slated to be added in 2012, and revenues are projected to be above $8 million. The firm expects that by 2015, revenue will increase to $14 million and employment to 60.
A Pennsylvania maker of pressure control devices for the fluid power and chemical industries was in its third year of declining sales, profits, and employment when awarded TAAF-funded technical assistance in 2008. Sales had fallen by 37 percent, profits had declined 67 percent and 8 percent of the employees were laid off as a direct result of imports. The company implemented projects in strategic planning, lean manufacturing, marketing communications, and six sigma. Since program entry, sales have improved by more than 20 percent, jobs have grown by 12 percent, earnings have increased 42 percent, productivity has increased 7.5 percent, and return on human capital has grown 26.9 percent. As a direct consequence of this success, a world leader in the American fluid power industry acquired the firm in October 2012.
A Pennsylvania manufacturer of industrial wear products for the construction and material handling industries had suffered a 25 percent drop in sales, an 83 percent reduction in earnings, an 81 percent decline in productivity and 13 percent of its employees had been separated—all over a 24-month period. A flood of imports impacted virtually all of the company's products. Management recognized that its product line had been commoditized and that it could no longer compete on price alone. With projects addressing new product development, e-commerce and systems technology, the firm began to add value through superior design, cost mastery, and marketing. The firm was awarded TAAF-funded technical assistance in 2011. Since program entry, sales have grown by more than 50 percent, earnings have improved five-fold, productivity has increased more than 12 percent, jobs have grown 36 percent, and the return on the firm's human capital has more than tripled.
A Wisconsin manufacturer of custom solenoids was experiencing tough competition from Asian importers in the automotive, recreational vehicle, motorcycle, and industrial application markets. Several key customers moved their purchases to overseas providers with cheaper prices, resulting in a 21 percent decline in sales, forcing the firm to lay off workers. The firm was certified for TAAF in June 2010. The firm was able to enhance marketing tools with two projects in late 2010 that helped attract new domestic and international customers. In addition, the firm was able to cost-share export development assistance early in 2012, including research and marketing material translation. As a result of assistance from MWTAAC and TAAF-funded technical assistance, the manufacturer's exports have grown dramatically and both sales and employment have increased over 90 percent in less than two years.
A Minnesota manufacturer of commercial and residential air filtration systems received TAAF-funded technical assistance between 2008 and 2011 for export-related quality certifications, testing and marketing material translation. In addition, TAAF program technical assistance provided
A Connecticut metal finishing firm, the largest full-service metal finisher in the Northeast, experienced a significant decline in sales due to increased foreign competition and a shrinking domestic market. In 2010, the firm was certified for TAAF and with the assistance of NETAAC, prepared an AP to fund projects such as leadership training, a new Web site, upgraded marketing materials, establish lean manufacturing, and NADCAP, a critical certification that could potentially open many new markets for the firm. After merging with another local Connecticut firm, they are now able to service a much larger market providing full-service metal finishing services. As a result of TAAF-funded technical assistance, the firm has become stronger and more competitive, increasing sales by 20 percent and adding 20 more jobs.
A Rhode Island full-service contract manufacturer serving a diverse group of customers including electronic manufacturers of medical instrumentation, military electronics, oceanographic instruments, and commercial products was adversely affected by a combination of growing foreign market competition and the global recession. In 2010, the firm was certified for TAAF and, with the assistance of NETAAC, prepared a business recovery plan (AP) to fund projects such as development of a strategic business plan, marketing and sales plan, MIS upgrades, and process improvement program. Within one year of TAAF-funded technical assistance, the firm has realized a 10 percent increase in employment and a 15 percent increase in sales. After successful realization of Lean Manufacturing and sales and marketing projects, the firm was able to capture new orders, increased the need for continuous improvement, and was able to lower cost of production by further streamlining their processes. The firm is now focusing on re-shoring efforts and committed to bringing jobs back to America.
A New York manufacturer of precision optical fabrication machines and systems was suffering from the adverse effects of foreign competition from Germany. The combination of the foreign competition, coupled with the recent downturn in the economy, significantly reduced the firm's sales revenues. The firm needed to react to the continual loss of market share to foreign competition and did not have a formal strategic-based sales and marketing plan in place nor did it have the internal expertise to develop one. In order to effectively recover from the adverse effects of foreign competition, the firm sought technical assistance from NYSTAAC. At the time of TAAF certification, the firm had 35 full-time employees and annual sales of approximately $6 million. In order to stop the decline in sales and employment levels, the firm with assistance from NYSTAAC and TAAF-funded technical assistance, developed a business recovery plan (AP) that included a formal sales and marketing plan. In following the plan, the firm was able to achieve 85 percent growth in sales revenue to an annual rate of $12 million. This in turn has resulted in the firm adding 17 new employees since the implementation of the plan. An additional major outcome of the planning process was the recent expansion of the firm's manufacturing facility to accommodate new business.
A New York manufacturer of clipboards sought technical assistance from NYSTAAC to develop a business recovery plan (AP) to address inefficiencies with an outdated Management Information System (MIS) and production software, which when improved, would reduce deficits and increase productivity, resulting in higher output and increased sales. Since the firm was certified for TAAF in 2008, their sales have increased approximately $3.4 million and they have been able to maintain the same employment level.
A Montana manufacturer of high performance laser diode and fiber optic control, test and measurement products used in research laboratories, telecommunication, and photonic production facilities received TAAF certification in 2005 based on a 74 percent increase in imports of these devices from China and Japan. Implementation of TAAF-funded projects such as extensive CE product testing, lean manufacturing and training, and sales market analysis and development over a 5 year period have resulted in firm product expansion into European markets, and increased penetration into China, Japan, and Korea. As a result of NWTAAC assistance and TAAF-funded technical assistance, as of the end of 2011, employment has stabilized and sales have increased 48 percent since certification, with export sales now comprising 50 percent of total sales, a 22 percent increase since entering the program.
An Idaho light duty manufacturer of sheet metal and plastic ventilation and roofing components was certified for TAAF in 2010 based on a 20 percent decline in sales resulting from increased imports from China, Canada, and Mexico. TAAF-funded technical assistance projects thus far have included Web site redesign and a two‐phased search engine optimization project. As a result of these projects the firm has gone from zero exports and internet orders to over 300 new orders per month to customers all over the U.S. and Canada with about 75 percent of the orders coming from repeat customers. This increase in sales of $400,000 from two years ago provides better profit margins with 10-to-15 percent of the sales going to Canada. The firm has also increased employment by about 2.5 full time employees and is about to add another just for parcel packaging for the internet orders. As an added benefit, this new nationwide customer base gives this firm a better idea of what people want, and these sales are much more profitable than their wholesale business.
Faced with intense foreign competition and an increasingly competitive market, a Utah manufacturer of plastic folding tables and chairs contacted RMTAAC in 2010 for assistance to improve the firm's competitive position. RMTAAC conducted a thorough business assessment and competitive analysis to identify strategic areas for improvement to build a more solid foundation for future growth. The firm was awarded technical assistance through the TAAF program to target cost reductions in its manufacturing processes. The firm has been able to utilize TAAF-funded technical assistance to shift its efforts to a firm-wide lean manufacturing initiative. The firm implemented lean manufacturing to reduce wasteful or non-value added activities in the manufacturing process. The firm has seen a 25 percent reduction in inventory carrying costs since applying lean manufacturing principles. In addition, the firm's sales are up 27 percent since
A South Dakota manufacturer of industrial cleaning machinery had noted increased competition from foreign countries. Over the last decade, consolidation has been a significant trend in the industrial machinery industry. As larger multi-national conglomerates have gained scale in their operations through acquisitions, the competitive challenges continue to mount for smaller manufacturers in the industry. The firm contacted RMTAAC in 2010 for assistance with TAAF certification. Upon certification, RMTAAC worked with the firm to develop a customized business recovery plan (AP) focused on implementing strategic improvements to strengthen the firm's competitiveness in the global marketplace. Between July 2011 and December 2011, the firm developed a customized sales and marketing program. To date, the firm's sales have increased 18.8 percent from the previous year, and the quote-to-order conversion rate has increased 7 percent. As a result of TAAF-funded technical assistance, the firm's sales are at a 72-year high.
After losing sales to a major customer in 2000, a Georgia manufacturing firm ended an era of selling a complete textile machine to a U.S. customer. The impact of low-cost textile imports from China and Mexico was devastating the firm's domestic customers. In 2006, as sales and employment continued to decline, the firm turned to the TAAF program for help. The SETAAC team developed a customized business recovery plan (AP) which focused on planning and implementing strategic improvements to strengthen the firm's competitiveness in the global marketplace. With TAAF-funded technical assistance, the firm received certification from the Historically Underutilized Business Zone (HUBZone) program, which helps small businesses in urban and rural communities gain access to Federal procurement opportunities. The firm also redesigned its Web site and other marketing materials in order to appeal to a broader client base. The work paid off, as the firm now provides an ammunition testing system for the Air Force. As a result of TAAF-funded technical assistance, the firm has increased employment by 37 percent and revenue by 10 percent. At the end of the first quarter of 2012, the firm was on track for a 25 percent increase in revenue over 2011.
Based in South Carolina, a producer of screens for rotary screen textile printing experienced a 22 percent loss in sales from 2008 to 2009 as a result of Chinese competitors. To address the issue of foreign competition, the firm applied for and was certified for TAAF in 2009. The SETAAC team outlined key projects to help the firm increase its competitive edge. With consultants from the South Carolina Manufacturing Extension Partnership (SCMEP), the firm was able to transition from textile-based screen engraving to digital printing of designs directly to fabric by using a new brand. Projects performed by the SCMEP included Web site redesign, organic search engine optimization, lead generation and pay-per-click advertising. This outreach lead the firm to an opportunity with a large promotional and graphic communications firm with over 750 member locations in the U.S. and Canada. Since the initiation of this project, annual sales have steadily increased by over $220,000. May 2012 saw a 50 percent sales increase, and June 2012 as the highest sales month in four years. In addition to increasing sales, the firm has also added three additional employees.
A Texas manufacturer of uniforms, industrial safety, and rehabilitation equipment was certified for TAAF in 2008. The firm had experienced a 21 percent decline in sales and 31 percent decline in employment since the previous year. The foreign impact was traced to imports from China, Bangladesh, Indonesia, Mexico and the Caribbean basin countries. The firm received EDA approval of an AP focusing on technical assistance in the areas of strategic marketing, Enterprise Resource Planning (ERP) implementation, and lean manufacturing techniques. To date, the firm has worked on four marketing projects, which included photography of their products, a complete redesign of their marketing materials such as catalogs, brochures, and press packages, along with product imaging improvements and a branding strategy. Management information systems projects integrated the firm's MAS 200 SAGE accounting software to interface with their Web site projects to streamline and improve the functionality of accounting, inventory control, on-line customer ordering accessible year round (24 hours a day) with the capability to track orders by oilrig number/employee, and create automated customized reports. The firm has completed 99 percent of their projects and seen a dramatic increase in sales. They recorded sales of $20.9 million in 2011 and an employment of 30, an increase of 345 percent and 25 percent respectively since the date of certification.
A Louisiana manufacturer of Creole pralines and a variety of other pecan-based confections was adversely impacted by imports from Canada, Mexico, and Thailand. The firm was certified for TAAF in May 2009. At the time of certification, annualized sales were approximately $2.7 million, down from $3.3 million the previous year. The firm AP project plans included a support system upgrade required to make significant Management Information System (MIS) upgrades. Although they had an MIS system, it did not have the capacity to allow the firm to manage their increasingly diversifying business. Although implementation of the projects outlined in their business recovery plan is ongoing, the firm has fared better than many other firms that are recovering from the aftermath of not only Hurricane Katrina, but also the generalized impact of the recession during this period. Annual sales two years from the date of certification grew to $3.6 million—an annualized growth rate of roughly 15 percent.
A California custom packaging manufacturer serving customers in the medical, food, and electronics industries suffered injury from import competition from Asia from 2004 through 2006. Its customers increased the purchase of packaging solutions made in the Pacific Rim. A severe downturn in the static packaging industry resulted in the Pacific Rim producing the bulk share of electronic components. The firm was certified for TAAF in December of 2006. WTAAC and the firm's management developed a strategy to change the way the customers think about flexible barrier packaging and to provide new ideas to industry to use this packaging. Specifically, the goal was to develop innovative ways of using barrier packaging to enter the advertising niche, a market segment that has not previously used flexible packaging. The firm completed the implementation phase of the TAAF program in January 2010. While active in the program, the firm implemented its marketing project and two information technology projects. Since TAAF certification, sales increased 34 percent, employment increased 28 percent, profitability
A second-generation California bonding wedge manufacturer, specializing in the design and manufacture of bonding wedges for the microelectronics industry was suffering from continued shrinking market share due to increasing competition from low price Pacific Rim manufacturers from 2000 to 2002. As a result, 2002 annual sales decreased 44 percent and employment decreased 34 percent. The firm was certified for TAAF in October of 2002. WTAAC and the firm's management developed a strategy for the firm to specialize in the manufacture of high quality bonding wedges for the microelectronic industry while expanding its brand sales and diversifying its customer base. The firm successfully completed the implementation phase of the TAAF program in February 2009. While active in the program, the firm implemented two quality management system projects, three production engineering projects, four marketing and promotion projects, and one information technology project. These projects focused on significantly expanding international sales while improving manufacturing efficiency, reducing production cost and shortening cycle times. Since TAAF certification, the firm regained profitability, with sales increasing 45 percent, and productivity improving 45 percent.
(1) the authority granted by law to an executive department, agency, or the head thereof; or
(2) the functions of the Director of the Office of Management and Budget relating to budgetary, administrative, or legislative proposals.
(b) This order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.